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The Associated Press
Boeing is reporting a $149 million loss for the second quarter despite higher revenue, as the plane maker struggles with higher costs in both its airline and defense business. CEO David Calhoun said Wednesday that Boeing has "more work ahead" but is making progress in stabilizing its factories and supply chain. Boeing says it's starting to boost production of its two most popular airline planes, the 737 Max and the 787 Dreamliner, to take advantage of demand for newer, more fuel-efficient planes. However, the company is continuing to see problems with its supply chain, which continued in the second quarter.
Boeing flipped to a $149 million loss in the second quarter despite higher revenue, as the plane maker struggled with higher costs in both its airline and defense business.
Boeing said it is beginning to increase production of its two most popular airline planes. Shares jumped nearly 7% Wednesday, the biggest upward move for the company's stock in a year.
European rival Airbus reported a second-quarter profit and also said it was making progress to raise production of its best-selling plane.
Boeing plans to raise production of the 737 Max from 31 to 38 planes a month to take advantage of demand for newer, more fuel-efficient planes. Boeing is also boosting output of the larger, two-aisle 787 Dreamliner from four to five per month by year end.
"We have more work ahead to improve performance, but our progress is clear and we're confident in our path forward." CEO David Calhoun said in a memo to employees. He said the company was improving the stability of operations in its factories and among suppliers.
Boeing, headquartered in Arlington, Virginia, has been beset by supply-chain problems that continued during the second quarter, including a temporary delay in 737 deliveries because of fittings on the Max and regulators' questions about Dreamliner inspections.
Boeing said the commercial-planes division was weighed down by "abnormal costs," which it did not detail. Cai von Rumohr, an analyst with Cowen, said those were likely the result of fixing issues with fuel tanks on the Boeing 767 and fuselage fittings on the Dreamliner.
The defense and space business also performed worse than analysts expected. Von Rumohr called it "disappointingly still in the red," partly due to write-downs on several programs.