Boeing — Boeing just released its first-quarter financial report, and the comments were mixed.
While revenue exceeded expectations, profits fell short.
Moreover, despite problems with manufacturing, Boeing announced plans to increase production of its 737 Max planes.
The company
Boeing is a multinational corporation headquartered in the United States that designs, manufactures, and sells airplanes, helicopters, rockets, satellites, and missiles worldwide.
It is one of the world’s major aerospace companies, having headquarters in Chicago, Illinois.
Boeing builds both commercial and military aircraft, including the well-known 737, 747, and 787 models.
Demand, disruptions in the supply chain, and production efficiency are all variables that influence its manufacturing pace.
Boeing has endured a number of setbacks in recent years, including the grounding of its 737 MAX series planes, which has slowed its manufacturing speed and financial performance.
Output
Boeing said on Wednesday that it will increase 737 Max manufacturing from 31 to 38 planes by 2023.
Given the current production issues with specific planes, the remark came as a surprise.
Because Boeing needs to get planes to airlines as soon as possible, the production rate for the best-selling planes will be the fastest in years.
Airlines are aiming to capitalize on a rebound in air travel.
In addition, Boeing expects to deliver 400 to 450 737 planes in 2023.
“This is an important year for us,” Boeing CEO Dave Calhoun told staff in a memo on Wednesday.
“As demand surges across our markets, we must focus together on execution and meeting our customer commitments.”
Boeing also intends to raise 787 Dreamliner production from three aircraft today to five aircraft one month later in 2023.
Shares and revenue
Boeing reported quarterly revenues of $17.92 billion, a 28% increase over 2022 and a $2 billion rise over $17.43 billion expectations.
According to the corporation, demand for its aircraft has increased significantly.
Meanwhile, Boeing’s adjusted EPS loss for the quarter ($1.27) was greater than Wall Street’s prediction of $0.97.
“We delivered a solid first quarter and are focused on driving stability for our customers,” said Calhoun.
“We are progressing through recent supply chain disruptions but remain confident in the goals we set for this year, as well as for the longer term.”
“Demand is strong across our key markets and we are growing investments to advance our development programs and innovate strategic capabilities for our customers and for our future.”
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Guidance
The company restated its earlier forecast of $4.5 billion to $6.5 billion in operating cash flow and $4 to $5 billion in free cash flow for 2023.
Boeing also reiterated its earlier 737 Max delivery forecast of 400 to 450 aircraft in 2023.
Following a manufacturing setback with the 737 Max in mid-April, when the company warned that a problem with fuselage brackets could cause deliveries to be delayed, the data was released.
“We will work diligently through rework of affected airplanes in production and storage to ensure each meets our standards of prior delivery,” said Calhoun.
“This effort will impact the timing of deliveries over the next several months.”
Production and delivery
According to Dave Calhoun, the glitch will create a two-week delay in manufacture.
Boeing currently has a backlog of 4,219 737 jets, according to the company’s website.
Boeing’s 787 Dreamliner experienced a delivery delay in February, prompting the company to cease deliveries due to a fuselage component failure.
The problem was rectified when the business addressed the FAA’s concerns regarding the Dreamliner’s front pressure bulkhead in early March.
According to the company, the 787 Dreamliner program is now producing three planes per month, with plans to raise production to five later in 2023.
They also want to increase it to 10 every month by 2025/2026.
New deals
In March, Boeing inked a deal with Saudi Arabia.
Saudi Arabian Airlines and a new firm called Riyadh Air placed an order for about 121 787s with the corporation.
A total of 78 planes are considered firm orders, with an additional 43 planes available for purchase.
72 of the 121 orders were placed with Riyadh Air.
The deal is estimated to be worth $40 billion.
“It is significant,” said Calhoun.
