As the recovery accelerates, Boeing will lay off 10,000 fewer employees than expected

Boeing Update

As the market recovery accelerates, Boeing plans to lay off 10,000 employees during the worst of the coronavirus pandemic.

The American aircraft manufacturer currently has approximately 140,000 employees and is expected to remain at this level. Boeing said in October last year that its goal is to increase the number of employees from 160,000 To 130,000 As the Covid-19 crisis and travel restrictions have disrupted airlines’ demand for new aircraft, layoffs, voluntary departures and natural attrition have been implemented.

CEO David Calhoun said in a memo to employees: “As the commercial market recovery accelerates, our defense and government services businesses are targeting growth opportunities. We increase investment to further strengthen the engineering. We now see our personnel The level of equipment is more stable.”.

He added that the pace of business market recovery, and Trade relations with China The financial performance of Boeing and Boeing will be the main determinant of future employment levels.

The company warned that the market recovery may be volatile, as it depends on how the spread of the infectious Delta variant will affect the Covid case rate and how quickly people are vaccinated against the virus.

Boeing’s earnings per share and revenue exceeded Wall Street expectations, and it achieved quarterly earnings for the first time since September 2019. The stock price rose 6% in pre-market trading.

The company reported net income of $567 million in the second quarter and core earnings per share of 40 cents. A year ago, it lost $4.79 per share, and Wall Street analysts predicted a loss of 83 cents per share for the quarter.

This manufacturer brought in revenue of 17 billion U.S. dollars, while analysts forecasted revenue of 16.6 billion U.S. dollars, an increase of 44% compared to the same period last year.

Revenue is driven by improved business delivery and service demand.Boeing delivered 79 commercial aircraft during the quarter, most of which were 737 Maxes, because Manufacturing defect Forcing the company to stop delivering the wide-body 787 Dreamliner in May.

Boeing’s services business also increased the company’s revenue by $4.1 billion, an increase of 17% compared to the second quarter of 2020, as airlines resumed maintenance they did not need when they cut flight schedules due to the pandemic.

The company also reduced the outflow of free cash flow, that is, operating cash flow minus capital expenditures, which is an important indicator for investors. It reported an outflow of US$705 million, down from US$5.6 billion a year ago. It is generally estimated to be US$3.7 billion.

“From a stock perspective, the shocking jump will only bring upside,” Baird analyst Peter Arment said in a report.

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