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Business Journals
24-04-2025
- Business
- Business Journals
GE Aerospace to invest $16M in Durham despite tariff impacts
GE Aerospace has hundreds of workers in Durham an thousands across North Carolina. Story Highlights GE Aerospace plans $1 billion investment despite tariff impacts. Durham facility to receive $16 million for increased engine production. GE Aerospace employs 2,000 people across North Carolina. Despite significant impacts expected from tariffs, GE Aerospace still plans to invest $1 billion into its manufacturing operation, including in Durham. Tucked away near Research Triangle Park, GE Aerospace operates an airline engine manufacturing facility with 400 employees. It's one of just three GE Aerospace commercial engine assembly lines in the United States. And of that $1 billion planned investment, $16 million has been earmarked for the Durham site. Tariffs, however, are taking a toll on the bottom line. On an earnings call this week, H. Lawrence Culp, CEO of GE Aerospace, reiterated the company's commitment to investing in manufacturing. But he also told analysts tariff policy would 'result in additional costs for us and our supply chain.' The company, based in Cincinnati, will seek to save $500 million this year by cutting costs and raising prices. But GE Aerospace does not plan to pull back in Durham. Kristen Neubauer, Durham plant leader said in an email that, 'as demand grows, we'll continue to build capacity into our shop to meet that ramp for our customers.' The firm doesn't provide site specific numbers, but said it delivered a total of 1,900 engines last year. In Durham, that includes engine models for regional aircraft (CF34), narrow body aircraft (CFM56, LEAP) and wide body aircraft (CF8, GE90, GE9X, GEnx). The company recently confirmed plans to make major investments at the site, including new assembly systems that will increase capacity. Neubauer said the focus is on creating 'world class processes' to be ready to ramp up the LEAP engine and wide body 9X engine. The LEAP will power planes such as the Boeing 737 Max and the Airbus A320neo. The GE9X will power massive Boeing 777Xs. 'We have done a lot of work focused on improving safety, quality and delivery,' Neubauer said. GE Aerospace has 2,000 employees across the state. GE Aerospace's investment in Durham is part of a $100 million commitment across the company's entire North Carolina operation that also includes $13 million at its West Jefferson site and $20 million at a facility in Asheville that produces engine parts. The company also has operations in Wilmington. GE Aerospace is a collaborator in Honda Aero, which has a facility in Burlington that makes the engine for the HondaJet manufactured by Honda Aircraft Co. in Greensboro. North Carolina is getting a lot of attention in the aerospace sector, including from JetZero, a next-generation jet maker considering the Greensboro area for a 10,000-job manufacturing plant.
Epoch Times
23-04-2025
- Business
- Epoch Times
GE Aerospace Reports Strong Sales as It Returns to Manufacturing Roots
News Analysis As GE Aerospace signals a return to its roots in manufacturing, company revenues rose across all business segments. The company's stock rose more than 6 percent on April 22 on better-than-expected first-quarter results. On April 22, the Ohio-based aircraft supplier Orders were strong for both equipment and services. At Commercial Engines & Services (CES), the company secured a significant engine commitment from Japanese airline All Nippon Airways for more than 75 LEAP (Leading Edge Aviation Propulsion) engines to power its fleet of 13 Airbus A321neo and up to 22 Boeing 737 MAX aircraft. Total operating profit was $2.1 billion, up 38 percent and above FactSet's consensus of $1.9 billion. The profit margin reached 22.6 percent, up 40 basis points from a year earlier. 'GE Aerospace had a strong start to 2025 with orders and revenue up double digits, driven by commercial services, and adjusted EPS [earnings per share] up 60 percent,' said GE CEO H. Lawrence Culp, Jr. Related Stories 4/16/2025 4/11/2025 Georgios Koimisis, an associate professor of finance, told The Epoch Times that the solid increase in new orders helped boost GE Aerospace's momentum, especially in its commercial engine business. The company's first-quarter results arrived nearly a year and a half after the company was spun off from the old GE and debuted on Wall Street, suggesting it may be better off as a standalone entity than as part of a conglomerate. This separation allowed GE Aerospace to return to its roots in manufacturing efficiency, quality, and innovation, and to cope with a challenging macroeconomic environment, as management described during the earnings conference call. Culp said the company has taken strategic actions, such as controlling costs and leveraging available trade programs, to cope with the macroeconomic dynamics. The company forecast low double-digit revenue growth and operating profit between $7.8 billion and $8.2 billion for the year. 'Based on what we know today, these actions, along with our solid first quarter and commercial services backlog of over $140 billion, enable us to maintain our full-year guidance,' he The rising backlog highlights the company's reliance on organic growth: the expansion of its core customer base. This business strategy supports and reinforces efficiency, product quality, and innovation. For instance, the company received a commitment from Malaysia Aviation Group for 60 CFM LEAP engines to power 30 Boeing 737 MAX aircraft. In addition, it signed an agreement with Korean Air for up to 30 Boeing 787-10s and 20 777-9s using its GEnx and GE9X engines. GE Aerospace's reliance on organic growth differs radically from the old GE business strategy, which relied on non-organic growth and the acquisition of other companies at inflated prices, sometimes outside its core business. This strategy created a few synergies but also generated plenty of management issues as the conglomerate became too large to be managed effectively. As a result, old GE fell into a value trap: a company with a low valuation that continued to grow, destroying rather than creating shareholder value. Investors fled its shares, which underperformed the broader market. That was a turning point for the GE conglomerate, as its leadership split it into three companies: GE Aerospace, GE Vernova, and GE HealthCare. This move helped lift GE Aerospace's stock. Its shares have risen about 26 percent over the past year, outperforming the S&P 500, which has gained 5.5 percent during the same period. The company's share rose 6.07 percent during the April 22 trading session, boosted by its better-than-expected first-quarter earnings. Koimisis remains optimistic about the future of GE Aerospace. 'GE is also planning to invest heavily in U.S. manufacturing and to hire thousands of new workers, signaling confidence in future growth,' he said. 'It also shows that the company aims at making its supply chain more reliable.' However, he said tariffs are a serious concern, as they could pressure the company's profits later in the year. 'While GE is taking steps to reduce the impact of tariffs by adjusting prices and improving operations, the risk could grow if trade tensions escalate,' he said.
Yahoo
22-04-2025
- Business
- Yahoo
GE Aerospace Shares Climb After Q1 Profit Crushes Estimates
April 22 - GE Aerospace (NYSE:GE) shares rose more than 3% in premarket trading on Tuesday after the company posted stronger-than-expected first-quarter results. Warning! GuruFocus has detected 5 Warning Sign with GE. Adjusted earnings per share reached $1.49 for the March quarter, topping Wall Street's consensus estimate of $1.27. Revenue climbed 11% to $9.94 billion, beating the projected $9.05 billion. The business cited ongoing strength in both its commercial and defense segments, supported by a services backlog that now exceeds $140 billion. That figure highlights continued demand for aircraft maintenance and parts as global air travel recovers and defense contracts remain steady. GE Aerospace Chairman and CEO H. Lawrence Culp, Jr. stated GE Aerospace had a strong start to 2025 with orders and revenue up double digits, driven by commercial services, and adjusted EPS up 60%. We continue to drive improvements through FLIGHT DECK, tackling supply chain constraints head on to accelerate deliveries throughout 2025". The results come as GE Aerospace solidifies its position as a standalone company following the recent spin-offs of GE HealthCare Technologies (NASDAQ:GEHC) and GE Vernova (NYSE:GEV), which focus on healthcare and energy, respectively. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
22-04-2025
- Business
- Yahoo
GE Aerospace Expands Q1 Operating Margins, CEO Talks Cost Control To Mitigate Tariff Impact
GE Aerospace (NYSE:GE) shares are trading higher in the premarket on Tuesday after it reported first-quarter 2025 adjusted revenue growth of 11% year-over-year to $9 billion, in line with the consensus of $9 billion. GAAP revenue was $9.935 billion (+11% YoY). Commercial Engines & Services revenue was $6.977 billion (+14% YoY), and Defense & Propulsion Technologies revenue totaled $2.324 billion (+1% YoY). Total orders increased 12% YoY to $12.3 billion, with Commercial Engines & Services +15% YoY and Defense & Propulsion Technologies flat. GE Aerospace's adjusted operating profit margin expanded 460 bps to 23.8%, with an adjusted operating profit of 2.146 billion, up 38% YoY in the quarter. Adjusted EPS for the quarter was $1.49 (+60% Y/Y), beating the consensus of $1.26. Related: During the quarter, GE Aerospace boosted material inputs by 8% through its FLIGHT DECK platform, supporting a 17% increase in Commercial Engine Services and 5% growth in Defense. GE Aerospace Chairman and CEO H. Lawrence Culp, Jr commented, 'The macroeconomic dynamics we are operating in today require us to take a number of strategic actions, such as controlling costs and leveraging available trade programs. Based on what we know today, these actions, along with our solid first quarter and commercial services backlog of over $140 billion, enable us to maintain our full-year guidance.' 2025 Guidance reaffirmed: GE Aerospace expects adjusted revenue growth in the low double digits and adjusted EPS of $5.10 – 5.45 vs. the $5.10 consensus. The company expects adjusted operating profit of $7.8 billion—$8.2 billion and adjusted Free Cash Flow of $6.3 billion—$6.8 billion. GE Aerospace stated that its 2025 guidance now factors in the impact of announced tariffs and delayed spare engine deliveries. The company expects full-year departures to grow in the low single digits, down from its mid-single-digit forecast. The outlook excludes potential changes in airframer schedules, further tariff hikes, or a global recession. The company announced a $1 billion investment in U.S. manufacturing and technology and plans to hire approximately 5,000 workers. It also secured major engine agreements with ANA, Malaysia Aviation, and Korean Air and a U.S. Air Force contract worth up to $5 billion. Price Action: GE shares are up 5.07% at $187.40 premarket at the last check on Tuesday. Photo by Jonathan Weiss via Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? GE AEROSPACE (GE): Free Stock Analysis Report This article GE Aerospace Expands Q1 Operating Margins, CEO Talks Cost Control To Mitigate Tariff Impact originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
