Boeing Struggles in 2024, But $21 Billion Investment Offers Hope for Recovery

Boeing has reportedly secured $21 billion in capital, signaling a potential turnaround from its recent challenges.

However, Boeing’s delivery numbers for 2024 remain bleak. The company faced a major setback in December 2023 when an Alaska Airlines B737 MAX 9 suffered a mid-flight fuselage failure, triggering investigations by the Federal Aviation Administration (FAA) and the Department of Justice (DOJ).

Adding to Boeing’s woes, approximately 33,000 union workers initiated a strike in September 2024, and after two months, the resolution appears imminent.

These events have severely impacted Boeing’s performance, with cumulative deliveries dropping to 305 units through October—a 25% decrease from the previous year. October recorded a mere 14 deliveries, and projections for November hover between 20 and 30 units.

IM Securities analyst Bae Se Ho foresees a recovery in delivery numbers starting in 2025 as issues with the B737 MAX 9 and the labor strike subside.

Boeing’s current backlog stands at 6,197 aircraft (including 4,770 B737s, 557 B777s, and 781 other models), potentially securing about nine years of work at a 700-unit annual delivery rate.

While Bae doubts that 2025 deliveries will match 2018 levels, he anticipates they will surpass 2023 figures. As of Q3 2024, Boeing’s cash reserves have fallen to $10.47 billion, down 21% year-over-year, while net debt has risen by $8.3 billion to $47.2 billion.

Experts attribute the sharp decline in production to ongoing fuselage investigations and strike-related disruptions.

Notably, Boeing’s free cash flow (FCF) has deteriorated, reaching a cumulative—$10.2 billion in 2024.

On October 30, Boeing issued $21 billion in new stock and convertible bonds to avert a credit rating downgrade and prepare for $11.5 billion in loan maturities due in February 2026.

Financial experts say this capital infusion has significantly bolstered Boeing’s liquidity position. IM Securities projects Boeing’s 2025 revenue at $85.7 billion, a 17% year-over-year increase, with earnings per share (EPS) expected to turn positive at $1.89.

Bae predicts that while Boeing’s 2025 deliveries should improve over 2024, the extent of recovery will become clearer once the company releases its 2025 guidance during the Q4 earnings call. He adds that the recent capital raise should alleviate immediate liquidity concerns.