Boeing Delays 737 Production Stabilization to 2027, Sees Cash Flow Below Market Estimates

Key Facts

Boeing reported revenue of $24.188 billion in the third quarter of 2026, up 4% from the same period a year earlier, but faces delays in ramping up aircraft production and deliveries. The company posted a U.S. GAAP diluted loss of $0.26 per share and a non-GAAP core loss of $0.34 per share. Analysts, according to LSEG data cited by Reuters, had expected an adjusted loss of $0.21 per share. The stock fell 9.6% to $170.23 in afternoon trading on October 27, its worst daily performance since April 3, 2025. The decline came as the company said it would not meet its target of delivering 500 aircraft this year and delayed reaching its target production rate for the 737.

The divergence among Boeing’s business units shows that revenue growth has not been accompanied by a balanced recovery in its aircraft business. Commercial Airplanes revenue fell 3% to $10.720 billion, and the unit posted an operating loss of $697 million and a negative margin of 6.5%. The company attributed the result to a less favorable delivery mix, higher expected costs for future production-rate changes and increased estimated supply-chain costs. By contrast, Defense, Space & Security revenue rose 15% to $7.935 billion, with operating profit of $492 million and a margin of 6.2%. The segment’s results included a $252 million gain from the sale of HRL Laboratories, alongside improved operating performance.

Global Services revenue also rose 4% to $5.574 billion, and the unit posted operating profit of $1.019 billion and a margin of 18.3%. Boeing said higher business volume supported revenue, while favorable volume and mix helped support margins. For the first nine months of the year, revenue totaled $70.965 billion, up 8% from $65.515 billion in the same period of 2025. Cash and marketable securities stood at $20.7 billion at the end of the quarter, compared with $20.0 billion at the start. Consolidated debt was $45.9 billion at quarter-end.

Despite losses in Commercial Airplanes, the backlog reached a record $745.431 billion on September 30. Commercial Airplanes accounted for $611.833 billion of the total, compared with $100.505 billion for Defense, Space & Security and $32.725 billion for Global Services. Commercial Airplanes recorded 300 net orders during the quarter, including orders from Turkish Airlines, Ethiopian Airlines and Lufthansa. Boeing delivered 161 commercial aircraft in the same period. The U.S. Navy selected the company to design, build and deliver an F/A-XX fighter, but the contract has not yet entered the backlog, pending completion of the selection and evaluation review.

Turning those orders into deliveries and revenue is constrained by production, with Boeing expecting to reach a rate of 47 737s a month in early 2027, after previously targeting that level in the summer. Reuters reported that wing production constraints remain among the main obstacles to increasing the rate, and that the company’s plan targets 52 aircraft a month in the second half of 2027. Boeing expects free cash flow of $3 billion in 2027, compared with Wall Street’s average estimate of $5.5 billion, Reuters reported. The company also pushed its $10 billion free cash flow target to 2029, a year later than investors had expected. Chief Executive Kelly Ortberg said the company would continue to focus on safety and quality and intensify efforts to simplify work and execute with discipline.

Boeing continues to produce 787s at a rate of 8 aircraft a month, while continuing flight certification tests for the 777-9, with first delivery targeted in 2027. During the quarter, the 737-7 and 737-10 received amended type certificates from the Federal Aviation Administration, according to the company’s statement. These steps followed Boeing’s regaining in July the authority to issue airworthiness certificates for 737 Max and 787 aircraft, after a review lasting several months, while government inspectors continued to oversee its factories. On October 20, the Associated Press described certification of the 737 Max 10 as a milestone in the company’s efforts to restore its reputation and financial position after challenges involving safety, quality and production. The announced production and delivery dates, along with the new cash flow forecast, remain the key upcoming indicators of the company’s ability to address manufacturing bottlenecks and improve cash generation.