Boeing (BA) reported preliminary fourth quarter results on Thursday after the bell, estimating a whopping $3.5 billion operating money flow loss on account of the consequences of the IAM (International Association of Machinists) work stoppage, alongside workforce reductions and changes to its defense business.
For the quarter, Boeing expects to report revenue of $15.2 billion versus $16.76 billion consensus estimates per Bloomberg on a GAAP loss per share of $5.46 versus a lack of $1.32 estimated. Boeing also expects to take pre-tax charges of $1.7 billion in its defense and space business.
Boeing shares were down 1% in after-hours trade.
“Although we face near-term challenges, we took necessary steps to stabilize our business in the course of the quarter including reaching an agreement with our IAM-represented teammates and conducting a successful capital raise to enhance our balance sheet,” said Kelly Ortberg, Boeing president and CEO. “We also restarted 737, 767 and 777/777X production and our team stays focused on the labor ahead to construct a latest future for Boeing.”
Boeing said the IAM strike, which concluded in November with a latest four-year contract, will result in higher labor costs, leading to pre-tax charges of $1.1 billion for the 777X and 767 jet programs.
Following the eight-week strike, Boeing upped the pay of IAM members by 38% over 4 years; merged the prior $7,000 ratification bonus with a $5,000 lump sum payment for a complete $12,000 into 401(k) plans or as a money payout; increased its 401(K) match; and lowered health care premiums, amongst other things.
In early December Boeing laid off a whole lot of employees at its base in Washington state and in California. The corporate had previously said it would cut back its headcount by 10%.
Earlier this month Boeing reported that it delivered 57 planes within the fourth quarter: 36 737 MAX jets, 15 787 Dreamliners, and three 767 and three 777 jets. For the 12 months Boeing said it delivered 348 business jets, down a 3rd in comparison with a 12 months ago.
In November, Boeing’s dwindling money position threatened the corporate’s investment credit standing, which led to it announcing that it will launch a $19 billion share sale to spice up money reserves. Boeing said at the top of Q4 money and investments in marketable securities stood at $26.3 billion.
Pras Subramanian is a reporter for Yahoo Finance. You possibly can follow him on X and on Instagram.
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