Boeing Co. (BA) shares were trading lower in the premarket session on Wednesday. The stock fell 10.69% to $168.18 on Tuesday after the company reported earnings.
Investors reacted to a wider-than-expected adjusted loss and a slower ramp in 737 production.
The company reported adjusted EPS of -$0.34 on revenue of $24.19 billion. On the earnings call, executives said stabilizing 737 production at 47 jets per month is taking longer than expected.
For investors, key catalysts include progress on the 737 MAX, stronger deliveries, 777-9 certification, and free cash flow execution.
The Wing Is the Problem
On the conference call, CEO Kelly Ortberg said Boeing continues to make progress but cautioned that the recovery will not be linear.
"We know there's more work to do, and I've said before, our progress is not always going to be perfectly linear, but we continue to improve, and I'm confident we're on the right track."
The main constraint is the 737 wing production system, where some planned process improvements failed to deliver the expected throughput.
"Some of those flow enablers just flat out did not yield the flow savings. Some did, some didn't. So we had to step back and make some changes to that," Ortberg said.
Boeing is adding capacity where needed, while keeping the focus on production stability rather than forcing another rate increase.
Rate 52 Slips to the Back Half of 2027
The slower ramp has pushed Boeing's next production step further out.
Ortberg said the company now plans to "target rate 52 in the back half of 2027," with timing dependent on readiness across wings, fuselages and other rate-enabling operations.
CFO Jay Malave said the delay will weigh on near-term deliveries.
"As we close out the year, the delay in stability at 47 per month is expected to translate to the lower delivery output and come in shy of the 500 (737s) delivery target."
Boeing delivered 161 commercial aircraft in the third quarter, down from 171 in the prior quarter.
Certification Lessons and the Cash Flow Path
Ortberg said Boeing has gained a clearer understanding of the certification process following work on the 737-7 and 737-10.
"I think we now know after the Dash 7 and Dash 10 what it takes to get certification complete in this new post-ACSA world of regulation," he said.
Boeing is now applying that experience to the 777-9, which it still expects to deliver for the first time in 2027. The 777-9 still requires additional FAA flight-test authorization, including ETOPS testing. Certification is not yet complete.
Boeing also expects roughly $2 billion in free cash flow in 2026, rising to about $3 billion in 2027 and $6 billion in 2028 before reaching its $10 billion target in 2029.
BA Price Action: Boeing shares were up 0.20% at $168.51 during premarket trading on Wednesday. The stock is trading at a new 52-week low, according to market data.
