Boeing ups revenue forecast for year
Jul 25, 2012, 4:26 AM | Updated: 6:12 am
A Boeing 787 Dreamliner flies during a display on the third day of the Farnborough International Airshow. (AP Photo/Lefteris Pitarakis)
(AP Photo/Lefteris Pitarakis)
Boeing Co. posted an unexpected 3 percent improvement in second-quarter net income on strong sales of commercial airplanes. The results surprised Wall Street and the company raised its earnings forecast for the year.
The company released its second quarter earnings on Wednesday.
The company now expects revenues for the year to be between $79.5 and $81.5 billion. That’s a billion and a half more than it predicted in April.
The results announced before the markets opened Wednesday eased investors’ fears of an imminent slowdown in the company’s defense unit, which produces Chinook helicopters and F-18s among many other aircraft models. They also highlighted strong growth in the company’s commercial airplane unit which has been rapidly increasing the pace of production for some planes to meet demand.
Defense revenue rose 7 percent, while revenue in the commercial airplane division jumped 34 percent. The divisions are roughly the same size, but some observers fear they will go in opposite directions.
Boeing’s defense unit is vulnerable to potentially severe military spending cuts in January.
But it’s clear the unit is still holding strong. The second-quarter revenue growth is about the same as Boeing saw in the first three months of the year.
Boeing’s commercial airplane unit, meanwhile, is rapidly speeding production and deliveries of its new 787. That will move planes that have been mostly finished, but undelivered, out of inventory and turn them into cash. Boeing is also booking firm orders for its new 737 Max, a redesigned version of its classic 737.
Boeing delivered 32 more planes in the second quarter of this year than in 2011. Boeing delivered 150 planes in the second quarter. It has made 287 deliveries for the year.
For all of 2012, Boeing Co. now expects to earn $4.40 to $4.60 per share, up from between $4.15 and $4.35. Still, that new forecast is mostly under what Wall Street is banking on. Analysts predict $4.57 per share, on average.
The Associated Press contributed to this report.
