US aviation giant Boeing reported a quarterly loss of $5.4 billion (about €4.6 billion) on Wednesday.
Boeing said it was fined $5 billion for postponing the first deliveries of its long-delayed 777X model to 2027. This loss also includes compensation payable to customers who faced delayed deliveries.
Delayed Widebody A Financial and an Opportunity Cost
Last month, CEO Kelly Ortberg said the company was behind schedule in certifying the jet and still needed a lot of work. But they did not announce delays beyond the planned 2026 delivery date at that time.
The 777X is key to Boeing’s long-term widebody strategy, which aims to capture the market share already held by its larger 747 and 777 for busy, long-haul and frequent international routes.
Repeated certification and production delays since the plane’s first flight in 2020 have led to delivery delays, with Boeing incurring $15 billion in charges in the process, further straining its finances.
“While we are disappointed by the 777X schedule delays, the airplane is performing well in flight testing, and we are focused on the work ahead to complete our development programs and stabilize our operations to fully recover our company’s performance and restore trust with all of our stakeholders,” Ortberg said.
The problems have opened the door to Boeing’s European rival Airbus as it tries to boost sales of its new long-range, high-capacity workhorse, the A350.
The timing is also far from ideal, as demand for international air travel has surged again following the COVID-19 pandemic and airlines are eager to buy new aircraft again.
Shares fall slightly, but revenue gives investors some relief
Planemaker shares were down about 1% in premarket trading. Wall Street analysts were predicting bad news about the 777X even before Wednesday’s announcement.
The company’s revenues of $23.3 billion for the quarter represented an increase of at least 30% over the prior year’s figures and exceeded analysts’ expectations.
The airline also reported free cash flow of $238 million, the first time the figure has been positive since 2023.
Boeing is trying to recover from its worst one-year performance ever, with a net loss of $11.8 billion in 2024.
After battling quality issues and production delays on its 737 MAX for years, leading to a few major air crashes, near misses and certification withdrawal, Boeing is working cautiously to increase monthly production in 2025.
This followed the resolution of a costly machinists’ strike lasting from September to November 2024, involving more than 30,000 workers.
The 55 jets delivered by Boeing in September was its strongest performance for that calendar month since 2018, and a significant jump from the 33 aircraft delivered last year.
Edited by: Shawn Sinico