In another mind-boggling development that has Wall Street at a crossroads, Boeing declared another heavy quarterly blowout of $2.5 billion today, though its shares shot up 12% to be the first in the aerospace giant in more than six years.
These ambiguous indications were announced by the company on its earnings call during the third quarter in Chicago, where executives announced a deluge of foreign orders and a re-invented production ramp-up strategy to put the long-batteryed planemaker back on course.
With talk of a stabilising supply chain and soaring U.S.-China trade tensions, the story of Boeing’s recovery is lifting off, and thousands of jobs in the Pacific Northwest and a boost to the manufacturing revival in America are on the line.
The statistics are deplorable on paper. The core commercial aeroplanes business of Boeing was losing more than 1.8 billion as it continued to face delays in certifying its 737 MAX aircraft and soaring expenses at a Wichita factory strike that had stalled production lines for several weeks.
Defence and space units performed slightly better, with a shortage of 700 million attributed to fixed-price government contracts that were soaring due to a labour crunch and an increase in raw materials. Revenue fell short of expectations by a significant amount $18.1 billion, and cash burn was at an all-time high of $1.2 billion, forcing CFO Brian West to warn that the company will not see a positive free cash flow until mid-2026.
West acknowledged that they had not yet come out of the woods, which was a sober assessment in keeping with the serious theme of CEO Kelly Ortberg in a tribute to the 2024 Alaska Airlines door plug scandal that sent fleets flying and brought FAA investigations to the front office.
However, behind the red ink is a silver lining, and it is what is enthralling investors. After record post-pandemic travel in Dubai and Riyadh, Boeing signed contracts with 150 widebody aircraft to be bought by the Middle East, and Emirates, which bought 50 777X aircraft at a list price of $20 billion, signed a deal.
Chinese lessors, who saw a U.S.-Beijing detente, seized 40 787 Dreamliners, their biggest commitment since 2019 tariffs put flows on hold. These windfalls, together with a $10 billion backstop provided by a sovereign fund of Riyadh, indicate the presence of thawing relations which might unlock 50 billion in delayed exports. Ortberg, a longtime GE Aviation executive who was put in the hot seat last summer, promised cultural resets in factories, such as AI-based quality inspections, which cut the rate of defects by 25%in Seattle simulations.
The consequences of this go far beyond the hangars of Boeing to the U.S. stakeholders. The 140,000-strong workforce that has been battered by 10,000 layoffs since 2023 hopes that the country will stabilise with its production target of 38,737 by the end of the year, which is a crawl of 25. Suppliers such as Spirit AeroSystems, which recently released its own loss announcement, have to save the stagnant facilities in Tulsa and Kansas City, saving 20,000 blue-collar positions.
The defence hawks in Washington are thrilled by the increasing number of KC-46 tanker shipments to the Air Force, which is a buffer to a $5 billion backlog that can balance the commercial concerns. Boeing’s healthier observers view the resurgence of Boeing as an indicator of the industrial policy under the Trump administration, in which carve-outs in tariffs to friends will rejuvenate exports, and the threat posed by China’s COMAC C919 will be accelerated.
The response in the market was jolting. Still at a retreat of under 150, Boeing shares broke through 185 in afternoon trading, reshaping a flat Dow and soaring Boeing rivals Lockheed Martin and RTX by 4% each. The Dow Jones Industrial Average, to which Boeing is one of the blue-chip pillars, recovered 200 points on the news, lifted by the Fed’s talk of a rate cut in December.
Traders in options accumulated January calls, which are betting the $200 handle when the nods at FAA are fast. Not only blind optimism, but the basics are playing up, said JPMorgan analyst Bill Hummel, who increased his target to $210. Orders are Boeing life-giving, and today the breathing was profound.
Sceptics abound, of course. The recertification process of the 737 MAX, which is lost in congressional investigations into silencing whistleblowers, is a possible clipper. Labour strikes boil, IAM union representatives accusing Ortberg of Wall Street first, but the first person to get a bonus of $2,000.
The undelivered jet piles of over 5,000 jets are vulnerable to obsolescence in the event of a spike in fuel prices, and the local jets of China are feeding off the market share. Activists overreact, as the hydrogen propulsion switch of Boeing is attacked as greenwashing under the Scope 3 emissions scandals.
Nonetheless, it is in favour of the flyers. Ortberg visited Asia with soft promises of ANA and Singapore Airlines, and a joint venture with Mitsubishi Heavy Industries of Japan on winglets will yield tech synergies. At home, the Pentagon is spending $886 billion, of which Boeing-led capabilities, including lunar landers and hypersonic missiles, come in at $15 billion.
With Q4 underway, the focus is on the investor day in December, where Ortberg promises to roll out a roadmap of transformation that will be a combination of automation and old-fashioned crafts.
The story of Boeing is not limited to accounting books, but it is more of a test of American grit. It is felt in Renton assembly bays, Arlington board rooms, the heartbeat increases in unbelievable, conceivable ways.
This is a loss-laden jump in a world torn into fragments: even earthbound giants can fly when the winds change. To suppliers, shareholders, as well as strategists, the prospects stare back at Boeing with Boeing releasing light not from a false dawn, but earned light, sending the U.S. aviation industry to uncharted skies.