Boeing (BA.US) is rallying 7% today after reporting results for Q2 2023 ahead of the Wall Street session today. Company reported an unexpected positive cash flow for the period and decided to increase aircraft production rates. Let's take a quick look at Boeing's earnings.
Boeing reports positive free cash flow!
Second quarter results from Boeing turned out to be a positive surprise. Revenue increased 18% YoY to $19.75 billion and exceeded market expectations. Sales were driven by 41% YoY jump in Commercial Airplanes sales with the company delivering 136 aircraft. Revenue in other segments was in-line with estimates. Boeing said that strong demand for its aircraft and deposits on large orders allowed it to book positive free cash flow. However, the company is still facing issues, including parts shortages, high employee turnover and inflation that is making fixed-price contracts less profitable. In spite of higher sales company reported eight-straight quarterly loss. However, majority of the losses came from the Defense, Space & Security segment which booked a $257 million charge after indefinitely delaying launch of crewed spacecraft.
Boeing Q2 2023 results
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Adjusted free cash flow: $2.58 billion vs -$73.6 million expected
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Revenue: $19.75 billion vs $18.53 billion expected
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Commercial Airplanes revenue: $8.84 billion vs $7.64 billion expected (+41% YoY)
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Defense, Space & Security revenue: $6.17 billion vs $6.16 billion expected (-0.4% YoY)
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Global Services revenue $4.75 billion vs $4.63 billion expected (+10% YoY)
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Operating cash flow: $2.88 billion vs $435.6 million expected ($81 million a year ago)
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Core loss per share: $0.82c vs.-$0.84 expected (-$0.37 a year ago)
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Defense, Space & Security operating loss: $527 million vs. +$102.3 million expected (+$71 million a year ago)
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Backlog: $440 billion
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Global services oper earnings $856 million vs $753.2 million expected (+18% YoY)
Boeing remains optimistic
While Boeing is still facing issues that are impacting production, company is optimistic about future amid strong demand for its aircraft. Boeing decided to increase production rate of 737 jetliners to 38 per month, up 23%. Company also reiterated its target of reaching a pre-Covid production level of 50 737 jets by 2025-2026, as well as delivering 400-450 737 jets and 70-80 Dreamliners this year. Boeing also still expects to generate $3-5 billion in free cash flow this year.
A look at the chart
Boeing (BA.US) surged following earnings release. Stock launched today's trading with an over-3% bullish price gap and continue to move higher afterwards. Taking a look at D1 chart from a technical point of view, we can see that the stock broke above the $220 resistance zone that also served as the upper limit of a ascending triangle pattern. Textbook range of the breakout points to $252 area, which is a level not seen since mid-2021. Source: xStation5
