What's going on?

American industrial giant General Electric (GE) warned on Friday that it wouldn�t be earning as much profit as it had hoped for 2017 � and disgruntled investors sent the stock down to its lowest level in nearly two years!

What does this mean?

Under the stewardship of GE�s current CEO (who�s leaving his post soon), America�s famed industrial conglomerate has been reorganizing its business by focusing on its industrial roots and shedding other arms of the business. However, Wall Street has been warning that GE still might not have cut enough to meet investors� profit expectations in the years ahead.

Those fears edged closer to reality on Friday, when GE announced that its yearly profits would be in the lower range of the company�s forecasts � largely because of its oil and gas division (see below).

Why should I care?

The bigger picture: GE�s foothold in oil and gas has been hurting its profitability.

Many investors pointed at the weak performance of GE�s oil and gas division as signs that the company still has a long way to go in restructuring the business. The departing CEO broadly expanded GE�s foothold in the energy industry (e.g. rigs for oilfields) before the oil price collapsed to historic lows in 2016. Until the oil price rebounds and demand for GE�s oilfield equipment returns, GE will likely struggle to turn a profit out of this major part of the business.

For markets: This marked GE�s outgoing CEO�s final earnings report, which may help the new CEO off to a better start.

GE�s outgoing CEO is leaving the company with a controversial record and a somewhat mixed earnings report for his final quarter as CEO. While GE�s earnings in the second quarter of 2017 had a number of soft spots like oil and gas, some Wall Street analysts have said he�s possibly frontloaded bad news in this earnings report in order to taper investors� expectations for the incoming CEO.