Heard on the Street: Boeing’s surprise second-quarter profit is a sign that the worst period in the plane maker’s history is over, but a plague of issues still threatens its competitive position
Boeing is making money again, but regaining its status as an investor darling will take something more.
On Wednesday, the Chicago-based plane maker’s stock jumped almost 6% after its surprise announcement offor the second quarter. It is the first time the company has reported positive net income since the third quarter of 2019, due to the double whammy of the pandemic and the grounding of its 737 MAX jet.
Some of the improvement was thanks to higher profit margins in the defense and services divisions, but the commercial-airplane arm also surpassed expectations. It reported a 268% surge in revenues for the period, and—as was already known—logged 180 new net orders including high-profile MAX purchases by United Airlines and Southwest Airlines . This placed Boeing ahead of its European rival Airbus .
Crucially, Boeing managed to ship 50 737 aircraft in the three months through June, freeing up more of its massive stockpile of undelivered planes. Together with much-needed predelivery payments following the new orders, this reduced Boeing’s quarterly cash bleed to just $705 million. Wall Street was expecting an outflow of almost $3 billion.for the MAX was key. Its share price has significantly trailed Airbus’s over the past few months. Given how many high-profile mishaps the U.S.
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