Earnings call transcript Q1 2023

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Operator

Thank you for standing by. Good day, everyone, and welcome to The Boeing Company's First Quarter 2023 Earnings Conference Call. Today's call is being recorded. The management discussion and the slide presentation, plus the analyst question-and-answer session are being broadcast live over the Internet. [Operator Instructions].

opening Mr. introductions, for call turning time, to over this remarks I'm and the At Vice of Welch, Matt President Boeing. Investor Relations for Mr. Welch, ahead. go please

Matt Welch

XXXX Brian are Officer. Dave Thank Boeing's Boeing's Chief President Matt morning. Financial good Executive Calhoun, Executive and Earnings Officer; Vice Chief Quarter and and Welch, today you, am Boeing's Call. me Welcome with and I West, and First to President

broadcast and As slide at follow a reminder, you boeing.com. today's can presentation

release. information is included As always, press today's detailed financial in

projections, included our risks, filings statement Furthermore, goals including those of and forward-looking involve and today's discussion end estimates in the web the described SEC disclaimer presentation. the in at in

we and presentation In you earnings our for refer reconciliation release non-GAAP disclosures certain and addition, of to measures.

to over Now Dave Calhoun. I will the turn call

David Calhoun

morning, the operational set for remain. for had you good annual flow. do. ranges Good more last Matt. XXXX, real for joining and continue billion well as see we cash thank Challenges and as XXXX solid But a $XX we steady delivery to everyone, recovery. and the including cash There's can We progress, our we make shared about in quarter, first frame, and feel to overall, in us. progress XXXX where flow financial free outlook time November, Thanks,

an Let's update XXX. with on our start

two inspection been do. and hard fittings, to early The has affected of We've we isolated specific our over what working in airplanes. to team understood. been Our the last we progressing week. have issue's know It's

our The the next work over several deliveries of will the months. timing impact

over capacities production lower about later coming increase delivery we this Unfortunately, months, to we XXX shortfalls our to this that. our customers, terrible rate recover these and the and the per near we of expect Deliveries for still However, year. of XX to year. deliver airplanes will but month be and many we will plan term, will impact summer feel timing XXX

schedule Spirit in appreciate we're They're partner. we're recovery to working supplier week, we of parts we keep issue. us not We're ensure that notified changing adding also can very master closely that pace, and promptly the and are constructive important they plan, working back, way. a on the comfortable mentioned As an this last Stepping inventory.

continue with always. the transparently to will We work as FAA

As with well, work will customers fleet transparently requirements. support and we to scheduling their our planning

flight As last the fleet of we safely. no continue safety can to issue, mentioned immediate there's week, operate and

We will diligently process work together. through this

We will prioritize safety.

and quality We prioritize transparency the will of step way. every

now that be flight view. more wider made. have hours proud the our safely of We X,XXX to fleet. service, XXX with more X than MAX flying And airplanes we and the a have return I since fleet flown the has reliability. Taking couldn't over the progress MAX exceptional team million in

our is supporting customers service, XX And been with their our operators All has to to of focus respect and airplanes on service. XX China, and sky. back airplanes in MAX in and are the their returned return have to flying

an addition, the delivery Evaluation the their Boeing's released that important of are It's step in XXX Report. In CAAC Aircraft aircraft possession. currently toward

of lead our the follow customers. will We

our in BCA. top on orders. quarter. We this, to all across with XXX were Moving of booked remains start year: we up airplane XXX Riyadh first Air, And in this XXX of product I'll earlier airplanes. proud XX ordering newly to strong the very orders Saudia, Arabia; Demand net to lines. and commitments XXXs the MAX, customer major Saudi and XXXXs; announce XXX airline XX Air India, and XXX established

with our working we're a deliveries, to We XX month On XXX strong airplanes the demand, with subject meet strong commercial delivered including commitments. March in the customer of quarter, deliveries. in

still improve have high, monthly deliveries stability. remains and in However, we to work variation

as course, XXX, earlier. mentioned Of the I that with starts

we'll And of stability will key programs are we yes, system subject notified the across and when And production, pause push also not steadily are we On robust meet demand. increasing our defects. rates we prioritize too of the the to fast.

of development, the all the progressing On -XX we're time XXXX. lines development not XXX-X, have our across or key programs. certification changed on And

to we to still space, portfolio in Boeing and Now is switch more Defense. field. performing improve are In our let to operating defense BDS, do well But products me our and work the performance. positioned, our have well

news the the added understand and progressing quality it, previously were last results that quarter The we is issue by First program, Tanker impacted that a we're month. through KC-XXA by cost rework. supplier on good shared driven we

a it on the operational delivering decision opportunity States continuing the side, the the and KC-Y for for the mission is great us, Customers' is United capabilities well. Air the reflects On tanker is its Force. to perform tanker

order side, booked On see solid we Apache on demand and the key activity. the we're continuing tanker, quarter, to E-X. In the orders the

accelerating of addition, In delivery we response are and needs. weapons in customers' to the missiles our

the capabilities are encouraged initial And of with the and needs to by budget short It's portfolio and term. long allies, presidential our and our also the positioned well both We're released. the our expectations. nation in the request in support recently line

we'll well continue to operational more business performance to normalized positioned, and improve defense Our is levels.

very In quarter. Boeing Global Services, strong another

that to both steady keep proud military of The made. pre-pandemic team customers levels. to Solid, and enabled time. dynamic commercial have fleets business now services a very they the has and fully the I'm has flying progress performance through returned very

through we in We're term, suppliers. businesses, long the path. the supply continue remain on focused recent business most our across considered and to and transparently with right All partnership work our and we'll We'll the the issue stability across the MAX drive customers things and chain. on

sight well Demand the supply place same view. in share and improvement, that chain not remain of today did same day. seen That November strong is said, we've and is well our into line our portfolio In we improvement until and significant better every our positioned. guidance, We XXXX. getting predict is

development a have we're for programs, of of new in to prepare generation We the innovating and capabilities pipeline robust next products.

that operational feel and financial our we've for our And both restore and Lots to longer term. shared, year still we for our this outlook of to about but do, track the we're work strength. on good

With over Brian. to turn that, I'll it

Brian West

Great. Thanks, Dave, and everyone. good morning,

results. cover Let's next total to the go the page company and

year-over-year, was That's billion. primarily by up both XX% volume in $XX.X revenue and higher quarter First defense. commercial driven

was margin and $X.XX, per operating to costs abnormal and KC-XX period Tanker last as noted big versus the month. volume were both year a expenses operating that share as higher improvements on commercial by minus core Margins due program charge and was I expected Core performance. last improved driven X.X%, the loss negative EPS and well

usage on as another the commercial important lot award well in program, versus better an quarter, last cash as $XXX by driven was the Free tanker flow franchise. for a higher deliveries advanced the of to X million the tied KC-XX significantly year payment

in deliveries than As we was our expected due noted quarter lower cash wide-body lower last this fourth seasonality. to and earnings quarter call, the

Turning page, Airplanes. I'll next cover to the Commercial

valued with of start booked have airplanes over XXX X,XXX Lufthansa, we orders. $XXX net and JAL and a Let's orders backlog BCA billion. the in quarter, at including

costs on are both to spending. higher X.X%, year. R&D the programs, XX and impacted abnormal XXX XX offset than left. was by by Moving the increases and better customer expenses, airplane including period year-over-year, significantly minus with was the which Revenue $X.X figures XX last the margins margin on Operating billion, deliveries But expected XX% up was driven partially considerations. by

March. year-over-year, the had up the program. a including month in deliveries of The minute in first XXX Let's on XX deliveries XX XXX take XX% the quarter,

will XXXs item. found financial airplanes. impacted, where issue. understand a booked we supplier be Picking impact off quarter. the Dave steps up deliveries We the in left We the this repairs although We near-term rework XXX deliver fuselage we between And several and and regarding expect to started the nonmaterial XXX still year. required, on

April said first average will previously. per with deliveries half and be about but we lower, airplanes XQ the XX will what line in month, monthly be

to sequential deliveries quarterly half expected per in be second improvement XX back with half. are around The the month,

recovery. ultimate the be end delivery While range pace the pressured, will by is the high fuselage of the performance of dictated

Regarding quarter airplanes XXX approximately -XXs. and in XX with -Xs built that in were inventory, and we roughly customers the inventory, China including XXX for ended MAX

inventoried XQ, airplanes, still and delivered to inventoried XX% likely end Within roughly most the we of will And expect rework. by will increase these XXXX. require airplanes in the XXX of number the fuselage be

support final availability. On fuselage engineering expect completing and including increases as through paced and supply rate recovery, a this anticipated months, production, chain advance. near-term manufacturing in we've we're overall coming resources in the stability, To as not well schedule, Spirit assembly inventory contemplated airplanes production including supporting cash builds any parts forward changing by master look. the and our recover We're we're to into

to we in to expect time mentioned, rate year our this per 'XX, increase per as month and month final frame. XX 'XX later XX Within the assembly, Dave

month ended to year. and and be XX per airplanes had XXX the deliveries of XX We're with month the XXXX. in at Moving plan X XX producing year-end. most per the which expect We on reach by to still to We quarter this end delivered of by deliveries XX X the first still quarter in inventory, will program.

We expectations, in with of of by total done billion. $X.X We in to change of there's be booked line expect abnormal the the still estimate and costs this largely quarter, XXX to the no end year. abnormal

unchanged. costs line in Finally, estimate and billion on of the in the $X.X $XXX line abnormal are of XXXX program, abnormal the the We expectations. Both efforts are program ongoing. booked with time million quarter,

XX awards for is in page space. let's defense U.S. go billion Apaches XXX that, $XX BDS next the Force $XX the billion. The quarter, Army. the an as for turn the through contract development KC-XX U.S. Tankers for E-X as and including and Air and booked With to BDS during orders well backlog

figures MH-XXX Tanker up milestone in underlying program the XX aircraft the KC-XX was Revenue by completions also Grey production volume. began and to award, year-over-year, of quarter on satellites billion, X $X.X and Wolf. Moving delivered driven We the the the left. XX% and

month. minus charge higher by negative, still the was million a margin program, on last which than I Operating noted $XXX driven pretax last significantly year X.X%, tanker but

fixed-price bit cycles on to as the in portfolio. Let the me are quarter can Remember, development XX% a of lot little you and commitment attention, development much there a the move get revenues firm we BDS full-scale, these derisk These into production. stable is of overall through of as a the the contracts programs we give and contracts. context as

over in importantly, revenues the of margins. delivered XX% and collectively Next quarter double-digit

historical We are that to levels. performing many have performance programs important

to made certain factory near-term It to of these programs chain is that course to the normal small fully revenue we've of over issues, due will and are time specific and stability the margins supply return programs negative and that year this these experiencing through take on pressures of contracts of improve up time. work balance a through levels expect established XQ we highlighted The that will previously. number margin

underpin which development fully and around and efforts plans in The forward. accelerated committed team our disciplines, contracting people, new all our programs is of innovation lean implemented delivering the investing We've our to BDS manufacturing customers. we're going in

Overall, the to drive stability There's defense performing will confident we're portfolio efforts return this and base, business that would is field, and performance the demand products strong customer across the positioned. recognize. the to are well investors our in that levels our execution

next the I'll page, to Global Turning Services. cover

orders quarter. in As backlog and another Dave received mentioned, during had very $XX billion the We billion. quarter, BGS $X strong is the

figures Operating expansion margins. we margin versus last was the repeat. will Revenue mix, government our businesses primarily $X.X double-digit expected and commercial to left. favorable that points by Looking quarter X% basis and both due on was commercial XX.X%, Operating up than to assume an were year, higher and margins with in our year-over-year, XXX driven business. the parts of the billion, distribution don't delivering

Converted XXth ground on In the component Converted BGS line AerCap's Jacksonville, and facility operations broke Freighter in in new quarter, Boeing first Boeing a the India, announced XXX-XXX Florida. Freighter delivered

cash driven Turning debt page, our securities, and I'll marketable to quarter cover billion. ended of with by the and We seasonality. We balance down next in billion cash usage $XX.X the the $X.X and cash expected absorbed decreased billion debt $XX.X maturities to and quarter of debt. the paid flow

also of undrawn. $XX at which the end revolving of credit quarter, billion had We of remain all the facilities

and pay Our is the strong we're shared: invest rating priorities liquidity flow, with is capital generate very position deploying down and we've the debt. in strong. line a cash priority, credit The business investment-grade

line the remains page is financial shared, outlook. Commercial our outlook last demand is levels, [indiscernible] And Defense budget from programs of $X Passenger of is February billion what demand year-over-year XX% and cash unchanged and in FY XXXX international. with domestic $X free and services. billion the initial previously 'XX XX% flipping and key flow including to increased traffic on across strong robust, pre-pandemic in comprised XX% expectations. to The presidential is our over we generation. at

and the of the As our portfolio Dave positioned capabilities of well our nation mentioned, to and allies. are support needs

when in we The the of recall delivery likely of the that financial the chain continue. instability we There's variability good plan this as out for November, On chain is front, but supply many news progress set it last predicted through our our pockets the we supply base, we you'll would XXXX framework likely guidance. of and year. within face will areas rest supply

We as we buffers continue inventory including predictability. forward and impacts take to mitigate appropriate of and actions investments, higher make key to resources deployment improve

expect From roughly core we On in by charge, expect a improve XQ XXX financials quarterly will higher to XQ offset largely as perspective, would continue we specifically, be deliveries. be the to the the line 'XX performance absent wide-body tanker year. EPS delivery impacts with throughout

long-term we free considered, our on 'XX we including feel the of be slightly time good flow negative expect to guidance, the we front recovery. us. remain work in And to frame. We in free as cash cash to what's billion breakeven track All flow about achieve through things $XX XX of 'XX,

I'll that, Dave for to over any turn comments. With closing it

David Calhoun

add. Yes, to not much

we November, we as so strained robust, We November, way. of still back investors, Just a than confident. for did XXXX we if remain of we the and to not finally our is thought that most through out continue and reminder in more exactly through see that that in when would be what Demand guidance world an set XXXX. environment all described had

time, your thanks and questions. some So for take let's

Operator

our of will from Myles from Research. [Operator first And Instructions]. the question Wolfe Walton line come

Myles Walton

years on Dave, or sounds Spirit, it escape for slip the quality several it's like been at going actually.

it been noncompliant particularly take this think like FAA's of renewed up, comfortable to long to the won't did getting why things we've pop deliveries? question I for the we And natural be discover? so is, should how that So continue zero sort tolerance with

David Calhoun

the to issue shortly my Yes, meeting happen Myles, take of rest shareowner after with it, have to This We the particular way, to along defect, by question. at I our a appreciate the I happen the Board. came our attention. look

in airplane difficult defect. It's It's that app assess. our to not section of only a visibly and very

In fact, to visibly it to is assess impossible do it's the once process complete.

action, likely And was process top a in was was on So to that It's ceiling firsthand that made you're without that not from that process impossible any forward. standard. it the witnessing importantly, cracks. not point to it applied there -- of notice fitting find

designs protection. provide Again, in just for it's safety those. of So one significantly no greater safety implications. margins The our

that Spirit think So hope many one, and very ever this accept might particular, go where on, anyway, how we put out things I these the I very, in or but don't difficult, don't you matter there to that in ever see. puts accept no people you field

in in the is factory yet not on good been subsequent issue. have get of looked Anyway, it. captured the fin the through through fuselages stages. at we've at news And unveiling procedures, good We've we've both we through the been the where our have gone the order rework already the to that airplanes remove to now finished

get of in fact it. an and encouraging our process don't everybody guidance. is of right." things "That efficient that why That's raised now And we hand raise again, about now and if They time, our accept a we're more witnessed And employee the reworking. hand. over without And confident scopes. are, something doubt, found But in defined procedure chain, ultimately only all doesn't doing that more have that this, celebrate the just to like see we way we becoming manageable. out would the I in I'm And these their look they will are them. work that his said, That the supply sort,

Operator

of The next Kahyaoglu line Sheila question from is from Jefferies. the

Sheila Kahyaoglu

margins your BCA concessions think impact, aircraft impacting in the about inventory How we production going we and forward? of do about do historically trajectory think BCA margins? how Maybe

Brian West

a question. Thanks, Yes. will Broadly we've said, year things. the do next speaking, couple as for a Sheila, margins of and as volatile this big the be bit we

First, and levels we well inventory got liquidate factories. those the down XX XX shadow to shutting as as

XX, prepare the abnormal then the on to to expenses and ramp We through move also the rates. have XXX

a and year. get will up next and through be down out we it little get out as of So and move

the BCA indicate last margins the the first we the all But and would that's mentioned, volume. that the like BCA recognize. back term, the terms be to like Dave quarter, as still into negative. the course, and will for quarter of to move see to abnormal by And did half time year, margins that path of a month than double-digit we get lower 'XX, the lower things we fourth XQ will back improve. get you also as near In of I be the 'XX, margins things

and execute. us. through we of we to just It's defined, to front So got clearly in work what's got

Operator

The from Bernstein. Doug next Harned question is from

Douglas Harned

you're discussions month XXX, path month the go in QX some a the And term. also 'XX, a rate you've on go to had X longer could to the 'XX. then that potentially XX On reach in and higher

Now we this if a Charleston. And maximum at Charleston month. the is years, all being done X go in a back was capacity few

go do were of investment? there the you So to then both and before the out what for you of were a Charleston? XX how you Everett out to when facility higher, as in downturn month need of per terms single XXX or compared would they operating what to expect margins you do And

David Calhoun

the end start the work So toward way back and my from front let me end.

X parts I'm margins, from higher confident you imagine, and might don't achieve when one you and you you will that. you As we from X we expect another, go to and optimize and to X that do, transport

have space, we continue less both investment, through more do constrained to Today, that respect up how up things factory. to our in that workup with effort we do to pretty joint in factory investment inside verification has and lots Everett. lot has is this we factory of equipment the because taken route that this to and a physical With do with

So way work we that. have to got through our

a to think can have I as planning not on in we it that us don't routings X factories, XX. to don't time we the team from think, noted XX. and don't works -- a demand We confident new get big investment full you see the get what we're only to

So remove it's to from business. we've going to effort just and verification our time, take that joint got us

Brian West

it on turns 'XX. back because we the consolidation side, of the And that XX margins by it margin, are they time Doug, margin to 'XX to fully And were than be higher 'XX, as program frame like things to Charleston. have will this expect in

the on the margin better content XX perspective, -XX get the of cash on as margins Charleston. front, well And Dave unit in benefits will as described also consolidating on improved that the

So we on of focused front like us, execution and a we plan think we've XX. number, very underwriting and got XX's that. the good are in there's that's

Operator

The from Poponak from next Noah question is Sachs. Goldman

Noah Poponak

'XX. to the the the to then outlined you've and try in ask near between pace XXX term about now Wanted for in the also and term medium plan

how could clean guess, need in units those somewhere line are factory? reworked like before somewhere to I in seems units. then off many the to So process restart sort of be It a you

Brian, of have all again. half of like it first as April normal implied disrupted, you heavily June Is second for months, as that averaging kind correct? starts the XX to sounds look the X disrupted, maybe May

this relatively to terms early middle In the 'XX talking some to that year, towards? scenario the ramp, there. at demand And early in term, the we what reputable the at close medium then chain wanting supply about 'XX. be know in working I there's the consistent, be of XX the is in of XX XX guess at a being press is is least to you're wanting and in where

Brian West

Yes.

that back with end. Let's start

get we plan XX. have to So to will a

to of let's subsequent take care of higher that itself. terms numbers, In ramps let

believe getting And in XX. number that 'XX, still the is 'XX. Let's focus XX on to we

the front know in everyone factory factory what's near so terms repair to of is the term, production by got Spirit's terms our the in we into in take we to barrel days. time these, it's of of of what's the one terms in obviously, and unit in And barrel of us, in production know our to far done. get -- too cycle, If not

we it's In more will on months. the fin are production back that it more airplane, the our be near have complicated, you out. takes an As getting way levels obviously, term, then time. normal sort vertical to will But

us bit largely XXX but by more. closing by going inventory we've by our XX that factored that that the for we provided those first In fix. bit will this The that the to terms a of yes, of position the liquidated to inventory, rather, XXXX. little we our to going the this described, that good get of XXXX. XX% out off more the are have liquidate is It little goods into It's -- not finished to path XXX take XXXX -- news in have inventory will time cost cost, a in of the quarter. We take

is all, that, front the it schedule. the way a the in -- have year. short-term us, then the sure all think changed an the think thing chain not pace recovery, make want So to biggest keeps of with And and start We to we get Spirit. to us closely big supply out the that rest area out; we as we our two, working that's deal. the our one, know And through we're I as the way move master we that and for of we And calling can we to in move what's we back of get XX.

David Calhoun

finished already. way, the we are the mind. largely of on keep a it's by through Noah, two in things goods, them One, to couple

of So we weeks, and work that a in again, in are and measured scope the measured months. few defining -- not

confident And in so we're that.

get done keep it's a a But add. pure of finished you in A conformance the big scope to have work on concurrently, can mind goods we without that not even now so lot the that work other know defect. is thing

Noah Poponak

percentage you your finished that were it like long would faster the pace change deliver, The doesn't the as than just wasn't and rework enormous. can that Right. as seem -- goods, Right. you deliveries of deliveries from

better think what's understand factory, what That's sort trying to I I sense. makes I it get that but at, was So now. of

that color. all appreciate So

Operator

Spingarn question The Melius from Research. is from next Rob

Robert Spingarn

you're only? of clarification then include talking that a of the quick The about, mods? Moses or on a clarification, rates production production Moses does question. cetera, et is from Renton Lake -- Just out XX, inventory rather Or the that the and deliveries out

sold-out the there then strongest been forward [Technical question side environment, out other pricing you the from And has these how here? just on XXX Difficulty] on perspective, the And and the the on airplane narrow-bodies the with big the orders? at we go on as wide-body being is a really demand how pricing guys recent do least

Brian West

You broke up a little bit at the end just... of your question on pricing. Could you

Robert Spingarn

asked So on narrow-body then it MAX? the I Basically, on offering. strongest didn't pricing conditions side work. just the Airbus, arguably XXX sold-out at on side, you, And wide-body how's the is with the the

pricing So just there situation? the how given is demand

David Calhoun

Yes.

the pricing, on comment is just all selling Nobody We're sold-out. world. me further Let out. particularly on wide-body

compete -- that deliveries we then themselves pricing important go then the follows. So competitive in we everything we and for still and are factor

on get and with So says market we other these itself. is the when have we orders we Airbus the the implication your very discuss that solid airplane and both the the that happy I'm a we the all do. it's suggest as firming to of as view, pricing got I calls and the competition, what you don't is, than pricing environment And say of every point probably tight prospect is and pleased won, and do each price that same. will I'm sure to

Brian West

number. your part, final in question, XX And clarification the the that assembly is first

movement the sometime in XX, of year. at it's now, later XX right So

Robert Spingarn

Renton So it's number. a

Brian West

Yes.

Operator

from The Barclays. David next from Strauss question is

David Strauss

would Spirit words, the issue. manufacturing fuselages In coming up to issue from are Just to Has when line fixed MAX see those the come their their you And other actually off clean now? on start following expect you? to end?

Brian West

delivering scope, they the to imminently. start there, ones they're know the know fix and They going clean

what good about go we they've got to So feel do.

Of something course, finished for goods our inventory. on end is harder the work that's in

David Strauss

the I Renton. Okay. month the third the the XX Day, Quick in third going to activated actually recall think this Have on you point? line a follow-up, at pacing activating I item being line Investor from

Brian West

You bet.

David Calhoun

fourth. on moving And we're still forward the

Operator

Gursky Jason is The Citi. from next question from

Jason Gursky

orders outlook the for on the question quick commercial business. a in Just

a for if you're So of that the expectations given provide of a on pipeline color wondering little you perspective from seeing. the kind could your year, bit book-to-bill

MAX interested don't up get I'd ahead for deliveries also specifically. too your the But in are want on in get far and to to the China great. is And back thoughts here, China next. getting I Deliveries be ourselves the of future air

David Calhoun

Yes.

both to Let to make of mind. me predicated our of want no my start. Number out sure you on expectations sides if I guidance, here, of China. don't -- one, want mouth of I speak our are all all

about everything by way demand to of does we've the that be I So and supply constraints rate, in, want that not in and discussed marketplace factor production clear that.

goods airplanes their originally we hand, China. to hard other of the to it delivery finished On the very out that, takes because able to are there's and intended of customer. when do the working we're getting to regain And inventory the simply if risk work less in do

because rates production demand XX to -- out and supply. those are already of not constrained all way are or by anything much our lines way these change by we're along rates -- doesn't it the They're not But beyond rates.

plenty supply add could if I think we thought could meet it. I the

about I with So are play in should next further every know we I they're respect are future and out. think that order orders, is think we sizable, how -- and there all as and plenty speak, to further deliveries and

not, So XXs. now we're or out, believe in it the

X, the -- over now, that's of X to out way years. competing it's what does years we're far support X, period time. think out, what backlog just about in the think And right of terms in I it, best So deliveries

Operator

Rumohr from Cowen. is from Cai next question The von

Cai von Rumohr

you you've you of that and a At the see you time, Investor November of taken Day, to having build couple $X billion cash discussed forecast out year. of supply XXX, the And flow a of laid since billion higher to this inventories. the because you XXX, shells, to chain mentioned $X

a of So in were guys lot revised number. there bad that

to know maintain advance, the forecast get the customers I had you you substantially that good in in home $X good but things that the airline to the What number? billion you tanker allow it? that are guys What better? to are stay are advances from

David Calhoun

then and I'll let Cai, let two one guys. a with good Brian or reminder, me start mention

advance, of always the tanker Sort had on. counted we

have of on. a So field. always was come the to get earlier need tankers counted it little that because in their may But

you But I not, and did chain is problems. ripping said, did what when that any we guidance we we we have to back, never gave like the come expect supply

there judgment these we would of the gave things. we some that have when So some to range through was live applied

two Now might about, tougher we little suggest I not have a much. been things were of than would but or one that thinking these

continue into factored our And will -- that And XXXX. that guidance. so the factor way into all was anyway, that continues

might comment individual on want things. you to Brian, a So of couple

Brian West

a Yes, question, couple of things. for the just Thanks Cai.

back the a first light. in XX make We'll deliveries that the the year. quarter, rest of up were little On

the that benefit. always to we just plan That's get it something customer The in wanted bit a mentioned think sooner, the is we later You good. year. which tanker done for

So first that's quarter. the

as breakeven position benefit. And going then I we'll half in quarter, mentioned, But largely out. to in going push a XXXs of because the again, second of the be that be back are more it's to

XX, going XX across XX. In to be about acceleration, as to wide-bodies the be the going the board, that the going XX rate XXX, half, ramp. it's to recovery, there's think accelerate I second the And are

that that still of high delivering but bit all $X that's $X to a we're got along billion. pressured, end be might So And of to little contemplated. conviction committed range. we've High commitment billion

Operator

Peter Arment RW from Baird.

Peter Arment

that? do it's through delivery, these as regulator wondering but the it of your this see skyline important next China. you whether on I that regulator-driven? is like I comments And know that seems sort still is out steps on just Or you you've made. appreciate customer-driven? it 'XX interpret Dave, I'm to deliveries, How derisked steps the

David Calhoun

my come always misinterpreted been as robustly taking imagined. to has in Yes. view has with respect grow. airplanes, Again, anyone want issue and market, get level to now The back China at don't which might I as And domestic to deliveries pre-pandemic continue anything the will of travel the here. have is

So they need airplanes.

to customers, them as for And term. I'll my satisfy in view, is so airplanes sort a going a in medium fact need need. the just that And pretty of that near more state to way easy are this to our relatively

here. It's -- discussion discussion orders books. geopolitical because we So rather is in on required have any the get than geopolitical no actually involved

tarmac. We have airplanes on the

like a the And Chinese would from that delivery airplanes. their just of so this take they government to is nod

So if and going all of stick the with mind, don't guidance then of activities all sort best get of happen. do, back don't And that you. news that to if that to And exists. it that situation the assume my our posture, our welcome will of going things as are to we you is and I'm they all

Operator

is Seth from question next The JPMorgan. from Seifman

Seth Seifman

a in wonder just for broader context. about we I if Dave, talk a second Spirit

there struggling current the but couple even on of the they've been different think lately. I issue a predate fronts might grounding,

don't Spirit And anybody X the you understandable XX years than or I a fast because idea to And had think X you moving go. maybe is to only other then and as XX than it's pretty has can can of more as go they guys. challenging

that they the But labor big June? specific sure support more for are you how with coming maybe to increase to a make rate they're in that contract and have reference going that you to up there broadly, then

David Calhoun

Well, contract. the I'll about labor be optimistic

I have and I Boeing, to answer. deliver control, you'll you they've get They about the their that. suspect Tom to might all a they're got my know my think so as for It's workers palatable in. that to not guess ask is guess, situation they'll know

on keep will to this and their months, there. them We in rate in ramp ramp steady on them am of and us our This slow not I they rate, years and down in to ahead their increases. ability in with impede not a to course were course weeks measures get confident us. were reasonable last a will defect in ability to

stay in their We're to talking their people. we're with to Spirit. going factories, present We're

difficult that said, of issue procedure it you employee on -- normally there's up. Like it's find, everybody hand their a can ways I look an couple came this it. I said, was at bad a to noticed jumped raised and As and but

the resolved the were rework. one. with a that of work on healthy is a clear FAA. chain, we we week, of impacted, Within and signal weak a the had had a not a We That supply all airplanes this picture at were

during going to their going We're while advance maintain them they that to cash through willingness you to Brian constructively recovery with we're And continue stages. our attitude. go this mentioned so to moment Spirit. work

constructive. to going we're yes, So stay

and I can and Tom for with team have the -- been chain and they of confident And quite there. I that request requests and some on we at them Spirit this. ahead supply can confidence we get increase rate time, have are the get

Operator

Liwag Stanley. is question Morgan Kristine next from The from

Kristine Liwag

how rate Following up will on your how inventory much the a supplier be master supplier than And schedule the master agreement supply chain build rate? long at schedule -- or that sorry, final is production to cost? going the higher MAX, for the production XXX

Brian West

Kristine. we all matter inventory too a and anything Thanks months, forward matter It's about. It's question. look. the of is our of a not It's the in for contemplated much months, Yes. worry

about fact, keeping this, little and another a pace we're hold In thinking we're buffer. of comfortable everyone again, perfectly at indication how

think that We XX going get we're close bit help alternative better beyond. then posture, than the it and keeping us to that's going keep wire. to a too having a that's and And to little to

Kristine Liwag

with are on Great. Should the Spirit? And is there mitigating Spirit. meet things production do it labor if, for could could Spirit? again, a to you And you follow-up a to disruption easier at on that are disruption your actions at targets agreement question a What production you Seth's make there take? see we

David Calhoun

I'm supplier going going on supplier Yes, far and workforce good to our not the assume smart speculate that. are to and can not worry about and our that. I'm to ahead enough at play enough enough that

Matt Welch

have time question. final we one Lois, for And

Operator

Wells Matt Akers from Fargo. from come will That

Matthew Akers

was? since BGS you like Can positive, it say much how you I mix here? was gravitate of highest we that think is but you could touch higher you in is benefit on broke you kind kind of quarter? the of pre-COVID. I bit a the put little can this Should to mentioned I that think back out. kind this to like the mid-teens margins it a that expect level? Or of be margin know

Brian West

that the important capital-efficient Dave that's service is, mentioned, And business. years. the good news And on is love right? goes the for focused in That's a And It's healthy a and pre-pandemic that, profitable, very back the is for business, as we're question. years Thanks service on We side, the years to levels. and team sign. franchise Yes. growth. on commercial the

So well. very I think we're set up

a little more mid-teens set mid-single-digit a we're overall, But benefit. up flow set about like margins conversion in and mix to the cash with running high a business of very that's deliver it. we and more bit business quarter, get team confident well out and revenue we a just that The growth November. And

benefit going to our years. think to I several So the it's next over accrue

David Calhoun

years of in my services, all feels we I up in tightened leaned that to think it more a our margin, disciplines way. we favor intellectual in higher X or of And made do. a maybe lot content capital just pretty in if long, we property short and changes work the They significant

have now we course, of that. market And around supply-constrained a

I'm have go expanded, not and I'm margins surprised these So expecting down. to not them

a I doing think job. is team the great

Matt Welch

And Thank earnings that quarter everybody. concludes our call. first you,

Operator

Thank And does that the Quarter XXXX conclude ladies joining. you. Conference Thank Call. Boeing First for and Earnings gentlemen, you

The Boeing Company (BA) 26 Apr 232023 Q1 Earnings call transcript