Boeing Posts Big Q2 Net Loss on 737 Max Issues
Boeing announced a net loss of USD$2.94 billion for the second quarter, as charges on the 737 MAX pushed it heavily into the red.
The swing, from a $2.2 billion profit in the year earlier period, means Boeing reported its biggest ever quarterly loss.
The Chicago-based company announced last week that it would take a $4.9 billion second quarter after-tax charge on the estimated disruptions caused by the grounding of the 737 MAX.
Revenue for the quarter fell to $15.75 billion, down from last year’s $24.26 billion, reflecting the MAX charge and lower 737 deliveries. Negative operating cash flow of $590 million was also a swing from the positive $4.68 billion recorded in last year’s quarter.
Boeing said it is working closely with the FAA on the process to certify the 737 MAX software update and return the aircraft to service. But due to the uncertainty of the MAX’s return, the airframer said it will not issue new financial guidance until a future date.
On the timing of the 737 MAX’s re-certification, Boeing said development and testing is underway, with a final software package to be submitted to the FAA once all requirements have been satisfied.
Regulatory authorities will then determine the process for certifying the MAX software and training updates, and the timing for lifting the grounding order.
“This is a defining moment for Boeing and we remain focused on our enduring values of safety, quality, and integrity in all that we do, as we work to safely return the 737 MAX to service,” Boeing CEO Dennis Muilenburg said.
The Commercial Aircraft division delivered 90 aircraft during the second quarter, down from 194 in 2Q18. Of the total, just 24 were 737s, with no MAX deliveries due to the grounding. Total 737 deliveries in the second quarter last year were 137.
Other commercial aircraft deliveries in the quarter were two 747s, 10 767s, 12 777s and 42 787s.