General Electric

General Electric Company (GE) is a multinational conglomerate headquartered in Boston, Massachusetts, that was incorporated in 1892 following a series of mergers between various companies owned and operated by Thomas Alva Edison and the Thomson-Houston Electric Company.

For well over a century, General Electric was one of the largest and most diversified corporations in the world, spanning a wide range of sectors and industries. A series of financial setbacks in the 2010s forced the company to sell off major portions of its holdings, including its flagship media, financial services, and consumer products arms.

After transitioning from its conglomerate-centric model, General Electric now focuses on three main business components: energy solutions, jet engines, and health care technologies. This strategic pivot reinforces its status as an emblem of perpetual innovation and reinvention.

General Electric’s innovations span a wide array of technological and industrial fields, including:

GE’s portfolio of products and services underscores its extensive range of R&D initiatives and legacy operations. GE also engages in financial services, providing financial investment in energy infrastructure projects across the globe.

General Electric was incorporated in 1892, acquiring all the assets of the Edison General Electric Company and two other electrical companies. Edison General had been founded as the Edison Electric Light Company in 1878 by Thomas Edison to market his incandescent lamp and other later products. Edison remained associated with General Electric through his patents and consulting duties.

GE would go on to produce one of the largest lines of electrical industrial and consumer goods in the world, later establishing (in 1900) an industrial research laboratory, where many of its later products were developed by in-house scientists. The historical time line of GE’s notable innovations, beginning with Edison’s work prior to the company’s official establishment, and following GE’s incorporation in 1892, includes:

Through the late 19th century to the 20th century, GE became a global powerhouse known for pioneering and innovative technological advancements and reshaping industries.

Jack Welch began working at GE as a junior chemical engineer in 1960. Rising through the company’s ranks and across several of GE’s divisions over the next two decades, Welch became the company’s youngest chair and CEO in 1981.

Jack Welch’s tenure at GE would solidify his position as one of the most distinguished CEOs in American business history. Welch aggressively restructured the company’s business divisions, established a culture of fierce competition and performance expectations, expanded GE’s diversification-through-acquisition strategy, and shifted greater focus toward shareholder value. Under Welch, GE Capital, the company’s financial services division, became a major profit generator. This made Welch one of the most remarkable CEOs of his time, increasing GE’s value from $14 billion in 1981 to $600 billion (outpacing the S&P 500) within two decades.

In 1986, under Welch’s leadership, GE purchased the RCA Corporation (which it had helped to found in 1919), including the RCA-owned television network the National Broadcasting Company (NBC), Inc. In 1987, GE sold RCA’s consumer electronics division to Thomson SA, a state-owned French firm, and purchased Thomson’s medical technology division. In 1989 GE agreed to combine its European business interests in appliances, medical systems, electrical distribution, and power systems with the formerly unrelated British corporation General Electric Company.

Although GE’s consumer products are most visible to the general public, they accounted for a minority of the company’s annual sales. A substantial portion went to the U.S. Department of Defense. As of the early 21st century, GE’s business lines consisted of:

In the years leading up to the 2008 financial crisis, and following Welch’s departure, GE’s CEO Jeff Immelt leveraged GE Capital funds toward the acquisition of commercial real estate (among other acquisitions that have since been viewed in a critical light). GE also acquired WMC Mortgage, a subprime lender. Essentially, GE’s massive real estate sector holdings were purchased near or at the top of the market.

The financial crisis that erupted in 2008, triggered by overleveraged investments in the U.S. real estate industry combined with risky subprime loans, plunged the value of GE Capital’s investments and holdings and, ultimately, GE’s share price, which fell more than 80% from late 2007 to early 2009.

As the crisis ebbed, GE began the arduous task of restructuring in order to concentrate on areas of potential growth:

By 2020, GE’s vision would shift away from the conglomerate model and toward what would eventually become its three primary business components: energy solutions, jet engines, and health care technologies. In 2021, GE announced plans to divide its operations into three separate entities.

These spin-offs represent a full-circle return to General Electric’s roots: Using technological innovation to solve some of the world’s largest problems.