GE - Earnings call transcript Q3 2024 | General Electric Company

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Operator

Good day, ladies and gentlemen, and welcome to the GE Aerospace Third Quarter 2024 Earnings Conference Call. [Operator Instructions] My name is Liz, and I will be your conference coordinator today. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the program over to your host for today's conference, Blaire Shoor, from the GE Aerospace Investor Relations team. Please proceed.

Blaire Shoor

Liz. Thanks, Aerospace Earnings GE Quarter Third to Call. XXXX Welcome CEO, and CFO, joined by Ghai. Culp; and Chairman I'm Rahul Larry Many of and our best we the based them view and statements see of we're making the world today. our as are businesses forward-looking on

website, our the change and changes. elements may As described filings those in SEC as world

to over Now Larry.

H. Culp

good pleased headquarters you, to Ohio. Evendale, Blaire, in you joining and thank be morning. We're Aerospace's from GE

bringing lifting them be safely, have an top our incredible responsibility our proprietary For and will safely. been We're DECK, day Aerospace inventing FLIGHT people and always culture. a up to by of motivated lean by future are each our our than X operating and more core guided and purpose last priority employees model. flight, home home Those words, century, the them GE bringing

tomorrow. delivery while dedicated Our order. demand focus will team is the the us safety, building of innovative That to significant cost that meet of to enable today, in and quality, solutions

shared XX,XXX It to of of have today, flight privilege to employees that world tomorrow is we for the around advance the continue the future. the because commitment and our

than flow strong to $X.X up and profit quarter our were delivered Orders XX%, cash. was conversion by XX%, and equipment, XXX%. up more Turning was XX%. robust in we cash and billion, Revenue up performance. driven was services growth Free X% demand, operating from up and third earnings while of EPS adjusted with

& growth Engines Services, orders up XX% equipment. in Commercial In and than CES, with services were XX%, or both more

XX% than in year-over-year. our billion, and was operating in backlog wins on XX% services. Services and of which profit, total greater widebodies XX% which recent of Our supported up is considerable revenue grew build $XXX narrowbodies

in commercial external expanding be to deliveries the servicing our OE support sales with priority installed quarter-over-quarter, MRO step-up the and extensive also aftermarket network growing Our We capacity. higher with part made continues spare progress base. most industry's to while

while year-over-year. Technologies, Propulsion leading Defense this developing up while for We're our teams on increased work by of programs or but deliveries focused XX%, lies out you sure, down & dedication their a be ahead. profit more thank to morning delivery declined. but DPT, the improving Milton. Progress were In thanks Engine Hurricanes orders sequentially, to defense Helene future. Many our this goes technology quarter, work specific impacted to and team mission-critical and and for our

finest. the to minimize clock around the our each customers. worked and our You its impact other support GE Aerospace to at

full quarter both year-to-date, and Given raising we're the $X our results, growing expectations, than more strength of year cash our with profit guidance. our fourth billion combined

and to We closely supporting with dynamics. also current as continue navigate Boeing coordinate them are they committed to their

inputs, and taking to We're up own services year-to-date Slide digits We're products to engine to this XX%. within Demand with commercial meet and by narrowbody and X%. increase departures remains expand departures including ensuring output historic our steps high demand. suppliers operations making global XX% increasing quarter-over-quarter, capacity, X. with and our our increasing up over to we're defense XX% positioned progress up LEAP for single of highlighted share robust, Moving

sales parts completed sequentially, spare supporting grew visits our third-party network. also We shop by

X We're improvements. for months, drive and and strengthening we're working deck hand-in-hand over suppliers, material increased discussed grateful we're last constraints, we've inputs flight partnerships. As key unlock sustainable the with to using their

in of our the deliveries. supplier third result priority quarter, As subset supporting sites output a that increased a key work, of XX%

yielding these efforts second with in in are X Kaizen led joint improvement the the third a quarter, quarter demonstrating supplier a example, double-digit that receipts one results. in As material to

inputs output. We the to in again sequential expect fourth quarter, supporting in increase a step-up

we're manufacture, upgraded weeks. expecting XA the be blade, HPT to The is kit, and durability LEAP HPT our We're progress blade coming new certified on easier also the making to durability it with including which in will X line the a durability current wing, with field, in increase performing help improvement on CFMXX give we X.Xx will are enhancements LEAP time in Combined currently with expect in that also the levels. this well output.

support With growth by complementary size aftermarket to We're in growth. to LEAP's we're projected output XXXX, improve reduce X preparing fleet times. expanding for this capacity ways to and shop double visit turnaround

times there visit more LEAP like enabled constraint improved XX%. First, identified we're We Actions to problem work, LEAP visits reducing mapping output. shop capacity waste, use eliminate in to and At shop TAT. leveraging in third increase this quarter test over by FLIGHT to our we value a key in Selma, stream reduce time, year-over-year. standard XX% and MRO waste nearly facility lead cycle DECK the and reduce Brazil, solving

to MRO ownership. engine inspection $X third, expanding fourth and We've in we're a developing to quarter. And ensure capabilities. next create provides over cost best in capacity, here the years billion and Second, LEAP techniques internal Poland, partnered enhanced that which shop and induct add Technik repair we're Lufthansa the add third-party options we'll capacity. MRO with investing expand customers dedicated X flexibility to first of the the in there network, competitive our We're

XX in Third-party of We're shop to provide their Engineering for of the restoration the a ST fleet visits number also MROs recently pleased shop selection quarter. record visits announced that third over the LEAP years. inducted Akasa exclusive Airlines next performance

meaningfully base will safety our on with their engines increase quality. our enable installed faster confident our delivering and customers more focused our to the and expanding also quarter there's engines with to modernizing actions work While airlines and without compromising fleets wing. servicing and defense growing into under XXXX. We're output us fourth do, and we're I'm

the aircraft. LEAP-XA-powered from will Center, Eva anticipated helicopters. engines Boeing and add upgrade growing fleets. Survivable of the we multiple GEnx will our over XX XXX GEnx we engines and or powering secured over TXXX Defense, commitments the engines. Boeing of their selected XXX Airways won power Airborne add During In engines Air for also U.S. to existing Polish SAOC, Operations XB GEXX Ministry quarter, for We to Force's services widebodies, National XXX-X. XX CFM-powered fleet of Apache, in GN the of contracts overhaul new the Defense Qatar to acquisition our In their AXXX Guardian were aircraft customers' Air Avalon

accelerates and RISE than engine, This the will the that a catalyst more the future. higher dust way the our turboprop tests ever expected a next design before. fan future. planning and reflects on coming the engine technology to of generation ingestion new also for learnings era We We're with development months. level for durability engines in technologies advancing operating of in from pave key sustainable recently environments. of the aircraft a open Turning temperature testing certification completing began earlier new

for demand Our defense products globally. platforms remain in critical

the for been range has Hawk and Apaches next success technologies. and also Black salt towards and milestone development. U.S. with of the for The is power-on Bell's engine to Milestone advanced runs. delivering modernization our key TXXX backbone ground of maturity digital progressing of the Our future the to aircraft critical our pass We're Army B continued and was long phase of next enter of

fourth you. technologies and XAXXX we're customers' round the of Air of of we'll the over the testing, Our completion to developing are our expectations the detailed meet today and back, forward U.S. confident for a nearing engine while is Force's design we our program. Stepping clear, completed future. Rahul, path nGAP

Rahul Ghai

from of conversion. and quarter you, with investments. Operating engine orders and strong margins billion, redemption. higher Revenue inflation combined GE and up Thank and flow were price the year-over-year. Larry, was delivery offset delivered EPS morning, profit sequential offset million good over partially operating growth, equity a increased XX%. in earnings. with with higher Adjusted than with benefit XX.X%. lower engine more to expanded X% the was preferred up Services Billings AD&A. another favorable on was improving higher XX% profit capital by Free segments. $X.XX, offset growth, of $X.X was cash deliveries price shipments basis double-digit both and Services points everyone. Operating XXX% profit mix from was cash up growth volume, and impact roughly use. X%, favorable Aerospace up XXX flow billion, $XXX free $X.X Working partially was

service prior and profit commercial favorable. half, continued increased, on results inflows up ongoing Given we billion material contract availability a than up more than X% be to year-to-date at the or services inventory the strength. from lower $X Cash first the These from challenges, from revenue quarters. rate had XX% operating long-term with momentum although build

free sets us have This flow, XXX% also $X.X a up close more cash delivered up billion of strong than conversion. well out at nearly We to year-over-year $X billion year.

and LEAP, deliveries lower than grew more shipments chain down and X%. widebody with Supply price revenue including narrowbody Equipment constraints improved revenue part work Turning higher up to CES. X%. shop scopes shop Internal the visits visit was pricing. Services third In flat customer units. were X% down year-over-year. from quarter, impacted with and total sales, engine mix XX% across up X%, increasing offsetting roughly spare

losses profit million and year-over-year with partially lower Equipment Overall, basis with delivered improved was growth, services, solid from offset higher $X.X CES investments, margin billion, pricing. up expanding higher increased year-over-year up XXX about expansion. XXX margins results points of engine $XXX revenue $X.X billion has of spare XX%, volume and by from profit, points double-digit basis year-to-date deliveries and price.

Moving and from strong to Defense DPT. the at X.X% demand book-to-bill Orders were year-to-date. up Defense XX% X.X% quarter in was & Systems.

$XX systems pricing now more backlog grew mix. offset down DPT the Defense engine was Improved System quarter. up X% and engine deliveries, year-over-year. down in was total billion, Our X%. billion $X than is by Revenue revenue X%, unfavorable &

Profit Aero. a $XXX Technologies products and Propulsion was to X%, improvement. on of NexGen year-over-year support compare. down driven than Avio investments million adverse offset by price tough and grew Inflation, XX% engine mix Additive primarily more

profit While revenue margins we XXX basis respectively, had year-to-date and quarter, with up and challenging a X% are points. expanding XX%,

considerable XX% company, delivery a an corporate. $XXX evolving reflect needs We meet solutions the to our needs allies. Spending movement GE continue Year-to-date, or made progress million. independent Aerospace. total improving ensure military that to of becoming of we Since work corporate is on about down operations towards providing cost the our while and

also our post-spin and separation We track are plans. restructuring on with

and it it on future it components flight the adjustments of for business, as is Colibrium as will is enabler a we critical most sale value. quarter, a for utilized us lawsuit gain to on and non-GAAP be Additionally, goodwill. key licensing agreement additive where on Colibrium from our create of focus LEAP business we the and settle this to legacy impairment several for key continue additive XX, a a can of had

earnings quarter, includes our assumes mid-teens cash we fourth raising trajectory growth. the This will At double continued down approximately Given entering sequential XX% the same our guidance year remains strong LEAP deliveries in deliveries This the year-to-date in quarter, to Revenue ongoing digits growth to Boeing. and the but the across expect year-over-year. full guidance. continue CES, and we fourth to the low are be now businesses. performance,

be expected now mid- services range year-over-year. to be DPT of the of in continue billion implying over profit spare will growth to billion, million reflecting billion, midpoint expansion mix. Internal part to midpoint growth. now be prior $XXX $X.X margin expect at profit $X.X is CES single higher growth performance work also in with of to the points expected digits, year-to-date billion estimate, and basis mix. high our up is XXX visit scope a X% $X.X up in from million operating the to $XXX We offset of lower guide, Operating line the guide, by prior to the shop $X.X improved prior sales, than at

$XXX be lower year-over-year. of around now expect to previously of to expectation reduction tax rate This at than expense some next-gen be P&AT. Corporate $XXX in XQ pressure of $X reflects is XX%, a of in end and costs unchanged. range investment the profit are and prior expect DPT from around below billion. low our Interest expected increased XXs. now billion down $XXX $X.X the to million, We performance, million programs and current We million eliminations lower

the We guide are $X.XX prior EPS and up guidance at improved the $X.XX profit to tax adjusted lower rate. from midpoint our from raising $X.XX, to

'XX. Larry, $X.X and cash in billion, provides are growth free back and to billion million to free a primarily $X.X foundation positioned our solid you. raising that up flow to $XXX earnings. in, significant midpoint, also are to All revenue, cash at We guidance us for the from profit we XXXX, higher deliver flow

H. Culp

to Aerospace advantages. is our solid returned with in GE thanks. first a and performance profitability competitive year-to-date. as deliver supporting over company positioned [ This we've our enhanced is billion year sustainable cash $X underpinned Rahul, ] to a by shareholders stand-alone that

the and by Our platforms defense narrowbody, preferred across sectors. widebody customers are

we do. with focus and in at core our and as Our technology cost deliver customers, greater that and safety, services well on the faster quality, time efficiency, providing everything support reliability is on will times them. we order wing delivery turnaround of as industry-leading to We and

strategy and commercial in enabling eye for exceptional our DECK and our defense deliver FLIGHT way Aerospace and the our to an shareholders breakthrough with results, our for deliver a keep GE define to sustainable We to to connects continue future towards for to technologies more to create pave innovation value flight culture. customers, the

we're strategy, including cash shareholder poised flow to to and of XXXX capital allocation beyond, drive and profit $XX cash growth deliver ahead, Looking shareholders billion will meaningful in returns. available our continue combined returning to free compounding with approximately

questions. we'll Now to Blair? go

Blaire Shoor

you please can Liz, Instructions] [Operator the open line?

Operator

David Our Barclays. comes Instructions] from Strauss first question with [Operator Thanks,

David Strauss

about wanted I So XXXX. ask, to Larry,

So back has talked at billion Obviously, growth come million. think, the about in guidance profit Investor relative to I the about in up, Day, XXXX you $XXX $X XXXX XXXX. EBIT

growth still of roughly XXXX. So a how to should off billion looking now? walk about Are we the baseline we in think higher at EBIT $X

H. Culp

'XX here reviews. We're of detail. of actually as And thinking will And the in defined transitions go the the in want prep we third more January, us that to just may midst review Good planning to are where how year. outlook. now in at March. we're vis-a-vis Rahul, working quarter get our we're strategic was the to back that with that David, work. I when were frame 'XX updated closer. up we'll really a really the that process think together then annual end Board have look We'll through that about time the in bit of in our through we we dedicated at budget the

Rahul Ghai

thanks for sure. question. No, Larry Yes. and David, the

we sitting were March. million than are we in $XXX said, higher about you where million, $XXX As at

here services that a starting And we commercial point. of we is of increases shop little the as we implemented. just backlog that expect given low significant visits we've double On strong, of kind their segment and kind lower the nicely. take year the So been the higher a that where stay of CFMXX through of that And bit, And they LEAP in the to share price have even than XXXX. grow X holding with trending services levels retirement. is other CFMXX, favor are kind extremely retirements our low this and departures are trends working GEXX of in were have digits then

are outlook. all to the help that going So -- those support XXXX things

had equipment side, growth is we On the the in slower equipment 'XX than expected.

some will that volume to So of move XXXX.

that We include higher are than equipment assumptions today and volume with will airframers sit be faster those to as growth of the here that we shipments. working safe services will to say XX

keep margins, put likely this it going that'll term. pressure So but important the flywheel longer to some over on is

On shared, we the DPT side, the book-to-bill, as just has been very strong.

for year, front next that cost a with growth this done plenty strong then high out, this XX% corporate the good backlog, cost we've side, these on 'XX guide. entering we're opportunity very XX% really year into has with based to some So mid- us. accelerated to And reduction taking actions profit from the but year year, and than on a next of faster in job growing And still single-digit of margins. of

our cash through And Jan. outlook, detail continued work above through to shareholder see in XXX% flow next share strong we we're and free But we what should here earnings work for and in, we'll dividend stay all and continue guidance returns buyback. doing year. the which on So provide for

Operator

Our comes Harned line the next of question from with Doug Bernstein.

Douglas Harned

continue expectations though, LEAP and on I your for output. wanted XXXX, a specifically to little bit around

the up got in You're QX. quarter-over-quarter strike. Boeing you've But

to talked you've supply before to chain in HPT you've new about You've particular, constraints that got transition blades and then the blades. got HPT the

next yourself trying issues? off? do different on LEAP numbers things of in you project you're some you And mitigating where output. terms those when do trade How So see these to for of year those

H. Culp

taking Boeing. We've touched demand. ramp, aftermarket. is both that care and just a all in than what bit of and to of operating would addition in airlines Well, want broadly we're the got items with more the the to and the one there because hand-in-hand you we airframers, expand about growing the It's And about. demand that's not of make thinking right, little Doug, LEAP on I it sure the challenge Airbus

each incredible going engines with side under on to both with And down road. Boeing of they're we've resolving want obviously, different our know they're to situation, well. the but an wing. rate the be them backlog here. We got aiming of other step be We the to stoppage fortunately, work ramping in to Airbus, going do XX as a way. the that

as really going with engines I the think determine much what that that what do saw base in of we FLIGHT the what supply in saw and encouraged to third how in be what the in by of we're quarter third are of able we we we with support, new quarter. we the well. I'm activity doing aftermarket second saw quarter, terms can work will what the is terms in DECK to

paced I on And is increase sequentially. think it critical prepared in really the we the saw that suppliers an of XX% I had think you where sequentially that remarks, operationally is quarter, but handful the like bit us problem-solving in bit the really not on-site I paced second here but collaboration, doing. a third, the in we're that underlying is only the a

we're more think the here do helps result, quarter to of all capacity geared as That's us unlocking and that fourth deliver well. as to our what in I we're up customers. a

good will down, we're think terms Rahul as engine poised, But LEAP XXXX. I As on, That's the year-over-year new deliveries. think, we unfortunately, growth touched just I goal. going of to in deliver into said, be

as the You that new you the That, we're is HPT about. of excited enhancements know, durability fourth Doug, really mentioned blade. X

blade in easier version XXXX improvement it's of it's that because unlock field will will and XA we twofer for shortly. will here That that make. also function in That in We help step capacity, the to know us as performance earnest an expect which a engine, real of well. the approval the be a

and for seeing, team do. supplier our incredible the travel largely that what XXXX I to will teams the know service airframers we're to and to airlines, that's fortunate still the So and have this for and that we're our like backlog about. be work

Operator

question the line next Robert comes from Vertical Stallard Research. Our of with

Robert Stallard

sure since of the might delay on Aerospace? question spoke, XXXX we I'm this another there's but for, wondering and not for GE have implications I last a sort Boeing financial practical announced if was program, what

H. Culp

But a ramp perspective, customer to will we're what a speak to prepare respect forward. heard. what think company simple. it's and and I really, And GE from the this few the continue aircraft We but maybe Well, whatsoever the little engine. Rahul with that spend on at an test engine tomorrow. We We're time every opportunity that to about can It's operational touch doing that and more you time. I'll the to heard they the with a I'm is change really them this just Kelly going that know sure I They bit point, a talk production about financial. weekend, airplane. past Aerospace matter love to talk really the to of no operation, excited of have at airplane. that late, want for

Rahul Ghai

guidance fourth units the rec And do We've quarter. here to few engines Boeing. in our a delivering Rob, rev we from perspective, have already the started

gone, Some in here will out go of X the remaining months are of quarter. them already more the

need we're would profile. based how with For many Boeing exactly their 'XX, on they demand working on engines

over will the decade. work at by we we expect the additional just as we Investor as But So key Day, And we an the obviously to XXXth that engine. out out. of for that that to do And get we shared about come us XXth cost cost engine, of the next XX% the program to the the to the here expect XX% work couple need is ramp continue in months. is to

losses And should the So the we'll decade in what's profitable program that's and plan. our past peak later be XXXX. the move by towards in

built and what that's into So both in long-term near-term our outlook. we

Operator

Walton next Wolfe question Research. Our with comes from Myles

Myles Walton

commercial might and I on expectation. of you with which be if and underlying the comment the a side, side you your getting delinquency that We I'm the the how do keep can customer penalties are be military better elucidate you surface was the if on or the GE the question for absorbing asked of deliveries, get hoping the plan might that concessions obviously below getting penalties both the keep deliveries some the worse? lot, delinquencies? can under just financials curious associated

Rahul Ghai

it's that and for you built to number for, start with the accrue everything obviously me we a let of But not and here. that's we here I we're material kind here Larry accruing to contracts XXXX. in as need know, customers. in for as want us Myles, typical into kind the jump sit been Myles, that of guidance. But that say

chain the how. in third know to through we're sequentially as or the we either challenges. get major better best quarter, as continue are and side side as support either commercial working customers damages as fourth nothing these liquidity And on But will to improve on or past work the They'll in penalty better So the in trying you supply military. and quarter. on -- saw, we deliveries the

Operator

comes Kahyaoglu the line question of from next Sheila with Our Jefferies.

Sheila Kahyaoglu

the Maybe that and the strong talk and backlog we coming the but of also mentioned DPP. engine to propulsion from despite could very be assume about some across pressure plus charge shortfalls, Orders profitability. additive I is today. in you softness combat continue

QX happens How margin do driving it when step of about what sequentially. guide, of about think down margins low some So think into again end we the pressure? and would what's we XXXX suggest that XXXX

Rahul Ghai

you support fourth quarter on Sheila, touched point it. next-gen So the I The is in the investment R&D here programs. our biggest think to pressure in

biggest here. driver the is that So

to that we the uncertainty, side budget that need the meet from our the Given customers sure lines us. to from are we continuing invest make time

technologies that bit Avio bit fourth here So R&D that's the mix propulsion increase in biggest of and the referenced. a little There's the we But the Aero is product pressure a in putting biggest that driver is on of additive little quarter. point.

mentioned, backlog for -- about 'XX, go year-over-year $XX up into $X is billion, you billion you as it's strong, the Now segment. as the up

on very do and should results basis than mentioned into response well. So that we earlier a And that margin should profit 'XX, been expansion strong faster supports I expect we as our grow mind, the get that David's drive have revenue, mid- on segment. growth in continued keep question. as single-digit in the the And to that, DPT to high year-to-date

So 'XX. that we'll continue into

Operator

Our next line with comes from of Epstein Bank of the question Ronald America.

Ronald Epstein

a were the more peel things visits maybe but other back you up, shop down. bit Can little the LEAP onion in quarter. on was

go you little a that be that in into for more detail can If everybody. might helpful

H. Culp

I the on a Ron, have what what board, support talked across lot been the think LEAP, given morning, it's the in and happening But about right? challenges much same seeing supply about talk touching just terms what's very here aftermarket. our chain ramp We virtually these of various that this we're there us one we previously of the we've in the really programs. suppliers every across

in what make that that here facilities, on broad-based. our to flow improvements we've third they are particularly trying that by in what things with balance, into support with, that alone make we've DECK XXX flow in we're pointing. base supply us seeing, seen new flow constant, another focused improving, to quarter, the perhaps in we working why aftermarket. When we're or enable engine, a that an encouraged think morning, are really not here got we're not more present do a have finger quarter. is something see in we on sure we're solving, not area that the line, but particular is in are when highlighted the And over not That's the the have So on facility you FLIGHT elsewhere. where whether It's And of are delayed. depending this X I pleased the field is product engineers when to that's may let particular problem itself the X

I pronounced visits, in on we parts more do balance, what than You suppliers engine internal lower I spare growth in underway. our with deliveries new concert it, think saw the our in need is results think, which were and sequentially. But to of in necessarily shop

here the the some we're think from That's is that commentary embedded that's gives the We want financial have momentum that optimism raise respect guidance next I airlines us X. Rahul we that fourth in for year. with I airframers and framing what more to customers, them quarter with and provided and the know think operationally. job us, the of developing

Rahul Ghai

And you quarter may if the add sales up. are did in I one part thing that see that is the Ron, spare

external the turnaround as So we about prioritize or spoke the in the delivery balance internal own our of constantly to network. our availability and time challenges, of the it external airline be parts and our network Larry both for in network needs reduce the the material customers,

a were what year-over-year saw -- visits. quarter. third in fourth have But the And the there's higher, parts bit getting for we're basis spare flat on into same a we shop shop our this higher and those inductions as So of quarter, now visits were than output. fungibility the parts of shoppers between sales quarter, you little part was spare sales were our

backlog to that more already a that part And getting on we we high spare with fourth even the need the a XX% spare to shop quarter than of backlog. are of are basis, fairly sales we're complete. So the visits in projecting part

And So the in we that together, we with for services growth felt parts visits. increases that all implemented put shop on holding quarter, price strength both sides the on the that that third very the you and and outlook spare all is year. good comfortable where -- our

Operator

Our JPMorgan. comes question with from Seifman next Seth

Seth Seifman

maybe where probably starting in would When getting you were March, ahead the same engines next XXXX. mean, -- starting that year-on-year. some I think way little risk time. from things that of you that level in bit, guess a versus we assume I made not are year on headwind a that we're more that to about about deliveries from, are reaching little about comments the the at at of XXXX the maybe deliveries of bit expected a talked dig the a But engine of I the maybe not

the to dollars aftermarket, is just the thinking relative then of something year? volume that OE improve we the maybe should to if think And the that just losses profitability, LEAP in also about, wondering at terms so as are expect way. it of should but that quite And in time, not on LEAP about that not I we next work was big.

Rahul Ghai

not accurate I level think, perhaps are is both output expected Seth, Our the back engine at you counts, on in right? that March. we'd

in R&D should we But there're spare that dynamics things. number our go -- all reduce those engine the in or So engines as other that have deliver, losses. to of other minimize keep mind, well, investments, our

X more on into Again, you're get point. we'll provide that's we as data just So which XXXX. accurate guidance

better we of and that think are On be LEAP improvements the expecting that about side, than Obviously, the is durability in be are spoke levels we expected a CFMXX XXXX. year. what in durability I at to the shaping LEAP that definitely up the fact the coming lot to beginning at Larry

a So see our also But part to external spare that plus. to network we've sales our is is growing. what huge that's started

of that obviously of basis, is that the shoppers business. third-party -- north year, of this So that XX% external if are we by completed shop we with shop XX% a a the And network. sold on an visits sold were profitable look about that you external visits third-party that And are very network.

part spare grow data -- point that sales for an because are So over that that's important means LEAP time. should those

for here in positive a be our provide that in should reflect that we'll as XXXX, guidance that So January. we and

H. Culp

we're anticipated. would haven't I offset, But I we next in maybe a that EIS other of that year, in want at We'll a earlier, as what was obviously us be But headwind, important than as X really and to Recall relative longer. engine nonetheless, higher That delay doing. it's changed create One, the things mind. be rate Seth, bit some. an maybe we CFMXX utilization, we'll deliveries ramping. to slower quarter a That said keep will said XX we helps of be just it year. a perhaps the ramping then what us last but bit there's is understand. add also to this will for of helping

Operator

with comes RigeBank. Our Scott next question from Deuschle

Scott Deuschle

LEAP in company blades Larry, drive the more the than this event, quantity certification the to it CES a already in received for new of And to certification? is output clarify, event, of that specific has LEAP quarter? that alone? that these is it fourth large which allows ahead multifaceted improvement just is HPT then the Or XA

H. Culp

production. in is blade new The

So really a turn but we to deliver ahead moment do anyone the manufacturing be upstream able will make of on what we what in that That of think unlock, that into relatively help, fourth time. we're supply it part blade we If future. That because the certified, of but served, part will kit. begin in work trying That in does Scott, underway. matters it's if happen It is the back But is importantly, an the we But the that easier to not than durability of in put most quarter an had the unlock, far delivery. is without that right? spirit is we will the to and component in because processes, is again, the can't designs, as [indiscernible] it to on of right? will most supply don't that it it us. near is more that that deliveries, be chain think please we'll we quality get But going box, help that the really existing safety aftermarket? will

If was progress of encouraged are certification that in happen just happening used host the it on here, I'm there and are have So seeing some that by the new silver It's there top helps would but again, there ago. to was if we're of Blade multifaceted, bullet we the time a a X regard. have of -- things that

that. all

Operator

Cowen. with Gautam from Khanna comes question next Our TD

Gautam Khanna

you I bit. a maybe visits for next if versus tease frame that out that the just now widebody, couple could over maybe if CFM was years you could wondering your shop expectations of for us up

Rahul Ghai

a in expected we expect to gradual that last Given still Gautam, earnings be and what again, at said, to the expectation what call, at So I visits on right? the 'XX, peak from now, of shop peak to now start in of the we we declining had think, then and seeing declining that's point in as are visits and but right? 'XX our stay pace, we So 'XX, is. that 'XX XXXX on, level start shop then

so Now third growth with increases, longer the else, keep go we grow. to visits everything still price to will grow and shop revenue continue as just in second given for continues into mind that revenue

shop the mind the getting second second in into On of has the GEXX fleet shop is not Keep side, that seen widebody visit. visit. XX% that

So helped GEXX. work discussed, are for time we've heavier to the now. which to we XXXX that's shop over we that also second see as to the transition what visits to that and And in here beginning previously spoke grow scopes our revenue will continue

the engine coming no well. GEXX, in I on performing things again, outlook is are change think in well, So

shop for is next roughly, over volume be reason than NX a years. expecting time is, are the on the growing, the And that had On a is the X basis, visit what you primary base expected. side, lot doing even better to flat as the initially installed wing we're the X to that on

Again, the news the later out now to So the were have 'XX that frame that's shop visits 'XX us. in time in good for the decade. moved

us is about is know, you and portfolio contract. of As long-term XX% serviced service north by a that in

of NX shop profitability side the program. that So fewer improves the visits on

our on are on all 'XX they've So shop kind to to time that's moved time The to But going happen. the what frame more 'XX to expectation the wing of 'XX. visits is the out improvement, given 'XX of NX.

Operator

Herbert Capital comes question from RBC next Our Markets. Ken with

Kenneth Herbert

and situation, with curious, I your XXXX? wanted in And fourth just up, priority FLIGHT we maybe that applying should into sequentially, think of sort around grew follow sites input, the of that as to to the I'm output you on about specifically just or how DECK comment about subset material quarter guess, your think expectations? line was XX% as I improve Larry,

H. Culp

were But where we're think Again, but and the perspective. I new what more, of doing make, light I ramp we could a in in right? demand XX%, is broadly. with we is the pleased have from from very just approach the aftermarket Ken, a underlying used think exactly

our our of talk larger that suppliers. set all where You've ultimately, so-called to particularly about beyond we're XX. suppliers goes time, before heard of over top the And it focused, us

we're finding but actions, able our understand corrective capacity. we're permanent what going to face think putting constraints, I both where is cause to by operational our best unlock and temporary the best really really collaborating, people and drive finger-pointing, [indiscernible] root not identify appropriate, at technical, again, the in,

new effort, what the is I think, support to with and is that do more what will we fixed here help XXXX. We're need need complement given us capacity going need really clearly deliver aftermarket, that for XXXX quarter also foundation than But Now to do a better that investments. to and make, FLIGHT we're fourth here that. to support to to DECK going between to the

talk In billion, development over next going about problems, be customer the turn, That we're about MRO deliveries. partners of not example, ultimately. in heard But them, invest capacity. we important in us network satisfying not the $X us for improving we know an by be to negotiating, going going issues, to network. serve the understanding demand. arguing solving turn, our will these really allow will in third-party that the intend that We're to unlock these and and, but better the that customers years is also You've X our of part of part to

Operator

Sachs. Our comes Poponak last question with from Noah Goldman

Noah Poponak

EBIT go I I despite there guess fourth end in the for headwind headwind beyond mix, you there ] third, of mix put we is and lifting is margin XXXX little And guess, is thinking? spread more should then, be -- in surprising that there Or can And it was that if there's up moving at was that? than Xx would services more new I for margin, but to high and I range on about specific [ out quarter the Larry, X.X% flat a maybe quantify, to X.X% 'XX, a 'XX? the think much which total basically the was there numbers XXXX the CES from as as your that? isn't just catch-up

Rahul Ghai

order just tell me reverse let if get that me and Noah, maybe don't take here, I So in there.

we right, the fourth you here as the quarter. services few things, third obviously, strong think transition CES, in the about -- as as we've to services, fourth quarter in growth a So the discussed,

XX% Just projecting year-to-date, -- full we XX% for year. had the

a growth stronger so thing that the little puts have of a here XX We shipments the So fourth lamps. as in got well. CES in OE R&D then Same well, we've quarter, OE do in CES on step-up with pressure growth And quarter. in growth margins. here the number bit the fourth as the the

in So and are for the various those the fourth puts XXXX. quarter takes

ago, need we the assumptions able are there volume that with a quantify in work Now headwind And specific that question, in we number there And Larry said to will Boeing. headwind minute not a X.X% we ] 'XX on be as had just [ next XX that just the was because exact yet provided. $X.X to XXXX. to for a

But deliveries you outlook ago, in puts different as the many of cost we until headwind XX So in overall profitable peak that headwind here grow services takes business, strong start that number. we've for be as to by program there're including we'll and think it the headwind, this it program the And for XXXX. discussed. decade the and the that in again, expect all a in Obviously, said ramp, And January. time then later we that come the to outlook will specific that's as losses beyond back I minute X to will specific just that will a period grow. and about because out grow engine that getting

Blaire Shoor

final any comments? Larry,

H. Culp

deliver rise interest challenge the team Aerospace. is thank you. confident the a heritage in ready future GE here, to here more creating to and our appreciate your thanks to today close sustainable Blaire, take just of hour. our great to customers Again, at and innovation, last being and I'm time GE We everybody your for And of for we the pride with flight. and us Aerospace

Operator

you concludes for and today's Thank ladies This you, gentlemen. participating. conference. Thank

You may now disconnect.

General Electric (GE) 22 Oct 242024 Q3 Earnings call transcript