Boeing Company - 1st Quarter Results

Boeing Reports First Quarter Results ARLINGTON,Va., April 23, 2025 -- First Quarter 2025 · 737 production gradually increased in the quarter; still expected to reach 38 per month this year · Revenue increased to $19.5 billion primarily reflecting 130 commercial deliveries · GAAP loss per share of ($0.16) and core (non-GAAP)* loss per share of ($0.49) · Operating cash flow of ($1.6) billion and free cash flow of ($2.3) billion (non-GAAP)* · Total company backlog grew to $545 billion, including over 5,600 commercial airplanes Table 1. First Summary Quarter Financial Results (Dollars 2025 2024 Change in Millions, except per share data) Revenues $19,496 $16,569 18% GAAP Earnings/(l $461 ($86) NM oss) from operations Operating 2.4 % (0.5) % NM margins Net loss ($31) ($355) NM Basic loss ($0.16) ($0.56) NM per share Operating ($1,616) ($3,362) NM cash flow Non-GAAP* Core $199 ($388) NM operating earnings/(l oss) Core 1.0 % (2.3) % NM operating margins Core loss ($0.49) ($1.13) NM per share *Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 5, "Non-GAAP Measures Disclosures." The Boeing Company [NYSE: BA] recorded first quarter revenue of $19.5billion, GAAP loss per share of ($0.16) and core loss per share (non-GAAP)* of ($0.49) (Table 1). The company reported operating cash flow of ($1.6)billion and free cash flow of ($2.3) billion (non-GAAP)*. Results primarily reflect improved operational performance and commercial delivery volume. Results also reflect only tariffs enacted as of March 31. "Our company is moving in the right direction as we start to see improved operational performance across our businesses from our ongoing focus on safety and quality," said Kelly Ortberg, Boeing president and chief executive officer. "We continue to execute our plan, are seeing early positive results and remain committed to making the fundamental changes needed to fully recover the company's performance while navigating the current environment." Table 2. First Cash Flow Quarter (Millions) 2025 2024 Operating ($1,616) ($3,362) cash flow Less ($674) ($567) additions to property, plant & equipment Free cash ($2,290) ($3,929) flow* *Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 5, "Non-GAAP Measures Disclosures." Operating cash flow was ($1.6) billion in the quarter reflecting higher commercial deliveries, as well as working capital timing (Table 2). Table 3. Quarter Cash, End Marketable Securities and Debt Balances (Billions) 1Q 2025 4Q 2024 Cash and $23.7 $26.3 investments in marketable securities1 Consolidated $53.6 $53.9 debt 1 Marketable securities consist primarily of time deposits due within one year classified as "short-term investments." Cash and investments in marketable securities totaled $23.7 billion, compared to $26.3 billion at the beginning of the quarter, primarily driven by the free cash flow usage in the quarter (Table 3). Debt was $53.6 billion, down from $53.9 billion at the beginning of the quarter due to the pay down of maturing debt. The company maintains access to credit facilities of $10.0 billion, which remain undrawn. Total company backlog at quarter end was $545 billion. Segment Results Commercial Airplanes Table 4. First Commercial Quarter Airplanes (Dollars 2025 2024 Change in Millions) Deliveries 130 83 57% Revenues $8,147 $4,653 75% Loss from ($537) ($1,143) NM operations Operating (6.6) % (24.6) % NM margins Commercial Airplanes first quarter revenue of $8.1billion and operating margin of (6.6) percent primarily reflect higher deliveries (Table 4). The 737 program gradually increased production in the quarter and maintains plans to reach 38 per month this year. The 787 program continued to stabilize production at five per month in the quarter and still expects to increase to seven per month this year. The 777X program began expanded FAA certification flight testing in the quarter, and the company still anticipates first delivery of the 777-9 in 2026. Commercial Airplanes booked 221 net orders in the quarter, including 20 777-9 and 20 787-10 airplanes for Korean Air and 50 737-8 airplanes for BOC Aviation. Commercial Airplanes delivered 130 airplanes during the quarter and backlog included over 5,600 airplanes valued at $460 billion. Defense, Space& Security Table 5. First Defense, Quarter Space & Security (Dollars 2025 2024 Change in Millions) Revenues $6,298 $6,950 (9)% Earnings $155 $151 3% from operations Operating 2.5 % 2.2 % 0.3 margins pts Defense, Space & Security first quarter revenue was $6.3 billion. First quarter operating margin of 2.5 percent reflects stabilizing operational performance. During the quarter, Defense, Space & Security was selected by the U.S. Air Force for a contract to design, build and deliver the F-47, its next-generation fighter aircraft. This order is not included in backlog at the end of the quarter pending completion of the source selection and evaluation review process. Backlog at Defense, Space & Security was $62 billion, of which 29 percent represents orders from customers outside the U.S. Global Services Table 6. Global Services First Quarter (Dollars in Millions) 2025 2024 Change Revenues $5,063 $5,045 -% Earnings from operations $943 $916 3% Operating margins 18.6 % 18.2 % 0.4 pts Global Services first quarter revenue was $5.1 billion. First quarter operating margin of 18.6 percent reflects favorable performance and mix. In the quarter, Global Services delivered the 100th 767-300 Boeing Converted Freighter to SF Airlines and received a modification contract from the U.S. Air Force to integrate electronic warfare systems for the F-15 Eagle. In April, the company entered an agreement to sell portions of its Digital Aviation Solutions business, and the transaction is expected to close by the end of 2025 subject to regulatory approval and customary closing conditions. Additional Financial Information Table 7. Additional Financial Information First Quarter (Dollars in Millions) 2025 2024 Revenues Unallocated items, eliminations and other ($12) ($79) Loss from operations Unallocated items, eliminations and other ($362) ($312) FAS/CAS service cost adjustment $262 $302 Other income, net $323 $277 Interest and debt expense ($708) ($569) Effective tax rate 140.8 % 6.1 % Unallocated items, eliminations and other primarily reflects timing of allocations. The first quarter effective tax rate primarily reflects an increase in the valuation allowance. Non-GAAP Measures Disclosures We supplement the reporting of our financial information determined under Generally Accepted Accounting Principles in the United States of America (GAAP) with certain non-GAAP financial information. The non-GAAP financial information presented excludes certain significant items that may not be indicative of, or are unrelated to, results from our ongoing business operations. We believe that these non-GAAP measures provide investors with additional insight into the company's ongoing business performance. These non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define such measures differently. We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. The following definitions are provided: Core Operating Earnings/(Loss), Core Operating Margins and Core Earnings/(Loss) Per Share Core operating earnings/(loss) is defined as GAAPEarnings/(loss) from operations excluding the FAS/CAS service cost adjustment. The FAS/CAS service cost adjustment represents the difference between the Financial Accounting Standards (FAS) pension and postretirement service costs calculated under GAAP and costs allocated to the business segments. Core operating margins is defined as Core operating earnings/(loss) expressed as a percentage of revenue. Core earnings/(loss) per share is defined as GAAP Diluted earnings/(loss) per share excluding the net earnings/(loss) per share impact of the FAS/CAS service cost adjustment and Non-operating pension and postretirement expenses. Non-operating pension and postretirement expenses represent the components of net periodic benefit costs other than service cost. Pension costs allocated to BDS and BGS businesses supporting government customers are computed in accordance with U.S. Government Cost Accounting Standards (CAS), which employ different actuarial assumptions and accounting conventions than GAAP. CAS costs are allocable to government contracts. Other postretirement benefit costs are allocated to all business segments based on CAS, which is generally based on benefits paid. Management uses core operating earnings/(loss), core operating margins and core earnings/(loss) per share for purposes of evaluating and forecasting underlying business performance. Management believes these core measures provide investors additional insights into operational performance as they exclude non-service pension and post-retirement costs, which primarily represent costs driven by market factors and costs not allocable to government contracts. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measure is provided on page 12. Free Cash Flow Free cash flow is GAAPoperating cash flow reduced by capital expenditures for property, plant and equipment. Management believes free cash flow provides investors with an important perspective on the cash available for shareholders, debt repayment, and acquisitions after making the capital investments required to support ongoing business operations and long term value creation. Free cash flow does not represent the residual cash flow available for discretionary expenditures as it excludes certain mandatory expenditures such as repayment of maturing debt. Management uses free cash flow as a measure to assess both business performance and overall liquidity. See Table 2 on page 2 for a reconciliation of free cash flow to the most directly comparable GAAP measure, operating cash flow. Caution Concerning Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "should," "expects," "intends," "projects," "plans," "believes," "estimates," "targets," "anticipates," and other similar words or expressions, or the negative thereof, generally can be used to help identify these forward -looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, industry projections and outlooks, plans, objectives and goals, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on expectations and assumptions that we believe to be reasonable when made, but that may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Among these factors are risks related to: (1) general conditions in the economy and our industry, including those due to regulatory changes; (2) our reliance on our commercial airline customers; (3) the overall health of our aircraft production system, production quality issues, commercial airplane production rates, our ability to successfully develop and certify new aircraft or new derivative aircraft, and the ability of our aircraft to meet stringent performance and reliability standards; (4) changing budget and appropriation levels and acquisition priorities of the U.S. government, as well as significant delays in U.S. government appropriations; (5) our dependence on our subcontractors and suppliers, as well as the availability of highly skilled labor and raw materials; (6) work stoppages or other labor disruptions; (7) competition within our markets; (8) our non-U.S. operations and sales to non -U.S. customers, including tariffs, trade restrictions and government actions; (9) changes in accounting estimates; (10) our pending acquisition of Spirit AeroSystems Holdings, Inc. (Spirit), including the satisfaction of closing conditions in the expected timeframe or at all; (11) realizing the anticipated benefits of mergers, acquisitions, joint ventures/strategic alliances or divestitures, including anticipated synergies and quality improvements related to our pending acquisition of Spirit; (12) our dependence on U.S. government contracts; (13) our reliance on fixed-price contracts; (14) our reliance on cost -type contracts; (15) contracts that include in-orbit incentive payments; (16) management of a complex, global IT infrastructure; (17) compromised or unauthorized access to our, our customers' and/or our suppliers' information and systems; (18) potential business disruptions, including threats to physical security or our information technology systems, extreme weather (including effects of climate change) or other acts of nature, and pandemics or other public health crises; (19) potential adverse developments in new or pending litigation and/or government inquiries or investigations; (20) potential environmental liabilities; (21) effects of climate change and legal, regulatory or market responses to such change; (22) credit rating agency actions and our ability to effectively manage our liquidity; (23) substantial pension and other postretirement benefit obligations; (24) the adequacy of our insurance coverage; (25) customer and aircraft concentration in our customer financing portfolio; (26) the dilutive effect of future issuances of our common stock; and (27) the preferential treatment of our 6.00% mandatory convertible preferred stock. Additional information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law. Contact: InvestorRelations: Matt Welch or David Dufault BoeingInvestorRelations@boeing.com Communications: Wilson Chow media@boeing.com The Boeing Company and Subsidiaries Consolidated Statements of Operations (Unaudited) Three months ended March 31 (Dollars in 2025 2024 millions, except per share data) Sales of $16,147 $13,268 products Sales of 3,349 3,301 services Total revenues 19,496 16,569 Cost of (14,379) (12,064) products Cost of (2,700) (2,629) services Total costs (17,079) (14,693) and expenses 2,417 1,876 Income from 3 67 operating investments, net General and (1,112) (1,161) administrative expense Research and (844) (868) development expense, net Loss on (3) dispositions, net Earnings/(loss) 461 (86) from operations Other income, 323 277 net Interest and (708) (569) debt expense Earnings/(loss) 76 (378) before income taxes Income tax (107) 23 (expense)/benef it Net loss (31) (355) Less: net 6 (12) earnings/(loss) attributable to noncontrolling interest Net loss ($37) ($343) attributable to Boeing shareholders Less: 86 Mandatory convertible preferred stock dividends accumulated during the period Net loss ($123) ($343) attributable to Boeing common shareholders Basic loss per ($0.16) ($0.56) share Diluted loss ($0.16) ($0.56) per share The Boeing Company and Subsidiaries Consolidated Statements of Financial Position (Unaudited) (Dollars in March 31 December millions, 2025 31 except per 2024 share data) Assets Cash and cash $10,142 $13,801 equivalents Short-term and 13,532 12,481 other investments Accounts 3,204 2,631 receivable, net Unbilled 9,031 8,363 receivables, net Current 202 207 portion of financing receivables, net Inventories 89,077 87,550 Other current 2,474 2,965 assets, net Total current 127,662 127,998 assets Financing 308 314 receivables and operating lease equipment, net Property, 11,459 11,412 plant and equipment, net of accumulated depreciation of $23,193 and $22,925 Goodwill 8,091 8,084 Acquired 1,904 1,957 intangible assets, net Deferred 137 185 income taxes Investments 1,001 999 Other assets, 5,932 5,414 net of accumulated amortization of $1,160 and $1,085 Total assets $156,494 $156,363 Liabilities and equity Accounts $11,034 $11,364 payable Accrued 23,576 24,103 liabilities Advances and 61,114 60,333 progress billings Short-term 7,930 1,278 debt and current portion of long-term debt Total current 103,654 97,078 liabilities Deferred 162 122 income taxes Accrued 2,146 2,176 retiree health care Accrued 5,909 5,997 pension plan liability, net Other long 2,260 2,318 -term liabilities Long-term debt 45,688 52,586 Total 159,819 160,277 liabilities Shareholders' equity: Mandatory 6 6 convertible preferred stock, 6.00% Series A, par value $1.00 - 20,000,000 shares authorized; 5,750,000 shares issued; aggregate liquidation preference $5,750 Common stock, 5,061 5,061 par value $5.00 - 1,200,000,000 shares authorized; 1,012,261,159 shares issued Additional 19,008 18,964 paid-in capital Treasury (31,879) (32,386) stock, at cost - 258,889,678 and 263,044,840 shares Retained 15,239 15,362 earnings Accumulated (10,760) (10,915) other comprehensive loss Total (3,325) (3,908) shareholders' deficit Noncontrolling (6) interests Total equity (3,325) (3,914) Total $156,494 $156,363 liabilities and equity The Boeing Company and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) Three months ended March 31 (Dollars in 2025 2024 millions) Cash flows-operating activities: Net loss ($31) ($355) Adjustments to reconcile net loss to net cash used by operating activities: Non-cash items - Share-based 135 119 plans expense Treasury shares 418 606 issued for 401(k) contribution Depreciation 466 442 and amortization Investment/asset 7 21 impairment charges, net Loss on 3 dispositions, net Other charges 99 10 and credits, net Changes in assets and liabilities - Accounts (570) (328) receivable Unbilled (671) (1,357) receivables Advances and 781 2,718 progress billings Inventories (1,521) (3,778) Other current (29) (249) assets Accounts (95) (264) payable Accrued (386) (666) liabilities Income taxes 26 (59) receivable, payable and deferred Other long-term (151) (83) liabilities Pension and (150) (261) other postretirement plans Financing 12 79 receivables and operating lease equipment, net Other 41 43 Net cash used (1,616) (3,362) by operating activities Cash flows - investing activities: Payments to (674) (567) acquire property, plant and equipment Proceeds from 3 11 disposals of property, plant and equipment Contributions (8,797) (243) to investments Proceeds from 7,750 2,907 investments Other 1 (34) Net cash used (1,717) 2,074 by investing activities Cash flows - financing activities: New borrowings 29 27 Debt repayments (295) (4,442) Employee taxes (14) (65) on certain share-based payment arrangements Dividends paid (72) on mandatory convertible preferred stock Other 14 18 Net cash used (338) (4,462) by financing activities Effect of 12 (28) exchange rate changes on cash and cash equivalents Net decrease in (3,659) (5,778) cash & cash equivalents, including restricted Cash & cash 13,822 12,713 equivalents, including restricted, at beginning of year Cash & cash 10,163 6,935 equivalents, including restricted, at end of period Less restricted 21 21 cash & cash equivalents, included in Investments Cash & cash $10,142 $6,914 equivalents at end of period The Boeing Company and Subsidiaries Summary of Business Segment Data (Unaudited) Three months ended March 31 (Dollars in 2025 2024 millions) Revenues: Commercial $8,147 $4,653 Airplanes Defense, Space 6,298 6,950 & Security Global 5,063 5,045 Services Unallocated (12) (79) items, eliminations and other Total revenues $19,496 $16,569 Earnings/(loss) from operations: Commercial ($537) ($1,143) Airplanes Defense, Space 155 151 & Security Global 943 916 Services Segment 561 (76) operating earnings/(loss) Unallocated (362) (312) items, eliminations and other FAS/CAS 262 302 service cost adjustment Earnings/(loss) 461 (86) from operations Other income, 323 277 net Interest and (708) (569) debt expense Earnings/(loss) 76 (378) before income taxes Income tax (107) 23 (expense)/benef it Net loss (31) (355) Less: net 6 (12) earnings/(loss) attributable to noncontrolling interest Net loss ($37) ($343) attributable to Boeing shareholders Less: 86 Mandatory convertible preferred stock dividends accumulated during the period Net loss ($123) ($343) attributable to Boeing common shareholders Research and development expense, net: Commercial $534 $518 Airplanes Defense, Space 199 235 & Security Global 29 26 Services Other 82 89 Total research $844 $868 and development expense, net Unallocated items, eliminations and other: Share-based ($30) $10 plans Deferred 5 (30) compensation Amortization (21) (23) of previously capitalized interest Research and (82) (89) development expense, net Eliminations (234) (180) and other unallocated items Sub-total (362) (312) (included in Core operating loss) Pension 193 230 FAS/CAS service cost adjustment Postretirement 69 72 FAS/CAS service cost adjustment FAS/CAS $262 $302 service cost adjustment Total ($100) ($10) The Boeing Company and Subsidiaries Operating and Financial Data (Unaudited) Deliveries Three months ended March 31 Commercial 2025 2024 Airplanes 737 105 67 767 5 3 777 7 - 787 13 13 Total 130 83 Defense, Space & Security AH-64 Apache 4 - (New) AH-64 Apache 11 6 (Remanufactured) CH-47 Chinook 1 1 (New) CH-47 Chinook 2 1 (Renewed) F-15 Models 1 1 F/A-18 Models 5 1 KC-46 Tanker - 3 MH-139 1 - P-8 Models 1 1 Total1 26 14 1 Deliveries of new-build production units, including remanufactures and modifications Total backlog (Dollars in millions) March 31 December 31 2025 2024 Commercial Airplanes $460,447 $435,175 Defense, Space & Security 61,567 64,023 Global Services 22,036 21,403 Unallocated items, eliminations and other 686 735 Total backlog $544,736 $521,336 Contractual backlog $523,964 $498,802 Unobligated backlog 20,772 22,534 Total backlog $544,736 $521,336 The Boeing Company and Subsidiaries Reconciliation of Non-GAAP Measures (Unaudited) The tables provided below reconcile the non-GAAP financial measures core operating loss, core operating margins, and core loss per share with the most directly comparable GAAP financial measures of loss from operations, operating margins, and diluted loss per share. See page 5 of this release for additional information on the use of these non-GAAP financial measures. (Dollars in First First millions, Quarter Quarter except per 2025 2024 share data) $ million Per $ million Per s Share s Share Revenues $19,496 $16,569 (Loss)/earnings 461 (86) from operations (GAAP) Operating 2.4 % (0.5) % margins (GAAP) FAS/CAS service cost adjustment: Pension (193) (230) FAS/CAS service cost adjustment Postretirement (69) (72) FAS/CAS service cost adjustment FAS/CAS (262) (302) service cost adjustment Core operating $199 ($388) (loss)/earnings (non-GAAP) Core operating 1.0 % (2.3) % margins (non -GAAP) Diluted loss ($0.16) ($0.56) per share (GAAP) Pension ($193) ($0.26) ($230) ($0.37) FAS/CAS service cost adjustment Postretirement (69) (0.09) (72) (0.12) FAS/CAS service cost adjustment Non-operating (43) (0.06) (123) (0.20) pension income Non-operating (5) (0.01) (18) (0.03) postretirement income Provision for 65 0.09 93 0.15 deferred income taxes on adjustments 1 Subtotal of ($245) ($0.33) ($350) ($0.57) adjustments Core loss per ($0.49) ($1.13) share (non -GAAP) Diluted 753.4 612.9 weighted average common shares outstanding (in millions) 1 The income tax impact is calculated using the U.S. corporate statutory tax rate. 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