Shares of aircraft manufacturer Boeing (BA 4.18%) were rallying on Friday, up 5.9% as of 1:45 p.m. ET.

It has been a tough stretch for Boeing over the past few years and even in its most recent fourth quarter. However, the company's defense segment received great news today, as it was awarded the contract for the Department of Defense's next-generation warfighter aircraft program.

Boeing lands a much-needed win

On Friday, President Donald Trump announced Boeing as the winner of the $20 billion initial contract to engineer and manufacture the F-47, which will be the DOD's sixth-generation warfighter, following the F-35.

The announcement was somewhat of a surprise, as F-35 manufacturer Lockheed Martin (NYSE: LMT) had been favored to win the contract. While the F-35 has been plagued by delays and cost overruns, Boeing's recent track record has also been less than stellar, with a series of high-profile commercial jet safety issues, delays to the new Air Force One plane (which Boeing now says will be ready in 2027-2028), and a worker strike last year.

Nevertheless, the administration went with Boeing for the new $20 billion program. At a media event today with Secretary of Defense Pete Hegseth, President Trump said: "The F-47 will be the most advanced, most capable, most lethal aircraft ever built. An experimental version of the plane has secretly been flying for almost five years and we're confident that it massively overpowers the capabilities of any other nation."

Boeing investors get a reprieve

Boeing's troubles continued in 2024, with revenue declining and losses increasing in both its commercial and defense segments. Its machinists went on strike in September, heavily affecting Q4 results, before reaching a new agreement on Nov. 5.

Still, there have been some glimmers of hope lately. At a recent conference, CFO Brian West said the company's cash outflows in the first quarter would be less than expected. In addition, Boeing has thus far delivered more commercial aircraft than rival Airbus through the first two months of the year, after delivering far fewer aircraft than its rival over the past six years.

Improved execution under Kelly Ortberg, who just became CEO of Boeing in August 2024, combined with the new F-47 win could perhaps lead to better days ahead for the troubled company. Therefore, Boeing is a turnaround story to watch in 2025, even though much uncertainty still clouds its outlook.