Boeing Reports Q4 Loss, Estimates $3.5B Operating Cash Flow Hit
Boeing (BA) announced preliminary Q4 results post-market, revealing a $3.5 billion operating cash flow loss attributed to the IAM work stoppage, workforce reductions, and defense business changes.
Financial Estimates
* Revenue: $15.2 billion (vs. consensus $16.76 billion)
* GAAP loss per share: $5.46 (vs. estimate $1.32)
* Pre-tax charges in defense and space business: $1.7 billion
Impact of IAM Strike
The eight-week IAM strike led to higher labor costs, resulting in pre-tax charges of $1.1 billion for 777X and 767 programs. Boeing granted IAM members a 38% pay increase over four years, increased 401(k) match, and reduced healthcare premiums.
Workforce and Production
Boeing laid off hundreds of workers in Washington state and California as part of its 10% headcount reduction plan. Production of 737, 767, and 777/777X aircraft has resumed.
Aircraft Deliveries and Cash Position
Boeing delivered 57 planes in Q4 (36 737 MAX, 15 787 Dreamliners, 6 others). Annual commercial jet deliveries declined by a third to 348. To bolster its cash reserves, Boeing launched a $19 billion share sale, resulting in $26.3 billion in cash and marketable securities at Q4 end.