Boeing has won a $9.7 billion contract to build 60 new transport planes for the US air force.
The contract calls for the Chicago-based firm to deliver the new C-17 Globemaster planes by 2008.
Boeing has been eager to land the contract as shrinking orders from the airline industry have hurt its commercial airline business.
The company has cut production in half since September 11th and issued lay-off notices to about 30,000 workers, most of them in Washington state.
The company's shares closed yesterday at $37.49, up $1.14. The Pentagon announced the C-17 contract after the stock market closed.
Boeing already has a contract to deliver 120 C-17s by the end of 2004.
The new contract will extend operations at the Boeing plant near Los Angeles where the C-17s are assembled.
The four-engine C-17, introduced in 1995, is one of the largest cargo planes in the US air force and has been used extensively to support the war in Afghanistan.
AP