Boeing (BA) 4Q 2024 earnings

Boeing CEO Kelly Ortberg on Tuesday said the corporate is making progress on its recovery, including by specializing in core businesses and increasing production after the plane maker’s multiple safety and manufacturing crises drove it to its sixth consecutive annual loss.

Ortberg said the corporate’s 737 Max deliveries will likely reach the “upper 30s” this month, up from 17 in December.

“We’re a bit ahead of where I expected,” he told CNBC’s “Squawk on the Street.” He said Boeing will likely turn cash-flow positive within the second half of the yr, after burning through greater than $14 billion in 2024, and that the corporate is ready up to succeed in production of 38 Max aircraft a month.

Boeing’s shares gained 1.5% on Tuesday.

Ortberg, a longtime aerospace executive whom Boeing hired out of retirement over the summer, said the corporate can be focused on fixing the corporate’s culture.

The corporate is anticipated it to dump units like its Jeppesen navigation business, which the CEO confirmed is a candidate during an earnings call on Tuesday.

“There are some areas where we will streamline the organization or we could also be higher off of focusing our energy elsewhere and we’ll be actioning those over the approaching months and yr,” Ortberg said on the decision. “I believe if I provide you with any guidance, consider it as more pruning the portfolio, not cutting down the tree.”

Boeing lost $3.86 billion within the last three months of 2024, taking about $3 billion in charges in its business aircraft unit and its defense and space business spanning aircraft from the Boeing 767 to the KC-46 tanker to the long-delayed pair of 747s which are set to function latest Air Force One planes. Revenue was down 31% from the identical period last yr to $15.2 billion.  

Boeing’s results were impacted, as expected, by a virtually two-month machinist strike that idled work on most of its aircraft and lengthened delivery delays to customers, which pay for the majority of their planes once they’re received. Boeing said it burned through about $3.5 billion within the fourth quarter, a difficult end to what was speculated to be a turnaround yr. The corporate expects to have an identical money use in the primary quarter.

The corporate last posted a profit in 2018. Along with the crashes and Covid, it has faced a bunch of producing defects and value overruns, and early last yr, a near-catastrophic midair blowout of a door panel on a virtually latest Max 9 jetliner because it climbed out of Portland, Oregon.

The Federal Aviation Administration capped Boeing’s production after the accident at 38 monthly.

“We’d like to get to 38 and show stability at 38” with safety and quality criteria, Ortberg said.

“Things look encouraging thus far,” he said, adding that it could get to some extent where the corporate could ramp up production to about 42 a month “sometime toward the top of the yr.”

Boeing had released preliminary results last week showing a wider loss and lower revenue than analysts expected.

The corporate’s annual loss totaled $11.83 billion, its largest since 2020, when it was grappling with a grounding of its bestselling plane, the 737 Max, after two fatal crashes and the Covid-19 pandemic.

“While it was a difficult yr, we’re seeing encouraging signs of progress as we work together to show around our company,” Ortberg said in a staff memo.

Its defense unit’s revenue fell 20% to $5.4 billion for the quarter, and it took $1.7 billion in pretax charges.

“While charges for the quarter in BDS are disappointing, now we have accomplished deep dives on all of our difficult fixed-price development programs,” Ortberg said within the memo. “We are actually more proactive and clear-eyed on the risks.”

Ortberg said within the CNBC interview on Tuesday that Boeing is discussing with President Donald Trump’s adviser Elon Musk methods to deliver the already delayed Air Force One aircraft earlier and reduce costs in this system, which is greater than $2 billion over budget. Musk’s company SpaceX can be a Boeing competitor.

Revenue for the business aircraft unit dropped 55% to $4.76 billion.

Here’s what the corporate reported compared with what Wall Street analysts surveyed by LSEG were expecting:

• Loss per share: $5.90 adjusted vs. $3.00 expected
• Revenue: $15.24 billion vs. expected $16.21 billion

Boeing lost $3.86 billion, or $5.46 per share within the fourth quarter, compared with a lack of $30 million, or a lack of 4 cents a share, in the identical period a yr ago. Adjusting for impacts of the strike and charges, the corporate lost $5.90 per share.

After the strike resulted in November, Boeing resumed production of its 737 Max aircraft in December, and earlier this month, it restarted test flights of its 777X aircraft, which have not yet been certified by the FAA. Boeing can be working to certify the Max 7 and Max 10 aircraft, the smallest and largest models within the single-aisle Max family.

While airline CEOs have largely supported Ortberg, key Boeing customers are still logging the results of the delivery delays.

American Airlines said over the weekend it made further cuts to its schedule due to late deliveries of latest Boeing 787 Dreamliners, which it also planned to make use of to launch a premium-seat-heavy configuration to capitalize on a consumer shift toward pricier, roomier seats.

It plans to suspend service between Miami and Paris in June and July, and cut down on frequencies between Dallas Fort Price International Airport and Recent York’s John F. Kennedy International to London in May, in addition to from Dallas to Honolulu in June.

“We’ll be proactively reaching out to our impacted customers to supply alternate travel arrangements and remain committed to mitigating the impact of those Boeing delays while continuing to supply a comprehensive global network,” American said in a press release.

Meanwhile, the CEO of European budget airline Ryanair, Michael O’Leary, said Monday that the corporate needed to cut its passenger traffic goal for the yr due to “frustrating” Boeing delivery delays.

— CNBC’s Phil LeBeau contributed to this report.

Correction: Boeing had a lack of $30 million within the fourth quarter a yr earlier. An earlier version misstated the figure.