Boeing shares plunge as investors 'keep getting more bad news'
The planemaker has filed a certification plan with US authorities for the Dreamliner.
Boeing shares plunged the most in almost two years after it burned more cash than expected, underscoring the strain on the planemaker as it contends with rising inflation and halted 787 Dreamliner deliveries.
The aviation titan recorded negative $3.57bn (€3.34bn) free cash flow in the first quarter and racked up $1bn in new accounting charges for its defense division. Boeing is also pausing production of its 777x jetliner through 2023 and postponing the initial delivery of the hulking twin-engine aircraft to 2025.
“This was another dreadful quarter from Boeing,” Robert Stallard, an analyst with Vertical Research Partners, said. “And what we think will really worry investors is that we keep getting more bad news,” he said.
The results highlight the magnitude of issues facing the company, stretching beyond the 787 delays to include the impact of war, Covid and tougher regulatory scrutiny in the wake of two fatal 737 Max crashes.
The shares slumped 9% at one stage. The results made for a “messier quarter than any of us would’ve liked,” Boeing chief executive Dave Calhoun said in an interview on CNBC. While inflation and a possible recession loom, he is optimistic that the company will generate cash on an annual basis this year for the first time since 2018.
The planemaker has filed a certification plan with US authorities for the Dreamliner and completed the required work to address tiny structural flaws in an initial batch of the carbon-fibre jets.
