Boeing Co., a leading aerospace and defense corporation, has announced projections for a significantly expanded loss and diminished revenues in its fourth quarter. This downturn is chiefly due to the work stoppage and agreement with the International Association of Machinists and Aerospace Workers (IAM), along with charges related to specific Defense, Space & Security programs. Following these preliminary fourth-quarter reports, Boeing's stock dipped by 1.8 percent in after-hours trading on the NYSE. In pre-market dealings, the stock shows a 1.7% decrease, trading at $175.56.
On Thursday, Boeing's shares concluded the regular trading session at $178.50, reflecting a 2.12% increase.
Kelly Ortberg, Boeing's President and CEO, stated, "Despite the short-term hurdles, we have made substantial progress in stabilizing our business during the quarter. This includes reaching terms with our IAM-represented colleagues and successfully securing capital to enhance our financial standing. Additionally, we've resumed production of the 737, 767, and 777/777X models. Our team remains dedicated to forging a new future for Boeing."
For the fourth quarter, Boeing anticipates a loss per share of $5.46, with revenues expected to reach $15.2 billion.
For contrast, in the same quarter last year, Boeing, based in Chicago, reported a net loss of $0.04 per share, a core loss of $0.47 per share, and total revenues of $22.02 billion, driven primarily by elevated commercial activity.
Wall Street analysts predict Boeing will report a loss of $1.66 per share with revenues totaling $15.16 billion for the quarter. It's important to note that analysts' forecasts usually exclude special items.
Within the quarter, Boeing's Commercial Airplanes division forecasts revenue of $4.8 billion, with an operating margin of negative 43.9 percent.
The Defense, Space & Security division expects to report revenue of $5.4 billion and an operating margin of negative 41.9 percent.
Boeing has acknowledged that the results for its Commercial Airplanes division will reflect the impact of the IAM work stoppage and agreement, including reduced deliveries and pre-tax earnings charges of $1.1 billion related to the 777X and 767 programs.
The 777X program is facing a pre-tax charge of $0.9 billion, attributed to increased labor costs linked to finalizing the IAM agreement. This charge is expected to affect the company's finances over several years. Nonetheless, Boeing still foresees the first delivery of the 777-9 in 2026.
Defense, Space & Security anticipates recording pre-tax earnings charges totaling $1.7 billion across the KC-46A, T-7A, Commercial Crew, VC-25B, and MQ-25 programs. Specifically, the KC-46A program is subject to a pre-tax charge of $0.8 billion, reflecting higher projected manufacturing costs influenced by the IAM work stoppage and agreement. The T-7A program's pre-tax charge of $0.5 billion is primarily driven by increased estimated costs for production lots in 2026 and beyond.
Additionally, Boeing projects an operating cash flow of $3.5 billion for the most recent quarter.
As of quarter-end, the company's cash and investments in marketable securities amounted to $26.3 billion.
Boeing is scheduled to release its fourth-quarter results on January 28.
