Boeing 3Q profit rises 31 percent, tops expectations
FILE - In this Feb. 5, 2018, file photo, Boeing worker Paul Covaci reaches out to touch a Boeing 737 MAX 7, the newest version of Boeing's fastest-selling airplane, during a debut for employees and media of the new jet in Renton, Wash. Boeing Co. reports earnings Wednesday, Oct. 24. (AP Photo/Elaine Thompson, File)
Boeing's third-quarter profit soared 31 percent to $2.36 billion as airlines continued placing orders for new planes to meet growing demand for travel.
The results beat expectations, and Boeing Co. raised its forecast for full-year earnings per share.
Boeing says passenger traffic climbed 6.8 percent in the first eight months of this year as a growing global middle class opens up to travel.
Even a few hiccups, such as this month's shutdown of European low-cost carrier Primera Air, which couldn't find financing, do not lessen Boeing's bullishness. CEO Dennis Muilenburg says most of his airline customers are doing fine.
"The airline industry is very healthy overall across all of the different types of business models, including low-cost carriers," Muilenburg said Wednesday on a call with analysts and reporters. Boeing predicts the world will demand 43,000 new passenger planes over the next 20 years.
Boeing delivered 190 airliners in the quarter. That is down 12 from the same period last year, but Boeing remains ahead of its 2017 pace. It took 171 net orders, contributing to a backlog that Boeing values at $491 billion and which includes more than 5,800 commercial planes.
Executives said they are getting a grip on supplier problems that have caused production delays for the 737, its most popular plane. Fuselages are again being delivered by Spirit AeroSystems, and the company expects a normal schedule of deliveries from engine maker CFM International by the end of the year, they said.
Boeing also runs a large defense business, which recently won Pentagon contracts for a new military training jet and an unmanned plane designed to refuel Navy fighter jets.
The company took a $691 million charge for early investments in those programs, but Muilenburg said there is a potential $60 billion market — in planes and follow-on services — for the T-X trainer jet and the MQ-25 drone. They are "franchises that are measured in decades," he said.
Excluding what Boeing considers non-repeating gains and expenses, the Chicago-based company said it earned $3.58 per share. That beat the $3.45-per-share average forecast of eight analysts surveyed by Zacks Investment Research.
Revenue rose 4 percent to $25.15. Five analysts in the Zacks survey had expected $23.72 billion.
Boeing said it now expects to pose full-year adjusted earnings of $14.90 to $15.10 per share — an increase from a prior forecast of $14.30 to $14.50 per share — with revenue between $98 billion and $100 billion.
The company raised its forecast of full-year revenue by $1 billion, to between $98 billion and $100 billion.
In afternoon trading, the shares were up $10.37, or 3 percent, to $360.42. Boeing shares, a component in the Dow Jones Industrial Average, began the day up 19 percent this year, compared with a 2.5 percent gain for the Standard & Poor's 500 index.
___
David Koenig can be reached at http://twitter.com/airlinewriter