Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Boeing Post Annual Loss; 737 Max Grounding Costs Almost $19B

Published 01/29/2020, 07:32 AM
Updated 01/29/2020, 08:28 AM
© Reuters.  Boeing Earnings, Revenue Miss in Q4

© Reuters. Boeing Earnings, Revenue Miss in Q4

By Peter Nurse

Investing.com - The full cost for Boeing (NYSE:BA) due to the grounding of its best selling plane, the 737 Max, was laid bare in its fourth quarterly results Wednesday, with the company posting its first annual loss in more than two decades.

Boeing (NYSE:BA) announced a loss per share of $2.33 in the fourth quarter, on revenue of $17.91 billion, a drop of 37%. Analysts polled by Investing.com anticipated earnings per share of $0.6 on revenue of $21.65 billion. The company also detailed the costs associated with the grounding of the series, taking a total charge of $18.6 billion. This resulted in an annual net loss of $3.47 a share, the first since 1997.

Boeing (NYSE:BA) shares bounced after early losses. At 08:10 AM ET (1310 GMT) the shares stood 2.5% higher at $324, still quite a bit lower than its 52 week high of $446.01 set on March 1, 2019, just before the second fatal crash involving the 737 MAX.

"We recognize we have a lot of work to do," said Boeing (NYSE:BA) President and Chief Executive Officer David Calhoun. "We are focused on returning the 737 MAX to service safely and restoring the long-standing trust that the Boeing brand represents with the flying public."

Calhoun took the helm earlier this month after previous chief Dennis Mullenburg was ousted for his handling of the Max crisis late last year.

And while these figures are horrendous, there could be more to come.

"We don't think Boeing (NYSE:BA) can reach full operational normalcy in the near-term — and one of the main impediments in this process is regaining public trust," said Haris Anwar, an analyst at Investing,com "Boeing is certainly capable of solving the technical issues required to make the MAX a viable revenue generator again, but that process is also closely tied with winning back public confidence."

The 737 MAX series has been grounded since March following two fatal crashes. The company is suggesting a return to service in the summer, but has already been forced more than once to push back its timeline after a series of embarrassing disclosures about how it treated regulatory approval process in the past.

Boeing follows other major Capital Goods sector earnings this month

Boeing's report follows an earnings beat by United Technologies on Tuesday, who reported EPS of $1.94 on revenue of $19.55B, compared to forecasts EPS of $1.84 on revenue of $19.4B.

ASML ADR had missed expectations on January 22 with fourth quarter EPS of $2.99 on revenue of $4.47B, compared to forecast for EPS of $3.01 on revenue of $4.35B.

Stay up-to-date on all of the upcoming earnings reports by visiting Investing.com's earnings calendar

Latest comments

Blowout loss and stock is up almost 3% premarket! This market is totally and utterly ridiculous! Better luck in a casino because at least there the rules of the game are understandable and fixed.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.