Boeing(US:BA)2025-07-29 16:20Part I. Financial Information Financial Statements Boeing reported increased Q2 2025 revenues and a narrowed net loss, with improved operating cash flow and changes in cash and debt Condensed Consolidated Statements of Operations Q2 2025 revenues increased to $22.7 billion, with net loss narrowing to $612 million and improved diluted loss per share | (Dollars in millions, except per share data) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $22,749 | $16,866 | $42,245 | $33,435 | | Earnings/(loss) from operations | ($176) | ($1,090) | $285 | ($1,176) | | Net loss attributable to Boeing shareholders | ($611) | ($1,439) | ($648) | ($1,782) | | Diluted loss per share | ($0.92) | ($2.33) | ($1.09) | ($2.90) | Condensed Consolidated Statements of Financial Position As of June 30, 2025, total assets decreased slightly, cash and equivalents significantly declined, while shareholders' deficit improved | (Dollars in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $7,087 | $13,801 | | Total current assets | $127,301 | $127,998 | | Total assets | $155,120 | $156,363 | | Long-term debt | $44,604 | $52,586 | | Total liabilities | $158,416 | $160,277 | | Total shareholders' deficit | ($3,295) | ($3,908) | Condensed Consolidated Statements of Cash Flows H1 2025 saw significantly improved operating cash flow, with cash used in investing and financing activities reflecting strategic shifts | (Dollars in millions) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used by operating activities | ($1,389) | ($7,285) | | Net cash used by investing activities | ($3,946) | ($26) | | Net cash (used)/provided by financing activities | ($725) | $5,538 | | Net decrease in cash & cash equivalents | ($6,026) | ($1,798) | Summary of Business Segment Data Q2 2025 saw BCA revenue surge and loss narrow, BDS achieve profit, and BGS maintain steady growth in revenue and earnings | (Dollars in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | | :--- | :--- | :--- | | Revenues | | | | Commercial Airplanes | $10,874 | $6,003 | | Defense, Space & Security | $6,617 | $6,021 | | Global Services | $5,281 | $4,889 | | Earnings/(loss) from operations | | | | Commercial Airplanes | ($557) | ($715) | | Defense, Space & Security | $110 | ($913) | | Global Services | $1,049 | $870 | Notes to Condensed Consolidated Financial Statements Notes detail the Spirit AeroSystems acquisition, Digital Aviation Solutions sale, fixed-price contract risks, and 737 MAX legal settlements - Boeing has agreed to acquire Spirit AeroSystems in an all-stock transaction, expected to close in 2025. The deal is subject to regulatory approvals and the sale of certain Spirit operations related to Airbus333438 - The company entered an agreement to sell portions of its Digital Aviation Solutions business (including Jeppesen and ForeFlight) to Thoma Bravo for $10.55 billion, with the transaction expected to close in 202543 - Several fixed-price development programs, including VC-25B, KC-46A Tanker, MQ-25, T-7A Red Hawk, and Commercial Crew, continue to face risks of additional material losses in future periods858687 - Boeing reached a non-prosecution agreement with the U.S. Department of Justice regarding the 737 MAX, which includes a $244 million fine, a commitment to invest $455 million in compliance and safety, and $445 million in additional compensation for victims' families121 - Total backlog increased to $618.5 billion as of June 30, 2025, with approximately 21% expected to be converted to revenue through 2026133 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses improved financial results driven by higher deliveries and defense performance, alongside safety plan implementation and program updates Consolidated Results of Operations and Financial Condition H1 2025 consolidated revenue increased to $42.2 billion, operating earnings turned positive, and total backlog grew to $618.5 billion - Following the January 2024 737-9 incident, Boeing submitted a comprehensive safety and quality plan to the FAA and slowed production rates to improve quality153154 | (Dollars in millions) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Revenues | $42,245 | $33,435 | | Earnings/(loss) from operations | $285 | ($1,176) | | Core operating loss (Non-GAAP) | ($234) | ($1,780) | - Total backlog increased to $618.5 billion at June 30, 2025, from $521.3 billion at December 31, 2024, driven by an $87.0 billion increase in BCA backlog175 Commercial Airplanes BCA H1 2025 revenue rose to $19.0 billion with narrowed operating loss, driven by increased deliveries and production rate adjustments | Program | H1 2025 Deliveries | H1 2024 Deliveries | | :--- | :--- | :--- | | 737 | 209 | 137 | | 777 | 20 | 7 | | 787 | 37 | 22 | | Total | 280 | 175 | - The 737 production rate gradually increased to 38 per month during the first half of 2025196 - Certification for the 737-7 and 737-10 models is now expected to occur in 2026198 - The company continues to anticipate the first delivery of the 777-9 in 2026203 Defense, Space & Security BDS H1 2025 revenue was stable at $12.9 billion, achieving an operating profit of $265 million due to lower charges on fixed-price programs - BDS operating earnings for H1 2025 were $265 million, compared to a $762 million loss in H1 2024211216 - The improved earnings were driven by significantly lower charges on major fixed-price development programs compared to the prior year. However, management notes that risk remains that additional reach-forward losses may be required in future periods on these programs216221 Global Services BGS H1 2025 revenue increased to $10.3 billion, with operating earnings growing to $2.0 billion due to higher services volume | (Dollars in millions) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Revenues | $10,344 | $9,934 | | Earnings from operations | $1,992 | $1,786 | | Operating margins | 19.3% | 18.0% | - The increase in revenue was primarily due to higher government services, while the increase in earnings was due to higher government and commercial services revenue and a 2025 gain on asset disposition223225 Liquidity and Capital Resources Operating cash flow significantly improved in H1 2025, with the company maintaining strong liquidity despite a $53.3 billion total debt balance - Net cash used by operating activities decreased by $5.9 billion to $1.4 billion for H1 2025, primarily driven by higher commercial airplane deliveries and working capital improvements228 - As of June 30, 2025, the company had $7.1 billion cash, $15.9 billion short-term investments, and $10.0 billion unused borrowing capacity on revolving credit lines235 - Total debt balance was $53.3 billion as of June 30, 2025, down from $53.9 billion at the end of 2024234 Quantitative and Qualitative Disclosures About Market Risk No significant changes to the company's market risk have occurred since December 31, 2024 - There have been no significant changes to the company's market risk since the end of the previous fiscal year248 Controls and Procedures Disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control - Management concluded that disclosure controls and procedures were effective as of the end of the quarter250 - No material changes were made to internal control over financial reporting during the second quarter of 2025251 Part II. Other Information Legal Proceedings This section refers to Note 18 of the financial statements for detailed discussion of legal proceedings - For information on legal proceedings, the report refers to Note 18 of the Condensed Consolidated Financial Statements253 Risk Factors The company updates risk factors, highlighting significant exposure to non-U.S. sales and geopolitical trade tensions, particularly with China - A significant portion of revenue (46% in 2024) comes from non-U.S. sales, exposing the company to risks from tariffs, trade restrictions, and geopolitical instability255 - The U.S.-China trade relationship is specifically highlighted as a challenge. In Q2 2025, certain Chinese customers paused accepting deliveries due to tariff negotiations, though deliveries have since resumed259 - Potential deterioration in trade relationships, particularly with China and the EU, could have a material adverse impact on the company's financial position and results260 Unregistered Sales of Equity Securities and Use of Proceeds During Q2 2025, 21,510 shares were transferred for tax withholding, with no open market stock repurchases - During Q2 2025, 21,510 shares were acquired from employees to cover tax withholding on vested RSUs. No open market repurchases were made under any publicly announced plan261