What Can We Expect From Boeing’s Q3 Earnings?
Boeing (NYSE:BA) is set to announce earnings for its third quarter Wednesday, October 26th. Overall, the company has suffered from low orders and high charges on some of its troubled programs, greatly affecting earnings. Furthermore, the airplane manufacturer pre-announced a decline of about 5.5% in its commercial deliveries this quarter, offset partially by an increase in defense deliveries by about 4.2%. However, despite a slowdown, Boeing deliveries have been higher than rival Airbus in the same period. That said, we can expect revenues and earnings to fall year over year by 5% to 10%.
Boeing deliveries have fallen considerably this year and will continue to do so considering the current economic environment. The weak economy has forced air carriers and governments to delay or cancel orders for new aircraft, including the flagship 787 Dreamliner. Furthermore, airliners built more than 20 to 30 years ago are still flying regular routes after being refurbished multiple times. To compensate for falling revenues, Boeing is seeking to push aggressively into aftermarket sales that currently show 4.5% annual growth.
In a recent announcement, the company announced that deliveries have fallen from 199 aircraft delivered in Q2 to 188 delivered in Q3. The deliveries for its 737 airplane fell from 126 to 120 from about a year ago and 787 deliveries fell to 36 from 37.
- Should You Pick Boeing Stock At $190?
- Having Lost 15% So Far This Year, Is Boeing Stock Undervalued At $210?
- Will Boeing Stock Recover To Its Highs of Over $250?
- Following A 39% Rise This Year Is Boeing Stock A Better Pick Over Caterpillar?
- Is Boeing Stock Undervalued At $190?
- Here’s What To Expect From Boeing’s Q2
Additionally, it seems likely that Boeing might cut production of its current-generation 777 aircraft. Management has already announced that the company will be cutting production of its wide body jet to about 7 per month in 2017 from about 8.3 per month currently. That said, it seems likely that even 7 may prove to be pushing it, as carriers wait for the next generation 777X model. We expect such cuts to adversely impact sales this quarter.
Notes:
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis of Boeing
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research