No man is an island, but General Electric boss Larry Culp might wish he were. The industrial firm he runs was buffeted in the second quarter by inflation, war, supply-chain problems and politics. While earnings tripled year-on-year, much of the business is still shrinking, and Culp is likely to miss a key cash-flow target for this year. The consolation is that if it weren’t for his tireless tinkering, things would be worse.

GE is preparing to split into three listed businesses starting next year, and their prospects couldn’t be more different. Revenue from the division that makes and services jet engines increased by 27% in the second quarter, year-on-year, as airlines thrust planes back into service. Global departures are back to 80% of pre-pandemic levels, the firm said on Tuesday. Aerospace now makes up one-third of GE’s revenue, roughly two-thirds of its pre-tax profit and almost all of its growth.

Things are tougher elsewhere. The healthcare business, which makes big-ticket hospital equipment, is barely growing, mostly because of supply-chain problems. Power and renewables equipment – to be rechristened GE Vernova – are worse. Chief among GE’s problems is the expiry of tax credits once offered to U.S. onshore wind farms. It may not be coincidence that of all three of GE’s segments, it’s aviation that Culp plans to oversee after the company has disassembled.

Until then, GE is fighting the tide. External forces, from the war in Ukraine to logistical bottlenecks, knocked around 5% off its revenue in the quarter, somewhere shy of $1 billion. Other uncontrollables like inflation whittled away 2 percentage points of profit margin, equivalent to around $400 million. In an imaginary world with that revenue and margin restored, GE’s pre-tax profit would have been around $2.2 billion, rather than the $1.7 billion it actually reported.

Even that was better than it might have been. Based on figures the firm put out on Tuesday, its cost-reduction measures added about $300 million of pre-tax profit. Culp, a hands-on manager, trumpets achievements like cutting the turnaround time at a GE engine maintenance plant in Wales by around four days. Those are the kind of small things that, in a world without external shocks, would make the $75 billion GE more valuable. That’s just not the world in which GE lives.

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