The Boeing Company’s (NYSE: BA) third quarter 2019 earnings fell short of the market’s views, while revenue topped the estimates. Boeing stock was trading up about 1% in the pre-market trading hours as it maintained the 737 MAX return to service timing.
The company reported non-GAAP EPS of $1.45 per share on revenue of $20 billion for the quarter ended September 30, 2019. Analysts had projected Boeing to post earnings of $2.09 per share on revenue of $19.67 billion.
GAAP EPS of $2.05 in the third quarter 2019 declined 50%. while revenue decreased 9% year-over-year. The recently ended quarterly results reflected lower 737 deliveries partially offset by higher defense and services volume.
Boeing has developed software and training updates for the 737 MAX and continues to work with the FAA and global civil aviation authorities to complete remaining steps toward certification and readiness for return to service. These regulatory authorities will determine the timing and conditions of return to service in each relevant jurisdiction.
Boeing believes that regulatory approval of the 737 MAX return to service begins in the fourth quarter of 2019 and that it will gradually increase the 737 production rate from 42 per month to 57 per month by late 2020.
“Our top priority remains the safe return to service of the 737 MAX, and we’re making steady progress,” said CEO Dennis Muilenburg.
Commercial Airplanes segment delivered 62 airplanes during the three months ended September 30, 2019. Given the current global trade environment, the 787 production rate will be reduced to 12 airplanes per month for approximately two years beginning in late 2020.
The 777X program is progressing through pre-flight testing and remains on track for first flight in early 2020. The company is now targeting early 2021 for first delivery of the 777X.
When reporting second quarter 2019 results, the aircraft manufacturer refrained from giving a financial forecast, citing “uncertainty of the timing and conditions surrounding return to service of the 737 MAX fleet.”
BA stock had advanced 5% since the beginning of this year, while it declined 5% from this time last year.