Boeing Pares Down Losses, Delivers More 737 Max Jets
Boeing has become so embattled that the company's stock rose even after reporting a worse-than-expected loss and sales that came in $900 million short of forecasts. For a company that has endured a steady stream of bad news for the last three years these latest results nearly qualify as a "good" quarter, Chris Isidore reported for CNN Business.
Photo Insert: Boeing increased production of its 737 Max to 31 planes per month, up from 26 monthly at the end of last year.
Shares of Boeing, a component of the Dow, gained 3% in mid-morning trading on the report.
Although they're still down 22% for the year despite Tuesday's close, investors were likely cheered that Boeing reported a positive operating cash flow of $81 million — only the second quarter in the last three years that the company did not burn through cash. What's more, the company said it's on track to maintain positive cash flow for the year.
It could be the beginning of a reversal of a cash-burn trend that Boeing has faced since the second quarter of 2019, when its 737 Max was grounded after two fatal crashes. In that time Boeing had a negative operating cash flow of $24.7 billion.
Boeing was unable to provide a definitive date for resuming deliveries of its 787 Dreamliner planes, which have been halted for more than a year by the Federal Aviation Administration (FAA). It was forced to take a $283 million charge in the quarter due to the halt, and it expects the total costs will reach $2 billion.
"While we are making meaningful progress, we have more work ahead," said CEO Dave Calhoun. Overall, Boeing reported net income of $160 million excluding special charges for the second quarter, down 72% from a year earlier. And though revenue of $16.9 billion was off just 2% from the prior year and was $900 million less than analysts had forecast.
In other sunnier news for Boeing, the company increased production of its 737 Max to 31 planes per month, up from 26 monthly at the end of last year.
It also received orders for 169 of the jets during the quarter, including 100 from Delta Air Lines— the major US airline that had not previously owned the plane. Boeing delivered 103 of the 737 Max jets in the quarter, the most since the FAA ended the 20-month grounding of the jet in November 2020. One of those deliveries was to Ethiopian Airlines, one of the two airlines that suffered a fatal crash with the plane.