Boeing shares trade lower Wednesday: What’s going on? – Boeing (NYSE:BA)

Boeing Inc B.A Shares traded lower on Wednesday after a disappointing third-quarter earnings report. Union members are expected to vote on a new contract proposal. Here’s what you need to know.

What to know: Boeing reported $17.85 billion in revenue, which was down 1% year-over-year and came in below expectations of $17.93 billion. The company reported an adjusted loss of $10.44 per share. stock, missing estimates for a loss of $10.34 a share. share, according to Benzinga Pro.

Boeing’s adjusted operating loss widened to $5.99 billion, up from $1.09 billion a year ago. The core operating loss margin also grew significantly, reaching 33.6% compared to 6% a year ago. In addition, commercial aircraft deliveries fell 10%, while the Defense, Space & Security unit saw revenue increase 1% and the Global Services division grew 2%.

Boeing said the drop in earnings was partly due to a walkout by the International Association of Machinists and Aerospace Workers (IAM), as well as allegations about Boeing’s commercial and defense programs.

In a CNBC interview after the report, Boeing’s CFO said the cash burn will continue in 2025, but free cash flow is expected to be better next year compared to 2024. Free cash flow in the fourth quarter is expected to be similar to the second quarter. The Boeing CFO also mentioned plans to address the company’s balance sheet.

managing director Kelly Ortberg acknowledged Boeing’s challenges, pointing to cultural issues, performance issues and high debt. He said the company needs time to stabilize and regain confidence. Ortberg also emphasized focusing on fewer projects going forward.

“It will take time to return Boeing to its former heritage, but with the right focus and culture, we can once again become an iconic company and leader in aviation,” he said.

In the labor market, more than 30,000 machinists went on strike in mid-September, halting production of the 737 MAX and other models, according to Reuters.

A new contract proposal with a 35% pay increase over four years and a $7,000 ratification bonus will be voted on Wednesday. If accepted, it could end the strike that has reportedly cost Boeing about $100 million a day. The report indicates that the outcome remains uncertain and workers are divided on whether to accept the offer.

The vote on the latest contract proposal is expected to end at 8 p.m. ET. A “simple 50%+1 majority” is needed to approve the new offer.

BA Price action: Boeing shares were down 1.17% at $158.01 at the time of writing, according to Benzinga Pro.

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