It seems Jack Welch has taken the failure of General Electric NYSE:GE) CEO Jeffrey Immelt very personal, as Welch said if Immelt misses earnings targets again, "I'd get a gun out and shoot him."
“I'd be shocked beyond belief and I'd get a gun out and shoot him if he doesn't make what he promised now,” Welch said on CNBC, a cable station owned by GE. “Just deliver the earnings. Tell them you're going to grow 12 percent and deliver 12 percent.”
The remarks were in response to the shocking numbers coming out of GE for the quarter, where investors and analysts were stunned by the company missing their profit guidance by 6 percent in the first quarter from the year before.
What was worse, it happened only a short three weeks after Immelt assured investors that the company would reach the quarterly goals. The miss was blamed on problems late in the quarter in relationship to their financial business.
Welch didn't let up, as he added, “I'm not here defending what happened. This was a bad miss. This is a credibility crash. He's got to earn it back. He will earn it back. But to take GE apart, what's wrong with the company, it's falling apart, blow up the model, sell NBC, sell real off estate, let's go out of business because we had 24 hours of a mess?”
Something like this isn't supposed to happen at GE, and investors responded accordingly, as the stock plunged 13 percent, and almost $47 billion in market value dropped immediately for the company.
While not making any excuses for the situation, Welch added that the knee-jerk response by investors to change the business model are ill-advised. He said there's no need to make huge changes at the company, because what's in place really works.
It sounds like Jack came on to slow down investor rebellion, and to publicly chastise Immelt so they would feel good about their shares in the company and their future value.
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