01—Abstract
Summary
Summary of the 10-Q filed April 24, 2024. Cited figures are marked; the original filing is the authoritative source.
Boeing reported a net loss of $343 milliona for the first quarter of 2024, a slight improvement from the $414 million net loss in the same period last year.
Total revenues declined to $16.6 billionb from $17.9 billion year-over-year, primarily due to lower deliveries in the Commercial Airplanes segment. The company's financial performance in the quarter was significantly impacted by the Alaska Airlines Flight 1282 accident involving a 737-9 aircraft. This event led to production slowdowns, enhanced inspections, and substantial customer considerations, impacting Commercial Airplanes' revenue and widening its operating loss.
Despite these challenges, the Defense, Space & Security segment showed improved profitability, and Global Services saw revenue growth. Significant inventory build-up related to production issues also weighed on operating cash flow. Looking ahead, Boeing faces continued scrutiny on quality control and production rates, particularly for the 737 MAX program.
The company's ability to ramp up production, manage supply chain issues, and navigate regulatory approvals for new variants will be critical for future financial performance and cash generation. The company also noted ongoing discussions regarding a potential acquisition of Spirit AeroSystems.
02—Key points
Key Highlights
- Net loss attributable to Boeing Shareholders was $343 million, an improvement from $414 million in Q1 2023.
- Total revenues decreased to $16.6 billion from $17.9 billion year-over-year, largely due to a significant drop in Commercial Airplanes revenue.
- Commercial Airplanes segment experienced a wider operating loss of $1.14 billion, impacted by lower 737 deliveries and customer considerations related to the 737-9 grounding.
- Defense, Space & Security segment reported an operating profit of $151 million, a notable improvement from a loss of $212 million in Q1 2023.
- Net cash used by operating activities significantly increased to $3.4 billion from $0.3 billion in the prior year, primarily driven by changes in inventories.
- Inventories increased substantially to $83.5 billion from $79.7 billion, reflecting production slowdowns and delivery impacts.
- The company incurred a $443 million earnings charge related to customer considerations for the Alaska Airlines 737-9 accident and grounding.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2024, Boeing Co lost $0.02.
- Revenue$16.57B100.0%
- Cost of revenue−$14.69B88.7%
- Gross profit$1.88B11.3%
- Operating costs−$1.96B11.8%
- Operating income−$86.0M0.5%
- Interest, other & tax−$257.0M1.6%
- Net income−$343.0M2.1%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed April 24, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $16.57B$17.92B | −7.5% |
| Cost of Revenue | $14.69B$16.00B | −8.2% |
| Gross Profit | $1.88B$1.92B | −2.4% |
| R&D Expenses | $868.00M$741.00M | +17.1% |
| Operating Income | -$86.00M-$149.00M | +42.3% |
| Net Income | -$343.00M-$414.00M | +17.1% |
| EPS (Basic) | $-0.56$-0.69 | +18.8% |
| EPS (Diluted) | $-0.56$-0.69 | +18.8% |
| Shares Outstanding (Basic) | 612.90M602.20M | +1.8% |
| Shares Outstanding (Diluted) | 612.90M602.20M | +1.8% |
05—Questions
Frequently Asked Questions
What caused the decrease in revenue for the first quarter of 2024?
The decrease in revenue was primarily driven by lower deliveries in the Commercial Airplanes segment, significantly impacted by the Alaska Airlines 737-9 accident, resulting in grounding, inspections, and production slowdowns. Customer considerations related to this event also reduced revenue.
How did the 737-9 grounding affect Boeing's financial results?
The 737-9 grounding following the Alaska Airlines accident led to a significant increase in the Commercial Airplanes segment's operating loss due to lower deliveries and a $443 million charge for customer considerations. It also contributed to a substantial increase in inventory and a significant use of cash from operating activities as production rates were slowed.
What is the outlook for the Defense, Space & Security segment?
The Defense, Space & Security segment showed a strong performance with an increase in operating profit to $151 million from a loss in the prior year. This improvement was attributed to higher volumes on key programs, contract modifications, and better performance on previously challenged programs. The segment's backlog also saw an increase.
What is the current liquidity position of Boeing?
Boeing had $6.9 billion in cash and cash equivalents and $0.6 billion in short-term investments as of March 31, 2024. The company also had $10.0 billion of unused borrowing capacity on its revolving credit lines, indicating a sufficient liquidity position to meet its near-term obligations. However, net cash used by operating activities was a significant concern.
06—Continue