The worldwide aerospace and defense business sector had flat financial performance for the second year in a row, and steady employment in the sector according to a new study by Deloitte.

Industry revenues barely kept pace with inflation and the industry experienced comparatively flat-to-modest increases in core operating profit, with non-recurring charges excluded, according to the 2010 Global Aerospace and Defense Industry Performance Wrap-up.

“Flat results are not surprising given the tough economy,” said Tom Captain, vice chairman, Deloitte LLP and global aerospace and defense sector leader. “Global defense contractors are experiencing new challenges in growing revenues and profits. “Conversely, the commercial aerospace sector is pointing to higher revenues and profits moving forward, particularly as business and personal travel rates continue to climb, especially in the emerging global economies.”

Part of the problem lies in the fact the industry didn’t boost sales orders sufficiently to replace sales revenue billings the report stated. While the industry backlog rebounded from 2009 levels, it experienced uneven growth, with commercial aircraft orders gaining momentum while defense contractors struggled with a difficult budget environment.

The industry did report operating profits of $56.9 billion in 2010, a 24.9 percent improvement from 2009. Employment in the global aerospace and defense industry remained constant at about 2 million employees in 2010, with a very modest decline of 0.8%.

The report also found that:

  • Core operating margins of 8.9 percent represented an increase of 2.9 percent, or 26 basis points, although reported operating margins increased by 23.0 percent, or 162 bps, as a result of the virtual absence of large, non-recurring charges to earnings in 2010 relative to 2009.
  • Core revenues of U.S. companies grew faster in 2010 than their European counterparts with U.S. revenues growing 1.9 percent in 2010 versus 0.9 percent growth among European companies.
  • Boeing maintained its position as the world’s largest A&D Industry company, despite a 5.8% revenue decline, largely attributable to reduced  commercial aircraft deliveries, notably in the 747 and 777 programs

Related News

Chandler Harris is a freelance business and technology writer located in Silicon Valley. He has written for numerous publications including Entrepreneur, InformationWeek, San Jose Magazine, Government Technology, Public CIO,, U.S. Banker, Digital Communities Magazine, Converge Magazine, Surfer's Journal, Adventure Sports Magazine,, and the San Jose Business Journal. Chandler is also engaged in helping companies further their content marketing needs through content strategy, optimization and creation, as well as blogging and social media platforms. When he's not writing, Chandler enjoys his beach haunt of Santa Cruz where he rides roller coasters with his son, surfs and bikes across mountain ranges.