The U.S. industrial conglomerate on Monday ousted Flannery as chief executive officer in a surprise move, replacing him with outsider and board member Larry Culp.
Flannery became GE's CEO on August 1, 2017, succeeding Jeffrey Immelt in the position.
Shares of GE were up 9.8% at $12.40. The company expects to take a non-cash goodwill impairment charge related to the GE Power Business.
The company's stock was up more than 15 per cent in pre-market trading in NY shortly before 1300 GMT. In the release, the company said that the change in management will be effective immediately.
In a statement on Monday, GE lauded Culp's tenure at Danaher and said that he "executed a disciplined capital allocation approach, including a series of strategic acquisitions and dispositions", among other activities.
The struggling energy, health and transportation conglomerate said it would fall short of its forecast for free cash flow and earnings per share for 2018 due to weakness in its power business, something analysts had expected.
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GE has turned to cost-cutting measures in recent quarters to offset sagging revenues, selling off a light-bulb segment once spearheaded by Thomas Edison and its distributed power business.
Flannery is being replaced by H. Lawrence Culp Jr., the former CEO of Danaher, an industrial company.
Culp, known for turning around Danaher, was added to GE's board in February. The average tenure for a CEO at the company, which was once renowned for grooming executives to run major corporations including Boeing, Home Depot and Honeywell, was almost 14 years prior to Flannery's swift exit. Slimmed-down GE will focus on jet engines, power plants and renewable energy. Flannery's time as CEO has been filled with challenges and the company has sold off several businesses in an effort to right the ship.
Also in June, GE lost its spot in the blue-chip Dow Jones Industrial Average after over a century. We have a lot of work ahead of us to unlock the value of GE. It is a privilege to be asked to lead this iconic company, ' Culp said in the company's statement.
Culp may also "re-baseline" the company, UBS analyst Steven Winoker, said in a note.
GE, however, has not seen such gains, particularly when it comes to its power business which was hit by problems with its latest generation of gas turbines and posted a $10 billion loss a year ago. "I am excited to get to work". "However, we believe that CEO Culp will, at a minimum, re-baseline the company, drive execution and make long-term decisions that benefit the company and shareholders".