Boeing said Wednesday that it lost $1.2 billion in the first quarter as it and took large write-downs and lost money in both its civilian-airplane and defense businesses.
The loss was bigger than Wall Street had forecast, and the company's quarterly revenue also fell short of expectations. Boeing burned through $3.2 billion in cash.
“Messier quarter than any of us would have liked," CEO David Calhoun acknowledged on CNBC.
Shares of Boeing Co., based in Chicago, fell 10% shortly after the opening bell Wednesday.
Boeing offered some optimism for improvement, however, saying that it has submitted plans to resume deliveries of its 787 airliner and it increased production and deliveries of the 737 Max passenger jet during the quarter.
Calhoun said the company was on track to generate positive cash flow over the entire year "despite the pressures on our defense and commercial development programs.”
The quarterly report brought disappointing news for Boeing shareholders on several fronts.
The company again pushed back the expected first delivery of a new version of its long-range, twin-aisle 777 passenger jet by at least a year until 2025. The move was widely expected, as Boeing adapts to certification standards that have been tightened since regulators approved the Max, then were forced to ground the planes after two deadly crashes.
The delay in expected approval for the 777-9 caused Boeing to forecast $1.5 billion in “abnormal” production costs.
Boeing took a $660 million charge for its program to build new presidential Air Force One jets, which it blamed on higher supplier costs, final technical requirements and schedule delays. It also took $367 million in charges on a military training jet.
Boeing said it submitted plans to the Federal Aviation Administration to resume deliveries of the 787 passenger jet. Those deliveries have been halted for more than a year by production issues that Boeing previously said would add about $2 billion in costs, of which $312 million was recorded in the first quarter.
Airlines are expecting a boom summer, with travelers returning in huge numbers after two years of pandemic. But some of them, like American, have trimmed summer schedules because they haven't received the Boeing 787s that they ordered years ago.
“They have a busy summer schedule. We have already disappointed them with respect to the capacity on that summer schedule," Calhoun said. Just when Boeing will be cleared to resume deliveries of 787s is up to the FAA, but Calhoun said “We will be back in the air sooner rather than later.”
Boeing expects to boost production of the 737 Max to 31 planes a month in the current quarter, which runs through June. That plane was grounded worldwide for nearly two years after two deadly crashes.
And Boeing took $212 million in pretax charges related to Russia’s invasion of Ukraine. The company did not immediately explain the write-down.
In a memo to employees, Calhoun said Boeing is taking steps to improve long-term performance.
“We are a long-cycle business, and the success of our efforts will be measured over years and decades, not quarters,” he said.
Boeing's commercial-airplanes division lost $859 billion, hobbled by the inability to deliver 787 jets while Boeing tries to fix production flaws on the twin-aisle plane.
The defense business, long a bulwark against volatility in aircraft sales to airlines, lost $929 million as revenue fell 24%.
The company reported a loss attributable to shareholders of $1.22 billion, compared with a loss of $537 million a year earlier. The “core” loss was $2.75 a share on revenue of $13.99 billion. Analysts expected a loss of 25 cents per share on revenue of $16.02 billion, according to a FactSet survey.
Twitter announced a partnership with S&P Dow Jones Indices on Thursday to build the S&P 500 Sentiment Index for monitoring the performance of 200 S&P members based on tweets with company $cashtags. Jared Podnos, strategic market development lead at Twitter, and Peter Roffman, global head of innovation and strategy at S&P Dow Jones Indices, joined Cheddar to provide some background on the partnership and to explain exactly how monitoring companies through public opinion will work. "[The S&P] taps into this conversation. They understand the real-time conversation as well as the historical trends, and then we can analyze that and understand the consumer sentiment and really build these innovative products around that conversation," Podnos added.
Cognitive healthcare platform BrainCheck recently raised $10 million in a Series B round. The platform offers neurologists a new way to detect and care for brain disorders like Alzeheimer's, and brain injuries like concussions. BrainCheck CEO Yael Katz joined Cheddar News' Closing Bell to discuss.
Stocks closed mixed today, with the S&P 500 and the Nasdaq both notching record closing highs. Veronica Willis, investment strategy analyst at the Wells Fargo Investment Institute, joins Cheddar News' Closing Bell to discuss today's close, recent inflation data, rising oil prices, and more.
Jean-Denis Mariani, the chief digital officer at COTY, the parent company for major brands like Bottega Veneta, Burberry, and Kylie Skin, joined Cheddar to talk about the impact of the pandemic on the beauty industry and the rapid shift to e-commerce sales. "There is no digital strategy anymore, only strategy in a digital world," he said. Mariani also talked about personalized makeup selection for consumers as the beauty sector begins to incorporate technology like artificial intelligence.
Amid an ongoing global semiconductor chip shortage, American automaker Ford has decided to open up supply chains of its own. Karl Brauer, an executive analyst at iSeeCars.com, joined Cheddar to discuss Ford's new partnership with multinational semiconductor maker GlobalFoundries to build those chips domestically. Brauer praised Ford for the move both for ongoing supply woes and the future of automobile manufacturing. "It's not just the supply chain," he said. "It's not just about getting chips, but maybe getting chips that are more customized and specific to your needs."
Gerald Johnson, Executive VP, Global Manufacturing and Sustainability at General Motors, joins Cheddar News to break down what Factory ZERO signifies for GM's all-electric future and why the auto manufacturer will be a leader in the growing EV industry.
According to the U.S. Labor Department, a record 4.4-million people quit their job in September, with data showing there are seven unemployed workers for every ten job openings.
However, Americans aren't just quitting their jobs for more suitable ones, many are embracing their entrepreneurial side, leaving to start their own business. Dick Schulze, founder of Best Buy joined Cheddar's Opening Bell to discuss.
Airlines are gearing up for a busy winter season as they continue to rebound from the pandemic. But jet fuel prices combined with the ongoing labor shortage could put a damper on those holiday gains. Christian Vernet, president of La Compagnie, the only all business class airline in the world, joined Cheddar for an update on the state of the airline industry and how it's dealing with the surge in demand after the U.S. reopened its border to international visitors.
Cadillac is launching its first ever all-electric vehicle. The 2023 Lyriq boasts an estimated 300 mile range, $60,000 dollar starting price, a 33-inch advanced LED display, among many other features. The rollout comes as Cadillac has posted record third quarter global sales and plans to become all-electric by 2030. Rory Harvey, vice president of Cadillac, joined Cheddar to discuss what drivers can expect from the Lyriq, and how the brand has been able to deal with the ongoing chip shortage.
