Should Boeing Stock Investors Worry About Its Turnaround?
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At Boeing (BA), investors should most closely watch the profit on commercial jets, because that business is still losing money. The unit reported an operating margin of negative 2.7% in fiscal Q2 2026, even while delivering 171 airplanes, its highest quarterly total since 2018. It brought in $11.8 billion, accounting for nearly half of Boeing’s $24.6 billion revenue in that quarter. So why is Boeing still losing money on its jets?
Why Boeing’s Jet Business Is Still Losing Money
Management attributes the weak profit on its jets to pricing. On its fiscal Q2 2026 call in July, it said cash margins on the 737 and 787 programs are at depressed levels, slightly above breakeven. Management noted this is largely because of pricing drags that take time to fade as deliveries go on. The 737 and 787 barely make money, while the unit as a whole still runs at a loss. The unit’s margin still improved from a year earlier, with management crediting higher delivery volume and mix. Boeing is now ramping the 737 to 47 airplanes a month. Volume is rising, while the price on each jet remains the weak point.
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Boeing’s Profit Is Far Below Its 2018 Level
Management uses 2018 as its own bar, expecting 737 margins to approximate their 2018 level by 2030. That goal covers the 737, and a separate goal covers the 787, not Boeing as a whole. For Boeing as a whole, the operating margin was negative 5.4% over the twelve months to June 2026. This compares with 11.7% over the twelve months to December 2018, its highest in the past ten years.
Investors still pay 41.8 times Boeing’s operating cash flow over the past twelve months, compared with 15.1 for the S&P 500. Holders have had a poor year all the same: the stock lost 11.3% over the year to October 21, 2026, while the S&P 500 returned 16.5%.
Boeing Expects Better Prices On Jets Still To Come
Management expects the airplanes in Boeing’s record $597 billion commercial backlog to be delivered at better prices and with a better mix. It also expects 787 margins to surpass their 2018 level by 2030. Management calls a $10 billion free cash flow figure after 2026 very attainable, a sum equal to about 6.6% of Boeing’s market value at the October 21 close. For 2026 itself, the company expects free cash flow of $1 billion to $3 billion.
Management also named what could slow the plan. It said the 737’s next planned rate is 52 airplanes a month, and that raising output gets harder as rates go from 52 to 57. Engine deliveries for the 787 fell behind in the first half of 2026.
A holder has reason for concern rather than alarm. The unit’s margin is improving as deliveries rise. However, the price likely assumes Boeing wins back much of its 2018 margin, while management’s own 2030 goal covers only the 737 and 787. The commercial airplane margin, negative 2.7% in fiscal Q2 2026 with help from about 1.5 points of one-time favorable adjustments, is the number to watch when Boeing reports on October 27.
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