Boeing reports better-than-feared quarter, says supply chain is stabilizing amid 737 Max crisis

Boeing
on
Wednesday
reported
a
narrower-than-expected
loss
and
lower
cash
burn
than
anticipated,
and
said
it
is
stabilizing
its
supply
chain
as
it
grapples
with
the
latest

737
Max
safety
crisis.

Boeing
burned
$3.9
billion
in
the
first
quarter,
beating
a
previous
company
forecast
and
Wall
Street
analysts’
expectations
for
cash
burn
of
as
much
as
$4.5
billion
for
the
three-month
period.

“Near
term,
yes,
we
are
in
a
tough
moment,”
CEO
Dave
Calhoun,
who
announced
in
March
that
he
would

step
down
by
year-end,
said
in
a
note
to
employees
on
Wednesday. “Lower
deliveries
can
be
difficult
for
our
customers
and
for
our
financials.
But
safety
and
quality
must
and
will
come
above
all
else.
We
are
absolutely
committed
to
doing
everything
we
can
to
make
certain
our
regulators,
customers,
employees,
and
the
flying
public
are
100
percent
confident
in
Boeing.”

Boeing
has
been
hamstrung
in
ramping
up
production,
especially
of
its
best-selling
737
Max
planes.
After
the
door
plug
blew
out
on
the
Alaska
Airlines
Max
9
on
Jan.
5,
the
Federal
Aviation
Administration
has
barred
Boeing
from
increasing
output.
The
FAA
also
said
it
found
numerous
issues
of
noncompliance
along
Boeing’s
supply
chain.

Calhoun
said
the
company
has
lowered
production
to
below
38
Max
jets
per
month.
Deliveries
have

slowed
sharply
this
quarter.

“We
are
using
this
period,
as
difficult
as
it
is,
to
deliberately
slow
the
system,
stabilize
the
supply
chain,
fortify
our
factory
operations
and
position
Boeing
to
deliver
with
the
predictability
and
quality
our
customers
demand
for
the
long
term,”
Calhoun
said. “As
these
efforts
begin
to
take
hold,
we’re
seeing
early
signs
of
more
predictable,
stable
and
efficient
cycle
times
in
our
737
factory,
and
expect
this
will
continue
to
slowly
improve.”

Boeing
lost
$355
million
in
the
first
quarter,
or
56
cents
a
share,
down
from
a
$425
million,
or
69
cent
per-share
loss
a
year
earlier.
Excluding
one-time
items,
Boeing
lost
$388
million,
or
$1.13
a
share.

Revenue
fell
8%
to
$16.57
million,
slightly
ahead
of
analysts’
estimates.

Here’s
what
the
company

reported
compared
with
what
Wall
Street
analysts
surveyed
by
LSEG
were
expecting:

• 
  Loss
  per
  share:
  $1.13
  adjusted,
  vs.
  estimated
  adjusted
  loss
  $1.76
• 
  Revenue: $16.57
  billion,
  vs.
  estimated
  $16.23
  billion

Boeing
executives
will
hold
a
call
with
analysts
at
10:30
a.m.
ET,
and
questions
abound
for
Boeing’s
lame
duck
CEO
Calhoun
and
other
Boeing
leaders.

Among
those
questions:
When
will
Boeing
stabilize
its
production
line
and
increase
production
of
the
737
Max
and
other
planes?
When
will
Boeing
appoint
a
new
CEO?
How
much
will
the
current
crisis
cost
Boeing?
When
might
Boeing
finalize
a
deal
to
buy
back
fuselage
maker


Spirit
AeroSystems.

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