US Markets
Wednesday, April 24th, 2024 1:59 pm EDT
Key Points
- Boeing reported a better-than-expected quarter but continued to burn cash as it aims to stabilize production following a door blowout incident on a 737 Max earlier in the year.
- The company burned $3.9 billion in the first quarter, surpassing both previous company forecasts and Wall Street analysts’ expectations.
- CEO Dave Calhoun emphasized Boeing’s commitment to safety and quality amid production challenges, particularly with the 737 Max, which has led to lowered output and slowed deliveries, while revenue dropped 31% in the commercial airplane unit.
Boeing reported a quarter that surpassed expectations, yet it continued to grapple with cash burn as it navigates challenges in stabilizing production, notably following a door blowout incident on a 737 Max earlier in the year. Despite burning $3.9 billion in the first quarter, which exceeded previous forecasts, CEO Dave Calhoun emphasized the company’s unwavering commitment to safety and quality, prioritizing confidence from regulators, customers, employees, and the flying public. Production hurdles, particularly with the 737 Max, have constrained Boeing, prompting a reduction in output. Regulatory restrictions from the FAA, coupled with quality control issues along the supply chain, have further complicated Boeing’s efforts. Calhoun reiterated the company’s focus on stabilizing the supply chain and fortifying factory operations to ensure long-term predictability and quality. Although Boeing experienced an 8% decline in revenue, slightly surpassing analyst estimates, Calhoun affirmed the company’s goal of achieving $10 billion in annual free cash flow by 2025-2026, albeit potentially delayed by six months. Boeing has been actively addressing manufacturing challenges, aiming to minimize defects and streamline operations. Discussions regarding a potential acquisition of Spirit AeroSystems, Boeing’s fuselage maker, are underway, with Calhoun expressing optimism about reaching a deal in the second quarter. Amidst uncertainties surrounding production stability, CEO succession, and financial implications of the ongoing crisis, Boeing executives face inquiries from analysts regarding the company’s strategic roadmap and recovery trajectory.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/24/boeing-ba-earnings-q1-2024.html
