The company said second-quarter results showed it was making progress in transitioning its operations after a series of manufacturing and regulatory issues prevented it from delivering commercial jets on time and without quality issues.
“Even as we navigate a challenging environment, we are making progress on important programs and are beginning to meet significant milestones,” Chief Executive David Calhoun said in a note to employees Wednesday.
Boeing shares were up around 3% in early trading on Wednesday.
Production of the 737 MAX has reached 31 aircraft per month, up from 16 a year ago, as it deals with supply chain challenges such as engine shortages, which are also affecting competitor Airbus SE, which reports quarterly results later on Wednesday. Boeing has announced it has boosted 737 deliveries in June.
Executives expect Boeing will soon receive regulatory approval to resume deliveries of its widebody 787 Dreamliner. A series of production issues have mostly kept the planemaker from turning this jet over to customers over the past two years, leaving it stockpiling more than $25 billion of the plane.
Boeing is usually close to par with rival Airbus, which attends the annual Farnborough Air Show, but this year it’s lagging far behind. WSJ’s George Downs reports from the show on how Boeing is trying to catch up and what it takes to restore balance to the aviation duopoly. Picture: Rami Abukalam
The company on Wednesday reported earnings of $160 million, or 32 cents a share, for the three months ended June 30, up from $567 million, or $1, for the same period last year.
Adjusted loss per share of 37 cents, which excludes pension costs, fell short of the consensus loss of 13 cents among analysts polled by FactSet. Revenue fell 2% to $16.7 billion in the quarter, versus $17.6 billion that analysts were expecting.
Arlington, Virginia-based Boeing’s defense operations continued to be weighed down by charges. The company booked a $93 million fee for its Starliner space capsule during the quarter. Boeing successfully launched the Starliner in May, but higher costs have come after previous failed attempts to launch and dock with the International Space Station. It also claimed a $147 million fee for its MQ-25 refueling drone as costs rose to meet requirements set by the US Navy.
The company said it had positive operating cash flow in the second quarter. He reiterated the goal of generating excess cash for the full year.
In recent years, Boeing has grappled with manufacturing and regulatory issues that have hampered a recovery from two crises: a nearly two-year grounding of its 737 MAX to fly after two deadly crashes in 2018 and 2019, and the pandemic’s blow to demand new ones airplanes.
A year ago, Mr. Calhoun expressed optimism, telling analysts in July 2021: “We are turning a corner and the recovery is gaining momentum.”
Recently, Mr. Calhoun said this year would mark a turning point. “I can’t measure it week-by-week or month-by-month or even quarter-by-quarter, but I know the year is going to be a lot better,” he said at an analysts’ meeting in June.
Boeing executives have said they are focused on stabilizing the company’s operations. Airbus has been producing its A320 narrow-body family at a monthly rate of around 50 per month, with a goal of reaching 75 by 2025. But Mr Calhoun pointed to supply shortages and inflation as potential obstacles to the ramp-up in his message to staff on Wednesday. “Even with high demand, we won’t be chasing production rates or pushing our system too fast,” he said.
Boeing has had to slow production of its narrow-body aircraft this year due to supply shortages, and the outsourcing of stored MAX jets has taken longer than the company anticipated. Many of the planes have been in storage since a previous nearly two-year grounding after the two MAX crashes. Many of the MAX jets are destined for customers in China, which has not allowed the planes to resume service in the country.
The company has said it will deliver about 500 of the 737 MAX jets by the end of the year. As of June 30, the company had handed over less than half that number to customers.
write to Andrew Tangel at [email protected] and Doug Cameron at [email protected]
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