By Ben Fox Rubin
Boeing Co.'s (BA) second-quarter income rose 2.8% as the aerospace giant saw a continued rebound in its commercial airplane business, while its defense operations flagged.
The company raised its per-share earnings estimate for the year, now seeing $4.40 to $4.60 a share, from its previous view of $4.15 and $4.35. Boeing also upped its revenue guidance by $1.5 billion, forecasting $79.5 billion to $81.5 billion.
The company's commercial business has been benefiting from a global expansion of passenger air travel and a flood of orders for its best-selling 737 jets. For the latest period, the commercial airplane business posted revenue of $11.84 billion, up 34%, as deliveries improved 27%.
Still, Boeing's ability to execute on its bulging commercial aircraft backlog has been a primary concern among investors, and the company still has significant milestones to meet in boosting 787 output and launching its new 737 Max.
Meanwhile, Boeing and others have faced challenges from soft U.S. defense spending. The company earlier this year unveiled plans to close defense operations in Wichita, Kan., as it grapples with lighter government spending. In the latest period, Boeing's defense, space and security segment, saw revenue rise 7% to $ 8.19 billion and operating earnings shrank 6%. Its network and space systems segment posted a 34% earnings drop.
Boeing reported a profit of $967 million, or $1.27 a share, up from $941 million, or $1.25 a share, a year earlier. Revenue rose 21% to $20.01 billion.
Analysts polled by Thomson Reuters most recently projected earnings of $1.12 a share on revenue of $19.37 billion.
Operating margin narrowed to 7.7% from 9.3%.
Shares closed Tuesday at $72.03 and were up 2.7% premarket. As of the close, the stock was down 1.8% so far this year.
Write to Ben Fox Rubin at email@example.com
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