Real gross domestic product (GDP), the total output of goods and services in the U.S., increased at an annual rate of 1.8 percent in the first quarter of 2013, the Bureau of Economic Analysis announced Wednesday.

This is the last and final revision for Q1 GDP and a huge and disappointing decrease from earlier estimates of an annual growth rate of 2.4 percent.

With the third estimate for the first quarter, the increase in personal consumption expenditures (PCE) was less than previously estimated, and exports and imports are now estimated to have declined,” the report states.

“The increase in real GDP in the first quarter primarily reflected positive contributions from PCE, private inventory investment, and residential fixed investment that were partly offset by negative contributions from federal government spending, state and local government spending, and exports,” it adds.

Imports, a subtraction in the calculation of GDP, decreased.

Growth in Q1 GDP was driven by accelerations in private inventory investment, PCE, decreases in fed spending, and smaller decreases in exports that were “partly offset by an upturn in imports” and a “deceleration in nonresidential fixed investment.”

Real personal consumption expenditures increased 2.6 percent in the first quarter, compared with an increase of 1.8 percent in the fourth, the report notes.

Durable goods went up by 7.6 percent (earlier estimates put it at 8.2 percent), compared with Q4’s increase of 13.6 percent. Nondurable goods went up by 2.8 percent, compared with Q4’s increase of 0.1 percent. Services increased 1.7 percent (not the earlier 3.1 percent), compared with an increase of 0.6 percent.

Here’s GDP broken down by its components [courtesy Zero Hedge]:

Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent

Meanwhile, profits “from current production (corporate profits with inventory valuation and capital consumption adjustments) decreased $28.0 billion in the first quarter, in contrast to an increase of $45.4 billion in the fourth,” the report notes.

“Current-production cash flow (net cash flow with inventory valuation adjustment) — the internal funds available to corporations for investment — increased $125.6 billion in the first quarter, in contrast to a decrease of $89.8 billion in the fourth,” it adds.

BOTTOM LINE: Q1 GDP grew much, much slower than originally estimated and the disappointing revision is due mostly to a decrease in consumer spending.

Markets, for their part, are coping with the less-than-sterling GDP report:

Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent
Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent
Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent Q1 GDP Revised Downward From 2.4 Percent to 1.8 Percent

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