Boeing reports Q2 2019 results

The Boeing Co. reported second quarter (Q2) revenue of $15.8 billion, reflecting a previously announced 737 MAX charge as well as fewer 737 deliveries partially offset by higher defense and services volume. Revenues for the first half (H1) 2019 vs. H1 2018 were down 19% and commercial aircraft deliveries for the same time period were down 37%.

Boeing officials stated the company is working very closely with the FAA on the process they have laid out to certify the 737 MAX software update andsafely return the MAX to service. Boeing will submit the final software package to the FAA once it has satisfied all the certification requirements. Regulatory authorities will determine the process for certifying the MAX software and training updates as well as the timing for lifting the grounding order.

"This is a defining moment for Boeing and we remain focused on our enduring values of safety, quality, and integrity in all that we do, as we work to safely return the 737 MAX to service," said Boeing chairman, president and chief executive officer Dennis Muilenburg. "During these challenging times, teams across our enterprise continue to perform at a high level while delivering on commitments and capturing new opportunities driven by strong, long-term fundamentals."

Due to the uncertainty of the timing and conditions surrounding return to service of the 737 MAX fleet, new financial guidance for 2019 will be issued at a future date.

During Q2, Commercial Airplanes delivered 90 airplanes, including 42 787s, and captured orders for two 777 freighters for DHL and six 767 freighters for FedEx. Highlights from the Paris Air Show included a letter of intent from IAG for 200 737 MAX airplanes as well as several wide body commitments.

The 777X program is progressing through pre-flight testing. Boeing is still targeting late 2020 for first delivery of the 777X despite significant risk to this schedule due to engine challenges that are delaying first flight until early 2020.

The report was not all glum news. Commercial Airplanes backlog remains healthy with more than 5,500 airplanes valued at $390 billion.

Defense, Space & Security Q2 revenue increased to $6.6 billion primarily driven by higher volume across derivative aircraft, satellites, and weapons. Backlog at Defense, Space & Security was $64 billion, of which 31% represents orders from customers outside the U.S.

Global Services Q2 revenue increased to $4.5 billion, primarily driven by the acquisition of Boeing Distribution Services Inc. (formerly KLX) and higher international government services volume.