Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Revenue | $24.2 billion | Up 4% |
| Operating Margin | 1.5% | Improved |
| Core Earnings Per Share | Loss of $0.34 | Improved |
| Free Cash Flow | $464 million | Improved |
| BCA Revenue | $10.7 billion | Down 3% |
| BDS Revenue | $7.9 billion | Up 15% |
Guidance and outlook
- 2026 Free Cash Flow: Approximately $2 billion.
- 2027 Free Cash Flow: Approximately $3 billion.
- 2028 Free Cash Flow: Approximately $6 billion.
- 2029 Free Cash Flow: Approximately $10 billion.
- 787 Deliveries: 90 to 100 for the full year 2026, expected to be closer to the lower end.
- 777X First Delivery: Expected in 2027.
How management sounded
Positive (+6 on our -10 to +10 scale). Management provided a clear multiyear free cash flow outlook and secured major defense wins, though they acknowledged ongoing production challenges and the need for continued operational discipline. Management sounded more upbeat than on 8% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
737 Production Stability
Asked: Myles Walton from Wolfe Research asked about the path to higher production rates and the stability of the supply chain.
Answer: Management noted that while engines are not a problem, the wing back shop has not yielded the expected flow savings, requiring a slower, more disciplined approach to rate increases.
Free Cash Flow Outlook
Asked: Noah Poponak from Goldman Sachs asked about the logic behind the multiyear cash flow targets and if the 777X schedule risk is fully accounted for.
Answer: Management explained that they have financially provisioned for potential certification delays and that the targets are based on improved margin profiles and higher delivery volumes.
Defense Portfolio Growth
Asked: Ron Epstein from Bank of America asked about the growth prospects for the Defense and Space segment following recent contract wins.
Answer: Management expects mid-single-digit or higher revenue growth for the defense portfolio, supported by new program wins and improved contract structures.
777X Certification
Asked: David Strauss from Wells Fargo asked about the risk of the 777X certification slipping into 2028.
Answer: Management stated that while they are driving for an earlier date, they have provisioned for a mid-2027 certification within their financial assumptions.
What to watch before the next call
- Progress on 737 wing production stability and the ramp-up of fuselage production.
- Certification timeline for the 777X, specifically the ETOPS testing phase.
- Execution of the 787 production rate increase to 10 per month.
