Boeing reported a bigger-than-expected loss

Source Credit : Portfolio Prints

Boeing reported a larger-than-expected quarterly loss on Tuesday after recording a $280 million charge related to its troubled Air Force One replacement programme. However, the aerospace giant generated positive free cash flow, signalling continued progress in its turnaround efforts.

The charge stemmed from higher engineering costs associated with delivering two delayed presidential aircraft by 2028, contributing to a net loss of $428 million for the second quarter.

Boeing posted a core loss of 76 cents per share, exceeding analysts' expectations of a 30-cent loss, according to LSEG data. Despite missing forecasts, the result marked an improvement from the core loss of $1.24 per share reported in the same period last year.



A key bright spot was cash generation. Boeing recorded free cash flow of $631 million during the quarter, a significant turnaround from the negative $200 million reported a year earlier. The improvement was driven in part by stronger-than-expected customer payments.

Investors responded positively, with Boeing shares rising more than 1.5% in pre-market trading.

The company reaffirmed its full-year free cash flow forecast of $1 billion to $3 billion, which would mark its first positive annual cash flow since 2023. The outlook is supported by increasing production of the best-selling 737 MAX aircraft.

Capital expenditure also rose during the quarter as Boeing expanded manufacturing capabilities for the 787 Dreamliner in South Carolina and military aircraft production in the St. Louis, Missouri, region.

Meanwhile, Boeing continues work on two 747-8 aircraft intended to serve as the next Air Force One fleet under a $3.9 billion fixed-price contract signed in 2018. The project is now four years behind schedule and more than $1 billion over budget.

In the interim, U.S. President Donald Trump accepted a Qatar-donated 747-8 to serve as Air Force One. However, he recently indicated that the aircraft would soon undergo upgrades following concerns over its security features.