Top jet manufacturer Boeing reported on Wednesday a net loss of $355 million in the first quarter after months of scrutiny over recent safety issues.
Operating revenue declined 8% year over year in the first quarter, from approximately $17.9 billion to $16.6 billion, with the company burning more than $3.9 billion in free cash flow in the time frame compared to $786 million a year ago, according to Boeing’s first quarter earnings report. Recent scrutiny of safety with Boeing products began in January after an Alaska Airlines flight had a door plug fly off mid-air, resulting in an emergency landing and an investigation into the company’s quality assurance. (RELATED: The Oil And Gas Industry Might Be What’s Keeping Biden’s Economy Humming On Paper Despite ‘Regulatory Assault’)
“Our first quarter results reflect the immediate actions we’ve taken to slow down 737 production to drive improvements in quality,” Boeing CEO Dave Calhoun said in the report. “We will take the time necessary to strengthen our quality and safety management systems and this work will position us for a stronger and more stable future.”
Boeing reported an over $3.3 billion operating cash flow loss in the first quarter, compared to a $318 billion loss at the start of 2023, according to the earnings report. The decline in profits led to a core loss per share of $1.13 for shareholders in the first quarter, lower than the $1.27 loss in the same time frame last year.
An initial report from the National Transportation Safety Board in February showed that the Alaska Airlines plane had no bolts installed on the door prior to the flight.
DEI does not come cheap: Boeing reports biggest cash burn in 4 years as company struggles with selling flying paperweights that were “designed by clowns and supervised by monkeys” pic.twitter.com/1zbeCDH0cp
— zerohedge (@zerohedge) April 24, 2024
Calhoun announced in late March that he would be stepping down from Boeing at the end of the year amid the safety issues. Calhoun could be awarded $32.8 million in total compensation for his work in 2023, adding on to over $64 million already dolled out since he took up the post in 2020, depending on stock performance.
“Near term, yes, we are in a tough moment. Lower deliveries can be difficult for our customers and for our financials,” Calhoun said in a message to employees on Monday. “But safety and quality must and will come above all else. We are absolutely committed to doing everything we can to make certain our regulators, customers, employees, and the flying public are 100% confident in Boeing. While I have shared my plans to step down as CEO around the end of this year, I will be focused every day on seeing that commitment through.”
Boeing planes have a history of safety issues, most notably a pair of crashes that occurred in 2018 and 2019 that resulted in the deaths of 346 people. Congress ordered an investigation into Boeing following the incident, which showed a disconnect in safety culture between senior management and rank-and-file members.
Boeing deferred the Daily Caller News Foundation to the message sent out to employees.
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