Why Boeing Shares Are Flying Higher Today

Boeing Co BA shares are up Wednesday morning after second-quarter results beat Street expectations. The company reported a second-quarter FY23 revenue increase of 18% year-over-year to $19.75 billion, beating the consensus of $16.58 billion.

Revenue increase reflects 136 commercial deliveries in the quarter, compared to 121 in 2Q22.

Adjusted loss per share expanded to $(0.82) from $(0.37) in 2Q22, beating the consensus of $(0.84).

BA recorded a loss from operations of $(99) million, compared to a profit of $780 million a year ago.

Operating cash flow for the quarter totaled $2.87 billion, compared to $81 million in 2Q22; Free cash flow was $2.58 billion.

Commercial Airplanes revenue increased by 41% Y/Y to $8.84 billion, and deliveries increased by 12%.

During the quarter, Commercial Airplanes booked 460 net orders, and the backlog included over 4,800 airplanes valued at $363 billion.

Defense, Space & Security revenue was flat Y/Y at $6.17 billion. The backlog was $58 billion, of which 31% represents orders from customers outside the US.

Also Read: Boeing Sees Solid June Deliveries, Boosting Confidence in Production Recovery - Analysts Optimistic

Global Services revenue grew by 10% Y/Y to $4.75 billion. The operating margin expanded 110 bps to 18%, reflecting higher commercial volume and a favorable mix.

The company held cash and equivalents of $13.8 billion at the end of the quarter. The total company backlog was $440 billion.

BA reduced its debt to $52.3 billion from $55.4 billion during the quarter. 

The company stated that its 737 program is transitioning production to 38 per month and plans to reach 50 per month in the 2025/2026 timeframe. The program still expects to deliver 400-450 airplanes this year.

The 787 program increased production to four per month with plans to ramp to five per month in late 2023 and 10 per month in the 2025/2026 timeframe.

FY23 Outlook: Boeing reaffirmed its outlook of $3 billion - $5 billion in adjusted free cash flow and $4.5 billion - $6.5 billion in operating cash flow.

Price Action: BA shares are trading higher by 3.88% at $222.43 premarket on Wednesday.

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