AP

Boeing posts $1.2 billion loss in Q1, worse than expected

Apr 27, 2022, 4:52 AM | Updated: 12:21 pm

Boeing said Wednesday that it lost $1.2 billion in the first quarter as it 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 Chicago-based Boeing Co. fell as much as 12.6% after the opening bell Wednesday — to a 52-week low — and were down 7% in midday trading.

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.”

“This was another dreadful quarter from Boeing,” Robert Stallard, a longtime aerospace analyst who covers Boeing for Vertical Research Partners, said in a note to clients. “And what we think will really worry investors is that we keep getting MORE bad news.”

The quarterly report brought disappointment for Boeing shareholders on several fronts.

The company again pushed back the expected first delivery of a new version of its huge, twin-aisle 777 passenger jet until 2025, five years after the original target. The delay 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 for the plane, which is designed to carry more than 400 passengers on long-haul flights. Boeing will halt production at least through the end of next year to avoid building planes that might need to be reworked later.

Boeing took a $660 million charge for its program to build two new presidential Air Force One jets — specially modified Boeing 747s — which it blamed on higher supplier costs and schedule delays. It also took $367 million in charges on a military training jet. Inflation is lowering the value of Boeing’s fixed-cost contracts for government customers.

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. Sanctions imposed by the United States and allies have barred Boeing from selling planes or performing services for Russian airlines.

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.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Republican presidential candidates, former New Jersey Gov. Chris Christie, left, talking with forme...

Associated Press

The GOP debate field was asked about Trump. But most of the stage’s attacks focused on Nikki Haley

The four Republican presidential candidates debating Wednesday night mostly targeted each other instead of Donald Trump.

2 days ago

Law enforcement officers head into the University of Nevada, Las Vegas, campus after reports of an ...

Associated Press

Police say 3 dead, fourth wounded and shooter also dead in University of Nevada, Las Vegas attack

Police said a suspect was found dead Wednesday as officers responded to an active shooter and reports of multiple victims at UNLV.

2 days ago

President Joe Biden's son, Hunter Biden, leaves after a court appearance, July 26, 2023, in Wilming...

Associated Press

Republicans threaten contempt proceedings if Hunter Biden refuses to appear for deposition

House Republicans are threatening to hold Hunter Biden in contempt if he does not show up this month for a closed-door deposition.

2 days ago

Sen. Tommy Tuberville, R-Ala., listens to a question during a news conference, March 30, 2022, in W...

Associated Press

Tuberville is ending blockade of most military nominees, clearing way for hundreds to be approved

Sen. Tommy Tuberville announced Tuesday that he's ending his blockade of hundreds of military promotions, following heavy criticism.

3 days ago

An employee works inside the Hanwha Qcells Solar plant on Oct. 16, 2023, in Dalton, Ga. On Tuesday,...

Associated Press

US job openings fall to lowest level since March 2021 as labor market cools

U.S. employers posted 8.7 million job openings in October, the fewest since March 2021, in a sign that hiring is cooling.

3 days ago

Megyn Kelly poses at The Hollywood Reporter's 25th annual Women in Entertainment Breakfast, Dec. 7,...

Associated Press

The fourth GOP debate will be a key moment for the young NewsNation cable network

By airing the fourth Republican presidential debate, NewsNation network will almost certainly reach the largest audience in its history.

3 days ago

Sponsored Articles

Follow @iamdamonallred...

Avoid a potential emergency and get your home’s heating and furnace safety checked

With the weather getting colder throughout the Valley, the best time to make sure your heating is all up to date is now. 

Follow @KTAR923...

The best ways to honor our heroes on Veterans Day and give back to the community

Veterans Day is fast approaching and there's no better way to support our veterans than to donate to the Military Assistance Mission.

...

Midwestern University

Midwestern University: innovating Arizona health care education

Midwestern University’s Glendale Campus near Loop 101 and 59th Avenue is an established leader in health care education and one of Arizona’s largest and most valuable health care resources.

Boeing posts $1.2 billion loss in Q1, worse than expected