Boeing Company (BA) shares dipped slightly on Tuesday despite reporting fourth-quarter results that showed meaningful progress in the aerospace giant's recovery efforts. Revenue came in at $23.948 billion, crushing the $22.470 billion analyst estimate and representing a 57% jump from $15.242 billion in the prior-year quarter.

The headline numbers tell an interesting story. Boeing delivered 160 airplanes during the quarter, reflecting what the company describes as improved operational performance. But earnings were messier. The company reported an adjusted loss of $1.91 per share, missing expectations for a 39-cent loss. That seems bad until you dig into the details.

GAAP earnings came in at $10.23 per share, a dramatic swing from the $5.46 loss a year earlier. Core earnings, the non-GAAP measure that strips out one-time items, hit $9.92 per share versus a $5.90 loss in the year-ago period. The boost came from a massive $9.6 billion gain on the sale of Boeing's Digital Aviation Solutions business, which added $11.83 to earnings per share. Without that transaction, the core business is still bleeding money, though considerably less than before.

Commercial Airplanes Drive Growth

The Commercial Airplanes segment posted revenue of $11.379 billion, more than double the $4.762 billion from a year earlier. Operating margin was negative 5.6%, an improvement from the brutal negative 43.9% margin in the prior-year quarter. Boeing noted the results included impacts from acquiring Spirit AeroSystems, the supplier it brought back in-house to address quality control issues.

The order book looks healthy. Commercial Airplanes secured 336 net orders in the fourth quarter and 1,173 for the full year. The segment ended 2025 with a backlog exceeding 6,100 airplanes valued at a record $567 billion. That's years of work lined up, assuming Boeing can keep ramping production.

Speaking of production, the 737 rate increased to 42 planes per month. The Federal Aviation Administration also approved the final phase of certification flight testing for the 737-10, clearing a key regulatory hurdle for the largest member of the 737 MAX family.

Defense Struggles Continue

Defense, Space & Security revenue rose to $7.417 billion from $5.411 billion, but the operating margin remained deeply negative at 6.8%. The segment absorbed $0.6 billion in losses on the troubled KC-46A tanker program, which has been a persistent problem child.

Global Services generated $5.209 billion in revenue compared to $5.119 billion a year earlier. The operating margin of 202.4% looks absurd until you realize it primarily reflects that $9.6 billion gain from the Digital Aviation Solutions sale. Strip that out, and Services delivered its typical steady, profitable performance.

Cash Flow Turns Positive

Cash generation showed real improvement. Operating cash flow reached $1.331 billion for the quarter versus a $3.450 billion outflow a year earlier. Free cash flow turned positive at $375 million compared to negative $4.098 billion in the prior-year period. These are the metrics Boeing bulls have been waiting to see.

Full-Year Performance and Forward Outlook

For the full year 2025, Boeing reported revenue of $89.463 billion, up 34% from $66.517 billion. The company delivered 600 commercial aircraft, the highest annual total since 2018, before the 737 MAX grounding and pandemic wreaked havoc on production.

GAAP earnings were $2.48 per share versus a $18.36 loss in 2024. Core earnings came in at $1.19 per share compared to a $20.38 loss the prior year. Full-year operating cash flow was $1.065 billion, a massive turnaround from the $12.080 billion outflow in 2024. Free cash flow remained negative at $1.877 billion but improved dramatically from negative $14.310 billion.

Boeing ended the quarter with $29.4 billion in cash and investments against $54.1 billion in consolidated debt. The balance sheet remains stretched, but the trajectory is moving in the right direction. The company's risk disclosures mention tariffs and regulatory changes as potential headwinds.

Total company backlog hit a record $682 billion, with all three business segments reaching record levels. That's an enormous cushion of future work.

"We made significant progress on our recovery in 2025 and have set the foundation to keep our momentum going in the year ahead. We completed the acquisition of Spirit AeroSystems and the sale of portions of the Digital Aviation Solutions business and remain focused on promoting stable operations, completing our development programs, rebuilding trust with our stakeholders, and fully restoring Boeing to the iconic company we all know it can be," said Kelly Ortberg, Boeing president and chief executive officer.

Boeing (BA) shares were down 1.38% at $245.00 during premarket trading on Tuesday. The stock is approaching its 52-week high of $254.14.