DBEA55AED16C0C92252A6554BC1553B2 Clicky DBEA55AED16C0C92252A6554BC1553B2 Clicky
February 12, 2025
Boeing
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Boeing formally reported its 2024 financial results today, matching the preview of results issued last week.  It just edged out the pandemic year of 2020 as the second worst financial year in Boeing history, with a net loss of $11.8 billion and cash flow burn of $14.3 billion.  Since 2019, the company has net losses of more than $30 billion after two MAX crashes, a global pandemic, and production quality and safety concerns with the 737 MAX after an incident in early 2024.

Fourth-quarter revenues were $15.24 billion, well below analysts’ expectations of $16.21 billion. The defense unit lost $5.41 billion in 2024, fueled by cost overruns on fixed-price programs. Only the services business unit showed positive results for the year.

The Turn-Around Plans

CEO Kelly Ortberg reiterated the company’s four-part plan to turn around the business and fix its culture in the earnings call. He also cited that the company will work with Elon Musk to speed up the deliveries of the new Air Force One aircraft. President Trump has asked for faster action on the project, which is scheduled for completion after his term ends.

Ortberg also indicated that the company plans to be in a position to produce 38 737 MAX aircraft per month in the second half of the year, reaching the current FAA limitation placed on Boeing after quality issues emerged.  He also indicated that, with FAA approval, the company could likely exceed that rate if permitted by year-end.  However, that process will follow several key performance indicators established by the FAA.  The company will ask for an increase in production rate once the KPIs reach stability at favorable rates.

Boeing

The company has no plans to launch a new program and is focused on certification efforts for the long-delayed MAX 7, MAX 10, and 777X.  Concerning the latter, he indicated that the company “has a good handle” on the thrust link failures and has resumed certification flight testing.  The company has not revised guidance on the expected certification timetable.

While the first half of 2025 will likely bleed cash, the company expects a cash flow turnaround about mid-year, with positive cash flow in the second half.  The company currently has $87.5 billion in inventories, much of which is a buffer from supply chain shortfalls. It should decrease during the year by de-stocking excess inventories, helping cash flows.

The Bottom Line

Despite the negative financial results for 2024, the company remains optimistic about its plans for 2025 and appears to be making good progress under Kelly Ortberg.  An example of cultural change is a single company-wide score for bonuses, as opposed to unit-by-unit rates in the past, to focus on a single new culture with accountability.

If Boeing can achieve the goals outlined, which remains a significant task, the company’s fortunes could turn around in the year’s second half.

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author avatar
Ernest Arvai
President AirInsight Group LLC

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