Boeing narrows third-quarter loss to $116 million as backlog hits record $745 billion
Boeing reported a third-quarter net loss of $116 million, or 26 cents a share, on Oct 27, compared with a loss of $5.34 billion a year earlier. Revenue rose 4% to $24.2 billion on higher defense and services volume, and total backlog grew to a record $745 billion, including more than 6,300 commercial airplanes.
On an adjusted basis, which Boeing calls core loss per share, the loss was 34 cents a share. Analysts had expected a loss of 21 cents, according to LSEG data cited by Reuters, which reported that supply-chain challenges and production delays in the commercial airplane division weighed on the quarter.
Results by business
| Unit | Revenue | Operating result |
|---|---|---|
| Commercial Airplanes | $10.7 billion, down 3% | Loss of $697 million |
| Defense, Space & Security | $7.9 billion, up 15% | Earnings of $492 million |
| Global Services | $5.6 billion, up 4% | Earnings of $1.0 billion |
The commercial unit lost $5.35 billion a year earlier, when results carried a charge on the 777X program. Boeing attributed this quarter's negative 6.5% operating margin to a less favorable delivery mix, higher projected costs tied to future production rate changes and higher estimated supply-chain costs. The unit delivered 161 airplanes, one more than a year earlier, and booked 300 net orders.
The defense unit's 6.2% operating margin included a $252 million gain on the sale of HRL Laboratories, Quartz reported. Defense backlog reached a record $101 billion.
Cash and debt
Operating cash flow was $1.5 billion, after Justice Department settlement payments of about $0.7 billion. Free cash flow, which is operating cash flow less spending on property and equipment, was $464 million, up from $238 million a year earlier.
Boeing ended the quarter with $20.7 billion in cash and marketable securities and $45.9 billion of consolidated debt. Its spending on property and equipment rose to $1.0 billion, mainly for its Charleston and St. Louis sites.
Production and certification
Boeing said the 737 program continues to progress toward stabilized production of 47 airplanes a month, while the 787 is stable at 8 a month. Boeing collects the bulk of an aircraft's price when the customer takes delivery, so production and delivery rates drive its cash.
The FAA granted amended type certification to the 737-7 during the quarter and to the 737-10 in October, the last two 737 Max variants to be certified. Airlines have ordered close to 1,500 Max 10s, about 30% of Boeing's unfilled 737 orders, Quartz reported.
Also during the quarter, the US Navy selected Boeing to design, build and deliver the F/A-XX, its sixth-generation fighter jet.
What comes next
- Boeing executives hold an earnings call at 10:30 a.m. ET on Oct 27 to update investors on how quickly the company can raise aircraft production.
- CEO Kelly Ortberg told investors in September that stabilizing 737 production was taking longer than expected, and the company expects to raise 737 output in 2027, CNBC reported.
- Boeing says the 777X remains on track for first delivery in 2027, and it expects first 737-10 deliveries the same year.