Boeing reports $6.1 billion third-quarter loss as strike takes toll on plane maker
Boeing reported a massive third-quarter loss of more than $6 billion, as the airplane manufacturer was dragged down by a strike and billions in charges tied to its commercial aircraft and defense programs.
Boeing's loss comes as the company is struggling to right itself after manufacturing problems and multiple federal investigations following a mid-air panel blowout in January. And in September, 33,000 of its machinists went on strike after failing to agree on a contract, shutting assembly plants in the Seattle area.
In August, the company brought in Kelly Ortberg, a seasoned aerospace executive, as its new CEO with the mandate to right Boeing's safety and manufacturing issues. Ortberg, who earlier this month announced job cuts of 10% of the company's workforce, or 17,000 employees, on Wednesday wrote in prepared remarks he'll deliver to investors later today that Boeing is "at a crossroads."
"The trust in our company has eroded," he wrote. "We've had serious lapses in our performance across the company which have disappointed many of our customers."
Boeing can't produce any new 737s until it ends the five-week-old strike by 33,000 machinists. In his remarks, Ortberg wrote that one of his top goals is ending the strike.
On Wednesday evening, the International Association of Machinists and Aerospace Workers will reveal whether striking workers are ready to go back to their jobs. Union members in the Seattle area and elsewhere will vote on a Boeing offer that includes pay raises of 35% over four years, $7,000 ratification bonuses and the retention of performance bonuses that Boeing wanted to eliminate.
"I'm very hopeful that the package we put forward will allow our employees to come back to work so we can immediately focus on restoring the company," Ortberg wrote. "Once we get back, we have the task of restarting the factories and the supply chain."
On a per-share basis, Boeing lost $9.97 for the period ended September 30, with an adjusted loss of $10.44 per share. Analysts polled by Zacks Investment Research were calling for a loss of $10.34 per share.
Revenue totaled $17.84 billion, matching Wall Street estimates.