November 1, 2026·37 min read
Boeing (BA), Financial Analysis
Insights derived from analysing SEC filings. Independent analysis, not a publication of the SEC.
Revenue Q3 2026
$24.2bn
+3.9% year on year (Q3 2025 $23.3bn)
Costs and expenses net of gains Q3 2026
$23.8bn
(15.0%) year on year (Q3 2025 $28.1bn)
Operating margin Q3 2026
1.5%
+22.0 pts year on year (Q3 2025 (20.5%))
Key findings
- Charges and gains distort the reported margin. Q3 2026 operating margin was 1.5% against (20.5%) in Q3 2025, and costs (revenue less operating income) fell 15.0% while revenue rose 3.9% to $24.2bn. Q3 2025 carried a $4.90bn 777X reach forward loss; excluding it the margin was 0.5%. Q3 2026 includes a $252m HRL Laboratories gain; excluding it the margin was 0.4%.
- Commercial Airplanes lost $697m in Q3 2026, a (6.5%) margin, on revenue of $10.72bn, (3.4%). The 10-Q names the decision to delay 737 and 787 rate increases and higher estimated supply chain costs and expects 737 rate 47 to stabilize in 2027; on the Q3 2026 call management placed stabilization in early 2027 and rate 52 in the back half of 2027.
- Deliveries rose 8.0% to 475 in 9M 2026 (367 737s, 62 787s); Airbus delivered 547 in the same period, +7.9% (Airbus's own 9M 2026 release of 28 Oct 2026). Backlog reached $745.4bn, +17.3% year on year, incl. $611.8bn for over 6,300 airplanes.
- Defense revenue grew 15.0% to $7.94bn with a 6.2% margin, 3.0% excluding the HRL gain; segment backlog $100.5bn, +18.5% since Dec 2025, before the Navy F/A XX fighter award.
- Global Services earned $1.02bn in Q3 2026 at a 18.3% margin, more than the company's $354m operating income; FY2025 segment earnings of $13.5bn include the $9.57bn Digital Aviation Solutions gain.
- Cash and debt: free cash flow $464m in Q3 2026 after $689m of DOJ agreement payments; debt $45.9bn against $54.1bn at FY2025. Shares closed at $171.55 on 30 Oct 2026, (32.5%) below the 52 week high; scenario values $141 base, $297 best, $15 worst in three years.
Figures are read from the Forms 10-K for FY2021 to FY2025, the Forms 10-Q for Q3 2025 to Q3 2026, the Forms 8-K with all their exhibits, incl. the quarterly earnings releases (Ex 99.1), the Spirit AeroSystems closing release and the director election release (Ex 99.1) and the credit agreements of Aug 2026 (Ex 10.1 to 10.3), the proxy statement of 2026 and the Form 8-K Item 5.07 vote results, Schedules 13G and Forms 4 on the record for central index key 12927, together with the comparable filings of six aerospace and defense peers used in chapters 2 to 5. CFO commentary is taken from the Q3 2026 and Q2 2026 earnings calls and a Dec 2025 investor conference; Boeing files no separate CFO commentary exhibit. Airbus figures come from Airbus's own 9M 2026 release of 28 Oct 2026. Accession numbers for every filing used appear in the Sources appendix. Market prices are regular session closes of 30 October 2026.
1 Revenue & Business Model
- Storyline: deliveries recover while charges and divestiture gains move reported margins. Commercial Airplanes carries the production ramp and the 777X losses, Defense, Space & Security carries fixed price program charges, and Global Services earns most of the operating profit. Chapters 2 to 4 cover the three revenue drivers: Commercial Airplanes, Defense, Space & Security and Global Services.
- Three segments, FY2025: Commercial Airplanes $41.5bn (46.4% of revenue) with a ($7.1bn) operating loss; Defense, Space & Security $27.2bn (30.4%), a ($128m) loss; Global Services $20.9bn (23.4%), $13.5bn of operating earnings incl. the $9.57bn Digital Aviation Solutions gain.
- Revenue FY2021 $62.3bn to FY2025 $89.5bn, a 9.5% CAGR; FY2024 $66.5bn included the IAM 751 strike; TTM Q3 2026 $94.9bn. Operating income was negative in FY2021 to FY2024.
- Regions FY2025: United States $48.1bn (53.7%), Asia $16.5bn (18.4%), Europe $11.4bn (12.8%), Middle East $7.0bn (7.9%); 35% of 2025 revenue came from US government contracts incl. foreign military sales.
- Backlog $745.4bn at 30 Sep 2026, against $635.7bn a year earlier; undelivered commercial firm orders 4,537 737s, 1,128 787s, 570 777Xs, 74 767s and 32 777s.
- Workforce about 182,000 at 31 Dec 2025, 14% outside the US and about 72,000 union members; the Spirit AeroSystems acquisition added about 15,000 employees.
Table 1.1 Segment revenue and operating income, FY2021 to FY2025 ($bn)
| Segment | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Commercial Airplanes revenue ($bn) | 19.7 | 26.0 | 33.9 | 22.9 | 41.5 |
| Commercial Airplanes operating income ($bn) | (6.4) | (2.3) | (1.6) | (8.0) | (7.1) |
| Defense, Space & Security revenue ($bn) | 26.5 | 23.2 | 24.9 | 23.9 | 27.2 |
| Defense, Space & Security operating income ($bn) | 1.5 | (3.5) | (1.8) | (5.4) | (0.1) |
| Global Services revenue ($bn) | 16.3 | 17.6 | 19.1 | 20.0 | 20.9 |
| Global Services operating income ($bn) | 2.0 | 2.7 | 3.3 | 3.6 | 13.5 |
| Unallocated items, eliminations and other revenue ($bn) | (0.3) | (0.2) | (0.2) | (0.2) | (0.2) |
FY2025 Global Services includes the $9.57bn Digital Aviation Solutions gain; FY2024 losses include the T 7A reach forward loss of $1.77bn and the IAM 751 strike.
Table 1.2 Segment revenue and operating income, last five quarters ($bn)
| Segment | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 | Q3 2026 |
|---|---|---|---|---|---|
| Commercial Airplanes revenue ($bn) | 11.09 | 11.38 | 9.20 | 11.75 | 10.72 |
| Commercial Airplanes operating income ($bn) | (5.35) | (0.63) | (0.56) | (0.32) | (0.70) |
| Commercial Airplanes operating margin (%) | (48.3) | (5.6) | (6.1) | (2.7) | (6.5) |
| Defense, Space & Security revenue ($bn) | 6.90 | 7.42 | 7.60 | 7.48 | 7.94 |
| Defense, Space & Security operating income ($bn) | 0.11 | (0.51) | 0.23 | (0.02) | 0.49 |
| Defense, Space & Security operating margin (%) | 1.7 | (6.8) | 3.1 | (0.2) | 6.2 |
| Global Services revenue ($bn) | 5.37 | 5.21 | 5.37 | 5.34 | 5.57 |
| Global Services operating income ($bn) | 0.94 | 10.54 | 0.97 | 0.97 | 1.02 |
| Global Services operating margin (%) | 17.5 | 202.4 | 18.1 | 18.1 | 18.3 |
Q4 2025 equals FY2025 less 9M 2025. Q3 2025 Commercial Airplanes includes the $4.90bn 777X reach forward loss; Q4 2025 Global Services the $9.57bn gain.
Table 1.3 Backlog by segment ($bn)
| Segment | 30 Sep 2026 | 31 Dec 2025 | Change (%) |
|---|---|---|---|
| Commercial Airplanes | 611.8 | 567.3 | 7.9 |
| Defense, Space & Security | 100.5 | 84.8 | 18.5 |
| Global Services | 32.7 | 29.7 | 10.1 |
| Total company | 745.4 | 682.2 | 9.3 |
Total includes unallocated items and eliminations. The Navy F/A XX award is not in backlog pending the source selection review.
2 Commercial Airplanes: 737 at 47 a Month, 777X Waits for 2027
- Commercial Airplanes revenue $10.72bn in Q3 2026, (3.4%); operating loss $697m, a (6.5%) margin, against (48.3%) in Q3 2025 incl. the $4.90bn 777X reach forward loss, or (4.1%) excluding it. The release names less favorable mix, rate adjustment costs and supply chain costs.
- 161 deliveries in Q3 2026 (737: 124, 787: 22, 767: 10, 777: 5) and 475 in 9M 2026, +8.0%; FY2025 600, the most since 2018.
- Rates: 737 moving from 42 to 47 per month since Q2 2026, stable in early 2027, then 52 in the back half of 2027 on a new production line that began low rate output in Jul 2026; 787 stable at 8 with the next increase from Dec 2026; first 777 9 delivery in 2027.
- Backlog $611.8bn at 30 Sep 2026, +7.9% since 31 Dec 2025, over 6,300 airplanes; 300 net orders in Q3 2026 and 686 in 9M 2026; 737 accounting quantity raised by 400 to 12,800.
- Spirit AeroSystems (closed Dec 2025) brought 737 fuselages and major 767, 777 and 787 structures in house; provisional goodwill of $10.60bn sits in Commercial Airplanes.
Table 2.1 Deliveries and undelivered orders by program
| Program | 9M 2026 | 9M 2025 | Change (%) | Undelivered orders 30 Sep 2026 | Production rate |
|---|---|---|---|---|---|
| 737 | 367 | 330 | 11.2 | 4,537 | moving to 47 per month |
| 787 | 62 | 61 | 1.6 | 1,128 | 8 per month |
| 767 | 26 | 20 | 30.0 | 74 | not stated |
| 777 | 20 | 29 | (31.0) | 32 | not stated |
| 777X | 0 | 0 | n/a | 570 | first delivery 2027 |
| Total | 475 | 440 | 8.0 | 6,341 |
Undelivered firm orders per the 10-Q Q3 2026; 737 total incl. 737 MAX 7 and 737 MAX 10 models.
How the commercial aircraft market is changing
- Regulators and suppliers set output while orders exceed it. The FAA limited 737 output to 38 per month in Jan 2024 after the 737 9 door plug accident, then allowed 42 in Oct 2025 and 47 in May 2026; Boeing names wings as the current 737 constraint and engine supply for the 787.
- Airbus (Airbus's own 9M 2026 release of 28 Oct 2026): 547 deliveries against 507, revenue EUR 50.6bn, 1,105 net orders, backlog 9,310 aircraft; it guides to about 870 deliveries in 2026 and an A320 family rate of 70 to 75 per month by end 2027, against Boeing's 737 target of 52.
- Engine and systems suppliers grow faster than airframers: GE Aerospace Commercial Engines and Services revenue +21.4% (LEAP deliveries +5%); Collins commercial OE +23% organically; Pratt & Whitney commercial OE (5%) with aftermarket +21%.
- Supply chain consolidation: Boeing bought Spirit AeroSystems' Boeing work while Airbus took Spirit's Airbus work packages; Boeing provides services to the buyers of the divested Spirit businesses.
- Trade: non US customers were 60% of Commercial Airplanes contract revenue in 2025; customers in China paused deliveries in Q2 2025 during tariff talks before resuming.
Table 2.2 Commercial aircraft and engine businesses compared
| Company | Line | Period | Filed detail | Value | Growth (%) | Margin (%) |
|---|---|---|---|---|---|---|
| Airbus (own release of 28 Oct 2026) | Commercial aircraft deliveries | 9M 2026 | Revenue EUR 50.6bn; backlog 9,310 aircraft; 2026 guide about 870 deliveries | 547 aircraft | 7.9 | n/a |
| GE Aerospace | Commercial Engines & Services revenue | Q3 2026 | CES orders $15.3bn (+58%); engine deliveries +8% with LEAP +5%; services +17% | $10.34bn | 21.4 | 27.9 |
| RTX (Pratt & Whitney) | Pratt & Whitney sales | Q3 2026 | Commercial OE sales (5%) while commercial aftermarket +21%; $363m customer bankruptcy charge; adjusted margin 10.5% | $9.23bn | 9.6 | 6.6 |
| RTX (Collins Aerospace) | Collins Aerospace sales | Q3 2026 | Commercial OE +23% organically; RTX commercial backlog $176bn | $8.38bn | 10.0 | 21.3 |
| General Dynamics (Gulfstream) | Aerospace segment revenue | Q3 2026 | Aerospace book to bill 1.4 to 1 with $5bn of orders | $3.54bn | 9.3 | 14.5 |
Airbus figures from Airbus's own 9M 2026 release of 28 Oct 2026 on its company website. Peer figures from Forms 8-K Ex 99 of Oct 2026. Pratt & Whitney margin is reported; its adjusted margin is 10.5%.
3 Defense, Space & Security: Record Backlog After Years of Charges
- Revenue $7.94bn in Q3 2026, +15.0%; operating earnings $492m, a 6.2% margin against 1.7% in Q3 2025; 3.0% excluding the $252m gain on the HRL Laboratories stake. 9M 2026 margin 3.1%.
- Charges on fixed price programs: T 7A reach forward loss $1.77bn in 2024; KC 46A losses $0.6bn in Q4 2025; VC 25B losses $280m in Q2 2026, with first VC 25B delivery expected in 2028. FY2024 segment loss ($5.41bn), FY2025 ($128m).
- Backlog $100.5bn at 30 Sep 2026, +18.5% since 31 Dec 2025, 23% from customers outside the US; Q3 2026 included a seven year PAC 3 seeker production award. The Navy F/A XX fighter selection is not yet in backlog.
- 33 defense deliveries in Q3 2026 against 32, and 98 in 9M 2026 against 94; Spirit Defense runs as a non integrated subsidiary of the segment.
How the defense market is changing
- Budgets: US FY2026 defense appropriations of $839bn were enacted on 3 Feb 2026 and the FY2027 request is $1.45tn; agencies are funded through 11 Dec 2026; the NASA FY2027 request of $19bn is $6bn below FY2026 (Boeing 10-Q).
- Peers grow from munitions, missiles and ships: Lockheed Martin backlog a record $292.0bn incl. a $52.5bn multiyear PAC 3 MSE award; General Dynamics booked $93.8bn of defense orders in Q3 2026 led by Virginia and Columbia class submarines; RTX defense backlog $164bn.
- Margins: defense peers report Q3 2026 margins of 7.9% to 14.1% at segment level; Boeing's Defense, Space & Security margin was 6.2% incl. the HRL gain after losses in FY2022 to FY2025.
Table 3.1 Defense businesses compared, Q3 2026
| Company and line | Period | Filed detail | Revenue | Growth (%) | Margin (%) |
|---|---|---|---|---|---|
| Boeing Defense, Space & Security | Q3 2026 | $100.5bn backlog; 3.0% margin excluding the $252m HRL gain | $7.94bn | 15.0 | 6.2 |
| Lockheed Martin | Q3 2026 | Aeronautics sales $8.21bn (+13%) at 9.0% margin; backlog $292.0bn | $20.70bn | 11.3 | n/a |
| Northrop Grumman | Q3 2026 | Aeronautics Systems sales $3.58bn (+14%) on F 35 and B 21; backlog $109.6bn, book to bill 1.5 | $11.12bn | 6.7 | 11.4 |
| RTX (Raytheon) | Q3 2026 | Patriot, Standard Missile and Tomahawk volume; RTX defense backlog $164bn | $8.03bn | 14.0 | 14.1 |
| General Dynamics | Q3 2026 | Company revenue $14.6bn (+12.9%); backlog $220.3bn; company book to bill 6.8 to 1 | $4.96bn | 21.1 | 7.9 |
| GE Aerospace | Q3 2026 | DPT orders $4.3bn (+18%); up to $2.9bn F414 support contract for F/A 18 and EA 18G fleets | $3.47bn | 6.7 | 13.7 |
Lockheed Martin company margin is not shown in the release figures used; its Aeronautics margin is 9.0%. General Dynamics line is Marine Systems; GE line is Defense & Propulsion Technologies, margin computed as $475m on $3.47bn.
4 Global Services: Aftermarket Earnings and Margins
- Revenue $5.57bn in Q3 2026, +3.8%; operating earnings $1.02bn, +8.6%, a 18.3% margin against 17.5%. Segment earnings were 2.9x company operating income of $354m.
- Digital Aviation Solutions: Jeppesen, ForeFlight and related units sold on 31 Oct 2025 for $10.55bn; the $9.57bn gain lifted Q4 2025 segment earnings to $10.54bn (18.8% margin excluding it). Q2 2026 revenue grew 8% excluding the divested units.
- Backlog $32.7bn at 30 Sep 2026, +10.1% since 31 Dec 2025; Q3 2026 awards incl. US Army AH 64 Apache fleet maintenance. Spirit spare parts work now reports in Global Services.
How the aftermarket is changing
- Aftermarket demand grows faster than new aircraft output: Pratt & Whitney commercial aftermarket +21% against commercial OE (5%) in Q3 2026; GE Aerospace spare parts revenue grew over 20%, services +17%, with a commercial services backlog above $170bn.
- Independent parts suppliers gain: HEICO Flight Support Group net sales +18% to $947.8m in its Jul 2026 quarter, 12% organic, at a 25.9% operating margin.
- Boeing's position: Global Services margin 18.3% sits below GE Commercial Engines and Services (27.9%), HEICO Flight Support (25.9%) and Collins (21.3%); the sale of Digital Aviation Solutions removed software and navigation revenue from the segment.
Table 4.1 Aftermarket and services businesses compared
| Company and line | Period | Filed detail | Value | Growth (%) | Margin (%) |
|---|---|---|---|---|---|
| Boeing Global Services | Q3 2026 | backlog $32.7bn; operating earnings $1.02bn | $5.57bn revenue | 3.8 | 18.3 |
| GE Aerospace | Q3 2026 | Services revenue +17%, internal shop visit revenue +12%; commercial services backlog over $170bn | $2.89bn profit | 21.1 | 27.9 |
| RTX (Collins Aerospace) | Q3 2026 | Commercial aftermarket +9% organically; adjusted profit $1.79bn (+50%) | $1.79bn profit | 42.0 | 21.3 |
| RTX (Pratt & Whitney) | Q3 2026 | Commercial aftermarket sales +21% | $968.0m profit | 28.9 | 10.5 |
| HEICO | Jul 2026 quarter | Organic growth 12%; operating income $245.3m (+24%) | $947.8m sales | 18.1 | 25.9 |
HEICO fiscal Q3 ends Jul 2026. GE and Collins values are operating profit; growth refers to the value shown.
5 Financial Analysis & Ratios
- One off items set the reported margin. Operating margin 4.8% in FY2025 incl. the $9.57bn Digital Aviation Solutions gain, (5.9%) excluding it; TTM Q3 2026 10.3% reported and 0.2% excluding the gain.
- Q3 2026: cost of products and services 91.0% of revenue against 110.2% in Q3 2025, when the 777X loss was booked; operating income $354m; net loss ($116m); diluted EPS (0.26) against (7.14); interest expense $573m against $694m.
- 9M 2026: revenue $70.97bn, +8.3%; operating income $958m (1.3% margin); operating cash flow $2.68bn, with advances and progress billings up $8.11bn and inventory up $6.73bn; capital expenditure $3.04bn; free cash flow ($359m).
- Balance sheet at 30 Sep 2026: debt $45.9bn, $8.2bn lower than at FY2025, of which $4.6bn current; cash and short term investments $20.7bn; net debt $25.2bn; shareholders' equity $6.5bn after negative equity in FY2021 to FY2024; $10.0bn of revolving credit undrawn; ratings BBB minus and Baa3.
- Capital returns: no common dividend since 2020 and no buybacks; preferred dividends $346m TTM on the 6.00% mandatory convertible preferred issued in Oct 2024 with $18.2bn of common stock.
Table 5.1 Income statement, cash flow and balance sheet summary ($bn unless stated)
| Line item | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | TTM Q3 2026 |
|---|---|---|---|---|---|---|
| Revenue | 62.3 | 66.6 | 77.8 | 66.5 | 89.5 | 94.9 |
| Gross profit | 3.0 | 3.5 | 7.7 | (2.0) | 4.3 | 8.9 |
| Research and development | 2.2 | 2.9 | 3.4 | 3.8 | 3.6 | 3.6 |
| Selling, general and administrative | 4.2 | 4.2 | 5.2 | 5.0 | 6.1 | 5.5 |
| Operating income | (2.9) | (3.5) | (0.8) | (10.7) | 4.3 | 9.7 |
| Net income | (4.2) | (4.9) | (2.2) | (11.8) | 2.2 | 7.7 |
| Diluted EPS ($) | (7.15) | (8.30) | (3.67) | (18.36) | 2.48 | 9.19 |
| Operating cash flow | (3.4) | 3.5 | 6.0 | (12.1) | 1.1 | 4.0 |
| Capital expenditure | (1.0) | (1.2) | (1.5) | (2.2) | (2.9) | (4.0) |
| Free cash flow | (4.4) | 2.3 | 4.4 | (14.3) | (1.9) | 0.0 |
| Stock based compensation | 0.8 | 0.7 | 0.7 | 0.4 | 0.4 | 0.4 |
| Cash and investments | 16.2 | 17.2 | 16.0 | 26.3 | 29.4 | 20.7 |
| Total debt | 58.1 | 57.0 | 52.3 | 53.9 | 54.1 | 45.9 |
| Total equity | (14.8) | (15.8) | (17.2) | (3.9) | 5.5 | 6.6 |
Selling, general and administrative shows Boeing's general and administrative expense; Boeing reports no separate selling line. Capital expenditure is additions to property, plant and equipment. Total debt excludes leases. TTM equals Q4 2025 plus Q1 to Q3 2026 and includes the $9.57bn Digital Aviation Solutions gain.
Table 5.2 What changed, Q3 2026 against Q3 2025
| Metric | Q3 2025 | Q3 2026 | Change |
|---|---|---|---|
| Revenue ($bn) | 23.27 | 24.19 | 3.9% |
| Gross profit ($bn) | (2.38) | 2.17 | n/a |
| Operating income ($bn) | (4.78) | 0.35 | n/a |
| Net income ($bn) | (5.34) | (0.12) | 97.8% |
| Diluted EPS ($) | (7.14) | (0.26) | 96.4% |
| Operating cash flow ($bn) | 1.12 | 1.50 | 33.2% |
| Free cash flow ($bn) | 0.24 | 0.46 | 95.0% |
| Operating margin (%) | (20.5) | 1.5 | 22.0 pts |
| Net margin (%) | (22.9) | (0.5) | 22.5 pts |
Table 5.3 Ratio analysis
| Ratio | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | TTM Q3 2026 |
|---|---|---|---|---|---|---|
| Growth and margins | ||||||
| Revenue growth (%) | n/a | 6.9 | 16.8 | (14.5) | 34.5 | n/a |
| Gross margin (%) | 4.9 | 5.3 | 9.9 | (3.0) | 4.8 | 9.4 |
| Operating margin (%) | (4.6) | (5.3) | (1.0) | (16.1) | 4.8 | 10.3 |
| Net margin (%) | (6.7) | (7.4) | (2.9) | (17.8) | 2.5 | 8.1 |
| FCF margin (%) | (7.1) | 3.4 | 5.7 | (21.5) | (2.1) | 0.0 |
| Cost and investment intensity | ||||||
| R&D (%) revenue | 3.6 | 4.3 | 4.3 | 5.7 | 4.0 | 3.8 |
| SBC (%) revenue | 1.3 | 1.1 | 0.9 | 0.6 | 0.5 | 0.5 |
| Capex (%) revenue | 1.6 | 1.8 | 2.0 | 3.4 | 3.3 | 4.2 |
| Effective tax rate (%) | n/a | n/a | n/a | n/a | 15.1 | 2.4 |
| Returns | ||||||
| ROA (%) | (3.0) | (3.6) | (1.6) | (8.1) | 1.4 | 4.5 |
| ROIC (%) | (8.7) | (12.1) | (3.3) | (37.1) | 12.1 | 29.9 |
| Asset turnover (x) | 0.45 | 0.49 | 0.57 | 0.43 | 0.53 | 0.56 |
| Liquidity and leverage | ||||||
| Current ratio (x) | 1.33 | 1.22 | 1.14 | 1.32 | 1.19 | 1.13 |
| Debt to equity (x) | n/a | n/a | n/a | n/a | 9.91 | 7.00 |
| Net cash ($bn) | (41.9) | (39.8) | (36.3) | (27.6) | (24.7) | (25.2) |
| Efficiency and cash quality | ||||||
| Days sales outstanding | 66 | 61 | 51 | 60 | 49 | 16 |
| Inventory days | 486 | 452 | 415 | 466 | 363 | 386 |
| FCF to net income (x) | n/a | n/a | n/a | n/a | (0.84) | 0.00 |
ROE is omitted: equity was negative in FY2021 to FY2024 and $5.5bn at FY2025. Debt to equity is not shown for years with negative equity. TTM ratios include the $9.57bn Digital Aviation Solutions gain; TTM operating margin excluding it is 0.2%.
Table 5.4 Valuation snapshot at $171.55 per share, 30 Oct 2026; P/E and EV/EBITDA omitted as TTM earnings include the $9.57bn gain
| Measure | Value |
|---|---|
| Market cap ($bn) | 135.9 |
| Enterprise value ($bn) | 161.1 |
| EV/Sales (TTM) (x) | 1.7 |
| FCF yield (%) | 0.0 |
| Price/Book (x) | 20.7 |
Cost structure and profitability
- Cost of products and services 91.0% of Q3 2026 revenue against 110.2% in Q3 2025, which included the $4.90bn 777X reach forward loss, and 88.5% in Q1 2026; gross margin 9.0%.
- Commercial Airplanes drives the Q3 2026 cost line: segment loss $697m after the decision to delay 737 and 787 rate increases and higher estimated supply chain costs; 767 reach forward losses $86m in 9M 2026; 777 and 777X at near break even gross margin.
- Excluding the named items, quarterly operating income stayed between ($0.79bn) and $0.46bn from Q1 2025 to Q3 2026 (Figure and Table below); Q3 2026 $102m excluding the HRL gain against $118m in Q3 2025 excluding the 777X loss.
- R&D $830m, 3.4% of revenue, and general and administrative $1.20bn, 5.0%, against 3.9% and 6.5% in Q3 2025.
- Depreciation and amortization $584m, +18.9%, after Spirit AeroSystems assets were added; capital expenditure $1.03bn, 4.3% of revenue.
- Below operating income: core EPS excludes the FAS/CAS service cost adjustment, a benefit of $460m in 9M 2026 against $787m in 9M 2025; the estimated 2026 effective tax rate is (10.8%).
Table 5.5 Costs as % of revenue, last five quarters
| Line | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 | Q3 2026 |
|---|---|---|---|---|---|
| Cost of products and services (% of revenue) | 110.2 | 92.4 | 88.5 | 90.2 | 91.0 |
| Research and development (% of revenue) | 3.9 | 4.0 | 4.1 | 3.8 | 3.4 |
| General and administrative (% of revenue) | 6.5 | 6.9 | 5.4 | 5.8 | 5.0 |
| Depreciation and amortization (% of revenue) | 2.1 | 2.2 | 2.6 | 2.4 | 2.4 |
| Operating income (% of revenue) | (20.5) | 36.7 | 2.0 | 0.6 | 1.5 |
| Capital expenditure (% of revenue) | 3.8 | 4.0 | 5.7 | 3.0 | 4.3 |
Table 5.6 Operating income and named charges and gains ($bn)
| Quarter | Operating income | Margin (%) | Named item | Item | Excluding item | Margin excluding (%) |
|---|---|---|---|---|---|---|
| Q3 2025 | (4.78) | (20.5) | 777X reach forward loss | (4.90) | 0.12 | 0.5 |
| Q4 2025 | 8.78 | 36.7 | Digital Aviation Solutions gain | 9.57 | (0.79) | (3.3) |
| Q1 2026 | 0.45 | 2.0 | none named | 0.00 | 0.45 | 2.0 |
| Q2 2026 | 0.16 | 0.6 | VC 25B losses | (0.28) | 0.44 | 1.8 |
| Q3 2026 | 0.35 | 1.5 | HRL Laboratories gain | 0.25 | 0.10 | 0.4 |
Named items are pre tax amounts disclosed in the Forms 10-Q, 10-K and 8-K Ex 99.1; the VC 25B amount is the Q2 2026 release figure. Q4 2025 also includes KC 46A losses of $0.6bn, not removed here.
6 MD&A & Management Commentary
Q3 2026 earnings call and results release
- Q3 2026 (27 Oct 2026): revenue $24.19bn, +3.9%; GAAP operating margin 1.5% against (20.5%); GAAP EPS (0.26), core EPS (0.34); 161 commercial deliveries, the most in a Q3 since 2018.
- Commercial Airplanes: margin (6.5%) on less favorable mix, rate adjustment costs and supply chain costs; on the call, 737 rate 47 stabilization moved into early 2027 with wings named as the constraint, rate 52 moved to the back half of 2027 and 2026 737 deliveries were guided below the 500 target stated earlier in 2026.
- Certification and programs: 737 MAX 7 received amended type certification in Q3 2026 and 737 MAX 10 in Oct 2026, with about 45 of both models in inventory; 787 stable at 8 per month with the next increase planned from Dec 2026; 777 freighter output disrupted by a key supplier parts shortage expected to last through 1H 2027.
- Defense and services: Defense, Space & Security margin 6.2% incl. the $252m HRL gain and selection for the Navy F/A XX fighter; Global Services margin 18.3% on revenue +3.8%.
- Cash: free cash flow $464m after $689m of DOJ agreement payments released from escrow (10-Q); on the Q3 2026 call, management stated a free cash flow path of about $2bn in 2026, $3bn in 2027, $6bn in 2028 and $10bn in 2029, against filed 9M 2026 free cash flow of ($359m).
- Q2 2026 call (28 Jul 2026): revenue $24.6bn, +8%; 171 deliveries incl. 129 737s; 2026 free cash flow target of $1bn to $3bn reaffirmed; Defense, Space & Security margin (0.2%) incl. $280m of VC 25B losses; debt reduced $8.2bn in 1H 2026 to $45.9bn.
Table 6.1 Company outlook as filed or stated on the call, with 2026 revisions
| Item | Outlook | Source |
|---|---|---|
| Free cash flow 2026 | about $2bn; Jan 2026: $1bn to $3bn, reaffirmed Jul 2026, narrowed Oct 2026 | Q4 2025, Q2 2026 and Q3 2026 calls |
| Free cash flow 2027 to 2029 | about $3bn (2027), $6bn (2028), $10bn (2029); CFO cited growth potential beyond $10bn | Q3 2026 call |
| 737 production | Q2 2026: rollouts at 47 per month in summer; Oct 2026: stable 47 in early 2027, 52 in back half of 2027 | Q2 2026 and Q3 2026 calls; 10-Q Q3 2026 (stabilization in 2027) |
| 2026 737 deliveries | Q2 2026: on track for 500; Oct 2026: below 500 | Q2 2026 and Q3 2026 calls |
| 787 production | 8 per month; next increase planned from Dec 2026; full year 787 deliveries 90 to 100 (Q2 2026) | 10-Q Q3 2026; Q2 2026 call |
| 777X | first 777 9 delivery 2027; 777 8 Freighter about two years later; 777 8 passenger not before 2030 | 10-Q Q3 2026 |
| Capital expenditure | 2026 higher than 2025 ($2.94bn) | 10-Q Q3 2026 |
| Defense, Space & Security margin | high single digit by end of decade | Q2 2026 call |
Management and CFO commentary
- CFO Jay Malave, Q3 2026 call: free cash flow path of about $2bn in 2026, $3bn in 2027, $6bn in 2028 and $10bn in 2029, with growth potential beyond $10bn once legacy cash uses end after 2029.
- CFO, Q3 2026 call: Q3 free cash flow $464m after about $0.7bn of DOJ settlement payments; debt $45.9bn, unchanged from Q2 2026; net debt about $25.2bn against $30.4bn a year earlier.
- CFO, investor conference of 2 Dec 2025: expected free cash flow to move from an outflow of about $2bn in 2025 to positive low single digit billions in 2026; the DOJ payment moved from 2025 into 2026.
- CEO Kelly Ortberg, Q3 2026 call: 737 rate 52 moved to the back half of 2027, citing wing back shop process issues, about a one year shift; defense growth expectation raised from low single digit to mid single digit or higher.
- CEO, 8-K Ex 99.1 of 27 Oct 2026: 737 MAX 7 and 737 MAX 10 certification and the F/A XX selection named as steps; renewed focus on Lean and disciplined execution.
- CEO, 8-K Ex 99.1 of 27 Jan 2026: completed the Spirit AeroSystems acquisition and part of the Digital Aviation Solutions sale; focus on stable operations, completing development programs and rebuilding trust.
Table 6.2 Management statements in their own words
| Speaker | Date and source | Statement |
|---|---|---|
| Kelly Ortberg, President and CEO | 8 Dec 2025, 8-K Ex 99.1 | “This is a pivotal moment in Boeing’s history and future success” |
| Kelly Ortberg, President and CEO | 28 Jul 2026, 8-K Ex 99.1 | “Our operations are more stable and key certification programs remain on plan” |
| Kelly Ortberg, President and CEO | 27 Oct 2026, 8-K Ex 99.1 | “But we are not done” |
Table 6.3 Key disclosures in the Forms 10-Q and 10-K
| Item | Disclosure |
|---|---|
| 10-Q Q3 2026, programs | 737 accounting quantity raised by 400 to 12,800 in 2026; new 737 line began low rate production in Jul 2026 and needs FAA production certification; 787 accounting quantity raised by 100 to 2,000; 777 quantity raised by 21 units after FAA approval of 777F production beyond 1 Jan 2028. |
| 10-Q Q3 2026, supply chain | Supplier shortages disrupted KC 46A and 777 Freighter production in Q3 2026; abnormal production costs expected into 2027 and expensed as incurred. |
| 10-Q Q3 2026, backlog | Contractual backlog +$53.05bn in 9M 2026, mainly Commercial Airplanes (+$44.54bn); cancellations $3.16bn (737 and 787); ASC 606 adjustments reduced backlog by $1.89bn, mainly 777X. Undelivered 737 orders: 737 8 58%, 737 MAX 10 33%, 737 MAX 7 6%, 737 9 3%. |
| 10-Q Q3 2026, liquidity | 9M 2026 operating cash flow $2.68bn, driven by $8.11bn higher advances and progress billings, offset by $6.73bn of inventory build; debt $45.9bn with $4.6bn short term. |
| 10-Q Q3 2026, tax and tariffs | Estimated 2026 annual effective tax rate (10.8%), driven by taxes on non US operations with US losses under valuation allowance; about $420m of IEEPA tariff refunds received in 9M 2026. |
| 10-Q Q3 2026, subsequent events | 737 MAX 10 certified in Oct 2026; F/A XX award to Defense, Space & Security not yet in backlog pending the source selection review; SPEEA ratified two contracts through 2030 on 1 Oct 2026. |
| 10-K FY2025, divestiture and acquisition | Digital Aviation Solutions sold 31 Oct 2025 for $10.55bn of proceeds, $9.57bn pre tax gain in Global Services. Spirit AeroSystems acquired 8 Dec 2025 for $8.39bn; provisional goodwill $10.60bn assigned to Commercial Airplanes. |
| 10-K FY2025, estimates | A 1% change in combined gross margins on profitable long term contracts would change 2025 pre tax income by about $320m; valuation allowance on deferred tax assets $9.75bn, incl. $1.83bn on acquired Spirit assets. |
7 Peer Valuation & Sector Summary
- Sector: commercial aircraft, defense and aftermarket services. Boeing's TTM revenue of $94.9bn compares with RTX $96.0bn, Lockheed Martin $79.1bn, General Dynamics $56.5bn, GE Aerospace $52.6bn and Northrop Grumman $43.6bn.
- Growth (Q3 2026 year on year): GE 15.9%, GD 12.9%, LMT 11.3%, RTX 11.1%, NOC 6.7%, BA 3.9%.
- Operating margin TTM: LMT 11.8%, RTX 11.8%, NOC 10.6%, GD 10.4%; BA 10.3% incl. the Digital Aviation Solutions gain and 0.2% excluding it. FCF margin: GE 15.3%, LMT 10.6%, GD 10.2%, RTX 9.9%, NOC 8.8%, BA 0.0%.
- Valuation: BA 1.7x EV/Sales against GE 6.2x, RTX 3.0x, NOC 2.1x, LMT 2.0x and GD 1.8x; P/E GE 34.3x, RTX 32.0x, LMT 22.6x, GD 21.6x and NOC 17.5x; BA P/E not meaningful.
- Airbus (Airbus's own 9M 2026 release of 28 Oct 2026): revenue EUR 50.6bn, +7%; EBIT adjusted EUR 4.50bn, 8.9% of revenue; 2026 guidance about 870 deliveries, EBIT adjusted about EUR 7.5bn and free cash flow before customer financing about EUR 4.5bn.
Table 7.1 Peer comparison, latest reported trailing twelve months
| Company | Revenue TTM ($bn) | Revenue growth (%) | Operating margin (%) | Net margin (%) | FCF margin (%) | ROE (%) | Net cash ($bn) | Market value ($bn) | EV/Sales (x) | P/E TTM (x) |
|---|---|---|---|---|---|---|---|---|---|---|
| BA | 94.9 | 3.9 | 0.2 | 8.1 | 0.0 | n/a | (25.2) | 136 | 1.7 | n/a |
| LMT | 79.1 | 11.3 | 11.8 | 8.2 | 10.6 | 77.6 | (14.5) | 147 | 2.0 | 22.6 |
| RTX | 96.0 | 11.1 | 11.8 | 8.8 | 9.9 | 12.5 | (21.8) | 269 | 3.0 | 32.0 |
| GE | 52.6 | 15.9 | n/a | 17.3 | 15.3 | 50.3 | (11.0) | 312 | 6.2 | 34.3 |
| NOC | 43.6 | 6.7 | 10.6 | 10.4 | 8.8 | 25.6 | (11.5) | 79 | 2.1 | 17.5 |
| GD | 56.5 | 12.9 | 10.4 | 8.2 | 10.2 | 17.6 | (2.6) | 101 | 1.8 | 21.6 |
TTM to Q3 2026 for all companies; growth is Q3 2026 revenue year on year. BA operating margin excludes the $9.57bn Digital Aviation Solutions gain (10.3% including it); BA net margin includes it. BA P/E and ROE are not meaningful as TTM earnings include the gain and equity is $6.6bn. GE does not tag operating income. Net cash is cash and short term investments less debt excluding leases; LMT reflects noncurrent long term debt only. Prices are closes of 30 Oct 2026.
8 Material Events & Contracts
- Nine Forms 8-K in twelve months: four earnings releases, the Spirit AeroSystems closing, a director election and a controller appointment, the Aug 2026 credit agreements and the annual meeting results. Boeing filed no notes offering in the period; debt fell through repayments.
- Spirit AeroSystems (closed 8 Dec 2025): total consideration $8.39bn, incl. $4.70bn in Boeing stock, $2.59bn of settled loans and advances and $948m of Spirit debt repaid; Boeing took over 737 fuselages and major 767, 777 and 787 structures; Spirit's Airbus related work went to Airbus.
- Credit agreements (Aug 2026): a new minimum liquidity covenant of $5.0bn applies to all three facilities, with consolidated debt capped at 60% of total capital.
Table 8.1 Forms 8-K filed in the last twelve months
| Date | Items | Event |
|---|---|---|
| 3 Dec 2025 | 5.02, 7.01, 9.01 | Bradley D. Tilden, former chairman and CEO of Alaska Air Group, elected director effective 3 Dec 2025; joins the Aerospace Safety and Finance committees (Ex 99.1). |
| 8 Dec 2025 | 7.01, 9.01 | Spirit AeroSystems acquisition completed on 8 Dec 2025; total consideration $8.39bn incl. $4.70bn in Boeing stock (Ex 99.1). |
| 27 Jan 2026 | 2.02, 9.01 | Q4 2025 results: revenue $23.95bn; diluted EPS $10.23 incl. the $9.6bn Digital Aviation Solutions gain; free cash flow $375m; FY2025 revenue $89.46bn, 600 deliveries, backlog $682bn (Ex 99.1). |
| 17 Apr 2026 | 5.07 | Annual meeting results: 12 directors elected; say on pay approved; written consent proposal 39.7% support; disability committee proposal rejected (Item 5.07). |
| 22 Apr 2026 | 2.02, 9.01 | Q1 2026 results: revenue $22.22bn; diluted EPS (0.11); free cash flow ($1.45bn); 143 deliveries; backlog $695bn (Ex 99.1). |
| 28 Jul 2026 | 2.02, 9.01 | Q2 2026 results: revenue $24.56bn; diluted EPS (0.67); free cash flow $631m; 171 deliveries; backlog $715bn (Ex 99.1). |
| 21 Aug 2026 | 5.02 | Ryan L. Shedd appointed SVP and Controller effective after the FY2026 10-K, succeeding Michael J. Cleary, who retires in 2027; base salary $600,000 (Item 5.02). |
| 28 Aug 2026 | 1.01, 2.03, 9.01 | New $3.0bn 364 day revolver to Aug 2027; $3.0bn five year facility extended to Aug 2029 and $4.0bn facility to May 2030; $10.0bn undrawn in total (Ex 10.1 to 10.3). |
| 27 Oct 2026 | 2.02, 9.01 | Q3 2026 results: revenue $24.19bn, +3.9%; diluted EPS (0.26); operating cash flow $1.50bn; free cash flow $464m; 161 deliveries; backlog $745bn (Ex 99.1). |
Table 8.2 Material contracts and financing arrangements
| Contract | Terms |
|---|---|
| Revolving credit facilities (Ex 10.1 to 10.3, Aug 2026) | $3.0bn 364 day revolver with Citibank and JPMorgan to 23 Aug 2027, Term SOFR plus 1.250% to 1.700%; $3.0bn facility to 24 Aug 2029; $4.0bn facility to 15 May 2030; $10.0bn undrawn. |
| 6.00% Series A mandatory convertible preferred | 5.75m shares, liquidation preference $5.75bn, issued Oct 2024; converts into common stock by Oct 2027; no general voting rights; dividends $87m per quarter. |
| Spirit AeroSystems merger | Closed 8 Dec 2025; $8.39bn total consideration; Spirit 4.600% notes due 2028 ($700m) guaranteed by Boeing; $230m of 3.250% Spirit exchangeable notes due 1 Nov 2028 may be exchanged into Boeing shares. |
| Digital Aviation Solutions sale | Jeppesen, ForeFlight and related units sold 31 Oct 2025 for $10.55bn of proceeds; pre tax gain $9.57bn in Global Services. |
| DOJ non prosecution agreement (May 2025) | Resolves the 737 MAX deferred prosecution breach; earnings charge of $445m recorded in Q2 2025 (10-Q Q3 2026, unallocated items); $689m released from escrow in Sep 2026 for required payments. |
| Senior notes | Debt $45.9bn at 30 Sep 2026 ($4.6bn current), against $54.1bn at 31 Dec 2025 after $8.4bn of 2026 repayments. |
9 Ownership, Voting Power & Annual Meeting
- One class of common stock with one vote per share and no controlling holder. Vanguard holds 9.0%, FMR 7.0% and BlackRock 6.8% (Schedules 13G at 31 Dec 2025); directors and executive officers hold below 1%. The mandatory convertible preferred converts into common stock by Oct 2027.
- 2026 annual meeting (17 Apr 2026, virtual): all 12 directors elected with 90.5% to 98.1% of votes cast; say on pay 89.7%; the written consent shareholder proposal received 39.7%, the disability access committee proposal 2.6%.
- Insiders, Nov 2025 to Oct 2026: open market purchases about $0.90m and sales about $5.25m. Directors Mortimer J. Buckley bought 2,230 shares at $224.20 (Mar 2026) and Bradley D. Tilden 1,370 shares at $218.50 (May 2026); Chief Engineer Howard McKenzie sold 10,497 shares at $233.99 (Feb 2026). CEO Kelly Ortberg made no open market sales and held 82,848 shares directly.
Table 9.1 Annual meeting vote results, 17 Apr 2026
| Proposal | For (bn votes) | Against (bn votes) | Abstain (bn votes) | For as % of votes cast | Result |
|---|---|---|---|---|---|
| Elect Robert A. Bradway | 0.490 | 0.052 | 0.004 | 90.5 | Elected; lowest director support |
| Elect Steven M. Mollenkopf (chair) | 0.508 | 0.034 | 0.004 | 93.7 | Elected |
| Elect Robert Kelly Ortberg (CEO) | 0.532 | 0.010 | 0.003 | 98.1 | Elected; highest director support |
| Elect Bradley D. Tilden | 0.531 | 0.011 | 0.004 | 98.0 | Elected |
| Advisory vote on executive compensation | 0.484 | 0.056 | 0.006 | 89.7 | Approved |
| Ratify Deloitte & Touche LLP as auditor for 2026 | 0.634 | 0.022 | 0.003 | 96.7 | Approved |
| Shareholder: Board committee on disability access | 0.014 | 0.522 | 0.010 | 2.6 | Rejected |
| Shareholder: action by written consent | 0.214 | 0.325 | 0.006 | 39.7 | Rejected |
Broker non votes 113.0m on each item except the auditor ratification. Eight of 16 proposals shown; the other eight directors received between the lowest and highest support shown.
2026 annual meeting
- Virtual meeting of 17 Apr 2026; record date shares about 784.7m; the Form 8-K Item 5.07 reports vote results only and no transcript of remarks was found.
- Directors: Kelly Ortberg 98.1%, Bradley D. Tilden 98.0%, Robert A. Bradway 90.5% of votes cast for; Deloitte & Touche ratified with 96.7%.
Table 9.2 Holders above 5% and voting power, proxy statement of 2026
| Holder | Shares (m) | Share of common stock (%) |
|---|---|---|
| The Vanguard Group | 71.0 | 9.0 |
| FMR LLC | 55.0 | 7.0 |
| BlackRock, Inc. | 53.0 | 6.8 |
| Directors and executive officers as a group | n/a | below 1 |
Schedule 13G positions at 31 Dec 2025 as listed in the proxy statement. One class of common stock with one vote per share; the 6.00% mandatory convertible preferred has no general voting rights.
10 Risk Factors
- Item 1A of the FY2025 Form 10-K holds 24 risk factors against 26 a year earlier (8,142 words against 8,324); the three Forms 10-Q of 2026 report no material change.
Table 10.1 Risk factors and legal matters with filed figures
| Risk | Disclosure and change |
|---|---|
| Production rates and certification | 737 at 47 per month and a further rate needing a new production line, subject to FAA concurrence; 777X reach forward losses $4.9bn in 2025 and $3.5bn in 2024, first delivery expected 2027. |
| Supply chain | Wings constrain the 737; supplier shortages disrupted 777 Freighter and KC 46A output in Q3 2026; abnormal production costs expected into 2027. |
| Fixed price contracts | T 7A reach forward loss $1.77bn in 2024; KC 46A losses $0.6bn in Q4 2025; VC 25B losses $280m in Q2 2026; a 1% change in margins on profitable long term contracts moves pre tax income by about $320m. |
| Liquidity and credit ratings | Debt $45.9bn, $4.6bn current; ratings BBB minus and Baa3; new $5.0bn minimum liquidity covenant on the $10.0bn of undrawn facilities. |
| Legal and regulatory | DOJ non prosecution agreement of May 2025: $445m earnings charge in Q2 2025 and $689m released from escrow in Sep 2026; securities class actions and door plug litigation pending, no loss range estimable. |
| Non US sales and tariffs | Non US customers 60% of Commercial Airplanes contract revenue in 2025; customers in China paused deliveries in Q2 2025; about $420m of IEEPA tariff refunds received in 9M 2026. |
| Labor | About 72,000 union members; 101 day IAM District 837 strike in St. Louis in 2025; SPEEA contracts ratified through 2030 on 1 Oct 2026; IAM District 70 (Kansas) contract to Jun 2027. |
| Dilution | 6.00% mandatory convertible preferred ($5.75bn liquidation preference) converts by Oct 2027; $230m of Spirit exchangeable notes due 2028 may be settled in shares. |
How risk factors changed
- Comparison: 10-K FY2025 filed 30 Jan 2026 acc 0001628280-26-004357 against 10-K FY2024 filed 3 Feb 2025 acc 0000012927-25-000015.
- Factor count falls from 26 to 24 and word count from 8,324 to 8,142 as two Spirit and financing factors drop out and no new factor is added.
- Spirit AeroSystems is named 10 times against 19 a year earlier, as completion risk gives way to integration and divestiture obligations after the Dec 2025 close.
- Tariff is named 8 times against 5, and the non US sales heading now names tariffs, trade restrictions and government actions.
- Production text adds dated targets: 737 at 47 per month in 2026, 777X first delivery in 2027 after $8.4bn of reach forward losses over 2024 and 2025.
- Labor risk shifts from the 2024 Puget Sound IAM 751 strike to the 101 day IAM District 837 strike in St. Louis and SPEEA contracts expiring in Oct 2026.
Table 10.2 Size of the risk factor section
| Measure | 10-K FY2024 | 10-K FY2025 |
|---|---|---|
| Risk factors (count) | 26 | 24 |
| Words in Item 1A | 8,324 | 8,142 |
Table 10.3 Risk factors added, removed and materially reworded
| Change | Risk factor | What changed |
|---|---|---|
| Removed | Pending Spirit AeroSystems acquisition may not close or deliver benefits | Standalone factor on completing the Spirit AeroSystems acquisition is gone after the deal closed in Dec 2025; integration risk now sits inside the mergers and acquisitions factor. |
| Removed | Customer financing portfolio concentrated by customer and aircraft type | Factor on concentration of financing receivables and operating lease equipment among customers below investment grade and in 717 aircraft no longer appears. |
| Reworded | Commercial Airplanes production system, rates and certification | Body grows from 728 to 845 words; adds 777X reach forward losses of $4.9bn in 2025 and $3.5bn in 2024 with first delivery now expected in 2027, the plan to raise 737 output to 47 per month in 2026 and a further rate needing a new production line subject to FAA concurrence, and 787 rate risk. |
| Reworded | Union workforces and work stoppages | Replaces the 2024 IAM 751 strike detail and $12.1bn 2024 operating cash outflow with the 101 day strike by IAM District 837 (about 3,200 St. Louis employees) that disrupted F/A 18, F 15, T 7A, MQ 25 and weapons work, and names two SPEEA contracts expiring in Oct 2026. |
| Reworded | Non US sales, now including tariffs and trade restrictions | Heading adds tariffs, trade restrictions and government actions; body adds that non US customers are 60% of Commercial Airplanes contract revenue, describes baseline, sectoral and country tariffs and retaliation, and cites customers in China pausing deliveries in Q2 2025 before resuming. |
| Reworded | Mergers, acquisitions, alliances and divestitures | Body grows from 180 to 326 words; adds Spirit integration risk after the Dec 2025 close, the divestiture of portions of Digital Aviation Solutions, and service obligations to buyers of divested Spirit businesses including Airbus. |
| Reworded | Fixed price contracts and cost overruns | Heading changes from could subject us to losses to subject us to losses; drops the 2024 references to the IAM 751 stoppage and workforce inexperience and adds text on judgments about labor costs, changing technical requirements and negotiation outcomes on development programs. |
| Reworded | Dilution from convertible preferred stock and Spirit notes | Drops the Spirit merger exchange ratio terms (0.18 to 0.25 shares, $149.00 to $206.94 collar) and adds possible share issuance on exchange of $230m of 3.250% Spirit Exchangeable Notes due 1 Nov 2028. |
Table 10.4 Risk factor updates in quarterly reports since the annual filing
| Filing | Change disclosed |
|---|---|
| 10-Q Q1 2026 filed 22 Apr 2026 | No material changes from the risk factors in the FY2025 10-K. |
| 10-Q Q2 2026 filed 28 Jul 2026 | No material changes from the risk factors in the FY2025 10-K. |
| 10-Q Q3 2026 filed 27 Oct 2026 | No material changes from the risk factors in the FY2025 10-K. |
11 Stock Price, Scenarios & Sensitivity
- BA closed at $171.55 on 30 Oct 2026, (32.5%) below the 52 week high of $254.20 and 4.0% above the low of $165.01; market value $135.9bn on 792.4m shares.
- Valuation: 1.7x EV/Sales on TTM revenue of $94.9bn; P/E not meaningful as TTM EPS of $9.19 includes the $9.57bn gain; TTM free cash flow $16m.
- Scenario model: revenue grows from TTM Q3 2026 $94.9bn for three years; operating margin as stated; interest expense held at the TTM $2.45bn; 18% tax rate; price equals TTM Q3 2029 EPS times exit P/E.
Critical factors and core assumptions
Table 11.1 Critical factors behind the best case
| Factor | Current value | Best case requires | Evidence in filings and calls |
|---|---|---|---|
| 737 production rate | moving to 47 per month; 124 deliveries in Q3 2026 | 47 stable in early 2027, 52 by late 2027, FAA approval of the new line | 10-Q Q3 2026; Q3 2026 call |
| 787 production rate | 8 per month; 22 deliveries in Q3 2026 | increase from Dec 2026 to 10 per month in 2027 | 10-Q Q3 2026 |
| 777X certification | flight test ongoing; near break even gross margin | first 777 9 delivery in 2027 with no new reach forward loss | 10-Q Q3 2026 |
| Free cash flow | TTM $16m; 2026 about $2bn | $3bn in 2027, $6bn in 2028, $10bn in 2029 | Q3 2026 call |
| Defense fixed price programs | 9M 2026 margin 3.1%; VC 25B losses in 2026 | no new reach forward losses; high single digit margin by 2029 | 10-Q; Q2 2026 call |
| Balance sheet | debt $45.9bn, net debt $25.2bn, BBB minus and Baa3 | debt reduction from free cash flow | 10-Q Q3 2026 liquidity section |
- Revenue base TTM Q3 2026 $94.9bn; operating income $9.7bn incl. the $9.57bn gain, $169m excluding it.
- Best case: 14% revenue CAGR, 10% operating margin, 25x P/E, share count +1% after preferred conversion.
- Base case: 10% revenue CAGR, 7% margin, 22x P/E, share count +3%.
- Worst case: 5% revenue CAGR, 3% margin, 18x P/E, share count +4%.
- Interest expense $2.45bn a year (TTM) and 18% tax rate in every case; no gains on divestitures. Demand assumption: backlog over 6,300 airplanes, about ten years of 2025 deliveries.
Scenarios, three years forward
Table 11.2 Scenario analysis, TTM Q3 2026 to TTM Q3 2029
| Measure | Worst case | Base case | Best case |
|---|---|---|---|
| Revenue CAGR, 3 years (%) | 5.0 | 10.0 | 14.0 |
| Revenue, TTM Q3 2029 ($bn) | 109.9 | 126.3 | 140.6 |
| Operating margin, TTM Q3 2029 (%) | 3.0 | 7.0 | 10.0 |
| Net income, TTM Q3 2029 ($bn) | 0.7 | 5.2 | 9.5 |
| EPS, TTM Q3 2029 ($) | 0.84 | 6.43 | 11.90 |
| Exit P/E (x) | 18.0 | 22.0 | 25.0 |
| Implied price ($) | 15 | 141 | 297 |
| Change against $171.55 (%) | (91) | (18) | 73 |
| Implied annual return (%) | (55.4) | (6.3) | 20.1 |
Implied annual return excludes dividends; no common dividend is paid.
Sensitivity analysis
Table 11.3 Sensitivity of implied price to revenue CAGR and operating margin at 22x P/E
| Revenue CAGR \ Operating margin | 3% | 5% | 7% | 9% | 10% |
|---|---|---|---|---|---|
| 5% | $19 | $67 | $116 | $164 | $189 |
| 7% | $23 | $74 | $126 | $177 | $203 |
| 10% | $30 | $86 | $141 | $197 | $225 |
| 12% | $34 | $93 | $152 | $211 | $241 |
| 14% | $39 | $101 | $163 | $226 | $257 |
Cells show implied share price in year 3. Current price $171.55. Blue cells sit above it, red cells below.
Table 11.4 Sensitivity of implied price to exit P/E and operating margin at 10% revenue CAGR
| Exit P/E \ Operating margin | 3% | 5% | 7% | 9% | 10% |
|---|---|---|---|---|---|
| 18x | $24 | $70 | $116 | $161 | $184 |
| 20x | $27 | $78 | $129 | $179 | $205 |
| 22x | $30 | $86 | $141 | $197 | $225 |
| 25x | $34 | $97 | $161 | $224 | $256 |
| 28x | $38 | $109 | $180 | $251 | $287 |
Cells show implied share price in year 3. Current price $171.55. Blue cells sit above it, red cells below.
Disclaimer
This analysis is for information only and is not financial advice. It is derived from public SEC filings retrieved via sec-api.io and is not a publication of the U.S. Securities and Exchange Commission. Scenario values are model outputs under stated assumptions and are not forecasts. Data as of 30 October 2026.
Sources
All company figures are read from SEC filings retrieved through the sec-api.io MCP server. Airbus figures come from Airbus's own 9M 2026 release of 28 Oct 2026 on its company website. Call statements are taken from the Q3 2026 and Q2 2026 earnings calls held by the company, as reported in coverage of those calls.
Table A.1 Filings used, with accession numbers
| Form | Period | Filed | Accession number |
|---|---|---|---|
| 10-Q | Q3 2026 | 27 Oct 2026 | 0001628280-26-067508 |
| 8-K Ex 99.1 | Q3 2026 | 27 Oct 2026 | 0001628280-26-067411 |
| 10-Q | Q2 2026 | 28 Jul 2026 | 0001628280-26-050038 |
| 8-K Ex 99.1 | Q2 2026 | 28 Jul 2026 | 0001628280-26-049929 |
| 10-Q | Q1 2026 | 22 Apr 2026 | 0001628280-26-026458 |
| 8-K Ex 99.1 | Q1 2026 | 22 Apr 2026 | 0001628280-26-026391 |
| 8-K Ex 99.1 | Q4 2025 | 27 Jan 2026 | 0001628280-26-003518 |
| 10-K | FY2025 | 30 Jan 2026 | 0001628280-26-004357 |
| 10-Q | Q3 2025 | 29 Oct 2025 | 0001628280-25-047023 |
| 10-K | FY2023 | 31 Jan 2024 | 0000012927-24-000010 |
| 10-K | FY2022 | 27 Jan 2023 | 0000012927-23-000007 |
| DEF 14A | 2026 annual meeting | 6 Mar 2026 | 0001193125-26-096787 |
| 8-K 5.07 | 2026 annual meeting | 17 Apr 2026 | 0001628280-26-025684 |
Table A.2 Peer and sector filings used
| Company | Form | Filed | Accession number |
|---|---|---|---|
| GE Aerospace | 8-K Ex 99 | 20 Oct 2026 | 0000040545-26-000063 |
| General Dynamics | 8-K Ex 99.1 | 30 Oct 2026 | 0000040533-26-000036 |
| HEICO | 8-K Ex 99.1 | 25 Aug 2026 | 0000046619-26-000018 |
| Lockheed Martin | 8-K Ex 99.1 | 22 Oct 2026 | 0001628280-26-066780 |
| Northrop Grumman | 8-K Ex 99 | 20 Oct 2026 | 0001133421-26-000037 |
| RTX | 8-K Ex 99 | 20 Oct 2026 | 0000101829-26-000030 |
Table B.1 Exhibits to Forms 8-K filed in the last twelve months
| Filed | Exhibit | Document | Content |
|---|---|---|---|
| 3 Dec 2025 | EX-99.1 | Bradley D. Tilden elected to Board | Former chairman, president and CEO of Alaska Air Group, aged 64, elected effective 3 Dec 2025; Joins Aerospace Safety and Finance committees |
| 8 Dec 2025 | EX-99.1 | Boeing completes acquisition of Spirit AeroSystems | Covers Spirit's Boeing related commercial work: 737 fuselages, major structures for 767, 777 and 787, plus P 8 and KC 46 fuselages; Brings Boeing's largest spare parts supplier in house; aftermarket aligns under Global Services |
| 27 Jan 2026 | EX-99.1 | Q4 and FY2025 results | Q4 2025 revenue $23.9bn (up 57%); GAAP EPS $10.23, core EPS $9.92, incl. $9.6bn gain on Digital Aviation Solutions sale ($11.83 per share); FY2025 revenue $89.5bn and 600 commercial deliveries, highest since 2018; Q4 deliveries 160 (737: 117, 787: 27, 767: 10, 777: 6) |
| 22 Apr 2026 | EX-99.1 | Q1 2026 results | Revenue $22.2bn (up 14%) on 143 commercial deliveries (737: 114, 787: 15, 777: 8, 767: 6); GAAP EPS ($0.11), core EPS ($0.20); operating cash flow ($0.2bn), free cash flow ($1.5bn) |
| 28 Jul 2026 | EX-99.1 | Q2 2026 results | Revenue $24.6bn (up 8%) on 171 commercial deliveries (737: 129, 787: 25, 767: 10, 777: 7); GAAP EPS ($0.67), core EPS ($0.76); operating cash flow $1.4bn, free cash flow $0.6bn |
| 28 Aug 2026 | EX-10.1, EX-10.2, EX-10.3 | Credit facilities: new 364 day revolver and two five year amendments | EX 10.1: new $3.0bn 364 day revolver with Citibank and JPMorgan, maturing 23 Aug 2027, replacing the prior $3.0bn facility; Pricing Term SOFR plus 1.250% to 1.700%; commitment fee 0.125% to 0.300%, based on credit rating |
| 27 Oct 2026 | EX-99.1 | Q3 2026 results | Revenue $24.2bn (up 4%); 161 commercial deliveries (737: 124, 787: 22, 767: 10, 777: 5); GAAP EPS ($0.26), core EPS ($0.34); operating cash flow $1.5bn incl. about $0.7bn DOJ settlement payments; free cash flow $0.5bn |
