GE Aerospace reported second-quarter results on Thursday, raising its full-year guidance after revenue and profit both rose more than 20% from a year earlier.
Adjusted earnings per share of $2.02 reflected a 22% gain from the same period last year. Analysts had expected $2.02 adjusted EPS from revenue of $11.87 billion, according to The Wall Street Journal. Total adjusted revenue reached $12.6 billion, up 24%. Under GAAP accounting, continuing operations generated $2.41 billion in profit, or $2.30 per share, versus $2.01 billion, or $1.87 per share, in the year-ago quarter.
Total orders rose 17% to $16.5 billion. The commercial engines and services segment contributed a 27% sales gain, and the defense and propulsion technologies unit recorded 16% higher sales. Free cash flow reached $3.0 billion, up 43%.
Looking ahead to the full year, the company revised its adjusted EPS target to a $7.65–$7.85 band, compared with the $7.10–$7.40 range it had previously set. GE Aerospace also lifted its adjusted revenue growth target, now pointing to a high-teens rate rather than the low-double-digit pace it had been forecasting. The commercial engines and services segment now targets operating profit of $10.25 billion to $10.35 billion, up from a prior range of $9.6 billion to $9.9 billion.
"GE Aerospace delivered a strong second quarter with revenue and EPS both up more than 20% driven by robust commercial services growth," Chairman and Chief Executive Officer H. Lawrence Culp, Jr. said in a statement. He added that the company is "raising our full-year guidance across the board" given its performance in the first half and visibility for the remainder of the year.
GE Aerospace stock was down 2.1% shortly after results were released, according to Barron's.
When GE Aerospace posted a first-quarter earnings beat earlier this year, it kept its full-year guidance unchanged while signaling results were trending toward the top of the range. At the time, the company cited rising oil prices, tightening jet fuel supplies, and a softening global economy as risks that warranted caution. Jet fuel prices in the U.S. had risen sharply following disruptions to flows through the Strait of Hormuz, putting pressure on airline customers whose spending on engine maintenance and spare parts drives the bulk of GE Aerospace's earnings.
The company said it finished the quarter with record internal shop visit output and total engine deliveries up 31% in the first half of the year, including LEAP engine deliveries up 41%.
