Nobody spends money on arms like the US of A.
Starting with a base of $534 billion in discretionary funding, coupled with another $51 billion for Overseas Contingency Operations funding (aka the “war budget”), the Pentagon’s spending power comes to a grand total of $585 billion.
Defense industry giants, Boeing, General Dynamics, Northrop Grumman, and Raytheon posted second-quarter earnings on Wednesday (Lockheed Martin earnings released last week).
Here’s a look at how they did…
Boeing

Boeing, the world’s largest plane maker, reported a smaller-than-expected second Q2 loss on Wednesday. The company’s first quarterly net loss in nearly seven years amounted to $234 million.
Boeing’s KC-46 tanker program for the US Air Force is delayed from August 2017 until January 2018 due to test flight problems. Modifications to the aircraft are expected to cost Boeing an additional $393 million (after taxes).
What’s more, Boeing could end production of its most iconic aircraft.
“If we are unable to obtain sufficient orders and/or market, production and other risks cannot be mitigated, we could record additional losses that may be material, and it is reasonably possible that we could decide to end production of the 747,” Boeing said in its filing on Wednesday.
Earlier this year, Boeing won a US Air Force contract worth $25.8 million to start work on the next fleet of Air Force One aircraft.
The aging Air Force One and it’s twin decoy will be replaced with two Boeing 747-8 and are expected to be operational in 2020.
Up to Wednesday’s close of $135.96, the company’s shares had fallen about 6% since the start of the year.
Highlights from Boeing’s quarterly earnings report:
•Operating cash flow of $1.2 billion (with 28.6 million shares repurchased for $3.5 billion)
•Cash flow of $3.2 billion, (down 2% from 2015)
•Core earnings per share loss of $0.44
•Revenue rose 1% to $24.8 billion (from earlier estimate of $24.5 billion)
• Demand still high with more than 5,700 commercial plane orders still in the works
Reuters contributed to this report.
General Dynamics

General Dynamics began their earnings conference call on Wednesday highlighting their “very good second quarter.”
The Falls Church, Virginia-based company announced $7.6 billion in Q2 revenue and achieved $758 million in net earnings.
General Dynamics recognized their aerospace unit (with a revenue of $2.13 billion) and maritime division.
At the end of June 2016, the defense giants’ National Steel and Shipbuilding division won a $640 million Pentagon contract to construct a T-AO 205 Class Fleet Replenishment Oiler. The contract could be worth up to $3.16 billion if the Pentagon decides to buy an additional five ships.
In March, the US Navy announced that General Dynamics will be the prime contractor for development of 12 new submarines.
Shares rose less than 1% to $145.09 in the afternoon and since the beginning of this year, the company’s stock has climbed 5.2%.
Highlights from General Dynamics’ quarterly earnings report:
•Revenue fell to $7.67 billion (down by $217 million from the Q2 2015)
•Raised 2016’s full-year earnings forecast to $9.70 per share (from $9.20, analysts’ expect $9.52)
•Profit margins could be as high as 13.8% (up from January 2016 estimate of 13.3%)
Reuters contributed to this report.
Lockheed Martin
