Boeing (NYSE:BA) announced a reduction in its fourth-quarter loss, exceeding expectations thanks to an increase in aircraft deliveries that boosted its revenue. The North American aerospace and defense company narrowed its net loss to $30 million in the final three months of the year, a significant improvement from its $663 million loss in the same period a year ago.

Excluding extraordinary items, the adjusted loss per share was $0.47, exceeding estimates of a loss of $0.72 per share. Revenue for the quarter grew 10% to $22 billion, driven by the delivery of 157 commercial aircraft, an increase from 152 deliveries in the corresponding quarter of the previous year.

The company, located in Arlington, Virginia, reported deliveries of 528 commercial aircraft throughout the year and a total of 1,576 net orders, expanding its order book to more than 5,600 aircraft, valued at approximately $520 billion.

In 2023, Boeing generated operating cash flow of $6 billion, resulting in free cash flow of $4.4 billion, according to adjusted metrics.

Boeing postpones outlook to 2024, CEO says company has “a lot to prove”

Boeing has “a lot to prove” to regain the trust of regulators and customers after an explosion in the cockpit panel of a 737 MAX aircraft, CEO Dave Calhoun said on Wednesday, adding that the planemaker will “take it slow.” , as it faces a “serious challenge”.

As expected, Calhoun did not offer a financial or delivery forecast for 2024, saying the company must focus on delivering quality planes.

The planemaker, however, reported a smaller quarterly loss and better-than-expected revenue and free cash flow, although investors are more likely to focus on the company’s expectations as it weathers the current crisis.

“We will not rush the system and will take our time to do it right,” Calhoun said in a letter to employees, expressing confidence in Boeing’s recovery.

The crash involving a MAX 9 jet operated by Alaska Airlines this month has turned into a full-blown safety and reputation crisis for the iconic planemaker, potentially leading to slower jet production and a loss of narrow-body market share. for Airbus.

“The full ramifications of the latest MAX safety issues have not yet been felt, and we consider that Boeing has not provided any update on its outlook,” Robert Stallard of Vertical Research Partners said in a note to investors on Wednesday.

Boeing said on Wednesday that 737 aircraft were being produced at a rate of 38 per month, a level it plans to maintain after the US Federal Aviation Administration (FAA) banned the company from increasing production, while at the same time which increased its supervision.

The 787 production rate was five per month, Boeing said, adding that it also resumed production of the 777X during the fourth quarter.

Jefferies projects the company could accumulate $5.5 billion in free cash flow in 2024 if it delivered 545 737s and 84 787s during the year, but that projection assumes Boeing is able to increase production from 737s to 42 jets per year. month in the second semester.

Increasing production of 737 MAX jets is crucial to Boeing’s recovery from a separate safety crisis stemming from two fatal crashes in 2018 and 2019 and the subsequent aerospace crisis that followed due to the COVID-19 pandemic.

‘MORE WORK TO DO’

“We have taken significant steps in recent years to strengthen our safety and quality processes, but this (Alaska Air) accident makes it absolutely clear that we have more work to do,” Calhoun said.

He also pointed to an announcement this month that Boeing would add quality inspections for the 737 MAX and send a team to supplier Spirit AeroSystems, which manufactures and installs the docking door involved in the incident.

In the fourth quarter, Boeing reported an adjusted loss per share of 47 cents, narrower than analysts’ estimates of a loss of 78 cents, according to LSEG data.