Boeing Q3 Earnings Preview: Brace for another dismal quarter

Boeing (NYSE:BA) is scheduled to announce Q3 earnings results on Tuesday, October 22nd, after market close.

The beleaguered aerospace company already reported disappointing preliminary Q3 results earlier this month, along with plans to cut its total workforce by ~10% and delay the first delivery of its 777X jet by a year.

It will also recognize $5B in earnings charges, and part of the latest quarter has been impacted by the widespread strike U.S. West Coast workers, which only recently came to an end. The strike had shuttered production of its 737 MAX, 767 and 777 jets and drained its reserves.

Boeing’s (BA) latest projections put its Q3 revenues at $17.8B and GAAP loss at $9.97/share, with a negative operating cash flow of $1.3B.

The consensus non-GAAP EPS Estimate is -$8.82 (vs -$3.26 in Q3 2023) and the consensus revenue estimate is $17.94B (-0.9% Y/Y).

Analysts at Baird and BofA Securities see the Boeing (BA) strike as a headwind across the aerospace sector and Q4 outlooks, although they remain bullish on the prospects of the commercial aftermarket sector, with record global flight activity and attractive margins.

On a positive note, Bernstein suggested the strike resolution may be the first step in the airplane maker’s long road to recovery.

Its analysts said: “We believe that Boeing’s cash position is not as dire as portrayed in the media. However, we still believe building a cushion is worthwhile, given uncertainty about a strike recovery and the supply chain.”

Bernstein hinges Boeing’s potential recovery on a successful equity raise of around $10B and a compelling plan from the new CEO Kelly Ortberg, followed by a strong execution of said plan, “Something that has so far been elusive.”

“Our business is in a difficult position, and it is hard to overstate the challenges we face together,” Ortberg said in a memo to employees announcing the job cuts. Investors will be keenly looking for his plans to overcome these challenges.

Over the last 2 years, Boeing (BA) has beaten EPS estimates 38% of the time and has beaten revenue estimates 38% of the time.

Over the last 3 months, EPS estimates have seen 0 upward revisions and 19 downward. Revenue estimates have seen 1 upward revision and 16 downward.