UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934   For the quarterly period ended March 31, 2016   OR

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission file number 001-00035 GENERAL ELECTRIC COMPANY (Exact name of registrant as specified in its charter)

New York		14-0689340
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
3135 Easton Turnpike, Fairfield, CT		06828-0001
(Address of principal executive offices)		(Zip Code)
(Registrant's telephone number, including area code) (203) 373-2211   _______________________________________________ (Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer 	Accelerated filer 
Non-accelerated filer 	Smaller reporting company 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 

There were 9,195,657,000 shares of common stock with a par value of $0.06 per share outstanding at March 31, 2016.

TABLE OF CONTENTS

	Page
Forward Looking Statements	3
Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)	4
Key Performance Indicators	8
Consolidated Results	10
Segment Operations	14
Corporate Items and Eliminations	34
Discontinued Operations	36
Other Consolidated Information	37
Statement of Financial Position	38
Financial Resources and Liquidity	39
Exposures	45
Critical Accounting Estimates	46
Other Items	47
Controls and Procedures	48
Other Financial Data	48
Regulations and Supervision	49
Legal Proceedings	50
Financial Statements and Notes	53
Exhibits	102
Form 10-Q Cross Reference Index	103
Signatures	104

FORWARD LOOKING STATEMENTS

	the impact of potential information technology or data security breaches; and

These or other uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements. This document includes certain forward-looking projected financial information that is based on current estimates and forecasts. Actual results could differ materially.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (MD&A)

PRESENTATION

The consolidated financial statements of General Electric Company (the Company) combine the industrial manufacturing and services businesses of General Electric Company (GE) with the financial services businesses of GE Capital Global Holdings, LLC, and its predecessor, General Electric Capital Corporation (GE Capital or Financial Services).

We believe that investors will gain a better understanding of our company if they understand how we measure and talk about our results. Because of the diversity in our businesses, we present our financial statements in a three-column format, which allows investors to see our industrial operations separately from our Financial Services operations. We believe that this, along with further disaggregation of our results into segments and GE Capital Verticals, provides useful information to investors. When used in this report, unless otherwise indicated by the context, we use the terms to mean the following:

	General Electric or the Company – the parent company, General Electric Company.



GE – the adding together of all affiliates other than GE Capital, whose continuing operations are presented on a one-line basis, giving effect to the elimination of transactions among such affiliates. Transactions between GE and GE Capital have not been eliminated at the GE level. We present the results of GE in the center column of our consolidated statements of earnings, financial position and cash flows. An example of a GE metric is GE cash from operating activities (GE CFOA).

	General Electric Capital Corporation or GECC – the predecessor to GE Capital Global Holdings, LLC.

	GE Capital Global Holdings, LLC or GECGH – the adding together of all affiliates of GECGH, giving effect to the elimination of transactions among such affiliates.



GE Capital or Financial Services – refers to GECGH, or its predecessor GECC, and is the adding together of all affiliates of GE Capital giving effect to the elimination of transactions among such affiliates. We present the results of GE Capital in the right-side column of our consolidated statements of earnings, financial position and cash flows.

	GE consolidated – the adding together of GE and GE Capital, giving effect to the elimination of transactions between the two. We present the results of GE consolidated in the left-side column of our consolidated statements of earnings, financial position and cash flows.



Industrial – GE excluding the continuing operations of GE Capital. We believe that this provides investors with a view as to the results of our industrial businesses and corporate items. An example of an Industrial metric is Industrial CFOA, which is GE CFOA excluding the effects of dividends from GE Capital.



Industrial segment – the sum of our eight industrial reporting segments, without giving effect to the elimination of transactions among such segments. This provides investors with a view as to the results of our industrial segments, without inter-segment eliminations and corporate items. An example of an industrial segment metric is industrial segment revenue growth.



Total segment – the sum of our eight industrial segments and one financial services segment, without giving effect to the elimination of transactions among such segments. This provides investors with a view as to the results of all of our segments, without inter-segment eliminations and corporate items.



GE Capital Verticals or Verticals – the adding together of GE Capital businesses that we expect to retain, principally its vertical financing businesses—GE Capital Aviation Services (GECAS), Energy Financial Services (EFS) and Industrial Finance (which includes Healthcare Equipment Finance and Working Capital Solutions)—that relate to the Company's core industrial domain and other operations, including our run-off insurance activities, and allocated corporate costs.

We integrate acquisitions as quickly as possible. Revenues and earnings from the date we complete the acquisition through the end of the fourth quarter following the acquisition are considered the acquisition effect of such businesses.

Discussion of GE Capital's total assets includes deferred income tax liabilities, which are presented within assets for purposes of our consolidated statement of financial position presentations for this filing.

Amounts reported in billions in graphs within this report are computed based on the amounts in millions. As a result, the sum of the components reported in billions may not equal the total amount reported in billions due to rounding. Certain columns and rows within the tables may not add due to the use of rounded numbers. Percentages presented are calculated from the underlying numbers in millions.

Discussions throughout this MD&A are based on continuing operations unless otherwise noted.

The MD&A should be read in conjunction with the Financial Statements and Notes to the consolidated financial statements.

OTHER TERMS USED BY GE

	Backlog – unfilled customer orders for products and product services (expected life of contract sales for product services).



Digital revenues – revenues related to software-enabled product upgrades, internally developed software (including Predix) and associated hardware, and software-enabled productivity solutions. These revenues are largely generated from our operating businesses and are included in their segment results.

	Earnings – unless otherwise indicated, we refer to captions such as "earnings from continuing operations attributable to common shareowners" simply as earnings.

	Earnings per share (EPS) – unless otherwise indicated, when we refer to earnings per share, it is the diluted per-share amount of "earnings from continuing operations attributable to common shareowners".



Ending Net Investment (ENI) – the total capital we have invested in the Financial Services business. It is the sum of short-term borrowings, long-term borrowings and equity (excluding noncontrolling interests) adjusted for unrealized gains and losses on investment securities and hedging instruments. Alternatively, it is the amount of assets of continuing operations less the amount of non-interest-bearing liabilities.

	Equipment leased to others (ELTO) – rental equipment we own that is available to rent and is stated at cost less accumulated depreciation.

	GE Capital Exit Plan – our plan, announced on April 10, 2015, to reduce the size of our financial services businesses through the sale of most of the assets of GE Capital, and to focus on continued investment and growth in our industrial businesses.



Industrial operating profit margin – Industrial segment profit plus corporate items and eliminations (excluding gains, restructuring, and pre-tax non-operating pension costs) divided by industrial segment revenues plus corporate items and eliminations (excluding gains and GE-GE Capital eliminations).

	Industrial segment gross margin – industrial segment sales less industrial segment cost of sales.

	Non-operating pension costs – comprise the expected return on plan assets, interest cost on benefit obligations and net actuarial gain (loss) amortization for our principal pension plans.

	Operating earnings – GE earnings from continuing operations attributable to common shareowners excluding the impact of non-operating pension costs.

	Operating earnings per share – unless otherwise indicated, when we refer to operating earnings per share, it is the diluted per-share amount of "operating earnings".

	Operating pension costs – comprise the service cost of benefits earned, prior service cost amortization and curtailment loss for our principal pension plans.

	Organic revenues – revenues excluding the effects of acquisitions, dispositions and foreign currency exchange.



Product services – for purposes of the financial statement display of sales and costs of sales in our Statement of Earnings, "goods" is required by SEC regulations to include all sales of tangible products, and "services" must include all other sales, including other services activities. In our MD&A section of this report, we refer to sales under product services agreements and sales of both goods (such as spare parts and equipment upgrades) and related services (such as monitoring, maintenance and repairs) as sales of "product services," which is an important part of our operations. We refer to "product services" simply as "services" within the MD&A.



Product services agreements – contractual commitments, with multiple-year terms, to provide specified services for products in our Power, Renewable Energy, Oil & Gas, Aviation and Transportation installed base – for example, monitoring, maintenance, service and spare parts for a gas turbine/generator set installed in a customer's power plant.

	Revenues – unless otherwise indicated, we refer to captions such as "revenues and other income" simply as revenues.

	Segment profit – refers to the operating profit of the industrial segments and the net earnings of the Financial Services segment. See the Segment Operations section within the MD&A for a description of the basis for segment profits.

NON-GAAP FINANCIAL MEASURES

In the accompanying analysis of financial information, we sometimes use information derived from consolidated financial data but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP). Certain of these data are considered "non-GAAP financial measures" under the SEC rules. Specifically, we have referred, in various sections of this report, to:

	Industrial segment organic revenue growth

	Operating and non-operating pension costs

	Adjusted Corporate costs (operating)

	Operating earnings, operating EPS and Industrial operating earnings

	Industrial operating + Verticals earnings and EPS

	Industrial operating profit and operating profit margin (excluding Alstom)

	Industrial segment operating profit and operating profit margin (excluding Alstom)

	Industrial cash flows from operating activities (Industrial CFOA)

	Capital ending net investment (ENI), excluding liquidity

The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures are included in the Supplemental Information section within this MD&A. Non-GAAP financial measures referred to in this report are designated with an asterisk (*).

OUR OPERATING SEGMENTS

We are a global digital industrial company, transforming industry with software-defined machines and solutions that are connected, responsive and predictive. With products and services ranging from aircraft engines, locomotives, power generation and oil and gas production equipment to medical imaging, financing and industrial products.

OUR INDUSTRIAL OPERATING SEGMENTS

	Power		Energy Connections		Transportation
	Renewable Energy		Aviation		Appliances & Lighting
	Oil & Gas		Healthcare

OUR FINANCIAL SERVICES OPERATING SEGMENT

Capital

Operational and financial overviews for our operating segments are provided in the Segment Operations section within this MD&A.

CORPORATE INFORMATION

GE's Internet address at www.ge.com, Investor Relations website at www.ge.com/investor-relations and our corporate blog at www.gereports.com, as well as GE's Facebook page and Twitter accounts, including @GE_Reports, contain a significant amount of information about GE, including financial and other information for investors. GE encourages investors to visit these websites from time to time, as information is updated and new information is posted.

KEY PERFORMANCE INDICATORS

(Dollars in billions; per-share amounts in dollars)

REVENUES PERFORMANCE			INDUSTRIAL ORDERS				INDUSTRIAL BACKLOG
	1Q 2016				Equipment Services			Equipment     Services
Industrial Segment	6%
Industrial Segment Organic*	(1)%
Financial Services	1%
				(a) Included $3.0 billion related to Alstom			(a) Included $28.8 billion related to Alstom
INDUSTRIAL SEGMENT PROFIT			INDUSTRIAL SEGMENT MARGIN				GE CFOA
								GE Capital Dividend       Industrial CFOA*
(a) Included an insignificant amount related to Alstom			(a) Included (0.7)% related to Alstom				(a) CFOA included $(0.4) billion related to Alstom
EARNINGS (LOSS) PER SHARE			OPERATING EPS*				INDUSTRIAL OPERATING + VERTICALS EPS*

 

*Non-GAAP Financial Measure

SIGNIFICANT DEVELOPMENTS IN 2016
			Our consolidated revenues were significantly affected by the U.S. dollar compared with various foreign currencies, and our operating earnings were significantly affected by transactional foreign exchange impacts as described in our consolidated results and segment operating results that follow.
			During the first quarter of 2016, we returned $8.3 billion to shareholders including $6.1 billion through buyback of our common stock and $2.2 billion in dividends.
			On January 15, 2016, we announced the signing of a definitive agreement to sell our Appliances business to Qingdao Haier Co., Ltd. (Haier) for approximately $5.4 billion. The transaction has been approved by our board of directors and Haier's board of directors and shareholders and remains subject to customary closing conditions, including regulatory approvals. The transaction is targeted to close in the second quarter of 2016.
			In March 2016, we completed the previously announced sale of the majority of our North American commercial lending and leasing businesses to Wells Fargo & Co. The sale included GE Capital's global Commercial Distribution Finance (CDF) and North American Vendor Finance and Corporate Finance platforms. The total transaction represents ending net investment (ENI), excluding liquidity (as originally reported at December 31, 2014) of approximately $30 billion. The portion that closed in March represents approximately $28 billion of ENI, excluding liquidity (as originally reported at December 31, 2014) and does not include the sale to Wells Fargo of the CDF business outside North America that is expected to be completed later in 2016.   On March 31, 2016, GE filed its request to the Financial Stability Oversight Council (FSOC) for rescission of GE Capital's designation as a nonbank Systemically Important Financial Institution (SIFI).

CONSOLIDATED RESULTS

THREE MONTHS ENDED MARCH 31

(Dollars in billions)

REVENUES		INDUSTRIAL AND FINANCIAL SERVICES REVENUES
(a)Included $2.8 billion related to Alstom		(a)Included $2.8 billion related to Alstom
COMMENTARY: 2016 - 2015
Consolidated revenues increased $1.6 billion, or 6%. Industrial revenues increased $1.6 billion, or 7%, mainly as the effects of acquisitions, primarily Alstom ($2.8 billion) were partially offset by the effects of a stronger U.S. dollar ($0.5 billion), the prior year dispositions ($0.5 billion) and organic revenue decreases ($0.2 billion). The effects of acquisitions increased Industrial revenues $0.2 billion and dispositions decreased Industrial revenues $0.2 billion in 2015. Financial services revenues increased 1% primarily as a result of the effects of acquisitions and organic revenue growth, partially offset by the effects of foreign currency exchange.

*Non-GAAP Financial Measure

THREE MONTHS ENDED MARCH 31

(Dollars in billions)

EARNINGS (LOSS)		OPERATING EARNINGS (LOSS)*		INDUSTRIAL SELLING, GENERAL & ADMINISTRATIVE (SG&A) AS A % OF SALES
				(a) 15.2% excluding $2.9 billion of Alstom sales and $0.6 billion of Alstom SG&A
COMMENTARY: 2016 - 2015
Consolidated earnings increased $4.8 billion. Financial Services losses decreased 84% primarily due to the absence of the first quarter 2015 charges associated with the GE Capital Exit Plan. The effects of acquisitions on our consolidated net earnings were a loss of $0.1 billion in 2016 (primarily Alstom) and an insignificant amount in 2015. The effects of dispositions on net earnings were insignificant amounts in both 2016 and 2015, respectively. Foreign exchange had a significant impact on our first quarter 2016 earnings. Industrial operating profit was adversely affected by $0.3 billion, primarily as a result of foreign exchange transactional impacts related to remeasurement and mark-to-market charges on open hedges. This impact was larger than in previous quarters as a result of significant movements in certain currencies including the weakening of the pound sterling and strengthening of the Japanese yen and Brazilian real. The underlying transactions for which these hedges were put in place will be reflected in sales and cost of sales in future periods and we expect the net impact of the hedges and underlying transactions to be insignificant over the lives of the contracts. Earnings per share amounts for the first quarter of 2016 were positively impacted by the reduction in number of outstanding common shares compared to the first quarter of 2015. The average number of shares outstanding used to calculate first quarter 2016 earnings per share was 8% lower than in the first quarter of 2015 as a result of previously disclosed actions, primarily the 2015 Synchrony Financial share exchange and ongoing share buyback activities over the last 12 months funded in large part by dividends from GE Capital. Industrial SG&A as a percentage of sales decreased 30 basis points (bps) as the favorable impact of global cost reduction initiatives, primarily at Corporate, and lower non-operating pension costs were partially offset by higher restructuring and Alstom acquisition-related costs.

See the Other Consolidated Information section within the MD&A for a discussion of income taxes.

*Non-GAAP Financial Measure

GE CAPITAL

GE Capital results include continuing operations, which are reported in the Capital segment (see Segment discussion), and discontinued operations (see Discontinued Operations section and Note 2).

THE GE CAPITAL EXIT PLAN

On April 10, 2015, the Company announced a plan (the GE Capital Exit Plan) to create a simple, more valuable company by reducing the size of its financial services businesses through the sale of most of the assets of GE Capital and aligning a smaller GE Capital with GE's industrial businesses. We expect GE Capital to release approximately $35 billion in dividends to GE (subject to regulatory approval) as a result of the sale of GE Capital assets. We received $4.3 billion in dividends from GE Capital in 2015 and $7.5 billion in the first quarter of 2016. As of March 31, 2016, we are ahead of our plan, having signed agreements with buyers for $166 billion of ending net investment (ENI), excluding liquidity (as originally reported at December 31, 2014), of which $146 billion has closed. In addition, as part of our initiative to reduce the size of our financial services businesses, we completed the split-off of our remaining interest in GE Capital's North American Retail Finance business, Synchrony Financial, to holders of GE common stock, which resulted in a $20.4 billion buyback of GE common stock (671.4 million shares) in 2015. In connection with the GE Capital Exit Plan, we completed a legal reorganization of GE Capital that included a merger of GE Capital into GE, a guarantee by GE of GE Capital debt, and an exchange of $36 billion of GE Capital debt for new GE notes. The result of all these actions reduced GE Capital's total assets by 44% from $501 billion at December 31, 2014 to $281 billion at March 31, 2016. As of March 31, 2016, we incurred charges of $22.6 billion related to these actions and remain on track versus our $23 billion estimate.

Given the progress of the GE Capital Exit Plan to date, we expect to largely complete that plan by the end of 2016. On March 31, 2016, GE filed its request to the Financial Stability Oversight Council (FSOC) for rescission of GE Capital's designation as a nonbank Systemically Important Financial Institution (SIFI).

Further information on these activities is described below and in Note 1 to the consolidated financial statements.

SALES AGREEMENTS

During the three months ended March 31, 2016, GE signed agreements to sell approximately $9 billion of ENI, excluding liquidity (as originally reported at December 31, 2014), of which approximately $4 billion, $4 billion and less than $1 billion related to our Commercial Lending and Leasing (CLL), Consumer and Real Estate businesses, respectively.

Of the signed agreements, sales representing approximately $42 billion of ENI, excluding liquidity (as originally reported at December 31, 2014) have closed during the first quarter of 2016, including approximately $40 billion, $1 billion and less than $1 billion related to our CLL, Consumer and Real Estate businesses, respectively.

Real Estate transactions that have closed included the majority of GE Capital's Real Estate debt and equity portfolio sold to funds managed by The Blackstone Group (which, in turn, sold a portion of this portfolio to Wells Fargo & Company). In connection with The Blackstone Group transactions, GE Capital provided $3.2 billion of seller financing to The Blackstone Group, which GE Capital intends to collect or sell by the end of 2016. As of March 31, 2016, GE Capital has collected or sold approximately $2.3 billion of this seller financing.

AFTER-TAX CHARGES RELATED TO THE GE CAPITAL EXIT PLAN

In the three months ended March 31, 2016, GE recorded $0.6 billion of after-tax charges related to the GE Capital Exit Plan of which $0.3 billion was recorded in continuing operations and $0.3 billion was recorded in discontinued operations. A description of these after-tax charges is provided below.

	$0.3 billion of charges associated with the preferred equity exchange that was completed in January 2016, which was recorded in continuing operations and reported in GE Capital's corporate component under the caption "Preferred stock dividends" in the Statement of Earnings.

	$0.3 billion of net loss primarily related to the completed and planned dispositions of most of the CLL businesses, which was recorded in discontinued operations under the caption "Earnings (loss) from discontinued operations, net of taxes" in the Statement of Earnings.



$0.1 billion of restructuring and other charges, of which an insignificant amount was recorded in discontinued operations under the caption "Earnings (loss) from discontinued operations, net of taxes" in the Statement of Earnings and $0.1 billion was recorded in continuing operations and reported in GE Capital's corporate component under the caption "Selling, general and administrative expenses" in the Statement of Earnings.

For additional information about the GE Capital Exit Plan, 2015 sales agreements and after-tax charges, refer to our Annual Report on Form 10-K for the year ended December 31, 2015.

In addition to the above charges, we have incurred other costs related to our ongoing liability management actions, including $0.4 billion pre-tax related to the repurchase of $4.9 billion of long-term unsecured debt and subordinated debentures. These charges will result in lower future interest costs, more than offsetting the initial charges. We expect to continue these actions when economically beneficial.

SEGMENT OPERATIONS

SUMMARY OF OPERATING SEGMENTS
	Three months ended March 31
(In millions)		2016			2015			V%
Revenues
Power	$	5,204		$	4,612			13 %
Renewable Energy		1,669			1,028			62 %
Oil & Gas		3,314			4,040			(18)%
Energy Connections		2,260			1,685			34 %
Aviation		6,262			5,674			10 %
Healthcare		4,183			4,075			3 %
Transportation		981			1,308			(25)%
Appliances & Lighting		1,996			1,940			3 %
Total industrial segment revenues		25,869			24,362			6 %
Capital		2,885			2,866			1 %
Total segment revenues		28,754			27,228			6 %
Corporate items and eliminations		(909)			(988)
Consolidated revenues	$	27,845		$	26,239			6 %
Segment profit (loss)
Power	$	573		$	757			(24)%
Renewable Energy		83			57			46 %
Oil & Gas		308			489			(37)%
Energy Connections		(85)			28			U
Aviation		1,524			1,314			16 %
Healthcare		631			587			7 %
Transportation		164			225			(27)%
Appliances & Lighting		115			102			13 %
Total industrial segment profit		3,314			3,560			(7)%
Capital		(893)			(5,721)			84 %
Total segment profit (loss)		2,421			(2,162)			F
Corporate items and eliminations		(1,571)			(1,691)
GE interest and other financial charges		(440)			(389)
GE provision for income taxes		(201)			(306)
Earnings (loss) from continuing operations attributable to GE common shareowners		210			(4,548)			F
Earnings (loss) from discontinued operations, net of taxes		(308)			(8,936)			97 %
Less net earnings attributable to
noncontrolling interests, discontinued operations		-			89			U
Earnings (loss) from discontinued operations,
net of tax and noncontrolling interest		(308)			(9,025)			97 %
Consolidated net earnings (loss)
attributable to GE common shareowners	$	(98)		$	(13,573)			99 %
		\

REVENUES AND PROFIT

Segment revenues include revenues and other income related to the segment.

Segment profit is determined based on internal performance measures used by the Chief Executive Officer (CEO) to assess the performance of each business in a given period. In connection with that assessment, the CEO may exclude matters such as charges for restructuring; rationalization and other similar expenses; acquisition costs and other related charges; technology and product development costs; certain gains and losses from acquisitions or dispositions; and litigation settlements or other charges, for which responsibility preceded the current management team.

Segment profit excludes results reported as discontinued operations and material accounting changes. Segment profit also excludes the portion of earnings or loss attributable to noncontrolling interests of consolidated subsidiaries, and as such only includes the portion of earnings or loss attributable to our share of the consolidated earnings or loss of consolidated subsidiaries.

Segment profit excludes or includes interest and other financial charges and income taxes according to how a particular segment's management is measured:

	Interest and other financial charges, income taxes and GE preferred stock dividends are excluded in determining segment profit (which we sometimes refer to as "operating profit") for the industrial segments.

	Interest and other financial charges, income taxes and GE Capital preferred stock dividends are included in determining segment profit (which we sometimes refer to as "net earnings") for the Capital segment.

Certain corporate costs, such as shared services, employee benefits and information technology are allocated to our segments based on usage. A portion of the remaining corporate costs is allocated based on each segment's relative net cost of operations.

With respect to the segment revenue and profit walks, the overall effect of foreign exchange is included within multiple captions.

	The translational foreign exchange impact is included within Foreign Exchange.

	The transactional impact of foreign exchange hedging is included in operating cost within Productivity and in other income within Other.

SEGMENT RESULTS – THREE MONTHS ENDED MARCH 31

(Dollars in billions)

INDUSTRIAL SEGMENT EQUIPMENT & SERVICES REVENUES			INDUSTRIAL SEGMENT PROFIT
	Equipment(a)     Services(b)
(a)   In 2016, $12.1 billion, excluding $1.7 billion related to Alstom (b)   In 2016, $11.0 billion, excluding $1.2 billion related to Alstom			(a)   In 2016, $3.3 billion, excluding an insignificant amount related to Alstom

COMMENTARY: 2016 - 2015
Industrial segment revenues increased 6%, mainly as a result of the effects of acquisitions (primarily Alstom), partially offset by $0.5 billion unfavorable impact of foreign exchange. Industrial segment profit decreased 7% mainly driven by lower earnings at Power, Oil & Gas and Energy Connections, partially offset by higher earnings at Aviation. Industrial segment profit decreased $0.3 billion as a result of foreign exchange, primarily transactional impacts from remeasurement and mark-to-market on open hedges. Industrial segment margin decreased 180 bps primarily driven by effects of Alstom results. Excluding Alstom, industrial segment margin was 14.5%, compared with 14.6% in the same period of 2015.

SIGNIFICANT SEGMENT DEVELOPMENTS

ALSTOM ACQUISITION

On November 2, 2015, we completed the acquisition of Alstom's Thermal, Renewables and Grid businesses. The completion of the transaction followed the regulatory approval of the deal in over 20 countries and regions including the EU, U.S., China, India, Japan and Brazil. The cash purchase price was €9.2 billion (approximately $10.1 billion) net of cash acquired. The acquisition and alliances with Alstom affected our Power, Energy Connections and Renewable Energy segments, and to a lesser extent our Oil & Gas segment.

Given the timing and complexity of the acquisition, the presentation of these businesses in our financial statements, including the preliminary allocation of the purchase price, is not final and is expected to change in future reporting periods.

At year-end 2015, we recognized approximately $13.5 billion of goodwill, $5.2 billion of intangible assets, and $1.1 billion of unfavorable customer contract liabilities. The preliminary fair value of the associated noncontrolling interest was approximately $3.6 billion. In the first quarter of 2016, the preliminary amount of goodwill, intangible assets and unfavorable customer contract liabilities recognized was adjusted to approximately $14.2 billion, $4.5 billion, and $1.1 billion, respectively. The adjustments reflected refinements in estimates in the first quarter of 2016, primarily related to updated revenue and cost assumptions for customer contracts, and other fair value adjustments related to acquired assets and liabilities. Further purchase accounting adjustments are expected. We will complete our post-closing procedures and purchase price allocation no later than the fourth quarter of 2016. See Note 7 to the consolidated financial statements for further information.

For the first quarter of 2016, Alstom contributed revenues of $2.8 billion and an operating loss of $0.2 billion ($0.1 billion after tax), which includes the effects of purchase accounting and acquisition related charges at Corporate. Alstom related revenues and operating profit are presented separately in the segment revenues and profit walks that follow.

PLANNED SALE OF APPLIANCES

On January 15, 2016, we announced the signing of a definitive agreement to sell our Appliances business to Qingdao Haier Co., Ltd. (Haier) for approximately $5.4 billion. The transaction has been approved by our board of directors and Haier's board of directors and shareholders and remains subject to customary closing conditions, including regulatory approvals. The transaction is targeted to close in the second quarter of 2016.

POWER

OPERATIONAL OVERVIEW

(Dollars in billions)

(a) Includes Water & Distributed Power and GE Hitachi Nuclear

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
			Services  Equipment
ORDERS			BACKLOG
	Equipment   Services			Equipment     Services
(a) Included $1.5 billion related to Alstom			(a) Included $15.2 billion related to Alstom
UNIT SALES

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT		SEGMENT PROFIT MARGIN
(a) $3.8 billion, excluding $1.4 billion related to Alstom*	Equipment       Services	(a) $0.5 billion, excluding an insignificant amount related to Alstom*		(a) 14.4%, excluding 1.9% related to Alstom*

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.6 billion (13%); Segment profit down $0.2 billion (24%) as a result of:   The increase in revenues was primarily driven by the effects of Alstom and increased service revenues, primarily at Power Services, that were partially offset by lower volume at Gas Power Systems as a result of 26 fewer gas turbine shipments than in the prior year. Revenues also decreased as a result of the effects of a stronger U.S. dollar and lower other income, including negative foreign exchange transactional hedge impacts. The decrease in profit was mainly due to lower cost productivity on lower volume and lower other income, including negative foreign exchange transactional hedge impacts, partially offset by a favorable business mix.
	Revenues		Profit
March 31, 2015	$	4.6	$	0.8
Volume		(0.7)		(0.1)
Price		-		-
Foreign Exchange		(0.1)		-
(Inflation)/Deflation		N/A		-
Mix		N/A		0.1
Productivity		N/A		(0.2)
Other		(0.1)		(0.1)
Alstom		1.4		-
March 31, 2016	$	5.2	$	0.6

*Non-GAAP Financial Measure

RENEWABLE ENERGY

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
(a) Offshore Wind revenues were insignificant
			Services  Equipment
ORDERS			BACKLOG
	Equipment   Services			Equipment     Services
(a) Included $0.2 billion related to Alstom			(a) Included $5.0 billion related to Alstom
UNIT SALES

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT		SEGMENT PROFIT MARGIN
(a) $1.4 billion, excluding $0.3 billion related to Alstom*	Equipment           Services	(a) $0.1 billion, excluding an insignificant amount related to Alstom*		(a) 6.6%, excluding (2.7)% related to Alstom*

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.6 billion (62%); Segment profit up 46%:   The increase in revenues was driven by higher volume, primarily higher turbine sales at Onshore Wind and higher sales at Hydro, including the effects of the Alstom acquisition. These increases were partially offset by the effects of a stronger U.S. dollar. The increase in profit was due to higher cost productivity, including the effects of a customer contract termination, and higher volume. These increases were partially offset by negative transactional foreign exchange impact.
	Revenues		Profit
March 31, 2015	$	1.0	$	0.1
Volume		0.5		-
Price		-		-
Foreign Exchange		(0.1)		-
(Inflation)/Deflation		N/A		-
Mix		N/A		-
Productivity		N/A		0.1
Other		-		-
Alstom		0.3		-
March 31, 2016	$	1.7	$	0.1

*Non-GAAP Financial Measure

OIL & GAS

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
(a) Previously referred to as Measurement & Controls (M&C)
			Services           Equipment
ORDERS			BACKLOG
	Equipment   Services			Equipment     Services
(a) Included an insignificant amount related to Alstom			(a) Included $0.1 billion related to Alstom

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT		SEGMENT PROFIT MARGIN
(a) $3.3 billion, excluding an insignificant amount related to Alstom*	Equipment       Services	(a) $0.3 billion, excluding an insignificant amount related to Alstom*		(a) 9.4%, excluding an insignificant amount related to Alstom*

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues down $0.7 billion (18%); Segment profit down $0.2 billion (37%) as a result of:   The decrease in revenues was primarily market driven, mainly due to lower equipment volume, driven by SS&D and Surface, as well as the impact of a stronger U.S. dollar and lower price, partially offset by higher other income, including a favorable foreign exchange transactional hedge impact. The decrease in operating profit was primarily market driven, due to lower volume at SS&D and Surface and lower prices at DTS and SS&D. The decrease in profit also resulted from lower productivity, which included the negative transactional impact of foreign exchange, partially offset by cost out actions, and higher other income resulting from lower foreign exchange mark-to-market charges than in 2015.
	Revenues		Profit
March 31, 2015	$	4.0	$	0.5
Volume		(0.6)		(0.1)
Price		(0.1)		(0.1)
Foreign Exchange		(0.2)		-
(Inflation)/Deflation		N/A		-
Mix		N/A		-
Productivity		N/A		(0.2)
Other		0.1		0.1
Alstom		-		-
March 31, 2016	$	3.3	$	0.3

*Non-GAAP Financial Measure

ENERGY CONNECTIONS

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
			Services  Equipment
ORDERS			BACKLOG
	Equipment Services			Equipment       Services
(a) Included $1.2 billion related to Alstom			(a) Included $8.4 billion related to Alstom

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT (LOSS)		SEGMENT PROFIT MARGIN
(a) $1.2 billion, excluding $1.1 billion related to Alstom*	Equipment       Services	(a) Includes an insignificant amount related to Alstom*		(a) (4.0)%, excluding (3.5)% related to Alstom*

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.6 billion (34%); Segment profit down $0.1 billion as a result of:   The increase in revenues was mainly due to higher volume driven by higher equipment sales at Grid, including the effects of Alstom, partially offset by a decrease in core volume driven by Industrial Solutions and Power Conversion. The decrease in revenues also reflects the effects of a stronger U.S. dollar. The decrease in profit was due to lower cost productivity, driven by lower sales volume at Industrial Solutions and Power Conversion, as well as a negative transactional foreign exchange impact.
	Revenues		Profit
March 31, 2015	$	1.7	$	-
Volume		(0.4)		-
Price		-		-
Foreign Exchange		(0.1)		-
(Inflation)/Deflation		N/A		-
Mix		N/A		-
Productivity		N/A		(0.1)
Other		-		-
Alstom		1.1		-
March 31, 2016	$	2.3	$	(0.1)

*Non-GAAP Financial Measure

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
			Services  Equipment
ORDERS			BACKLOG
	Equipment   Services			Equipment     Services
UNIT SALES
(a)GEnx engines are a subset of commercial engines (b)Commercial spares shipment rate in millions of dollars per day

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT		SEGMENT PROFIT MARGIN
	Equipment       Services

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.6 billion (10%); Segment profit up $0.2 billion (16%) as a result of:   The increase in revenues was due to higher volume, primarily in services. Equipment sales also increased as higher Military sales more than offset decreases at Commercial Engines. The increase in profit was mainly due to higher services volume, a favorable business mix and higher cost productivity.
	Revenues		Profit
March 31, 2015	$	5.7	$	1.3
Volume		0.6		0.1
Price		-		-
Foreign Exchange		-		-
(Inflation)/Deflation		N/A		-
Mix		N/A		0.1
Productivity		N/A		0.1
Other		-		(0.1)
March 31, 2016	$	6.3	$	1.5

HEALTHCARE

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
			Services  Equipment
ORDERS			BACKLOG
	Equipment Services			Equipment     Services

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES		SEGMENT PROFIT		SEGMENT PROFIT MARGIN
	Equipment       Services

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.1 billion (3%); Segment profit up 7% as a result of:   The increase in revenues was due to higher volume driven by Life Sciences and Healthcare Systems, partially offset by lower prices at Healthcare Systems and the effects of a stronger U.S. dollar. The increase in profit was mainly due to higher cost productivity, including a reduction in SG&A and volume growth, partially offset by lower prices.
	Revenues		Profit
March 31, 2015	$	4.1	$	0.6
Volume		0.3		-
Price		(0.1)		(0.1)
Foreign Exchange		(0.1)		-
(Inflation)/Deflation		N/A		-
Mix		N/A		-
Productivity		N/A		0.1
Other		-		-
March 31, 2016	$	4.2	$	0.6

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES			EQUIPMENT/SERVICES REVENUES
(a) Includes Digital Solutions, Marine, Stationary & Drilling
			Services  Equipment
ORDERS			BACKLOG
	Equipment Services			Equipment     Services
UNIT SALES

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES			SEGMENT PROFIT		SEGMENT PROFIT MARGIN
	Equipment       Services

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues down $0.3 billion (25%); Segment profit down $0.1 billion (27%) as a result of:   The decrease in revenues was due to lower equipment volume, driven by 59 fewer locomotive shipments than in the prior year. The decrease in profit was due to lower volume due to lower locomotive sales.
	Revenues		Profit
March 31, 2015	$	1.3	$	0.2
Volume		(0.3)		(0.1)
Price		-		-
Foreign Exchange		-		-
(Inflation)/Deflation		N/A		-
Mix		N/A		-
Productivity		N/A		-
Other		-		-
March 31, 2016	$	1.0	$	0.2

OPERATIONAL OVERVIEW

 (Dollar in billions)

2016 YTD SUB-SEGMENT REVENUES
(a) Includes Current, powered by GE

FINANCIAL OVERVIEW   (Dollar in billions)

SEGMENT REVENUES			SEGMENT PROFIT		SEGMENT PROFIT MARGIN
	Equipment           Services

SEGMENT REVENUES & PROFIT WALK:						COMMENTARY: 2016 - 2015
						Segment revenues up $0.1 billion or 3%; Segment profit up 13% as a result of:   The increase in revenues was due to higher volume at Appliances, partially offset by lower Lighting revenues as lower traditional lighting sales were partially offset by an increase in LED revenues. The increase in profit was due to material deflation, partially offset by lower prices.
	Revenues		Profit
March 31, 2015	$	1.9	$	0.1
Volume		0.1		-
Price		-		-
Foreign Exchange		-		-
(Inflation)/Deflation		N/A		0.1
Mix		N/A		-
Productivity		N/A		-
Other		-		-
March 31, 2016	$	2.0	$	0.1

CAPITAL

OPERATIONAL OVERVIEW

(Dollars in billions)

2016 YTD SUB-SEGMENT REVENUES
	ENDING NET INVESTMENT, EXCLUDING LIQUIDITY*			TIER 1 COMMON RATIO ESTIMATE
	(a) As originally reported; $331 billion including discontinued operations (b) $127 billion including discontinued operations

SIGNIFICANT TRENDS & DEVELOPMENTS



The GE Capital Exit Plan - On April 10, 2015, the Company announced its plan to reduce the size of the financial services businesses through the sale of most of its assets over the following 24 months. It is expected that as a result of the GE Capital Exit Plan, the Capital businesses that will remain with GE will account for about $90 billion in ending net investment (ENI), excluding liquidity, including approximately $40 billion in the U.S. ENI is a metric used to measure the total capital invested in the financial services businesses. Capital's ENI, excluding liquidity* was $81 billion at March 31, 2016. Further information on the GE Capital Exit Plan is provided in the Consolidated Results section of the MD&A and Note 1 to the consolidated financial statements.

As the GE Capital Exit Plan progresses, we will continue to incur interest on non-Verticals borrowings, restructuring costs and GE and GE Capital headquarters costs that are in excess of those allocated to the Verticals. These costs are recorded within other continuing operations within Capital.

	Milestone Aviation Group – On January 30, 2015, we acquired Milestone Aviation Group, a helicopter leasing business, for approximately $1.8 billion.

	Dividends – GE Capital paid common dividends of $7.5 and $0.5 billion to GE in the three months ended March 31, 2016 and 2015, respectively.

* Non-GAAP Financial Measure

FINANCIAL OVERVIEW

(Dollars in billions)

SEGMENT REVENUES			SEGMENT PROFIT (LOSS)(a)
	Total Capital   Other Continuing     Verticals			Verticals   Other Continuing Total Capital
			(a) Interest and other financial charges and income taxes are included in determining segment profit (loss) for the Capital segment.
COMMENTARY: 2016 - 2015

Capital revenues increased 1% primarily as a result of the effects of acquisitions and organic revenue growth, partially offset by the effects of foreign currency exchange.

	Within Capital, Verticals revenues increased by $0.1 billion, or 3%, as a result of higher gains ($0.3 billion) and the effects of acquisitions, partially offset by organic revenue declines ($0.2 billion) and higher impairments ($0.1 billion)

Capital net loss decreased by $4.8 billion, or 84%, primarily due to the absence of the first quarter 2015 charges associated with the GE Capital Exit Plan.

	Within Capital, Verticals net earnings increased by $0.2 billion, or 43%, as a result of higher gains ($0.2 billion), partially offset by higher impairments.

	Other Capital net loss decreased by $4.7 billion, or 77%, primarily as a result of:

	Lower tax expenses of $6.0 billion primarily related to the absence of the first quarter 2015 expected repatriation of foreign earnings and write-off of deferred tax assets related to the GE Capital Exit Plan.



Higher treasury operation expenses of $0.9 billion reflecting excess interest expense, including costs associated with the February 2016 hybrid tender and derivative activities that reduce or eliminate interest rate, currency or market risk between financial assets and liabilities. We expect to continue to have excess interest costs in 2016 as asset sales outpace our debt maturities. We may engage in liability management actions, such as buying back debt, based on market and economic conditions.

	Charges of $0.3 billion associated with the preferred equity exchange that was completed in January 2016.

	Higher restructuring expenses of $0.2 billion.

CORPORATE ITEMS AND ELIMINATIONS
REVENUES AND OPERATING PROFIT (COST)
		Three months ended March 31
(In millions)			2016			2015
Revenues
	Gains (losses) on disposals	$	59		$	-
	Eliminations and other		(968)			(988)
Total Corporate Items and Eliminations		$	(909)		$	(988)
Operating profit (cost)
	Gains (losses) on disposals		59			-
	Restructuring and other charges	$	(686)		$	(422)
	Principal retirement plans(a)		(468)			(789)
	Eliminations and other		(476)			(480)
Total Corporate Items and Eliminations		$	(1,571)		$	(1,691)
CORPORATE COSTS
		Three months ended March 31
(In millions)			2016			2015
Total Corporate Items and Eliminations		$	(1,571)		$	(1,691)
Less non-operating pension cost			(512)			(695)
Total Corporate costs (operating)*		$	(1,059)		$	(996)
Less restructuring and other charges			(686)			(422)
Less gains (losses) on disposals			59			-
Adjusted total corporate costs (operating)*		$	(431)		$	(574)

(a)	Included non-operating pension cost* of $0.5 billion and $0.7 billion in the three months ended March 31, 2016 and 2015, respectively, which includes expected return on plan assets, interest costs and non-cash amortization of actuarial gains and losses.

2016 – 2015 COMMENTARY

Revenues and other income increased $0.1 billion, primarily a result of:

	$0.1 billion of higher gains from the sale of two floors in 30 Rockefeller Plaza, New York City.

Operating costs decreased $0.1 billion, primarily as a result of:

	$0.3 billion lower costs associated with our principal retirement plans including the effects of lower discount rates, and

	$0.1 billion of higher gains from the sale of two floors in 30 Rockefeller Plaza, New York City.

These decreases to operating costs were partially offset by $0.3 billion higher restructuring and other charges, which included $0.1 billion of acquisition related charges.

*Non-GAAP Financial Measure

COSTS NOT INCLUDED IN SEGMENT RESULTS

Certain amounts are not included in industrial operating segment results because they are excluded from measurement of their operating performance for internal and external purposes. These amounts are included in GE Corporate Items & Eliminations and may include matters such as charges for restructuring; rationalization and other similar expenses; acquisition costs and related charges; technology and product development cost; certain gains and losses from acquisitions or dispositions; and litigation settlements or other charges, for which responsibility preceded the current management team. The amount of costs and gains not included in segment results follows.

COSTS
	Three months ended March 31
(In billions)		2016			2015
Power	$	0.2		$	0.1
Renewable Energy		-			-
Oil & Gas		0.2			0.1
Energy Connections		-			0.1
Aviation		-			-
Healthcare		0.1			-
Transportation		-			-
Appliances & Lighting		-			-
Total	$	0.7		$	0.4

DISCONTINUED OPERATIONS

Results of operations, financial position and cash flows for these businesses are separately reported as discontinued operations for all periods presented.

FINANCIAL INFORMATION FOR DISCONTINUED OPERATIONS
	Three months ended March 31
(In millions)	2016			2015
Earnings (loss) from discontinued operations, net of taxes	$	(308)		$	(8,936)

The first quarter 2016 loss from discontinued operations, net of taxes, primarily reflected the following:

	$0.2 billion after-tax loss at our CLL business (including $0.3 billion after-tax loss on disposals).

The first quarter 2015 loss from discontinued operations, net of taxes, primarily reflected the following:

	$4.0 billion after-tax loss at our CLL business (including $2.8 billion after-tax loss on disposals),

	$2.7 billion after-tax loss at our Consumer business,

	$2.3 billion after-tax loss at our CRE business (including $2.4 billion after-tax loss on disposals).

For additional information related to discontinued operations, see Note 2 to the consolidated financial statements of this Form 10-Q Report.

OTHER CONSOLIDATED INFORMATION

INCOME TAXES

GE pays the income taxes it owes in every country it does business. While GE and GE Capital file a consolidated U.S. federal income tax return, many factors impact our income tax expense and cash tax payments. The most significant factor is that we conduct business in approximately 180 countries and more than half of our revenue is earned outside the U.S., often in countries with lower tax rates than in the U.S. We reinvest most of our foreign earnings overseas to be able to fund our active non-U.S. business operations. Our tax liability is also affected by U.S. and foreign tax incentives designed to encourage certain investments, such as research and development, and is also affected by acquisitions, dispositions and tax law changes. Finally, our tax returns are routinely audited, and settlements of issues raised in these audits sometimes affect our tax rates.

GE and GE Capital file a consolidated U.S. federal income tax return. This enables GE and GE Capital to use tax deductions and credits of one member of the group to reduce the tax that otherwise would have been payable by another member of the group. The GE Capital effective tax rate reflects the benefit of these tax reductions in the consolidated return. GE makes cash payments to GE Capital for tax reductions and GE Capital pays for tax increases at the time GE's tax payments are due.

CONSOLIDATED – THREE MONTHS ENDED MARCH 31

(Dollars in billions)

PROVISION FOR INCOME TAXES

2016 – 2015 COMMENTARY

	The consolidated income tax rates of 388% for the first quarter 2015 and negative 58% for the first quarter 2016 are not meaningful.



The first quarter 2015 rate is caused by comparing positive tax expense of $6.3 billion with pre-tax income of $1.6 billion. During the first quarter of 2015 in conjunction with the GE Capital Exit Plan, we incurred tax expense of $6.0 billion related to expected repatriation of foreign earnings and write-off of deferred tax assets.

	The first quarter 2016 consolidated tax rate is caused by comparing a small tax benefit ($0.1 billion) to a small pre-tax income ($0.2 billion), reflecting a 36% tax rate on $0.9 billion of pre-tax loss at GE Capital and a 17% tax rate on $1.2 billion of pre-tax income at GE.

	The decrease in the consolidated income tax expense from $6.3 billion for the first quarter of 2015 to negative $0.1 billion for the first quarter of 2016 is due to the non-repeat of the tax expense incurred as part of the GE Capital Exit Plan in 2015 and the effect of lower pre-tax income.

	The consolidated tax provision includes $0.3 billion and $0.2 billion for GE (excluding GE Capital) for the first quarters of 2015 and 2016, respectively.

The effective tax rate in future periods is expected to increase as a result of changes in our income profile due to changes in GE Capital earnings as we continue to execute on the GE Capital Exit Plan.

BENEFITS FROM GLOBAL OPERATIONS

Absent the effects of the GE Capital Exit Plan, our consolidated income tax provision is reduced because of the benefits of lower-taxed global operations. There is a benefit from global operations as non-U.S. income is subject to local country tax rates that are significantly below the 35% U.S. statutory rate. These non-U.S. earnings have been indefinitely reinvested outside the U.S. and are not subject to current U.S. income tax. Most of these earnings have been reinvested in active non-U.S. business operations and we do not intend to repatriate these earnings to fund U.S. operations. The rate of tax on our indefinitely reinvested non-U.S. earnings is below the 35% U.S. statutory tax rate because we have significant business operations subject to tax in countries where the tax on that income is lower than the U.S. statutory rate and because GE funds certain non-U.S. operations through foreign companies that are subject to low foreign taxes.

A substantial portion of the benefit related to business operations subject to tax in countries where the tax on that income is lower than the U.S. statutory rate is derived from our GECAS aircraft leasing operations located in Ireland, from our Power operations located in Switzerland and Hungary, and our Healthcare operations in Europe.

We expect our ability to benefit from non-U.S. income taxed at less than the U.S. rate to continue, subject to changes in U.S. or foreign law. In addition, since this benefit depends on management's intention to indefinitely reinvest amounts outside the U.S., our tax provision will increase to the extent we no longer indefinitely reinvest foreign earnings.

STATEMENT OF FINANCIAL POSITION

Because GE and GE Capital share certain significant elements of their Statements of Financial Position, the following discussion addresses significant captions in the consolidated statement. Within the following discussions, however, we distinguish between GE and GE Capital activities in order to permit meaningful analysis of each individual consolidating statement.

MAJOR CHANGES IN OUR FINANCIAL POSITION FOR THE THREE MONTHS ENDED

MARCH 31, 2016



Cash and equivalents increased $4.6 billion. GE Cash and equivalents decreased $1.1 billion due to cash flows from operating activities of $7.9 billion (including common dividends from GE Capital of $7.5 billion), more than offset by buyback of treasury stock of $6.7 billion (cash basis), including $2.0 billion paid under an ASR agreement, and dividends of $2.2 billion. GE Capital Cash and equivalents increased $5.7 billion primarily driven by $36.5 billion in proceeds from business dispositions, partially offset by $14.0 billion net repayments of debt and $7.6 billion in payments of dividends to shareowners. See the Statement of Cash Flows section for additional information.

	All other assets increased $2.8 billion, primarily due to purchases of time deposits at GE Capital of $3.6 billion.

	Assets of discontinued operations decreased $39.3 billion, primarily due to the disposition of CLL businesses of $38.6 billion. See Note 2 for additional information.

	Borrowings decreased $11.6 billion, primarily due to a net decrease of GE Capital borrowings of $12.4 billion, partially offset by a net increase in borrowings by GE of $1.0 billion (excluding debt assumption).

	Liabilities of discontinued operations decreased $9.5 billion, primarily driven by the disposition of CLL businesses of $9.7 billion. See Note 2 for additional information.



Common stock held in treasury increased $5.5 billion, primarily due to buyback of treasury stock of $6.1 billion (book basis), including $1.7 billion repurchased under a $2.0 billion ASR agreement. This was partially offset by treasury stock dispositions of $0.6 billion, primarily stock option exercises of $0.4 billion.

FINANCIAL RESOURCES AND LIQUIDITY

Our 2016 GE Capital funding plan anticipates repayment of principal on outstanding short-term borrowings, including the current portion of long-term debt ($42.7 billion at December 31, 2015), principally through dispositions, asset sales and cash on hand. Long-term maturities and early redemptions were $13.6 billion in the first quarter of 2016. Additionally, $18.9 billion of senior unsecured notes matured as of May 6, 2016.

LIQUIDITY SOURCES

In addition to GE cash of $9.3 billion at March 31, 2016, GE Capital maintained liquidity sources of $105.8 billion that consisted of cash and equivalents of $65.8 billion, high-quality, liquid investments of $13.9 billion and cash and equivalents of $26.1 billion classified as discontinued operations and businesses held for sale. Additionally, we have $41.8 billion of committed unused credit lines.

CASH AND EQUIVALENTS
(In billions)		March 31, 2016					March 31, 2016
GE(a)	$	9.3			U.S.	$	22.2
GE Capital(b)		65.8			Non-U.S.(c)		52.9

(a)

At March 31, 2016, $3.0 billion of GE cash and equivalents was held in countries with currency controls that may restrict the transfer of funds to the U.S. or limit our ability to transfer funds to the U.S. without incurring substantial costs. These funds are available to fund operations and growth in these countries and we do not currently anticipate a need to transfer these funds to the U.S.

(b)	At March 31, 2016, GE Capital cash and equivalents of about $0.7 billion were primarily in insurance entities and were subject to regulatory restrictions.

(c)

Of this amount at March 31, 2016, $3.1 billion is held outside of the U.S. and is available to fund operations and other growth of non-U.S. subsidiaries; it is also available to fund our needs in the U.S. on a short-term basis through short-term loans, without being subject to U.S. tax. Under the Internal Revenue Code, these loans are permitted to be outstanding for 30 days or less and the total of all such loans is required to be outstanding for less than 60 days during the year. If we were to repatriate this cash, we would be subject to additional U.S. income taxes and foreign withholding taxes.

COMMITTED UNUSED CREDIT LINES
(In billions)	March 31, 2016
Revolving credit agreements (exceeding one year)	$	24.5
Revolving credit agreements (364-day line)(a)		17.3
Total(b)	$	41.8

(a)	Included $17.1 billion that contains a term-out feature that allows us to extend borrowings for two years from the date on which such borrowings would otherwise be due.

(b)	Total committed unused credit lines were extended to us by 44 financial institutions but can be drawn on and lent to GE Capital.

In conjunction with the GE Capital Exit Plan, we are currently evaluating the amount of credit lines we require in the future.

FUNDING PLAN

COMMERCIAL PAPER
(In billions)	GE			GE Capital
Average commercial paper borrowings during the first quarter of 2016	$	12.7		$	5.0
Maximum commercial paper borrowings outstanding during the first quarter of 2016		17.4			5.1

GE Capital commercial paper maturities have historically been funded principally through new commercial paper issuances and at GE are substantially repaid before quarter-end using indefinitely reinvested overseas cash, which as discussed above, is available for use in the U.S. on a short-term basis without being subject to U.S. tax.

We have seven deposit-taking banks outside of the U.S., which are classified as discontinued operations, and one deposit-taking bank in the U.S., GE Capital Bank, an industrial bank (IB), which is also classified as discontinued operations. On April 18, 2016, we completed the sale of the IB.

GE GUARANTEE OF CERTAIN GE CAPITAL DEBT

ACCELERATED SHARE REPURCHASE AGREEMENT

STATEMENT OF CASH FLOWS - THREE MONTHS ENDED MARCH 31, 2016 VERSUS 2015

CONSOLIDATED CASH FLOWS

We evaluate our cash flow performance by reviewing our industrial (non-GE Capital) businesses and GE Capital businesses separately. Cash from operating activities (CFOA) is the principal source of cash generation for our industrial businesses. The industrial businesses also have liquidity available via the public capital markets.

GE CASH FLOWS – THREE MONTHS ENDED MARCH 31

OPERATING CASH FLOWS				INVESTING CASH FLOWS				FINANCING CASH FLOWS
2015		2016		2015		2016		2015		2016

With respect to GE CFOA, we believe that it is useful to supplement our GE Statement of Cash Flows and to examine in a broader context the business activities that provide and require cash.

The most significant source of cash in GE CFOA is customer-related activities, the largest of which is collecting cash resulting from product or services sales. The most significant operating use of cash is to pay our suppliers, employees, tax authorities and others for a wide range of material and services. Dividends from GE Capital represent the distribution of a portion of GE Capital retained earnings, and are distinct from cash from continuing operations within the GE Capital businesses. See the Intercompany Transactions and Eliminations section for information related to transactions between GE and GE Capital.

2016 – 2015 COMMENTARY

GE cash from operating activities increased $6.5 billion primarily due to the following:

	An increase of operating cash collections of $2.3 billion to $27.4 billion in 2016, primarily driven by progress collections of $1.6 billion and Alstom related activities, partially offset by an increase in customer receivables of $0.7 billion.

	An increase in operating cash payments of $2.9 billion to $27.1 billion in 2016. This increase is primarily driven by increased spend on inventory, purchasing volume timing, payment of income taxes and Alstom related activities in the three months ended March 31, 2016 compared with that of 2015.

	Further, GE Capital paid common dividends totaling $7.5 billion and $0.5 billion to GE in the three months ended March 31, 2016 and 2015, respectively.

GE cash used for investing activities increased $0.2 billion primarily due to the following:

	Funding of a joint venture at our Aviation business in the three months ended March 31, 2016.

GE cash used for financing activities increased $5.3 billion primarily due to the following:

	An increase in net repurchases of GE shares for treasury of $6.6 billion, including $2.0 billion paid under an ASR agreement.

	This increase was partially offset by a net change in borrowings of $1.4 billion.

GE CAPITAL CASH FLOWS – THREE MONTHS ENDED MARCH 31

OPERATING CASH FLOWS				INVESTING CASH FLOWS				FINANCING CASH FLOWS
2015		2016		2015		2016		2015		2016

2016 – 2015 COMMENTARY:

GE Capital cash used for operating activities increased $0.2 billion primarily due to the following:

	An increase in net cash collateral activity with counterparties on derivative contracts of $2.8 billion.

	An increase in accounts payable of $0.2 billion in addition to an increase in cash generated from earnings and other activity.

	These increases were partially offset by a net decrease in tax activity of $3.8 billion driven by net tax payments in the three months ended March 31, 2016 compared with net tax refunds for the same period in 2015.

GE Capital cash from investing activities increased $18.0 billion primarily due to the following:

	In 2016, we closed the sale of certain of our CLL, Consumer and Real Estate businesses for proceeds of $35.5 billion, $0.8 billion and $0.2 billion, respectively.

	The 2015 acquisition of Milestone Aviation Group, resulting in net cash paid of $1.7 billion.

	These increases were partially offset by a decrease in cash resulting from the investment in high quality interest bearing deposits that mature in July 2016 of $3.6 billion and other activity.

GE Capital cash used for financing activities increased $17.1 billion primarily due to the following:

	Higher net repayments of borrowings of $9.8 billion driven primarily by a decrease in issuances of senior unsecured notes and an increase in long-term debt maturities and repurchases.

	GE Capital paid common dividends totaling $7.5 billion and $0.5 billion to GE in the three months ended March 31, 2016 and 2015, respectively.

INTERCOMPANY TRANSACTIONS AND ELIMINATIONS

EXPOSURES

OIL & GAS INDUSTRY

CRITICAL ACCOUNTING ESTIMATES

OTHER ITEMS

In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016- 02, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Similarly, lessors will be required to classify leases as either sales-type, finance or operating, with classification affecting the pattern of income recognition. Classification for both lessees and lessors will be based on an assessment of whether risks and rewards as well as substantive control have been transferred through a lease contract. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. While we continue to evaluate the effect of the standard on our ongoing financial reporting, we anticipate that the adoption of ASU 2016-02 may materially impact our statement of financial position.

CONTROLS AND PROCEDURES

Under the direction of our Chief Executive Officer and Chief Financial Officer, we evaluated our disclosure controls and procedures and internal control over financial reporting and concluded that our disclosure controls and procedures were effective as of March 31, 2016.

OTHER FINANCIAL DATA

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
								Approximate
								dollar value
						Total number		of shares that
						of shares		may yet be
						purchased		purchased
						as part of		under our
	Total number		Average			our share		share
	of shares		price paid			repurchase		repurchase
Period	purchased(a)		per share			program(b)		program(b)
(Shares in thousands)
2016
January		58,441	$	28.77		58,392
February		49,312	$	28.60		49,286
March (c)		98,921	$	30.88		98,850
Total		206,674	$	29.74		206,528	$	40.5	billion

REGULATIONS AND SUPERVISION

LEGAL PROCEEDINGS

One case is pending against WMC in the United States District Court for the Southern District of New York. The case was initiated by the Federal Housing Finance Agency (FHFA) in the fourth quarter 2012. In the second quarter 2013, Deutsche Bank, in its role as securitization trustee, intervened as a plaintiff and filed a complaint relating to approximately $1,300 million of loans and alleging losses in excess of approximately $100 million. In December 2013, the District Court issued an order denying WMC's motion to dismiss but, on its own motion, ordered re-briefing on several issues raised by WMC's motion to dismiss in February 2015. On July 10, 2015, the District Court entered an order dismissing the lawsuit as time-barred under the applicable statute of limitations. Deutsche Bank filed a notice of appeal from this order of dismissal on August 13, 2015.

 

In December 2015, we learned that, as part of continuing industry-wide investigation of subprime mortgages, the Civil Division of the U.S. Department of Justice is investigating potential violations of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) by WMC and its affiliates arising out of the origination, purchase or sale of residential mortgage loans between January 1, 2005 and December 31, 2007. The Justice Department subsequently issued subpoenas for documents to WMC and GE Capital in January 2016. We are cooperating with the Justice Department's investigation, which is at an early stage.

FINANCIAL STATEMENTS AND NOTES

Statement of Earnings (Loss)				54
Consolidated Statement of Comprehensive Income (Loss)				56
Consolidated Statement of Changes in Shareowners' Equity				57
Statement of Financial Position				58
Statement of Cash Flows				60
Notes to Consolidated Financial Statements
	1		Basis of Presentation and Summary of Significant Accounting Policies	62
	2		Businesses Held for Sale and Discontinued Operations	64
	3		Investment Securities	69
	4		Inventories	72
	5		GE Capital Financing Receivables and Allowance for Losses on Financing Receivables	72
	6		Property, Plant and Equipment	73
	7		Acquisitions, Goodwill and Other Intangible Assets	74
	8		Contract Assets	76
	9		Borrowings	77
	10		Postretirement Benefit Plans	79
	11		Income Taxes	80
	12		Shareowners' Equity	81
	13		Earnings Per Share Information	85
	14		Fair Value Measurements	86
	15		Financial Instruments	90
	16		Variable Interest Entities	96
	17		Intercompany Transactions	99
	18		Supplemental Information	100

FINANCIAL STATEMENTS

STATEMENT OF EARNINGS (LOSS)
(UNAUDITED)
	Three months ended March 31
	General Electric Company
	and consolidated affiliates
(In millions; per-share amounts in dollars)	2016			2015
Revenues and other income
Sales of goods	$	17,208		$	16,599
Sales of services		8,106			7,084
Other income		9			142
GE Capital earnings (loss) from continuing operations		-			-
GE Capital revenues from services		2,522			2,414
Total revenues and other income		27,845			26,239
Costs and expenses
Cost of goods sold		14,588			13,520
Cost of services sold		5,773			5,162
Selling, general and administrative expenses		4,608			4,415
Interest and other financial charges		1,736			618
Investment contracts, insurance losses and
insurance annuity benefits		642			613
Other costs and expenses		259			291
Total costs and expenses		27,606			24,619
Earnings (loss) from continuing operations before income taxes		238			1,621
Benefit (provision) for income taxes		139			(6,294)
Earnings (loss) from continuing operations		378			(4,673)
Earnings (loss) from discontinued operations, net of taxes (Note 2)		(308)			(8,936)
Net earnings (loss)		69			(13,608)
Less net earnings (loss) attributable to noncontrolling interests		(121)			(35)
Net earnings (loss) attributable to the Company		191			(13,573)
Preferred stock dividends		(289)			-
Net earnings (loss) attributable to GE common shareowners	$	(98)		$	(13,573)
Amounts attributable to GE common shareowners
Earnings (loss) from continuing operations	$	378		$	(4,673)
Less net earnings (loss) attributable to noncontrolling interests, continuing
operations		(121)			(124)
Earnings (loss) from continuing operations attributable to the Company		499			(4,548)
Preferred stock dividends		(289)			-
Earnings (loss) from continuing operations attributable
to GE common shareowners		210			(4,548)
Earnings (loss) from discontinued operations, net of taxes		(308)			(8,936)
Less net earnings (loss) attributable to
noncontrolling interests, discontinued operations		-			89
Net earnings (loss) attributable to GE common shareowners	$	(98)		$	(13,573)
Per-share amounts (Note 13)
Earnings (loss) from continuing operations
Diluted earnings (loss) per share	$	0.02		$	(0.45)
Basic earnings (loss) per share	$	0.02		$	(0.45)
Net earnings (loss)
Diluted earnings (loss) per share	$	(0.01)		$	(1.35)
Basic earnings (loss) per share	$	(0.01)		$	(1.35)
Dividends declared per common share	$	0.23		$	0.23

STATEMENT OF EARNINGS (LOSS) (CONTINUED)
(UNAUDITED)
	Three months ended March 31
	GE(a)						Financial Services (GE Capital)
(In millions; per-share amounts in dollars)	2016			2015			2016			2015
Revenues and other income
Sales of goods	$	17,213		$	16,648		$	25		$	21
Sales of services		8,194			7,192			-			-
Other income		92			52			-			-
GE Capital earnings (loss) from continuing operations		(893)			(5,721)			-			-
GE Capital revenues from services		-			-			2,860			2,845
Total revenues and other income		24,606			18,171			2,885			2,866
Costs and expenses
Cost of goods sold(b)		14,597			13,571			20			18
Cost of services sold(b)		5,293			4,754			568			516
Selling, general and administrative expenses		3,982			3,825			874			792
Interest and other financial charges		440			389			1,430			339
Investment contracts, insurance losses and
insurance annuity benefits		-			-			671			642
Other costs and expenses		-			-			268			290
Total costs and expenses		24,313			22,540			3,833			2,597
Earnings (loss) from continuing operations before income taxes		294			(4,369)			(948)			269
Benefit (provision) for income taxes		(201)			(306)			341			(5,988)
Earnings (loss) from continuing operations		92			(4,675)			(608)			(5,719)
Earnings (loss) from discontinued operations, net of taxes (Note 2)		(308)			(9,025)			(308)			(8,935)
Net earnings (loss)		(216)			(13,700)			(916)			(14,654)
Less net earnings (loss) attributable to noncontrolling interests		(117)			(127)			(4)			91
Net earnings (loss) attributable to the Company		(98)			(13,573)			(912)			(14,745)
Preferred stock dividends		-			-			(289)			-
Net earnings (loss) attributable to GE common shareowners	$	(98)		$	(13,573)		$	(1,201)		$	(14,745)
Amounts attributable to GE common shareowners:
Earnings (loss) from continuing operations	$	92		$	(4,675)		$	(608)		$	(5,719)
Less net earnings (loss) attributable to noncontrolling interests, continuing
operations		(117)			(127)			(4)			2
Earnings (loss) from continuing operations attributable to the Company		210			(4,548)			(604)			(5,721)
Preferred stock dividends		-			-			(289)			-
Earnings (loss) from continuing operations attributable
to GE common shareowners		210			(4,548)			(893)			(5,721)
Earnings (loss) from discontinued operations, net of taxes		(308)			(9,025)			(308)			(8,935)
Less net earnings (loss) attributable to
noncontrolling interests, discontinued operations		-			-			-			89
Net earnings (loss) attributable to GE common shareowners	$	(98)		$	(13,573)		$	(1,201)		$	(14,745)