Boeing Co. (BA) faced a rough morning on Thursday, with its stock plunging over 3% in pre-market trading. The decline came after the release of the company’s third-quarter financial results, which fell short of analyst expectations and highlighted the ongoing challenges facing the aerospace giant.
The company reported a 1% decline in revenue compared to the previous year, reaching $17.854 billion. This missed the street consensus estimate of $17.931 billion. Furthermore, Boeing’s adjusted loss per share widened to $10.44 from $3.62 in the same quarter last year, falling short of the consensus estimate of $10.34.
The company attributed these disappointing results to several factors, including the ongoing strikes led by the International Association of Machinists and Aerospace Workers (IAM), as well as previously announced charges on both commercial and defense programs. These charges likely reflect the company’s efforts to address past operational issues and address manufacturing delays.
The revenue miss comes amidst a broader set of challenges for Boeing. CEO Kelly Ortberg has acknowledged the company’s cultural and operational hurdles and pledged to transform the organization. However, the Q3 results underscore the significant impact of these challenges, especially in the wake of the ongoing labor unrest.
The IAM strike, which has halted much of Boeing’s Seattle-area production for over five weeks, represents a major hurdle for the company. This is Boeing’s first strike since 2008, and it adds to the company’s already challenging financial situation, including a $6 billion quarterly loss and ongoing cash burn. CEO Ortberg has emphasized the importance of resolving the labor dispute and getting production back on track.
While Boeing is addressing these challenges, the Q3 results demonstrate the difficult path ahead. Investors will be closely watching the company’s progress in resolving these issues and addressing the broader challenges facing the aerospace industry.
