Boeing reported a smaller-than-expected quarterly loss on Wednesday, as the U.S. planemaker produced and delivered more jets, after quality problems and a crippling strike shuttered most of its aircraft production late last year.
The company's shares jumped 8% in morning trading, as its loss was not as large as investors feared and after a gradual increase in 737 production during the quarter.
Boeing wants to roughly double output of its top-selling 737 MAX plane from its January level to a regulator-capped 38 per month by the end of this year.
CEO Kelly Ortberg, who took the helm of the planemaker last year promising to cautiously grow output, told CNBC that Boeing is producing 737s at a monthly rate in the low 30s.
Ortberg, who referred to 2025 as Boeing's "turnaround year" in a letter to employees on Wednesday, said the company also hopes to conduct more flights of its troubled Starliner space program this year.
But Boeing faces industry supply-chain snags that have delayed some jet production even as planemakers' backlogs swelled last year on strong demand for aircraft. It reported an $11.8-billion loss for 2024 due to problems at its major units.
Boeing is also dealing with the fallout of a U.S.-China trade war that led to the return of two of its planes destined for a Chinese carrier and could further strain relations with the fast-growing aviation market.
"We do not see China as a major driver of Boeing’s recovery in the next few years but the reported inability to deliver there is another question, as is the possibility to re-market some of these aircraft," said JPMorgan analysts led by Seth Seifman, in a note.
Ortberg said Boeing may redirect to other customers planes that were planned for delivery to Chinese airlines this year, due to tariffs.
“We're going to be pretty pragmatic with what we do here for those airplanes that haven't been built yet," Ortberg said. "There's plenty of customers out there looking for the MAX aircraft."
Free cash flow usage, a metric closely watched by investors, improved during the quarter to negative $2.3 billion, beating analysts' expectations of negative $3.6 billion on average, according to data compiled by LSEG. Boeing CFO Brian West said in March that cash flow could improve in the first quarter by hundreds of millions of dollars.
Ortberg reiterated a company target of positive free cash flow in the second half of the year as the company focuses on reducing debt and selling non-core assets.
On Tuesday, Boeing announced the sale of portions of its Digital Aviation Solutions business, including navigation unit Jeppesen, for $10.55 billion.
The planemaker reported an adjusted loss of 49 cents per share during the first quarter, compared with $1.13 per share a year ago. Analysts were expecting the company to report an adjusted loss of $1.29 per share, according to data compiled by LSEG.
Vertical Research analyst Rob Stallard called the results "relatively boring" compared with other quarters.
"While burning through over $2 billion of cash is hardly ‘good,’ consensus had been expecting worse," he said in a note to clients. "However, all eyes are on the future."
Boeing’s defense unit returned to profitability after three consecutive quarters of losses, reporting operating earnings of $155 million - up slightly from $151 million a year earlier.
