Boeing on Wednesday reported second-quarter profit that beat expectations. Yet shares of the Chicago-based planemaker still fell 3 percent after it announced that operating margins will drop for its Defense, Space and Security division.
Boeing now projects 2018 operating margins for the defense division of 10 percent to 10.5 percent, down from the previous forecast of 11 percent. The division employs about 14,500 people in the St. Louis area.
The margin forecast was revised down due to a combined $426 million of charges and cost overruns caused by Boeing’s work on its KC-46 aerial tanker. The company hopes to deliver the first of the aircraft to the U.S. .Air Force in October, more than two years behind schedule.
Second-quarter core earnings were $3.33 per share, beating the average analyst estimate of $3.24 per share, according to Zacks Investment Research. Revenue rose 5 percent to $24.3 billion, which also beat estimates.
For the full year, the company said it expects revenue of $97 billion to $99 billion, compared with its previous estimate of $96 billion to $98 billion.