Boeing’s third-quarter earnings report was a tale of two companies: one that’s finally getting its act together (defense) and another that’s still stuck in the hangar (commercial airplanes). The headline? The 737 Max, Boeing’s most notorious star, won’t hit its production target of 52 planes a month until late 2027—because, as CEO Kelly Ortberg put it, 'we’re going to do it right.' Meanwhile, the defense division is busy designing the Navy’s next-gen fighter jet, because nothing says 'progress' like building warplanes while your passenger jets are grounded by supply chain drama.
The 737 Max: A Slow Climb to Nowhere
Boeing’s 737 Max program is like a student who keeps asking for extensions on their thesis. The company now expects to stabilize production at 47 planes per month in early 2027, with the goal of reaching 52 later that year. The holdup? Wing production. Apparently, making wings—those pesky things that keep planes in the air—is harder than it looks. The delays pushed Boeing’s stock down 10% post-earnings, because Wall Street has the patience of a toddler on a sugar crash [1].
On the bright side, the FAA finally certified the 737-7 and 737-10 variants, which means Boeing can start delivering them next year. The backlog for the 737 family now stands at over 6,300 planes, valued at a record $612 billion. That’s a lot of future revenue, assuming Boeing can actually build the things [2].
Defense to the Rescue (Sort Of)
While the commercial division flounders, Boeing’s defense unit is having a moment. Revenue jumped 15% year-over-year to $7.9 billion, thanks to higher volume and a $252 million gain from the sale of HRL Laboratories. The big win? A contract to design and build the Navy’s F/A-XX next-gen fighter jet, which isn’t even in the backlog yet because the paperwork is still being filed (classic government efficiency) [3].
The defense backlog hit a record $101 billion, with 23% of orders coming from international customers. It’s a rare bright spot for Boeing, though the unit’s operating margin of 6.2% (boosted by that one-time gain) suggests profitability is still as elusive as a smooth FAA certification process [4].
Cash Flow: The Light at the End of the Tunnel (Maybe)
Boeing generated $1.5 billion in operating cash flow for the quarter, a 33% increase year-over-year. Free cash flow (non-GAAP) came in at $464 million, up from $238 million in Q3 2025. That’s progress, but it’s still a far cry from the $10 billion annual target Boeing has set for 2029. The company’s total debt remains a hefty $45.9 billion, which is roughly the GDP of a small country [5].
The commercial division’s operating loss narrowed to $697 million, a marked improvement from the $5.4 billion loss a year ago (which included a massive charge for the 777X program). Still, the unit’s -6.5% operating margin is a reminder that Boeing’s core business is still more 'money pit' than 'cash cow' [6].
What to Watch Next: The 777X and the Art of Patience
Boeing insists the 777X is on track for first delivery in 2027, but given the company’s track record, investors might want to pencil in '2028' in invisible ink. The 787 program, at least, is stable at 8 planes per month, which is a win by Boeing’s current standards [7].
The big question is whether Boeing can stabilize its supply chain and ramp up production without tripping over its own feet. The defense division’s growth is a lifeline, but the commercial side needs to start pulling its weight. Until then, Boeing’s story is one of incremental progress—two steps forward, one step back, and a lot of crossed fingers.