GE Aerospace Q2 Earnings: EPS Beat, Order Growth, Hikes Annual Profit And Cash Flow Outlook

GE Aerospace GE reported second-quarter 2024 adjusted revenue growth of 4% year-over-year to $8.22 billion, missing the consensus of $8.462 billion.

Total orders increased 18% year-over-year to $11.2 billion, with Commercial Engines & Services +38% and Defense & Propulsion Technologies -25%.

Sales by segments: Commercial Engines & Services $6.132 billion (+7% YoY) and Defense & Propulsion Technologies $2.401 billion (+1% YoY).

GE Aerospace’s adjusted profit margin expanded 560 bps to 23.1%, with an adjusted operating profit of $1.897 billion, up 37% YoY.

GE Aerospace reported double-digit growth in orders, operating profit, and free cash flow, leading to an increase in full-year profit and cash flow guidance.

“We are accelerating our actions and leveraging FLIGHT DECK to unlock supply constraints and fully meet customer demand. I am confident that advancing our strategic priorities for today, tomorrow and the future, will enable us to meet the needs of our customers and create exceptional value for shareholders,” commented GE Aerospace Chairman and CEO H. Lawrence Culp, Jr. 

Adjusted EPS was $1.20 (+61% YoY), beating the consensus of $0.99.

GE Aero’s cash from operating activities for the six months ended June 30, 2024, stood at $2.586 billion (+65% YoY), while free cash flow was $2.767 billion (+56% YoY).

The company repurchased ~13.9 million shares for $2.3 billion in the quarter, including 11.7 million shares for $1.9 billion under the $15 billion repurchase program announced in March 2024.

During the quarter, GE announced $1 billion in investments to expand MRO facilities globally.

At the Farnborough Airshow, the company secured major engine agreements with British Airways, Japan Airlines, Turkish Airlines, and National Airlines. It also advanced CFM RISE technologies, completed significant wind tunnel tests, and announced a new supercomputing agreement with the U.S. Department of Energy.

Also Read: GE Aerospace Invests In Supercomputing Talent: Plans To Hire 900 Engineers

2024 Guidance, revised: GE expects Adjusted revenue growth in high single digits (down from low double digits+ prior), Adjusted EPS of $3.95-$4.20 ($3.80-$4.05 prior) Vs. $4.08 consensus.

The company now expects an operating profit of $6.5 billion-$6.8 billion (prior $6.2 billion-$6.6 billion) and a Free Cash Flow of $5.3 billion-$5.6 billion.

Price Action: GE shares are trading higher by 1.77% at $165.64 premarket at the last check Tuesday.