Boeing Co. generated $2.58 billion in free cash flow in the second quarter, surprising investors as a flurry of jet deliveries and customer deposits helped overcome the financial strain from supplier glitches.
Analysts had expected the manufacturer to burn through almost $74 million in free cash after it grappled with disruptions to its workhorse 737 Max and the 787 Dreamliner, according to data compiled by Bloomberg. Boeing rose more than 3.5% in early morning trading as it also beat Wall Street’s expectations for revenue and earnings.
In a sign its aircraft production is stabilizing after years of turmoil, Boeing said it is starting to raise output of its 737 jetliners to a 38-jet monthly rate. That’s a 23% jump from the previous manufacturing pace, which had been in place for about a year as the US planemaker worked to get its factories and suppliers in sync.
Still, Boeing notched its eighth straight money-losing quarter. The adjusted loss stood at 82 cents a share, according to a statement Wednesday, compared with an 84-cent loss anticipated by analysts.
“This is a complex business and we expect challenges to come up. When they do, we are transparent, we take action and we move forward, one airplane at a time,” Dave Calhoun, Boeing’s chief executive officer, said in a message to employees. “While it can be difficult in the moment, this is what progress looks like.”
Last month, workers at Boeing supplier Spirit AeroSystems Holdings Inc. went on strike for a few days. Spirit makes most of the fuselage of Boeing’s all-important 737 model. Boeing and rival Airbus SE have both cautioned that supply constraints continue to hurt output and might remain a headache for years.
Boeing unveiled its earnings ahead of Airbus, which comes out with its numbers later on Wednesday. Before the report, the US planemaker’s shares had gained 12% so far, outpacing the 6.9% increase for the 30-member Dow Jones Industrial Average. Airbus, based in Toulouse in France, is up about 19%.
