Boeing Boosts 737 Production, Overshadowing Expected Q4 Loss

Boeing is taking significant steps to increase its 737 production, as the company navigates a challenging financial landscape.

Boeing’s Production Plans and Financial Outlook

With Wall Street analysts expressing optimism, Boeing plans to report its fourth-quarter earnings soon. While the company is anticipated to show a loss, investors are keen on the details regarding its free cash flow and increasing production rates.

Key Financial Projections

• Analysts project a loss of 39 cents per share for the fourth quarter.
• Boeing’s free cash flow is expected to surpass $10 billion by 2028, despite anticipating negative cash flow in 2025.
• Analysts suggest Boeing has substantial upside potential, with 24 out of 29 recommending buy positions.

Production Increase and Regulatory Approval

Recent regulatory changes allow Boeing to produce 42 jets per month, up from the previously imposed cap of 38. Analysts believe Boeing has managed to build sufficient inventory to support this increase.

CEO Kelly Ortberg has indicated that future production rate adjustments will be made cautiously, occurring no more frequently than every six months.

Challenges in Certification

Despite these positive developments, Boeing faces ongoing challenges. The company is struggling to certify its 737 MAX 7 and 10 variants, as well as the wide-body 777X, which is already six years behind schedule.

Market Performance and Investor Sentiment

Following a significant drop in share prices after a mid-air incident with an Alaska Airlines 737 MAX, Boeing’s stock has begun to recover. Analysts note that last year marked a turnaround for Boeing, with increased production and significant sales, including the sale of its subsidiary Jeppesen for $10.6 billion.

Looking Forward

With a steady stream of jet orders projected to last beyond 2030, Boeing is optimistic about its future. The key to satisfying investors lies in demonstrating a stable increase in production and achieving robust free cash flow.

As Boeing gears up for its upcoming earnings report, the focus remains on its ability to navigate production challenges and financial recovery.