The Latest: Boeing estimates 737 Max costs of $1 billion
The Latest on Boeing Co.’s quarterly results. (all times local):
Boeing estimates that it will spend $1 billion to fix the 737 Max and has pulled its forecast of 2019 earnings because of uncertainty surrounding the jetliner, which remains grounded after two deadly crashes.
The estimate was disclosed Wednesday in a presentation for investors as Boeing released first quarter financial results, which missed Wall Street expectations. A spokesman said the estimate covered higher production costs over the next several years.
Boeing did not go into great detail on the costs of fixing flight-control software that played a role in the crashes, which killed 346 people, or of providing additional training for pilots. Still, the disclosures gave the clearest picture yet of the financial damage that the accidents are causing to the aerospace giant.
Boeing is pulling its 2019 forecast over 737 Max uncertainty and says it’s suspending its stock buybacks.
The airline also provided first quarter results on Wednesday that beat Wall Street’s estimates.
Boeing Co. said its previously issued full-year guidance didn’t account for 737 Max impacts. It plans to issue a new guidance at a future date. Investors and consumers have been keeping a close eye on Boeing due to two deadly crashes involving the 737 Max. The two crashes have damaged the company’s reputation for safety, caused the worldwide grounding of about 370 Boeing 737 Max airliners, and raised questions about the U.S. government’s approval of the plane in 2017.
Boeing posted an adjusted profit of $3.16 per share on revenue of $22.92 billion. Analysts surveyed by Zacks Investment Research expected $3.11 per share on revenue of $22.26 billion.