GE Aerospace second quarter 2024 performance Financial results & company highlights July 23, 2024 Caution concerning forward-looking statements: This document contains "forward-looking statements" – that is, statements related to future events that by their nature address matters that are, to different degrees, uncertain. For details on the uncertainties that may cause our actual future results to be materially different than those expressed in our forward-looking statements, see www.geaerospace.com/investo ...

Revenue and Profit Performance - Total revenues for Q2 2024 were $9.1 billion, up $0.3 billion (4%) from the previous year, driven by an increase in Commercial Engines & Services[12] - Adjusted earnings per share for Q2 2024 was $1.20, with a profit margin of 15.9% and operating profit margin of 23.1%[13] - Total revenues for the six months ended June 30, 2024, increased by $1.5 billion (9%) to $18.0 billion, with equipment revenues up due to higher prices and favorable mix, and services revenues up due to increased shop visit volume and spare parts[19] - Continuing earnings for the three months ended June 30, 2024 increased by $0.1 billion to $1.3 billion, driven by a $0.4 billion increase in segment profit and a $0.1 billion decrease in provision for income taxes[20] - Adjusted earnings for the three months ended June 30, 2024 were $1.3 billion, an increase of $0.5 billion, primarily due to a $0.4 billion increase in segment profit and lower Adjusted Corporate & Other operating costs[20] - For the six months ended June 30, 2024, continuing earnings decreased by $4.7 billion, primarily due to a $6.0 billion decrease in gains on retained and sold ownership interests, partially offset by a $0.7 billion increase in segment profit[21] - Total revenues (GAAP) for Q2 2024 were $9.094 billion, a 4% increase compared to $8.755 billion in Q2 2023[76] - Adjusted revenues (Non-GAAP) for Q2 2024 were $8.223 billion, up 4% from $7.907 billion in Q2 2023[76] - Operating profit (Non-GAAP) for Q2 2024 was $1.897 billion, a 37% increase from $1.385 billion in Q2 2023[76] - Operating profit margin (Non-GAAP) improved to 23.1% in Q2 2024, up 560 basis points from 17.5% in Q2 2023[76] - Earnings (loss) from continuing operations (GAAP) for Q2 2024 were $1.320 billion, or $1.20 per share, compared to $1.195 billion, or $1.09 per share, in Q2 2023[78] - Adjusted earnings (Non-GAAP) for Q2 2024 were $1.321 billion, or $1.20 per share, compared to $812 million, or $0.74 per share, in Q2 2023[78] - Total revenues for the three months ended June 30, 2024, were $9,094 million, compared to $8,755 million in the same period in 2023[84] - Net earnings attributable to common shareholders for the three months ended June 30, 2024, were $1,266 million, compared to a loss of $25 million in the same period in 2023[84] - Diluted earnings per share from continuing operations for the three months ended June 30, 2024, were $1.20, compared to $1.09 in the same period in 2023[84] - Net earnings for the six months ended June 30, 2024, were $2.833 billion, compared to $7.518 billion in the same period in 2023[86] - Earnings per share from continuing operations for Q2 2024 increased to $1.20 (diluted) and $1.21 (basic), compared to $1.09 (diluted) and $1.10 (basic) in Q2 2023[148] - Net earnings attributable to common shareholders for Q2 2024 were $1.266 billion, a significant improvement from a net loss of $25 million in Q2 2023[148] - Earnings from continuing operations attributable to common shareholders for Q2 2024 were $1.320 billion, up from $1.195 billion in Q2 2023[177] Cash Flow and Financial Position - Cash flows from operating activities (CFOA) for the six months ended June 30, 2024, were $2.6 billion, up from $1.6 billion in the same period in 2023[14] - Free cash flows (FCF) for the six months ended June 30, 2024, were $2.8 billion, compared to $1.8 billion in the same period in 2023[14] - Total cash, cash equivalents, and restricted cash was $12.1 billion at June 30, 2024, with $5.0 billion held in the U.S. and $7.1 billion held outside the U.S.[54] - The company repurchased 11.7 million shares for $1.9 billion during the three months ended June 30, 2024, under a $15.0 billion share repurchase authorization[59] - Consolidated total borrowings decreased by $0.9 billion to $19.7 billion at June 30, 2024, mainly due to maturities[59] - The company received $2.6 billion from the disposition of 31.1 million shares of GE HealthCare in the first quarter of 2024, with a remaining interest of 30.5 million shares as of June 30, 2024[58] - Free cash flows (Non-GAAP) for the first six months of 2024 were $2.767 billion, compared to $1.770 billion in the same period of 2023[80] - Cash flows from operating activities (GAAP) for the first six months of 2024 were $2.586 billion, up from $1.564 billion in the same period of 2023[80] - Total assets as of June 30, 2024, were $123,190 million, compared to $173,300 million as of December 31, 2023[85] - Cash, cash equivalents, and restricted cash as of June 30, 2024, were $12,107 million, compared to $15,204 million as of December 31, 2023[85] - Total liabilities as of June 30, 2024, were $104,347 million, compared to $144,695 million as of December 31, 2023[85] - Total shareholders' equity as of June 30, 2024, was $18,598 million, compared to $27,403 million as of December 31, 2023[85] - The company's retained earnings as of June 30, 2024, were $77,349 million, compared to $86,553 million as of December 31, 2023[85] - The company's total equity as of June 30, 2024, was $18,843 million, compared to $28,605 million as of December 31, 2023[85] - Cash from operating activities for the six months ended June 30, 2024, was $1.905 billion, a significant increase from $226 million in 2023[86] - Cash used for investing activities for the six months ended June 30, 2024, was $3.478 billion, compared to $171 million in 2023[86] - Cash used for financing activities for the six months ended June 30, 2024, was $3.092 billion, compared to $4.394 billion in 2023[86] - Comprehensive income for the six months ended June 30, 2024, was $4.931 billion, compared to $6.212 billion in 2023[87] - The company's cash, cash equivalents, and restricted cash at June 30, 2024, were $14.947 billion, compared to $14.832 billion in 2023[86] - The company's total equity balance at June 30, 2024, was $18.843 billion, compared to $32.393 billion in 2023[87] - GE Vernova's cash balance on the date of separation was $4,242 million, with GE Aerospace contributing $515 million to fund future operations[94] - GE Aerospace collected net cash of $477 million related to transition services and sales of engines and parts to GE Vernova for the three months ended June 30, 2024[95] - GE Aerospace collected net cash of $157 million related to transition services and other activities with GE HealthCare for the six months ended June 30, 2024[97] - The company repurchased 13.9 million shares for $2,289 million during the three months ended June 30, 2024, and 15.0 million shares for $2,434 million during the six months ended June 30, 2024[147] Segment Performance - Equipment revenues for Q2 2024 decreased to $2.2 billion from $2.5 billion in Q2 2023, primarily due to lower deliveries of new engines[18] - Services revenues for Q2 2024 increased to $6.0 billion from $5.4 billion in Q2 2023, driven by higher internal shop visit volume and prices[18] - Segment revenues for the three months ended June 30, 2024 increased by $0.4 billion (7%) to $6.1 billion, with segment profit up $0.3 billion (21%) to $1.7 billion[29] - Defense & Systems segment revenues for the three months ended June 30, 2024 were $1.5 billion, with segment profit increasing to $344 million and a segment profit margin of 14.3%[38] - Segment revenues increased by 1% and segment profit increased by $0.1 billion (71%) for the three months ended June 30, 2024, driven by growth in Propulsion & Additive Technologies[39] - For the six months ended June 30, 2024, segment revenues increased by $0.4 billion (9%) and segment profit increased by $0.2 billion (49%), with growth in both Defense & Systems and Propulsion & Additive Technologies[41] - Commercial Engines & Services (CES) has a commercial engine fleet in service of approximately 44,000 units, with 13,000 units under long-term service agreements[27] - Total segment revenues for the six months ended June 30, 2024, were $16.941 billion, up from $15.310 billion in 2023[177] - Commercial Engines & Services segment revenue for Q2 2024 was $6.132 billion, a 6.9% increase from $5.737 billion in Q2 2023[177] - Defense & Propulsion Technologies segment revenue for Q2 2024 was $2.401 billion, slightly up from $2.375 billion in Q2 2023[177] - Corporate & Other segment reported a loss of $534 million in Q2 2024, compared to a loss of $84 million in Q2 2023[177] Remaining Performance Obligations (RPO) - Remaining performance obligation (RPO) as of June 30, 2024, increased by $5.8 billion (4%) to $159.8 billion, driven by Commercial Engines & Services and Defense & Propulsion Technologies[16] - The remaining performance obligation as of June 30, 2024, was $159.765 billion, with $19.191 billion related to equipment and $140.574 billion related to services[177] - Equipment-related remaining performance obligation is expected to be 37% satisfied within 1 year, 54% within 2 years, and 74% within 5 years[177] - Services-related remaining performance obligation is expected to be 11% recognized within 1 year, 42% within 5 years, 69% within 10 years, and 85% within 15 years[177] - GE Vernova's remaining performance obligations (RPO) related to GE Aerospace credit support were reduced by over 50% to approximately $29.0 billion as of Q2 2024[74] - Approximately $16 billion of GE Vernova's RPO related to GE Aerospace credit support is expected to mature within five years post-spin-off[74] Corporate and Other Costs - Corporate & Other operating costs increased by $0.5 billion for the three months ended June 30, 2024, primarily due to $0.8 billion of lower gains on retained and sold ownership interests and other equity securities[44] - For the six months ended June 30, 2024, Corporate & Other operating profit decreased by $5.6 billion, mainly due to $6.0 billion of lower gains on retained and sold ownership interests and other equity securities[45] - Adjusted Corporate & Other operating costs decreased by $0.1 billion for both the three and six months ended June 30, 2024, primarily due to a reduction in core functional costs[44][45] - Pre-tax separation costs for Q2 2024 were $75 million, down from $163 million in Q2 2023, as the company completed its spin-off of GE Vernova[154] - The company recognized $216 million of net tax benefit for Q2 2024 related to separation activities, including deferred tax benefits from state tax attributes[154] Tax and Accounting - The effective income tax rate was 8.6% for the three months ended June 30, 2024, compared to 16.8% for the same period in 2023[48] - Adjusted effective income tax rate (Non-GAAP) for Q2 2024 was 20.3%, compared to 24.1% in Q2 2023[78] - The effective income tax rate for the six months ended June 30, 2024, was 10.7%, reduced from the U.S. statutory rate of 21% due to separation income tax benefits and U.S. business tax credit benefits[142] - Net deferred income tax assets were $7,338 million as of June 30, 2024, compared to $7,502 million at the end of 2023[145] - The company is evaluating the impact of new FASB accounting standards on segment reporting and income tax disclosures, effective from fiscal years beginning after December 15, 2024[70][71] Share Repurchases and Investments - The company repurchased 11.7 million shares for $1.9 billion during the three months ended June 30, 2024, under a $15.0 billion share repurchase authorization[59] - The company repurchased 11,700 thousand shares for $1,946 million under the $15 billion share repurchase authorization during the three months ended June 30, 2024[81] - The company repurchased 13.9 million shares for $2,289 million during the three months ended June 30, 2024, and 15.0 million shares for $2,434 million during the six months ended June 30, 2024[147] - The company's investment in GE HealthCare comprises 30.5 million shares (6.7% ownership) as of June 30, 2024, with $2.602 billion received from share dispositions in H1 2024[149] - GE Aerospace held 30.5 million shares (approximately 6.7% ownership interest) in GE HealthCare as of June 30, 2024[104] - The estimated fair value of investment securities decreased to $38,129 million at June 30, 2024 from $38,000 million at December 31, 2023, primarily due to share sales of GE HealthCare equity interest and higher market yields[106] - Total estimated fair value of debt securities in an unrealized loss position were $21,476 million at June 30, 2024, with $16,283 million having gross unrealized losses of $(2,813) million and being in a loss position for 12 months or more[107] - Gross unrealized losses of $(2,946) million at June 30, 2024 included $(2,122) million related to U.S. corporate securities, $(138) million related to commercial mortgage-backed securities, and $(71) million related to Asset-backed securities[107] - The majority of equity securities are classified within Level 1 and debt securities within Level 2, with $7,088 million of investments classified within Level 3 at June 30, 2024[110] - The company holds $1,141 million of equity securities without readily determinable fair value at June 30, 2024, primarily limited partnership investments in private equity, infrastructure, and real estate funds[111] - Investments in unconsolidated VIEs increased to $7,260 million at June 30, 2024 from $6,577 million at December 31, 2023[165] - Total investment commitments were $3,930 million at June 30, 2024, including $3,671 million for unconsolidated VIEs[166] Insurance and Long-Term Care - Insurance cash and cash equivalents rose to $1,442 million at June 30, 2024, compared to $784 million at December 31, 2023[123] - Future policy benefit reserves decreased to $35,376 million at June 30, 2024, down from $37,689 million at December 31, 2023[127] - Present value of expected net premiums for long-term care decreased to $3,803 million at June 30, 2024, from $4,134 million at June 30, 2023[130] - Gross premiums for long-term care were $242 million for the six months ended June 30, 2024, compared to $246 million for the same period in 2023[130] - Benefit payments for long-term care were $29,105 million at June 30, 2024, compared to $30,022 million at June 30, 2023[131] - Benefit payments for structured settlement annuities were $8,700 million at June 30, 2024, compared to $9,224 million at June 30, 2023[131] - Policyholders account balances totaled $1,654 million as of June 30, 2024, a decrease from $1,884 million in 2023, primarily due to surrenders, withdrawals, and benefit payments of $215 million, partially offset by net additions from separate accounts and interest credited of $142 million[133] - The company provided a total of $15,035 million in capital contributions to its run-off insurance subsidiaries since 2018, including a final contribution of $1,820 million in Q1 2024[134] - The company signed an agreement in June 2024 to exit a block of its life and health insurance business via an assumption reinsurance transaction, pending regulatory approvals

GE AEROSPACE ANNOUNCES SECOND QUARTER 2024 RESULTS Delivers strong second quarter with significant profit growth, raises full-year profit and cash guidance Second quarter 2024: • Total orders of $11.2B, +18% • Total revenue (GAAP) of $9.1B, +4%; adjusted revenue* $8.2B, +4% • Profit (GAAP) of $1.4B, (4)%; operating profit* $1.9B, +37% • Profit margin (GAAP) of 15.9%, (130) bps; operating profit margin* 23.1%, +560 bps • Continuing EPS (GAAP) of $1.20, +$0.11; adjusted EPS* $1.20, +$0.46 • Cash from Operatin ...

FARNBOROUGH, England, July 22, 2024 /PRNewswire/ -- GE Aerospace (NYSE: GE) announced today that International Airlines Group (IAG) has committed to purchasing GEnx engines to power six new 787 Dreamliners for British Airways – the first introduction of this engine into their fleet."British Airways was the launch customer for the highly successful GE90 engine. Bringing the GEnx into their 787 fleet represents another important milestone in our relationship," said Russell Stokes, President and CEO, Commercia ...

FARNBOROUGH, England, July 22, 2024 /PRNewswire/ -- Following Japan Airlines' agreement with Boeing for up to 20 787-9 Dreamliner aircraft, GE Aerospace (NYSE: GE) today announced an order from the airline for GEnx-1B engines to power the new aircraft.   "GE Aerospace and Japan Airlines have a long and enduring relationship that stretches back decades, including being the launch customer for the GEnx engine," said Russell Stokes, President and CEO, Commercial Engines and Services, GE Aerospace. "We're honor ...

Agreement covers development and production of small affordable engines for possible use in unmanned aerial systems, collaborative combat aircraft, and similar applicationsFARNBOROUGH, England, July 22, 2024 /PRNewswire/ -- GE Aerospace (NYSE:GE) and Kratos Turbine Technologies, a division of Kratos Defense & Security Solutions, Inc., signed a Memorandum of Understanding to partner on the development and production of small affordable engines that could potentially power unmanned aerial systems (UAS), colla ...

Collaboration and Innovation - GE Aerospace and Oak Ridge National Laboratory collaborate to develop advanced computational modeling and simulation capabilities, leveraging Oak Ridge's expertise in supercomputing and AI tools [1] - The collaboration aims to accelerate engine design and testing, particularly for the Open Fan architecture, which is seen as a key technology for achieving net zero ambitions in the aviation industry [2] - Oak Ridge National Laboratory houses Frontier, the world's fastest supercomputer, capable of exascale data processing, which is instrumental in this collaboration [2] Technological Advancements - GE Aerospace has developed computational fluid dynamics software to model the aerodynamic and acoustic performance of full-scale Open Fan engine designs using Frontier [3] - Additional simulations on Frontier have been conducted to analyze different engine operating conditions, improving understanding of aerodynamic characteristics and acoustic signatures [3] - The RISE program, a joint initiative between GE Aerospace and Safran Aircraft Engines, focuses on developing technologies like Open Fan, compact core, and hybrid electric systems compatible with 100% Sustainable Aviation Fuel (SAF) [3] Future Prospects - The Open Fan engine architecture, part of the RISE program, aims to achieve greater propulsive efficiency by removing the nacelle while maintaining current speed and cabin experience standards [4] - GE Aerospace plans to hire over 900 engineers in 2024 to support innovation in current aircraft engine programs and develop new technologies for the future of flight [4] - The use of supercomputing power and software tools is enabling GE Aerospace to better evaluate new engine technologies at flight scale during the design phase, optimizing engine performance and airframe integration [4]

GE Aerospace (GE) is scheduled to report second-quarter 2024 results on Jul 23, before market open.The Zacks Consensus Estimate for its second-quarter earnings has increased 2.1% in the past 60 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 32.8%.Let’s see how things might have shaped up for GE Aerospace this earnings season.Factors to NoteGE Aerospace is expected to have benefited f ...

The aerospace company has a bright future due to its dominant position in airplane engines.The stock started 2024 as General Electric but is now GE Aerospace (GE 1.17%). The change of name reflects the spin-off of GE Vernova in early April. No matter which way you look at it, GE stock was up 24.6% in the first half, according to data provided by S&P Global Market Intelligence.Why GE stock outperformedThe exceptional performance is due to two factors. First, the successful spin-off of GE Vernova helped dispe ...

dmf87/iStock via Getty Images Introduction I would be lying if I said I didn't like catchy titles. However, as much as I like catchy titles, I believe backing them up with good information and solid, no-nonsense investment picks is even more important. After all, investing is a very serious business with very little room for error. When I say there's little room for error, I mean it's very important to use the power of compounding interest to our advantage, something Warren Buffett called the "eighth wo ...