Boeing Reports Fourth Quarter Net Loss of $8.4 Billion, Full Year 2020 Net Loss of $11.9 Billion
The aerospace giant reported a fourth quarter net loss of $8.4 billion or ($14.65) per share on a 15% decline in revenue to $15.3 billion versus Q4 2019. For the full year 2020, Boeing reported a net loss of $11.9 billion or ($20.88)/share on a 24% revenue decline to $58.2 billion.
On Wednesday (January 27, 2021), Boeing reported their fourth quarter and full year 2020 financial results. The company reported a fourth quarter net loss of $8.4 billion or ($14.65) per share on a 15 percent revenue decline to $15.3 billion compared to the fourth quarter of 2019. For the full year 2020, Boeing reported a net loss of $11.9 billion or ($20.88) per share on a year-over-year revenue decline of 24 percent to $58.2 billion. The company’s fourth quarter earnings were significantly impacted by the 737 MAX grounding, COVID-19 and commercial widebody programs. Boeing’s 777X program recorded a $6.5 billion pre-tax charge, with the first deliveries expected in late 2023. Operating cash flow for FY 20 was ($18.4) billion and the company ended the year with cash and marketable securities totaling $25.6 billion. The aerospace giant has a total backlog worth $363 billion, including over 4,000 commercial airplanes.
In today’s announcement, Boeing’s President and Chief Executive officer, Dave Calhoun, said,
“2020 was a year of profound societal and global disruption which significantly constrained our industry. The deep impact of the pandemic on commercial air travel, coupled with the 737 MAX grounding, challenged our results. I am proud of the resilience and dedication our global team demonstrated in this environment as we strengthened our safety processes, adapted to our market and supported our customers, suppliers, communities and each other. Our balanced portfolio of diverse defense, space and services programs continues to provide important stability as we lay the foundation for our recovery. While the impact of COVID-19 presents continued challenges for commercial aerospace into 2021, we remain confident in our future, squarely-focused on safety, quality and transparency as we rebuild trust and transform our business.”
The company achieved an important step during the quarter with the return of the 737 MAX in the U.S and other markets. Since the FAA approved the return to service, Boeing has delivered 40 737 MAX aircraft and five airlines have safely returned their fleets to service as of January 25, 2021, with MAX aircraft safely completing over 2,700 revenue flights with approximately 5,500 flight hours.
Fourth quarter Commercial Airplanes revenue decreased to $4.7 billion, largely attributable to lower widebody deliveries due to the impacts of the pandemic and 787 production issues, partially offset by higher 737 deliveries and lower MAX consideration charges. Operating margin for Q4 decreased 161.8 percent, driven by a $6.5 billion pre-tax charge on the 777X program, reduced delivery volume and $468 million in abnormal 737 MAX related production costs.
Boeing expects a continued low rate of 737 production due to the pandemic but plans on gradually increasing production to 31 per month by early 2022. The company will transition 787 production to five per month in March 2021, at which time 787 final assembly will be consolidated in South Carolina. For 2021, Boeing expects the combined production rate for the combined 777/777X program to remain at two per month. During the fourth quarter, Boeing received orders for 75 737 aircraft from Ryanair, eight 777 freighters from DHL and a commitment for 23 737s from Alaska Airlines. Boeing Commercial Airplanes delivered 59 airplanes during the quarter.
Boeing (NYSE:BA) is the world’s largest aerospace company and leading supplier of commercial airplanes, defense, space and security systems, as well as global services. The aerospace giant tops the list of the largest U.S. exporters, providing a significant positive impact to America’s annual GDP. Boeing supports government and commercial customers in over 150 countries and employs more than 160,000 team members worldwide. As Boeing continues to deliver for customers, they are committed to their legacy of aerospace leadership in technology and innovation and will continue investing in their people for future growth.