And Boeing Co. Dreamliner 787 aircraft with AirEuropa design move past the company’s final assembly plant in North Charleston, South Carolina, USA, on Tuesday, December 6, 2016.
Travis Dove | Bloomberg | Getty pictures
Boeing reported a broader adjusted loss and lower revenue than analysts expected when the company faced higher costs on both commercial and defense aircraft and fees associated with the war in Ukraine.
The manufacturer said it would halt production of the 777X, which has not yet been certified by U.S. regulators, through 2023, a plan the company says will create $ 1[ads1].5 billion in abnormal costs from the second quarter.
Boeing also does not expect deliveries of the aircraft to start until 2025, more than a year later than previously predicted. Shares fell more than 4% in pre-market trading after reporting results on Wednesday morning.
Boeing has had a boom in demand for its 737 Max aircraft, which returned to service at the end of 2020 after two fatal accidents. But production problems and certification delays have hampered other aviation programs.
“Through our first quarter results, you will see that we still have more work to do, but I am still encouraged with our path and we are on track to generate positive cash flow for 2022,” said Boeing CEO David Calhoun in a note. to employees Wednesday. “We are a long-cycle company, and the success of our efforts will be measured over years and decades, not quarters.”
Boeing said it was submitting its certification plan to the Federal Aviation Administration, a step toward getting regulators to sign on to resume deliveries of the widebody jets. These deliveries to customers have been suspended for most of the past 18 months, and buyers like American Airlines said they reduced some international flights in response.
Here’s how Boeing performed in the first quarter compared to analysts’ estimates followed by Refinitiv:
- Adjusted earnings: A core loss of $ 2.75 per share against an expected loss of 27 cents per share.
- Revenue: $ 13.99 billion against $ 16.02 billion, expected.
The company said it is increasing 737 Max production to 31 a month in the second quarter. It delivered 95 aircraft in the first quarter up from 77 from the same period last year, but revenues in the commercial aircraft unit fell 3% from last year to 4.16 billion dollars when 787 Dreamliner deliveries remained stopped.
Boeing reported negative operating cash flow for the quarter, but expects to remain cash flow positive in 2022.
The Boeing share is down 17% so far this year through Tuesday’s closing, and surpasses the S&P 500’s fall of 12.4%.
Manufacturer’s executives will hold a conversation with analysts at 10:30 a.m. ET.