Boeing announced on Wednesday that it will continue to incur cash outflows this quarter, underscoring ongoing struggles in both its commercial airplane and defense divisions. The company reported a larger-than-expected quarterly loss and revenues that fell short of analyst predictions. Additionally, Boeing revealed the appointment of industry veteran Robert “Kelly” Ortberg as its incoming CEO, in a bid to stabilize its operations.
In the second quarter, Boeing registered a loss of $2.90 per share on an adjusted basis, significantly missing the analyst forecast of $1.97 per share, with revenues down 15% to $16.87 billion, compared to an expected $17.23 billion. The company burned through $4.3 billion in cash during this period.
CEO Dave Calhoun acknowledged the tough quarter but highlighted progress in improving Boeing’s quality management systems. Notably, Calhoun plans to step down by year-end. CFO Brian West indicated that cash outflows would persist into the third quarter due to “near-term working capital pressures.”
Boeing aims to ramp up production of its 737 Max jets to 38 units per month, although it averaged in the mid-20s last quarter. The commercial airplanes unit saw a 32% year-over-year revenue decline, attributed to delayed deliveries and production shortfalls, pushing financial targets further out.
The defense segment did not fare better, reporting a 2% revenue dip and a near doubling of its quarterly loss to $913 million, driven by higher engineering costs and technical challenges. This sector also grapples with delays in constructing the two Air Force One aircraft.
Despite the setbacks, Boeing’s shares showed resilience, rising over 3% in midday trading. As the manufacturer tries to regain its footing, the market remains keenly focused on its recovery trajectory.
Original Story https://www.cnbc.com/2024/07/31/boeing-ba-earnings-q2-2024.html
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