GE revealed on Tuesday worse-than-expected results and a $22 billion accounting writedown for its beleaguered power division.
In a bid to fix GE's debt-riddled balance sheet, Culp announced the company will cut its quarterly dividend from 12 cents a share starting in 2019. By paying just a token dividend, GE (GE) will save about $3.9 billion of cash per year.
Analysts had been anticipating a potential dividend cut, though not one of this magnitude.
It's an especially painful move for a company that long viewed its stable dividend as a source of pride. But years of bad decisions forced GE to halve its dividend last November for just the second time since the Great Depression. The moves deal a blow to the many GE retirees and mom-and-pop shareholders who rely on the payouts.
"We are on the right path to create a more focused portfolio and strengthen our balance sheet," Culp said in a statement.
Culp, who was suddenly named CEO on October 1, promised to move "with speed to improve our financial position."
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