GE Aerospace stock fell 4.2% to $345.10 in pre-market trading on Thursday despite reporting second-quarter revenue of $13.35 billion and adjusted earnings of $2.02 per share, both exceeding analyst estimates. The decline followed a 1.87% gain to $360.35 in the previous session, suggesting investors were taking profits after the stock's recent rally. The company posted 31.5% year-over-year revenue growth, raised its full-year adjusted earnings guidance to approximately $7.75 per share at the midpoint, and improved its free cash flow margin to 22.7% from 20.7% in the same quarter last year.
GE Aerospace Reports Q2 Revenue of $13.35 Billion, Beats Estimates by 12%
GE Aerospace reported second-quarter revenue of $13.35 billion, up 31.5% from a year earlier and ahead of Wall Street expectations of $11.91 billion. The company posted adjusted earnings of $2.02 per share, beating analysts' estimates of $1.86 by approximately 8.6%. Revenue grew at a compound annual rate of 18.5% over the past five years, and accelerated to more than 20% annually over the last two years.
Company Raises Full-Year Adjusted EPS Guidance to $7.75 Midpoint
Management raised its full-year adjusted earnings guidance following the strong quarter. GE Aerospace now expects adjusted earnings per share of approximately $7.75 at the midpoint of its forecast, a 6.9% increase from its previous outlook. The company generated strong cash flow, with its free cash flow margin improving to 22.7%, up from 20.7% during the same quarter last year.
GE Aerospace Improves Operating Margin to 18.4% Average Over Five Years
GE Aerospace delivered an average operating margin of 18.4% over the past five years, with operating margins expanding by roughly 1.8 percentage points during that period as higher sales translated into improved operating leverage. Earnings per share increased at a compound annual growth rate of 32.2% over the last five years, indicating the company consistently improved profitability while expanding its business.
Analysts Expect Revenue Growth to Moderate to 6% Over Next 12 Months
Analysts expect revenue growth to moderate to around 6% over the next 12 months as comparisons become more difficult. GE Aerospace is outperforming expectations across several key financial metrics. The pre-market decline could suggest that investors are locking in gains after GE stock's strong run over the past few months.
FAQ
What were GE Aerospace's Q2 earnings results?
GE Aerospace reported second-quarter revenue of $13.35 billion, up 31.5% year-over-year, and adjusted earnings of $2.02 per share, beating analyst estimates of $1.86 by approximately 8.6%.
Why did GE Aerospace stock fall despite strong earnings?
GE Aerospace stock fell 4.2% to $345.10 in pre-market trading on Thursday, which could suggest investors were taking profits after the stock closed 1.87% higher at $360.35 in the previous session.
What is GE Aerospace's updated full-year earnings guidance?
GE Aerospace raised its full-year adjusted earnings per share guidance to approximately $7.75 at the midpoint, a 6.9% increase from its previous outlook.
