GE Aerospace (GE) has reported mixed second-quarter financial results along with improved profit margins and higher full-year guidance.
Specifically, GE Aerospace, which primarily makes aircraft engines, reported earnings per share (EPS) of $1.20 U.S. compared to $0.99 U.S. forecast on Wall Street.
Revenue in the quarter came in at $8.2 billion U.S., which was a little below the $8.4 billion U.S. consensus expectation of analysts.
Despite the mixed results, GE Aerospace announced that its operating profit margins rose to 23.1% in Q2, up six percentage points year over year.
Wall Street was looking for a profit margin of 20% for the year’s second quarter.
GE Aerospace makes more money by servicing and repairing existing engines than it does selling original equipment to airline manufacturers.
The company’s executives said that their profit margins are improving as services grow due to increased repair work with airline’s forced to keep existing planes in operation longer.
However, growth in the higher margin services work was partially offset by an 11% year-over-year decrease in new equipment sales in the company’s commercial aerospace division.
Supply chain issues continue to impact the entire aerospace value chain, especially as delays persist at aircraft manufacturer Boeing Co. (BA).
In terms of guidance, GE Aerospace said it now expects 2024 earnings per share of $3.95 U.S. to $4.20 U.S. That’s up from previous guidance of $3.80 U.S. to $4.05 U.S.
The midpoint of the new guidance is higher than the $4.08 U.S. a share forecast on Wall Street.
GE Aerospace’s stock has risen 85% over the last 12 months to trade at $162.76 U.S. per share.
