GE Aerospace (GE) Q2 2024 earnings summary

Executive summary

• Achieved strong Q2 2024 results with double-digit growth in orders, operating profit, and free cash flow, despite supply chain constraints; raised full-year profit and cash guidance.

• Commercial Engines & Services profit rose over 20%, while Defense & Propulsion Technologies profit grew over 70% year-over-year.

• Aftermarket services, representing about 70% of revenues, remain resilient and recurring, supporting profit growth.

• Announced $1B investment over five years to expand MRO facilities and secured major engine orders at Farnborough Airshow.

• Completed the separation of GE Vernova in April 2024; results now reported as discontinued operations.

Financial highlights

• Q2 2024 total revenue was $9.1B, up 4% year-over-year; operating profit reached $1.9B, up 37%, with margin expanding 560 bps to 23.1%.

• Adjusted EPS was $1.20, up 62% year-over-year; free cash flow was $1.1B, up nearly 20% year-over-year.

• Q2 total orders reached $11.2B, up 18% year-over-year; services orders up 31%, equipment orders down 3%.

• Free cash flow for H1 2024 was $2.8B, up from $1.8B in 2023, mainly due to higher net income.

• Cash from operating activities increased 27% to $957M compared to Q2 2023.

Outlook and guidance

• Raised 2024 guidance: adjusted EPS $3.95–$4.20, operating profit $6.5B–$6.8B, free cash flow $5.3B–$5.6B.

• Commercial Engines & Services revenue expected to grow low double-digits to mid-teens; Defense & Propulsion Technologies revenue to grow mid- to high-single digits.

• Free cash flow conversion remains above 100%.

• Commercial air travel departures grew 9% in H1 2024; high-single-digit growth expected for full year.

• Company remains committed to investing in R&D and returning majority of free cash flow to shareholders.