Boeing said Wednesday that it lost $1.2bn in the first quarter and took large write-downs and losses in both its civilian-plane and defence businesses.
The loss was bigger than Wall Street had forecast, and the company’s quarterly revenue also fell short of expectations. Boeing burned through $3.2bn in cash.
“Messier quarter than any of us would have liked,” CEO David Calhoun acknowledged on CNBC news.
Shares of Boeing Co, based in Chicago in the United States, fell 10 percent 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 defence and commercial development programmes.”
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 $1.5bn in “abnormal” production costs.
Boeing took a $660m charge for its programme to build new presidential Air Force One jets, which it blamed on higher supplier costs, final technical requirements and schedule delays. It also took $367m in charges on a military training jet.
Boeing said it submitted plans to the US Federal Aviation Administration (FAA) 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 $2bn in costs, of which $312m was recorded in the first quarter.
Airlines are expecting a boom summer, with travellers returning in huge numbers after two years of the coronavirus pandemic. But some of them, like American Airlines, 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 the crashes.
And Boeing took $212m 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-planes division lost $859bn, hobbled by the inability to deliver 787 jets while Boeing tries to fix production flaws on the twin-aisle plane.
The defence business, long a bulwark against volatility in aircraft sales to airlines, lost $929m as revenue fell 24 percent.
The company reported a loss attributable to shareholders of $1.22bn, compared with a loss of $537m a year earlier. The “core” loss was $2.75 a share on revenue of $13.99bn. Analysts expected a loss of 25 cents per share on revenue of $16.02bn, according to a FactSet survey.