Boeing reported a slightly narrower loss of $388 million in the first quarter compared to a year ago, but warned of further production cuts as it grapples with persistent quality and safety problems on its assembly lines.
While the quarterly loss was better than analysts expected, it was driven by improvement in non-commercial airplane units. Losses from the company’s core commercial aircraft business nearly doubled to $1.1 billion amid plunging jet deliveries.
Revenue tumbled 8% to $16.6 billion as the company delivered far fewer planes to airline customers, from whom Boeing earns most of its income. The results reflect an airplane maker still struggling to satisfy regulators, airlines, and the public over quality lapses threatening safety.
CEO Dave Calhoun, who announced retirement plans this quarter, said Boeing will take “the time necessary” to fix its quality systems, but cautioned this work will lead to further losses and missed delivery targets in the months ahead.
Boeing disclosed it will produce fewer 737 Max jets than originally planned for the rest of 2024 due to assembly line issues. Production of the larger 787 Dreamliner will also be constrained by supplier problems.
The earnings were impacted by compensation paid to airlines for the three-week grounding of 737 Max 9 jets in January after a door blew off on an Alaska Airlines flight shortly after takeoff. While Boeing didn’t disclose the amount, Alaska said it received $162 million.
The incident sparked multiple federal investigations that could expose Boeing to criminal liability. It has renewed scrutiny over the company’s commitment to quality and safety after two fatal 737 Max crashes in 2018-19.
Once renowned for engineering excellence, Boeing has reported $31.9 billion in losses since the Max grounding as prioritizing profits allegedly compromised standards.
