America’s largest planemaker is in trouble, and its most recent fiscal report proves it.
Boeing reported catastrophic losses for the third quarter of 2024, highlighting one of the worst years of the company’s history. Boeing has failed to turn a profit since 2018, though Wednesday’s report is the second-worst since its foundation.
The plane maker reported over $6 billion in losses for the quarter against $17.82 billion in revenues. Operating losses in the same quarter last year amounted to $1.09 billion. The core operating loss margin was 33% compared to 6% last year.
The defense, space, and security division’s revenues grew by 1% year-to-year to $5.5 billion. Global services revenue expanded by 2% compared to last year to $4.9 billion.
However, these increases were overshadowed by a massive revenue decline in the commercial airplane sector, falling by 5% y-o-y to $7.4 billion.
Moreover, airplane deliveries were 10% lower this quarter compared to last year. Boeing delivered 116 airplanes so far this year.
The company is drowning in a $58 billion debt pile against $10.5 billion in cash and marketable securities. “It will take time to return Boeing to its former legacy, but with the right focus and culture, we can be an iconic company and aerospace leader once again,” Kelly Ortberg, Boeing CEO commented.
“The trust in our company has eroded. We’re saddled with too much debt. We’ve had serious lapses in our performance across the company, which have disappointed many of our customers,” he said.
Ortberg also highlighted the company’s strengths, including a $511 billion-worth backlog of airplane orders.
A year to forget
2024 immediately started off on a wrong note for Boeing. On January 5th, a door on an Alaska Airlines flight dislodged from the plane, forcing an emergency landing.
Since then, accidents have multiplied for the plane-making giant, luckily without resulting in any death.
The accident streak, however, sparked a safety crisis for Boeing, which is currently being reviewed by the Federal Aviation Agency (FAA). This caused many clients to flee to Airbus, the France-based world’s largest plane maker.
Most recently, a nationwide strike crippled Boeing’s production lines, increasing its already massive backlog of orders. Strikers are demanding a 35% pay rise, with Ortberg focusing on negotiating a new national contract.
“Going forward, we will be focused on fundamentally changing the culture, stabilizing the business, and improving program execution, while setting the foundation for the future of Boeing,” Ortberg said. He added that Boeing will eventually find its legacy again, though it may take several years to do so.
Argomenti
