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Boeing posts fourth straight quarterly loss and tells staff to prepare for more job cuts

Business Insider logo Business Insider 10/28/2020 insider@insider.com (Grace Dean,Reuters)
a large passenger jet flying through the air: Boeing's third 777X aircraft departing on a test flight. Boeing © Provided by Business Insider Boeing's third 777X aircraft departing on a test flight. Boeing
  • Boeing expects staff numbers to fall to 130,000 by the end of 2021, which would be a near 20% drop in head count from the start of the year.
  • The company recorded a $466 million loss in the quarter to September, making it the fourth straight quarterly loss for the aircraft giant.
  • Its defense, space, and security division fared much better than its commercial aircraft sales as airlines continue to struggle due to travel restrictions.
  • The company "remain[s] confident in our long term future," said CEO, Dave Calhoun.
  • Visit Business Insider's homepage for more stories.

Aircraft giant Boeing reported its fourth straight quarterly loss and thousands of further expected job cuts on Wednesday as the coronavirus crisis and the 737 MAX jet grounding hurt sales.

While the earnings results weren't good, they weren't as bad as many analysts were expecting.

As flight numbers dropped during the pandemic, so have Boeing's staff numbers.

Boeing previously announced it would be cutting 10% of its workforce – but now it expects its staff to drop to 130,000 by the end of 2021, it said in a staff note. This would represent a drop of nearly 20% of its head count over the year. The reduction will come from a combination of natural attrition and voluntary and involuntary workforce reductions, it said.

The company reported a $466 million loss in the quarter to September. In the same period last year, it recorded a profit of $1.2 billion.

Read more: The president of Emirates reveals how the glitzy airline's hopes have turned to shipping cargo to stay afloat as the pandemic ravages international travel


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Boeing said it was sticking with its deeply reduced widebody production rates announced in July, as well as the goal to hit a build rate of 31 narrowbodies monthly in early 2022.

The company has also made progress toward returning 737 MAX jets to service after their 19-month-old worldwide ban triggered by two fatal accidents, it said. The model has completed around 1,400 test and check flights, and more than 3,000 flight hours as it progresses through the certification process.

The COVID-19 pandemic grounded air travel to a near halt, pushing major airlines to the brink of bankruptcy and forcing them to seek government aid, cut costs, and defer aircraft deliveries. Total revenue in the quarter to September fell 29% to $14.14 billion, with a 56% drop in revenue for its commercial aircraft as it sold and delivered only 28 planes to the travel sector.

But Boeing's defense, space, and security division fared much better. Its third-quarter revenues fell only 2%, and Boeing received an award for eight F-15EX advanced fighter aircraft for the US Air Force and a contract extension for the International Space Station for NASA.

The company's free cash outflow rose to $5.08 billion in the quarter, from $2.89 billion a year earlier, while total debt jumped to $61 billion, from $19.2 billion.

Excluding items, Boeing lost $1.39 per share in the third quarter ended on September 30.

"Despite the near-term headwinds, we remain confident in our long term future," said Boeing CEO Dave Calhoun.

 

Reporting by Eric M. Johnson and Ankit Ajmera for Reuters, and Grace Dean for Business Insider.

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