General Electric Company (NYSE:GE) announced the expansion of its digital presence in Europe and the launch of new products, partnerships and initiatives designed to foster growth of the digital industrial ecosystem across Europe. The company announced the opening of a new digital office in Paris, a Digital Foundry, which will serve as the hub of this ecosystem.
“Europe has the talent and infrastructure to lead a productivity revolution and the digitization of industry must be at the core of this mission,” said GE Chairman and CEO Jeff Immelt. “GE is committed to helping Europe develop the building blocks for their Industrial Internet that will help the continent’s companies turn information into insights and insights into outcomes.”
The new Digital Foundry will serve European customers and partners and will be located within the historic Le Centorial building in the 2nd arrondissement. It is the first of four foundries planned this year, establishing a global network of centers through which GE Digital will incubate local startups, collaborate with customers to develop new applications and extend the growing community of industrial developers in Europe. This first Digital Foundry will add 250 jobs in Paris, focused on engineering, data science, user experience and design thinking.
Expanding the Digital Industrial Ecosystem
Underpinning this expanding ecosystem is Predix, GE’s operating system for the Industrial Internet, and Predix.io, which allows third-party software engineers to leverage the platform’s capabilities to build, deploy and scale Industrial Internet applications within a safe, secure developer environment. Opened to customers in February, nearly 11,000 developers around the world are already building on the platform.
“The digitization of industry in Europe requires not only leadership and investment from companies such as GE and our partners – but also more collaboration between the private and public sector,” said GE Digital CEO Bill Ruh. “We are building an open platform, where GE’s 14,000 developers can collaborate with our customers and partners to create new applications.”
New Offerings Drive Digital Transformation
Recent studies estimate that the digitization of products and services will add more than €110 billion in annual revenue for industry in Europe over the next five years. To fuel that transformation GE has innovative products to address customer needs.
In April, GE Digital announced the release of its Asset Performance Management (APM) suite, the first set of commercially available applications to run on Predix. Today, it announced two major updates to the GE Digital software set, both of which improve its ability to service major European customers.
GE Power released new Digital Power Plant software designed to play a significant role in helping nations meet COP21 greenhouse gas emissions goals. The software will help European power customers such as Yildirim improve the efficiency and reduce emissions from coal-powered steam plants. Coal plants generate 40% of the world’s electricity. GE Power’s new software can reduce CO2 emissions from those plants by 3% and reduce fuel consumption by 67,000 tons of coal per year with the same MW of output.
Additionally, GE Digital’s Brilliant Manufacturing suite will run on Predix, planned for Q3 2016. Brilliant Manufacturing is able to gather, connect and analyze data from every aspect of production and leverage those insights to help manufacturers meet production targets, while controlling costs and risk. Brilliant Manufacturing is also the technology behind GE’s Brilliant Factories, which is currently in use improving GE’s own operations.
In the U.K., the GE Health Cloud, designed exclusively for the healthcare industry and powered by Predix, is now installed and available. The new cloud ecosystem and its applications connects software, hardware and analytics to speed, efficiency and collaboration across care pathways and multidisciplinary teams – both inside and outside the hospital setting.
Driving Outcomes with New Customers and Partners
Also today, GE Oil & Gas and Technip today signed a Memorandum of Understanding to explore new digital solutions, focused on the design and build of new Liquefied Natural Gas (LNG) projects. The two companies will work together to explore the application of Predix and digital solutions to the engineering, construction, commissioning, startup and operation phases for LNG facilities.
As part of the Foundry opening, GE also partnered with NUMA, the first startup accelerator in France, and government agencies including Banque Publique d’Investissement (BPI) to identify and grow high-potential ideas and startups in the region.
“Having GE’s European foundry’s headquarter in Paris is a great opportunity, and we will closely work with GE Digital to create and structure an innovation ecosystem around the Industrial Internet. We are confident that we can build a strong community of startups, data scientists, developers and software experts to find solutions to complex industrial challenges,” said Marie-Vorgan Le Barzic, CEO, NUMA.
Here are several additional European companies using GE’s software solutions to transform their businesses:
- A2A has installed GE’s operations optimization software at the Chivasso power plant in Northern Italy to breathe new life into the power plants previously believed to be unsustainable. This technology can deliver enterprise data visibility across A2A power plants, including non-GE equipment and fleet-wide footprints, providing a holistic understanding of the operational decisions that can expand capabilities, lower production costs and improve reliability.
- AkzoNobel uses GE’s Industrial Internet solutions to transform its operations. For example, the company has increased capacity by 20%, decreased lead times, and improved traceability at one of its factories in Sweden to better serve its customers.
- Capgemini, as a member of the GE Digital Alliance Program, has trained more than 700 developers on Predix. Capgemini provides a range of services on the Predix platform and is working with Current, powered by GE, to create solutions that help commercial and industrial customers reduce power consumption, generate power onsite, and drive new revenue streams through sensors and networked systems in buildings and cities. Capgemini is also an inaugural systems integrator for GE Health Cloud, leveraging its experience to deliver innovative solutions for healthcare providers and devices.
- Scottish Power Energy Networks selected GE as the supplier of the digital control system for the Future Intelligent NEtwork SubStation (FITNESS) project. FITNESS will pave the way for a smarter electricity grid as part of the U.K.’s energy security initiatives transition to a low carbon economy. GE will provide an intelligent digital substation solution with its DS Agile control system, integrated with its Grid Stability Package.
- Yara, the world’s largest producer of ammonia, nitrates and NPKs, will use GE Digital’s Smart Signal solution – part of GE’s APM suite – to drive operational excellence and improve asset productivity. Yara’s production segment works with GE to further eliminate downtime at its production plants, using the Yara Ferrara Plant site to test best practices in digital transformation.
“Since the creation of our GE Digital business and the launch of the Predix operating system, we have nearly 11,000 developers signed up, more than 100 apps and are seeing strong customer adoption,” said Immelt. “For GE internally, we know we will drive $500M in productivity. Now is the time for industrials to make the switch and to drive long-term value for their business.” (Original Source)
Shares of General Electric closed yesterday at $29.83, down $-0.21 or -0.70%. GE has a 1-year high of $32.05 and a 1-year low of $19.37. The stock’s 50-day moving average is $30.14 and its 200-day moving average is $29.88.
On the ratings front, General Electric has been the subject of a number of recent research reports. In a report issued on June 7, Cowen analyst Gautam Khanna initiated coverage with a Hold rating on GE and a price target of $29, which represents a slight downside potential from current levels. Separately, on June 6, Merrill Lynch’s Andrew Obin reiterated a Buy rating on the stock and has a price target of $33.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Gautam Khanna and Andrew Obin have a total average return of 11% and 8.6% respectively. Khanna has a success rate of 71.1% and is ranked #403 out of 3884 analysts, while Obin has a success rate of 64.9% and is ranked #612.
Overall, one research analyst has rated the stock with a Sell rating, 5 research analysts have assigned a Hold rating and 5 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $31.38 which is 5.2% above where the stock closed yesterday.