Boeing Reports Third Quarter Results
ARLINGTON, Va., Oct. 23, 2024 /PRNewswire/ --
Third Quarter 2024
Financials reflect impacts of the International Association of Machinists and Aerospace Workers (IAM) work stoppage and previously announced charges on commercial and defense programs
Revenue of $17.8 billion, GAAP loss per share of ($9.97) and core (non-GAAP)* loss per share of ($10.44)
Operating cash flow of ($1.3) billion and free cash flow of ($2.0) billion (non-GAAP)*
Total company backlog of $511 billion, including over 5,400 commercial airplanes
Table 1. Summary Financial Results
Third Quarter
Nine Months
(Dollars in Millions, except per share data)
2024
2023
Change
2024
2023
Change
Revenues
$17,840
$18,104
(1) %
$51,275
$55,776
(8) %
GAAP
Loss from operations
($5,761)
($808)
NM
($6,937)
($1,056)
NM
Operating margins
(32.3)
%
(4.5)
%
NM
(13.5)
%
(1.9)
%
NM
Net loss
($6,174)
($1,638)
NM
($7,968)
($2,212)
NM
Basic loss per share
($9.97)
($2.70)
NM
($12.91)
($3.64)
NM
Operating cash flow
($1,345)
$22
NM
($8,630)
$2,579
NM
Non-GAAP*
Core operating loss
($5,989)
($1,089)
NM
($7,769)
($1,919)
NM
Core operating margins
(33.6)
%
(6.0)
%
NM
(15.2)
%
(3.4)
%
NM
Core loss per share
($10.44)
($3.26)
NM
($14.52)
($5.35)
NM
*Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 5, "Non-GAAP Measures Disclosures."
The Boeing Company (NYSE:BA) recorded third quarter revenue of $17.8 billion, GAAP loss per share of ($9.97) and core loss per share (non-GAAP)* of ($10.44) (Table 1) primarily reflecting impacts of the IAM work stoppage and previously announced charges on commercial and defense programs. Boeing reported operating cash flow of ($1.3) billion and free cash flow of ($2.0) billion (non-GAAP)*.
"It will take time to return Boeing to its former legacy, but with the right focus and culture, we can be an iconic company and aerospace leader once again," said Kelly Ortberg, Boeing President and Chief Executive Officer. "Going forward, we will be focused on fundamentally changing the culture, stabilizing the business, and improving program execution, while setting the foundation for the future of Boeing."
Table 2. Cash Flow
Third Quarter
Nine Months
(Millions)
2024
2023
2024
2023
Operating cash flow
($1,345)
$22
($8,630)
$2,579
Less additions to property, plant & equipment
($611)
($332)
($1,582)
($1,096)
Free cash flow*
($1,956)
($310)
($10,212)
$1,483
*Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 5, "Non-GAAP Measures Disclosures."
Operating cash flow was ($1.3) billion in the quarter reflecting lower commercial widebody deliveries, as well as unfavorable working capital timing, including the impact of the IAM work stoppage (Table 2).
Table 3. Cash, Marketable Securities and Debt Balances
Quarter End
(Billions)
3Q 2024
2Q 2024
Cash
$10.0
$10.9
Marketable securities1
$0.5
$1.7
Total
$10.5
$12.6
Consolidated debt
$57.7
$57.9
1 Marketable securities consist primarily of time deposits due within one year classified as "short-term investments."
Cash and investments in marketable securities totaled $10.5 billion, compared to $12.6 billion at the beginning of the quarter driven by free cash flow usage in the quarter (Table 3). In October, the company entered into a new $10.0 billion short-term credit facility and now has access to total credit facilities of $20.0 billion, which remain undrawn.
Total company backlog at quarter end was $511 billion.
Segment Results
Commercial Airplanes
Table 4. Commercial Airplanes
Third Quarter
Nine Months
(Dollars in Millions)
2024
2023
Change
2024
2023
Change
Deliveries
116
105
10 %
291
371
(22) %
Revenues
$7,443
$7,876
(5) %
$18,099
$23,420
(23) %
Loss from operations
($4,021)
($678)
NM
($5,879)
($1,676)
NM
Operating margins
(54.0)
%
(8.6)
%
NM
(32.5)
%
(7.2)
%
NM
Commercial Airplanes third quarter revenue of $7.4 billion and operating margin of (54.0) percent reflect previously announced pre-tax charges of $3.0 billion on the 777X and 767 programs as well as the IAM work stoppage and higher period expense, including research and development (Table 4).
The 787 program is currently producing at 4 per month and maintains plans to return to 5 per month by year end. In the quarter, Commercial Airplanes booked 49 net orders and delivered 116 airplanes, with backlog of over 5,400 airplanes valued at $428 billion.
Defense, Space & Security
Table 5. Defense, Space & Security
Third Quarter
Nine Months
(Dollars in Millions)
2024
2023
Change
2024
2023
Change
Revenues
$5,536
$5,481
1 %
$18,507
$18,187
2 %
Loss from operations
($2,384)
($924)
NM
($3,146)
($1,663)
NM
Operating margins
(43.1)
%
(16.9)
%
NM
(17.0)
%
(9.1)
%
NM
Defense, Space & Security third quarter revenue of $5.5 billion and operating margin of (43.1) percent reflect the previously announced pre-tax charges of $2.0 billion on the T-7A, KC-46A Tanker, Commercial Crew, and MQ-25 programs. Results also reflect unfavorable performance on other programs.
During the quarter, Defense, Space & Security delivered the first production MH-139A to the U.S. Air Force and definitized a contract for two E-7A Wedgetails from the U.S. Air Force. Backlog at Defense, Space & Security was $62 billion, of which 28 percent represents orders from customers outside the U.S.
Global Services
Table 6. Global Services
Third Quarter
Nine Months
(Dollars in Millions)
2024
2023
Change
2024
2023
Change
Revenues
$4,901
$4,812
2 %
$14,835
$14,278
4 %
Earnings from operations
$834
$784
6 %
$2,620
$2,487
5 %
Operating margins
17.0
%
16.3
%
0.7 pts
17.7
%
17.4
%
0.3 pts
Global Services third quarter revenue of $4.9 billion and operating margin of 17.0 percent reflect higher commercial volume and mix.
During the quarter, Global Services secured agreements for Landing Gear Exchange Program and Integrated Material Management with All Nippon Airways and a KC-135 spares contract from the U.S. Air Force.
Additional Financial Information
Table 7. Additional Financial Information
Third Quarter
Nine Months
(Dollars in Millions)
2024
2023
2024
2023
Revenues
Unallocated items, eliminations and other
($40)
($65)
($166)
($109)
Loss from operations
Other unallocated items and eliminations
($418)
($271)
($1,364)
($1,067)
FAS/CAS service cost adjustment
$228
$281
$832
$863
Other income, net
$265
$297
$790
$919
Interest and debt expense
($728)
($589)
($1,970)
($1,859)
Effective tax rate
0.8
%
(48.9)
%
1.8
%
(10.8)
%
Other unallocated items and eliminations primarily reflects timing of allocations.
Non-GAAP Measures Disclosures
We supplement the reporting of our financial information determined under Generally Accepted Accounting Principles in the United States of America (GAAP) with certain non-GAAP financial information. The non-GAAP financial information presented excludes certain significant items that may not be indicative of, or are unrelated to, results from our ongoing business operations. We believe that these non-GAAP measures provide investors with additional insight into the company's ongoing business performance. These non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define such measures differently. We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. The following definitions are provided:
Core Operating Earnings/(loss), Core Operating Margin and Core Earnings/(loss) Per Share
Core operating earnings/(loss) is defined as GAAP Earnings/(loss) from operations excluding the FAS/CAS service cost adjustment. The FAS/CAS service cost adjustment represents the difference between the Financial Accounting Standards (FAS) pension and postretirement service costs calculated under GAAP and costs allocated to the business segments. Core operating margin ...
