World Economy

Boeing Profit Beats Estimates

Boeing Profit Beats EstimatesBoeing Profit Beats Estimates

Boeing topped earnings estimates and doubled its closely watched quarterly cash flow, partly offsetting a big charge for its aerial tanker program, sending its shares higher.

The world's largest plane maker on Wednesday reported $2.6 billion in free cash flow in the second quarter, reversing an outflow in the first quarter that had worried investors, freeing up cash for Boeing to spend $2 billion buying back its own shares, Reuters reported.

Net profit fell 33% to $1.11 billion, or $1.59 per share, chiefly due to the tanker charge, but the cash influx suggested Boeing would hit its full-year operating cash flow target of more than $9 billion.

Boeing's shares jumped 1.5% to $147.31 in early trading on the New York Stock Exchange. Revenue rose 11% to $24.54 billion, reflecting an 18% gain at Boeing's commercial aircraft business, as it delivered a record 197 planes.

Defense revenue fell 3%, and profit margins dipped less than some analysts had feared, as Pentagon spending remains under pressure.

Deferred costs on Boeing's 787 program rose by another $790 million, to $27.7 billion, but analysts said that rise was widely expected.

The 787 program still loses money on each plane, which has focused investors' attention on cash flow. It is expected to begin generating cash next year.

The Chicago-based company also cut its full year earnings forecast on Wednesday by 50 cents a share, to $7.70 to $7.90 a share, less than the charge.