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Boeing records a big loss


New York
CNN

Boeing reported a fourth-quarter operating loss of $650 million, surprising Wall Street analysts who expected the aviation giant to turn a profit.

The company blamed the unexpected loss on “abnormal production costs” as it tried to both deliver the remaining backlog of 737 Max jets and ramp up deliveries of 787 Dreamliners. The company’s production of the 787 remains below normal rates.

In addition, Boeing had to pay an undetermined amount of compensation to 787 customers whose deliveries were delayed by approximately one year.

Boeing has reported just two profitable quarters in the nearly four years since the 737 Max grounded. After two fatal crashes that killed 346 people, the plane was grounded for 20 months from March 2019. Then a year later the pandemic all but halted demand for flights and new planes – prompting the cancellation of hundreds of aircraft orders and the accumulation of losses for Boeing.

Still, the industry has shown signs of recovery, and analysts polled by Refinitiv had expected Boeing to earn 26 cents a share. Instead, he reported a loss of $1.75 per share. So while that’s an improvement from the $7.69 per share loss in the fourth quarter of 2021, it’s also a big disappointment.

The company’s revenue was also lower than expected, coming in at just under $20 billion. Although that was Boeing’s highest revenue since the start of the pandemic, it was about $360 million below analysts’ consensus estimate.

Boeing tried to give the best possible effect to its disappointing results.

The company said it was the first full year of positive operating cash flow since the 737 Max crisis began. Boeing eventually brought in $3.5 billion more than it spent, and the company reaffirmed its 2023 guidance of positive operating cash flow of between $4.5 billion and $6.5 billion. of dollars.

“Demand in our portfolio is strong and we remain focused on the stability of our operations and supply chain to meet our commitments in 2023 and beyond,” CEO Dave Calhoun said in the company’s statement. “While challenges remain, we are well positioned and on track to restore our operational and financial strength.”

Shares of Boeing (BA) fell 2% in premarket trading according to the report.

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