Boeing Is Making a Comeback With $10 Billion in Cash by Mid 2020s, CEO Says


(Bloomberg) — Boeing Co. shares jumped after Chief Executive Officer Dave Calhoun said the planemaker could generate $10 billion in cash annually by mid-decade, once it turns around its operations after years of setbacks and miscues.

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The company’s stock price rose as much as 5.8% Wednesday, the largest gain among the 30-member Dow Jones Industrial Average, as executives laid out plans to speed jetliner output and return annual sales to about $100 billion by 2025 or 2026. Boeing’s sales last reached that level in 2018.

The US planemaker is wooing investors and analysts with two days of tours and presentations in Seattle, Boeing’s first such gathering since 2016 as it recovers from one of the worst crises in its century-long history. The company had burned through more than $28 billion from 2019 through 2021 as it was buffeted by a global grounding of its 737 Max, the Covid pandemic and supplier disruptions.

While Calhoun stressed the work under way to restore Boeing’s finances and reputation for quality, he stopped short of predicting exactly when the company expected to return to a normal operating cadence. The company will have positive free cash flow for 2022, he said.

“I feel like we’ve mitigated these existential moments that we’ve had to face,” Calhoun said in his opening remarks.

Boeing’s stock had tumbled 29% so far this year through the close of Tuesday’s trading, worse than the 10% average decline for the 30-member Dow Jones Industrial Average.

The planemaker expects to generate $3 billion to $5 billion in free cash flow next year as it delivers more of its 737 Max and 787 Dreamliner jets, Chief Financial Officer Brian West said.

First Guidance

West also provided new details around the US planemaker’s fourth-quarter performance, as part of the first detailed financial guidance that Boeing has shared since two fatal 737 Max crashes sent it spiraling into crisis in early 2019.

Boeing is on pace to generate $2.5 billion in free cash flow during the fourth quarter, and a range of $1.5 billion to $2 billion in 2022, West said. If so, that would mark the first annual positive cash flow for the manufacturer since 2018.

Analysts had expected the company’s free cash flow to surge from $775 million this year to $5.3 billion in 2023, according to estimates compiled by Bloomberg.

Boeing faces added pressure to build up its cash reserves with payments looming for its $57 billion debt load. With nearly $17 billion of cash in hand, the planemaker doesn’t see a need to raise equity, West said.

(Updates with details from CFO Brian West’s presentation)

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