The Boeing Company

(New York Stock Exchange)
Back to all articles
Somewhat Bearish -45

Boeing Drops 9% as Commercial Jet Losses Overshadow Positive Cash Flow; GE Aerospace Ticks Up, RTX Holds Steady

Earnings report Guidance raised Regulatory approval AI-generated analysis

πŸ“‰ Boeing stock fell 9% to $171.23 as a deepening commercial jet loss overshadowed positive free cash flow of $464 million and a record $745 billion backlog.

πŸ’Έ Commercial Airplanes operating margins worsened to negative 6.5%, down from negative 2.7% previously, driven by unfavorable delivery mix and elevated supply chain costs.

πŸ“Š The company reported an adjusted loss of $0.34 per share for Q3 2026, missing the estimated deficit of $0.20 and marking a second consecutive quarterly miss on per-share results.

πŸ›‘οΈ Defense, Space & Security revenue grew 15% to $7.93 billion, supported by a $252 million gain from selling HRL Laboratories and the selection for the F/A-XX fighter program.

✈️ Boeing secured 300 net commercial orders in the quarter from customers including Turkish Airlines, Ethiopian Airlines, and Lufthansa, bolstering its massive backlog.

πŸš€ Production ramp progress includes certification of the 737-7 and 737-10 models, with a target rate of 47 jets per month for the 737 program.

πŸ”§ The first delivery of the 777X widebody jet is targeted for 2027, which would add a new revenue stream to the company's mix.

⚠️ Skeptics warn that commercial unit margins moved in the wrong direction and elevated supply chain costs could keep pressure on the business as output rises.

Bullish Signals
  • Boeing maintains a record $745 billion backlog, including $612 billion in commercial orders covering more than 6,300 planes, providing years of revenue visibility.
  • The Defense, Space & Security segment generated $7.93 billion in revenue, a 15% increase driven by the F/A-XX Navy fighter program win and HRL Laboratories sale gain.
  • Free cash flow turned positive at $464 million for Q3 2026, up from the year-ago period, while operating cash flow reached $1.5 billion despite settlement payments.
  • The company achieved certification for the 737-7 and 737-10 models and secured a target production rate of 47 jets per month for the 737 program.
  • Boeing booked 300 net commercial orders in the quarter from major carriers including Turkish Airlines, Ethiopian Airlines, and Lufthansa.
Risk Factors
  • Commercial Airplanes operating margins deepened to negative 6.5% from negative 2.7% in the prior quarter, significantly worsening profitability.
  • The company missed its Q3 loss estimate by nearly double, reporting an adjusted loss of $0.34 per share versus an expected deficit of $0.20.
  • Commercial airplane revenue fell 3% to $10.72 billion due to an unfavorable delivery mix and elevated supply chain expenses.
  • Engine delivery problems are slowing plans to raise production rates for the MAX narrowbody and Dreamliner widebody jets, hindering the turnaround ramp.
Full Analysis
Boeing (BA) shares dropped 9% in morning trading following its Q3 2026 earnings report, which revealed a deepening crisis in its commercial jet division despite a record backlog and positive free cash flow. The company reported an adjusted loss of $0.34 per share, missing analyst expectations for a smaller deficit, as total revenue reached $24.19 billion, slightly below consensus. The primary driver of the stock decline was the Commercial Airplanes segment, which saw operating margins deteriorate significantly to negative 6.5% from negative 2.7% in the prior quarter. Revenue for this unit fell 3% to $10.72 billion due to an unfavorable delivery mix, elevated supply chain expenses, and higher projected costs associated with future production rate adjustments. While the commercial struggles persist, Boeing's Defense, Space & Security segment provided a cushion with revenue rising 15% to $7.93 billion, aided by a gain on the sale of HRL Laboratories and a new win for the F/A-XX Navy fighter program. The company maintains a record $745 billion backlog, including $612 billion in commercial orders covering over 6,300 planes, offering long-term visibility.