Boeing Corporation’s stock price briefly dropped to $150 per share on Wednesday morning after the company’s latest quarterly earnings showed multiple missed targets and a $1.2 billion loss for the quarter.
Besides the net losses, another devastating number for Boeing was the $13.99 billion in revenues for the quarter, nearly $2 billion below the projected $15.94 billion. In addition, cash flow concerns once again were seen after last quarter’s announcement that the company had its first positive cash flow since the COVID-19 pandemic began.
“It was a messier quarter than any of us would have liked,” said Boeing CEO David Calhoun in an interview on CNBC.
Apart from the financial downturn, Boeing also announced that their 777X passenger jet production would be delayed. The company has paused production for another year on the new aircraft, making deliveries push back to 2025.
According to Boeing, the Federal Aviation Administration’s certification procedure takes longer than it has in the past. The company feared that starting production on the 777X before certification had been completed would complicate making any potential changes deemed necessary before delivery.
Boeing will incur $1.5 billion in unexpected costs due to delaying plans for the 777X passenger jet, beginning in the second quarter and continuing until production resumes.
“This was another dreadful quarter from Boeing,” said Robert Stallard, an analyst with Vertical Research Partners. “And what we think will really worry investors is that we keep getting more bad news.”
In the wake of the disappointing earnings report, Calhoun sent Boeing employees a memo that urged them to look beyond the numbers for a single quarter of business.
“We are a long-cycle business, and the success of our efforts will be measured over years and decades, not quarters,” said Calhoun.