Boeing shares take off after strong quarterly results

Boeing shares rose almost 3% in early trading in New York on Wednesday, after the airspace giant reported better-than-expected first quarter results ahead of the bell.

The group said sales in the three months to the end of June rose 11% year-on-year to $24.5bn, while profit tumbled 32.7% to $1.11bn or $1.59 per share.

Both figures came in ahead of analysts’ expectations, although core operating earnings, which exclude items such as pension components related to market fluctuations, declined 33% year-on-year to $1.62 a share.

Despite suffering sluggish growth in a number of regions due to the geopolitical tension, strong commercial-jet demand drove commercial airline revenue up 18% to $16.9bn in the period, while deliveries climbed 9% to 197 units.

However, operating margin declined from 10.8% to 7.1% due to the $513m pre-tax charge the company booked on the KC-46 tanker programme.

"Record commercial airplane deliveries to customers worldwide drove solid revenue growth," said group chief executive Dennis Muilenburg.

The group’s defence, space and security segment did not fare as well, as revenue fell 3% to $7.54bn in the first quarter, as the global services and support division posted an 8% decline in revenue, due largely to lower volumes.

Boeing, which bought back 14m shares in the period for a total of $2bn, has lowered its full-year guidance and now expects core earnings per share to be between $7.70 and $7.90 compared with a previous estimate of $8.20 to $8.40.

Boeing shares were up 2.60% to $148.77 at 1452 BST on Wednesday.