Boeing closes 2024 with strong backlog despite Q4 losses

ByInvestment Club

Overview

Boeing concluded the fourth quarter of 2024 with revenue of $15.2bn, while navigating the financial impacts of the International Association of Machinists and Aerospace Workers (IAM) agreement and related work stoppages. Despite challenges, the company resumed production across key programs like the 737, 767, and 777/777X. For the full year, Boeing delivered 348 commercial airplanes and grew its total backlog to $521bn, showcasing strong demand with over 5,500 airplanes included in its order book.

Kelly Ortberg, Boeing president and CEO, confirmed that the company is trying to recover its performance next year, after the latest challenges: “We made progress on key areas to stabilize our operations during the quarter and continued to strengthen important aspects of our safety and quality plan. My team and I are focused on making the fundamental changes needed to fully recover our company’s performance and restore trust with our customers, employees, suppliers, investors, regulators and all others who are counting on us.”

Q4 2024 vs. Q4 2023:

  • Revenues decreased significantly in the last quarter, to a value of $15.2bn (-31% YoY), affected by lower commercial airplane deliveries due to work stoppages and supply chain disruptions.
  • The result of the exercise was recorded a GAAP net loss of ($3.86)bn, driven by program charges on the KC-46A, T-7A, and 737 MAX, as well as workforce adjustments.
  • Free cash flow recorded a negative value of ($4.1)bn after a positive value recorded in the same period last year, primarily due to working capital timing and reduced deliveries.
  • Basic loss per share also experienced a drastic drop, down to a value of ($5.46).
  • The company delivered 86 airplanes during Q4, constrained by supply chain issues and production challenges.
  • Commercial airplanes revenue of $4.8bn (-55% YoY) and operating margin of (43.9) percent reflect the previously announced impacts associated with the IAM work stoppage and agreement including lower deliveries.
  • Defense, space & security of $5.4bn (-20% vs. Q4 2023) and operating margin of (41.9) percent reflect the previously announced pre-tax charges of $1.7bn on the KC-46A, T-7A, Commercial Crew, VC-25B and MQ-25 programs.
  • Global services revenue was $5.1bn (+6% vs. 2023), supported by strong commercial service volumes and contracts for C-17 sustainment and F-15 upgrades.

Full-Year 2024 performance:

  • Revenues experienced a significant decrease, down to $66.5bn (-14% YoY), attributed to declines in Commercial Airplanes revenue to $22.86bn (-33% YoY).
  • Only global services revenue increased slightly to a value of $19.95bn (+4% YoY).
  • The company recorded a big net loss of ($11.83)bn, influenced by production inefficiencies, program charges, and restructuring costs.
  • In the same sense, basic loss per share remained on a downward trend and decreased to a value of ($18.36).
  • From a positive value of 4.43bn in 2023, free cash flow dropped drastically to a value of ($14.31)bn, reflecting the problems the company had during the year.
  • The company delivered 348 commercial airplanes (-34% vs. 2023) and recorded 279 net orders.
  • Total backlog increased to $521bn (+0.2% YoY), with over 5,500 airplanes valued at $435bn.

Looking ahead, Boeing remains focused on stabilizing its operations and addressing key challenges in production and delivery schedules. The company plans to enhance efficiency and rebuild trust with customers, investors, and other stakeholders. With a robust backlog, Boeing is poised to leverage this strong foundation to navigate 2025 and beyond, while striving to restore profitability and operational excellence across its business segments.

Author: Ionuț-Adrian Lazar

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