Boeing Company
Other securities:
BA$Apreferred
Loading chart...
Item 1. Business
The Boeing Company, together with its subsidiaries (herein referred to as “Boeing,” the “Company,” “we,” “us,” “our”), is one of the world’s major aerospace firms.
We are organized based on the products and services we offer. We operate in three reportable segments:
•Commercial Airplanes (BCA);
•Defense, Space & Security (BDS);
•Global Services (BGS).
Commercial Airplanes Segment
This segment develops, produces and markets commercial jet aircraft principally to the commercial airline industry worldwide. We are a leading producer of commercial aircraft and offer a family of commercial jetliners designed to meet a broad spectrum of global passenger and cargo requirements of airlines. This family of commercial jet aircraft in production includes the 737 narrow-body model and the 767, 777 and 787 wide-body models. Development continues on the 777X program and the 737-7 and 737-10 derivatives.
Defense, Space & Security Segment
This segment engages in the research, development, production and modification of manned and unmanned military aircraft and weapons systems for strike, surveillance and mobility, including fighter and trainer aircraft; vertical lift, including rotorcraft and tilt-rotor aircraft; and commercial derivative aircraft, including anti-submarine and tanker aircraft. In addition, this segment engages in the research, development, production and modification of the following products and related services: strategic defense and intelligence systems, including strategic missile and defense systems, command, control, communications, computers, intelligence, surveillance and reconnaissance, cyber and information solutions, and intelligence systems, satellite systems, including government and commercial satellites and space exploration.
Global Services Segment
This segment provides services to our commercial and defense customers worldwide. Global Services sustains aerospace platforms and systems with a full spectrum of products and services, including supply chain and logistics management, engineering, maintenance and modifications, upgrades and conversions, spare parts, pilot and maintenance training systems and services, technical and maintenance documents, and digital solutions and analytics.
Intellectual Property
We own numerous patents and have licenses for the use of patents owned by others, which relate to our products and their manufacture. In addition to owning a large portfolio of intellectual property, we also license intellectual property to and from third parties. For example, the U.S. government has licenses in our patents that are developed in performance of government contracts, and it may use or authorize others to use the inventions covered by such patents for government purposes. Unpatented research, development and engineering skills, as well as certain trademarks, trade secrets and other intellectual property rights, also make an important contribution to our business. While our intellectual
1
property rights in the aggregate are important to the operation of each of our businesses, we do not believe that our business would be materially affected by the expiration of any particular intellectual property right or termination of any particular intellectual property patent license agreement.
Human Capital
As of December 31, 2025, Boeing’s total workforce was approximately 182,000 with 14% located outside of the U.S.
As of December 31, 2025, our workforce included approximately 72,000 union members. As of December 31, 2025, we had 32 independent agreements with nine different unions in the U.S., and we had agreements with 18 employee representative bodies internationally. Information about our principal collective bargaining agreements is set forth in the following table:
| Union | % of Total Workforce | Major Agreements with Union | Principal Location | Expiration Date | ||||||||||
| The International Association of Machinists and Aerospace Workers (IAM) | 25% | IAM District 70 | Kansas | June 2027 | ||||||||||
IAM District 751 | Washington | September 2028 | ||||||||||||
IAM District 837 | Missouri | July 2030 | ||||||||||||
| The Society of Professional Engineering Employees in Aerospace (SPEEA) | 11% | SPEEA Professional | Kansas | January 2026 | ||||||||||
SPEEA Technical | Washington | October 2026 | ||||||||||||
SPEEA Professional | Washington | October 2026 | ||||||||||||
SPEEA Technical | Kansas | December 2028 | ||||||||||||
| The United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) | 1% | UAW Local 952 | Oklahoma | January 2026 | ||||||||||
UAW Local 1069 | Pennsylvania | April 2027 |
During 2024, employees represented by IAM District 751, which represents over 30,000 Boeing manufacturing employees primarily located in Washington state, went out on strike for 53 days, halting production of most of our commercial aircraft and certain of our Defense, Space & Security products, and materially adversely impacting our business and financial position. During 2025, employees represented by IAM District 837, which represents approximately 3,200 employees at our St. Louis area sites, went out on strike for 101 days, disrupting our St. Louis operations and impacting programs including F/A-18, F-15, T-7A, MQ-25 and Weapons. We may experience additional work stoppages in the future, which could materially adversely affect our business, financial position, results of operations and cash flows and result in the diversion of management’s attention from other ongoing business concerns.
For information on risks related to our human capital, see “Risks Related to Our Business and Operations” in Item 1A. Risk Factors.
We are committed to creating a work environment where every teammate around the world can perform at their best and grow their careers while supporting our company’s mission to protect, connect and explore our world and beyond. During 2025, we continued to make progress in our culture transformation, including through launching our new Values and Behaviors, revising our performance management system to hold employees accountable not only for what they achieve but for how they achieve it, and enhancing training and leadership development programs. Our compensation program is designed to attract, reward and retain the best-qualified talent with competitive compensation and benefits, including healthcare, paid time off, parental leave, retirement benefits, tuition assistance, employee skills and leadership development programs, and mental and physical well-being programs.
2
We also invest in rewarding performance and have established a multi-level recognition program to acknowledge the achievements of excellent individual or team performance.
We support our employees’ continuous development of professional, technical and leadership skills through access to digital learning resources and partnerships with leading professional/technical societies and organizations around the world. In 2025, Boeing employees completed approximately 5.8 million hours of learning and approximately 12,000 Boeing employees leveraged our tuition assistance program to pursue degrees, professional certificates and individual courses in strategic fields of study.
Safety, quality, integrity and sustainability are at the core of how Boeing operates. We aspire to achieve zero workplace injuries and provide a safe, open and accountable work environment for our employees. Employees are required on an annual basis to sign the Boeing Code of Conduct to reaffirm their commitment to do their work in a compliant and ethical manner. Additionally, we continue to focus on creating a culture where all employees feel empowered to speak up and provide multiple channels for all employees to ask for guidance and report concerns, including those related to ethics, safety or quality. We address employee concerns and take appropriate actions that uphold our Boeing values.
Competition
The commercial jet aircraft market and the airline industry remain extremely competitive. BCA faces aggressive international competitors who are intent on increasing their market share, such as Airbus and entrants from China. We are focused on improving our products and processes and continuing cost reduction efforts. We intend to continue to compete with other aircraft manufacturers by providing customers with airplanes and services that deliver superior design, safety, quality, efficiency and value to customers around the world.
BDS faces strong competition primarily from General Dynamics Corporation, Lockheed Martin Corporation, Northrop Grumman Corporation, RTX Corporation and SpaceX. Non-U.S. companies such as BAE Systems and Airbus Group continue to build a strategic presence in the U.S. market by strengthening their North American operations and partnering with U.S. defense companies. In addition, certain competitors have occasionally formed teams with other competitors to address specific customer requirements. BDS expects the trend of strong competition to continue into 2026.
The commercial and defense services markets are extremely challenging and are made up of many of the same strong U.S. and non-U.S. competitors facing BCA and BDS along with other competitors in those markets. BGS leverages our extensive services network offering products and services which span the life cycle of our defense and commercial aircraft programs: training, fleet services and logistics, maintenance and engineering, modifications and upgrades, as well as the daily cycle of gate-to-gate operations. BGS expects the market to remain highly competitive in 2026, and intends to grow market share by leveraging a high level of customer satisfaction and productivity.
Regulatory Matters
Our businesses are heavily regulated in most of our markets. We work with numerous U.S. government agencies and entities, including but not limited to, all of the branches of the U.S. military, the National Aeronautics and Space Administration (NASA), the Federal Aviation Administration (FAA) and the Department of Homeland Security. Similar government authorities exist in our non-U.S. markets.
Government Contracts. The U.S. government, and other governments, may terminate any of our government contracts at their convenience, as well as for default based on our failure to meet specified performance requirements. If any of our U.S. government contracts were to be terminated for convenience, we generally would be entitled to receive payment for work completed and allowable termination or cancellation costs. If any of our government contracts were to be terminated for default,
3
generally the U.S. government would pay only for the work that has been accepted and could require us to pay the difference between the original contract price and the cost to re-procure the contract items, net of the work accepted from the original contract. The U.S. government can also hold us liable for damages resulting from the default.
Commercial Aircraft. In the U.S., our commercial aircraft products are required to comply with FAA regulations governing production and quality systems, airworthiness and installation approvals, repair procedures and continuing operational safety. For example, as a result of the 737-9 door plug accident in January 2024, the FAA investigated the 737 quality control system, including Spirit AeroSystems Holdings, Inc. (Spirit), and increased its oversight of our production and quality and safety management systems. The 737 program may only increase production rates and/or implement new production lines with the concurrence of the FAA
Loading financial statements...
Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
| Line item |
|---|
| Period ending |
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Consolidated Results of Operations and Financial Condition
Overview
We are a global market leader in the design, development, manufacture, sale, service and support of commercial jetliners, military aircraft, satellites, missile defense, human space flight and launch systems and services. We are one of the two major manufacturers of 100+ seat airplanes for the worldwide commercial airline industry and one of the largest defense contractors in the U.S. While our principal operations are in the U.S., we conduct operations in an expanding number of countries and rely on an extensive network of U.S. and non-U.S. partners, key suppliers and subcontractors.
Our strategy is centered on successful execution in healthy core businesses – Commercial Airplanes (BCA), Defense, Space & Security (BDS) and Global Services (BGS). BCA is committed to offering airplanes that deliver superior design, safety, quality, efficiency and value to customers around the world. BDS integrates its resources in defense, intelligence, communications, security, space and services to deliver capability-driven solutions to customers. Our BDS strategy is to leverage our core businesses to capture key next-generation programs while expanding our presence in adjacent and international markets. BGS provides support for commercial and defense customers through innovative, comprehensive and cost-competitive product and service solutions.
On January 5, 2024, a 737-9 flight made an emergency landing after a mid-exit door plug detached in flight. As a result of the accident, the Federal Aviation Administration (FAA) performed an investigation into the 737 quality control system and imposed certain additional requirements and restrictions. As part of our plan to improve quality and safety and to address the issues identified, we slowed production rates and delayed planned production rate increases to reduce traveled work in our factory, as well as at our suppliers. We have also taken additional actions to improve safety and quality, including investing in workforce training, simplifying plans and processes, eliminating defects, and enhancing our safety and quality culture. The 737-9 door plug accident and our resulting actions, including slowing production, significantly impacted our financial position, results of operations and cash flows during 2024 and 2025.
On November 4, 2024, the International Association of Machinists and Aerospace Workers District 751 (IAM 751), representing approximately 30,000 Boeing employees, voted to ratify a new contract, thereby ending the work stoppage initiated on September 13, 2024, which paused production of certain commercial aircraft models (737, 767, 777 and 777X aircraft) as well as production of commercial derivative aircraft for our Defense, Space & Security business (KC-46A Tanker and P-8A Poseidon). Production for all programs resumed in December 2024 and gradually ramped up during 2025.
On November 13, 2025, the International Association of Machinists and Aerospace Workers District 837 (IAM 837), representing approximately 3,200 Boeing employees, voted to ratify a new contract thereby ending the work stoppage initiated on August 4, 2025, which disrupted our St. Louis operations. Programs impacted included F/A-18, F-15, T-7A Red Hawk, MQ-25 and Weapons.
Our contracts with the Society of Professional Engineering Employees in Aerospace, representing approximately 16,000 Boeing employees, are scheduled to expire in October 2026, and could also have a material impact on our financial position, results of operations and cash flows.
24
During the fourth quarter of 2025, we completed a divestiture and an acquisition that are affecting our 2025 financial position, results of operations and cash flows. On October 31, 2025, we completed the divestiture of portions of our BGS segment’s Digital Aviation Solutions business (Digital Aviation Solutions Divestiture) for $10.55 billion in an all-cash transaction. On December 8, 2025, we completed the acquisition of Spirit AeroSystems Holdings, Inc. (Spirit) by exchanging approximately $4.7 billion of Boeing shares for all of Spirit’s outstanding shares (Spirit Acquisition). In connection with the Spirit Acquisition, we paid off certain Spirit debt and other obligations and assumed the remainder of Spirit’s outstanding debt and other obligations. Boeing’s acquisition includes all of Spirit’s Boeing-related commercial operations, including fuselages for the 737, P-8 and KC-46 Tanker programs, as well as major structures for the 767, 777 and 787 programs. It also includes Spirit’s defense and aftermarket businesses as well as portions of Spirit’s operations in Belfast, Ireland. Spirit employs approximately 15,000 people. For additional discussion related to the Digital Aviation Solutions Divestiture and Spirit Acquisition, see Note 3 and Note 2 of our Consolidated Financial Statements.
Business Environment and Trends
In 2025, global air traffic expanded near historical trend rates on an annual basis. This growth came despite a lower than usual contribution from the North American market, which saw stagnant demand particularly in the low-cost space. International demand outpaced domestic demand on an annual basis as the former built on the recovery momentum from 2024, including in China, lifting demand for wide-body airplanes. Based on these trends, both single-aisle and wide-body demand remain above current industry supply levels. We are experiencing strong demand from our airline customers globally.
We and our suppliers are experiencing improving supply chain performance with fewer disruptions from production quality issues, global supply chain constraints and labor instability. We and our suppliers continue to experience inflationary pressures. We continue to monitor the health and stability of the supply chain. Notwithstanding improvements, these factors continue to challenge overall productivity and adversely impact our financial position, results of operations and cash flows.
Airline financial performance, which influences demand for new aircraft, is benefiting from the resilient demand for travel. The International Air Transport Association (IATA) is estimating 2025 industry-wide net profits of $39.5 billion, up from $28.3 billion in 2024, primarily driven by Europe, North America and the Middle East. For 2026, IATA is forecasting $41 billion in net profits for the industry globally. The overall outlook continues to stabilize. We face uncertainties in the environment in the near- to medium-term as airlines are facing persistently high and volatile costs even as fuel prices have declined. The global economy is expecting a continued easing of inflation and interest rates, with regional economic and geopolitical difficulties adding uncertainty to the outlook and the financial viability of some airlines and regions.
The long-term airline industry outlook remains positive due to the fundamental drivers of air travel demand: economic growth, increasing propensity to travel, increased trade, globalization and improved airline services driven by liberalization of air traffic rights between countries. Our Commercial Market Outlook forecast projects a 3.1% growth rate in the global fleet over a 20-year period. Based on long-term global economic growth projections of 2.3% in average annual gross domestic product, we project demand for approximately 43,600 new airplanes over the next 20 years. The industry remains vulnerable to exogenous developments including fuel price spikes, potential new or increased tariffs, changing energy policies, credit market shocks, acts of terrorism, natural disasters, conflicts, epidemics, pandemics and increased global environmental regulations.
25
At BDS, we see strong demand reflecting the important role our products and services have in ensuring our national security. Outside of the U.S., we are seeing similar solid demand as governments prioritize security, defense technology and global cooperation given evolving threats. Our fixed-price development programs are maturing; however, technical and schedule challenges remain and have resulted in significant earnings charges on these programs. BDS’s production system and supply chain are beginning to stabilize; however, prior period performance has adversely affected margins and cash flows.
At BGS, we expect commercial revenues to remain strong in future quarters as the commercial airline industry has largely recovered and transitions to growth. The demand outlook for our government services business remains stable.
Consolidated Results of Operations
The following table summarizes key indicators of consolidated results of operations:
| (Dollars in millions, except per share data) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Revenues | $89,463 | $66,517 | $77,794 | ||||||||||||
| GAAP | |||||||||||||||
| Earnings/(loss) from operations | $4,281 | ($10,707) | ($773) | ||||||||||||
| Operating margins | 4.8 | % | (16.1) | % | (1.0) | % | |||||||||
| Effective income tax rate | 15.1 | % | 3.1 | % | (11.8) | % | |||||||||
| Net earnings/(loss) attributable to Boeing shareholders | $2,235 | ($11,817) | ($2,222) | ||||||||||||
| Diluted earnings/(loss) per share | $2.48 | ($18.36) | ($3.67) | ||||||||||||
Non-GAAP (1) | |||||||||||||||
Core operating earnings/(loss) | $3,236 | ($11,811) | ($1,829) | ||||||||||||
| Core operating margins | 3.6 | % | (17.8) | % | (2.4) | % | |||||||||
Core earnings/(loss) per share | $1.19 | ($20.38) | ($5.81) | ||||||||||||
(1)These measures exclude certain components of pension and other postretirement benefit expense. See pages 47 - 48 for important information about these non-GAAP measures and reconciliations to the most directly comparable GAAP measures.
Revenues
The following table summarizes Revenues:
| (Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Commercial Airplanes | $41,494 | $22,861 | $33,901 | ||||||||||||
| Defense, Space & Security | 27,234 | 23,918 | 24,933 | ||||||||||||
| Global Services | 20,923 | 19,954 | 19,127 | ||||||||||||
| Unallocated items, eliminations and other | (188) | (216) | (167) | ||||||||||||
| Total | $89,463 | $66,517 | $77,794 | ||||||||||||
Revenues increased by $22,946 million in 2025 compared with 2024 primarily driven by higher revenues at BCA, BDS and BGS. BCA revenues increased by $18,633 million primarily due to higher deliveries. BDS revenues increased by $3,316 million primarily due to lower net unfavorable cumulative
26
contract catch-up adjustments and higher volume. BGS revenues increased by $969 million primarily due to higher government and commercial services revenue.
Revenues decreased by $11,277 million in 2024 compared with 2023 driven by lower revenues at BCA and BDS, partially offset by higher revenues at BGS. BCA revenues decreased by $11,040 million primarily driven by lower deliveries across all programs and 737-9 customer considerations related to the January 2024 grounding. BDS revenues decreased by $1,015 million primarily due to higher net unfavorable cumulative contract catch-up adjustments on major fixed-price development programs. BGS revenues increased by $827 million primarily due to higher commercial services revenue.
Earnings/(Loss) From Operations
The following table summarizes Earnings/(loss) from operations:
| (Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Commercial Airplanes | ($7,079) | ($7,969) | ($1,635) | ||||||||||||
| Defense, Space & Security | (128) | (5,413) | (1,764) | ||||||||||||
| Global Services | 13,474 | 3,618 | 3,329 | ||||||||||||
Segment operating earnings/(loss) | 6,267 | (9,764) | (70) | ||||||||||||
| Unallocated items, eliminations and other | (3,031) | (2,047) | (1,759) | ||||||||||||
| Pension FAS/CAS service cost adjustment | 784 | 811 | 799 | ||||||||||||
| Postretirement FAS/CAS service cost adjustment | 261 | 293 | 257 | ||||||||||||
Earnings/(loss) from operations (GAAP) | $4,281 | ($10,707) | ($773) | ||||||||||||
FAS/CAS service cost adjustment(1) | (1,045) | (1,104) | (1,056) | ||||||||||||
Core operating earnings/(loss) (Non-GAAP)(2) | $3,236 | ($11,811) | ($1,829) | ||||||||||||
(1) The FAS/CAS service cost adjustment represents the difference between the FAS pension and postretirement service costs calculated under GAAP and costs allocated to the business segments.
(2) Core operating earnings/(loss) is a non-GAAP measure that excludes the FAS/CAS service cost adjustment. See pages 47 - 48.
Earnings from operations increased by $14,988 million in 2025 compared with 2024, primarily driven by BGS ($9,856 million), BDS ($5,285 million) and BCA ($890 million), partially offset by an increase in loss from operations on Unallocated items, eliminations and other ($984 million). The increase in earnings at BGS is primarily driven by a gain on the Digital Aviation Solutions Divestiture. The decrease in loss from operations at BDS is primarily driven by lower net unfavorable cumulative contract catch-up adjustments. The decrease in loss from operations at BCA is primarily driven by higher deliveries partially offset by higher combined reach-forward losses on 777X and 767 programs. The increase in loss from operations on Unallocated items, eliminations and other is primarily driven by an increase in unallocated General and administrative expense.
Loss from operations increased by $9,934 million in 2024 compared with 2023. BCA loss from operations increased by $6,334 million primarily due to reach-forward losses on the 777X and 767 programs, 737-9 customer considerations related to the January 2024 grounding, lower deliveries, and lower margins driven by production disruption including the IAM 751 work stoppage and new agreement, and higher research and development expense, partially offset by lower abnormal production costs. BDS loss from operations increased by $3,649 million compared to the same period in 2023 primarily due to higher net unfavorable cumulative contract catch-up adjustments in 2024 on major fixed-price development programs. BGS earnings from operations increased by $289 million in 2024 compared with 2023 primarily due to higher commercial services revenue. Loss from operations
27
on Unallocated items, eliminations and other increased by $288 million in 2024 primarily due to an increase in eliminations and other unallocated items expense, partially offset by an increase in share-based plans income.
Core operating earnings increased by $15,047 million in 2025 compared with 2024 and core operating loss increased by $9,982 million in 2024 compared with 2023 primarily due to changes in Segment operating earnings/(loss) as described above.
Unallocated Items, Eliminations and Other
The most significant items included in Unallocated items, eliminations and other (expense)/income are shown in the following table:
| (Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Share-based plans | ($49) | $171 | $62 | ||||||||||||
| Deferred compensation | (182) | (114) | (188) | ||||||||||||
| Amortization of previously capitalized interest | (92) | (93) | (95) | ||||||||||||
| Research and development expense, net | (411) | (377) | (315) | ||||||||||||
| Eliminations and other unallocated items | (2,297) | (1,634) | (1,223) | ||||||||||||
| Unallocated items, eliminations and other | ($3,031) | ($2,047) | ($1,759) | ||||||||||||
Unallocated share-based plans expense increased by $220 million in 2025 primarily due to the timing of when share-based plans expense was recorded compared with when it was allocated to our segments. Share-based plans income increased by $109 million in 2024 primarily due to fewer outstanding share-based awards in 2024 and the timing of corporate allocations.
Deferred compensation expense increased by $68 million in 2025 and decreased by $74 million in 2024 primarily driven by changes in our stock price.
Unallocated research and development expense increased by $34 million in 2025 and $62 million in 2024 primarily due to increased spending on enterprise product development.
Eliminations and other unallocated items expense increased by $663 million in 2025 primarily due to higher unallocated General and administrative expense. General and administrative expense for 2025 and 2024 includes earnings charges of $445 million and $244 million related to agreements with the U.S. Department of Justice. Eliminations and other unallocated items expense increased by $411 million in 2024 primarily due to an earnings charge of $244 million related to an agreement with the U.S. Department of Justice. For additional discussion, see Note 23 to our Consolidated Financial Statements.
Net periodic pension benefit costs included in Earnings/(loss) from operations were as follows:
| (Dollars in millions) | Pension | ||||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||||
| Allocated to business segments | ($793) | ($816) | ($801) | ||||||||||||||
| Pension FAS/CAS service cost adjustment | 784 | 811 | 799 | ||||||||||||||
Net periodic pension benefit cost included in Earnings/(loss) from operations | ($9) | ($5) | ($2) | ||||||||||||||
28
The pension FAS/CAS service cost adjustment recognized in Earnings/(loss) from operations in 2025 was largely consistent with 2024 and 2023. Net periodic benefit cost included in Earnings/(loss) from operations in 2025 was largely consistent with 2024 and 2023.
For additional discussion related to Postretirement Plans, see Note 18 to our Consolidated Financial Statements.
Other Earnings Items
(Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Earnings/(loss) from operations | $4,281 | ($10,707) | ($773) | ||||||||||||
| Other income, net | 1,125 | 1,222 | 1,227 | ||||||||||||
| Interest and debt expense | (2,771) | (2,725) | (2,459) | ||||||||||||
| Earnings/(loss) before income taxes | 2,635 | (12,210) | (2,005) | ||||||||||||
| Income tax (expense)/benefit | (397) | 381 | (237) | ||||||||||||
| Net earnings/(loss) | 2,238 | (11,829) | (2,242) | ||||||||||||
| Less: Net earnings/(loss) attributable to noncontrolling interest | 3 | (12) | (20) | ||||||||||||
| Net earnings/(loss) attributable to Boeing shareholders | $2,235 | ($11,817) | ($2,222) | ||||||||||||
Non-operating pension income included in Other income, net was $176 million in 2025, $476 million in 2024 and $529 million in 2023. The decreased income in 2025 compared to 2024 was primarily due to lower expected return on plan assets. The decreased income in 2024 compared to 2023 was primarily due to lower expected return on plan assets and higher amortization of net actuarial losses, partially offset by lower interest cost.
Non-operating postretirement income included in Other income, net was $19 million in 2025, $73 million in 2024 and $58 million in 2023. The decreased income in 2025 was primarily due to lower amortization of net actuarial gains and higher interest cost. The increased income in 2024 was primarily due to lower interest cost, partially offset by amortization of prior service credits.
For additional discussion related to Postretirement Plans, see Note 18 to our Consolidated Financial Statements.
Interest and debt expense increased by $46 million in 2025 primarily due to higher average interest rates. Interest and debt expense increased by $266 million in 2024 primarily due to higher average debt balances.
For a discussion related to Income Taxes, see Note 6 to our Consolidated Financial Statements.
Total Costs and Expenses (“Cost of Sales”)
Cost of sales, for both products and services, consists primarily of raw materials, parts, sub-assemblies, labor, overhead and subcontracting costs. Our BCA segment predominantly uses program accounting to account for cost of sales. Under program accounting, cost of sales for each commercial aircraft program equals the product of (i) revenue recognized in connection with customer deliveries and (ii) the estimated cost of sales percentage applicable to the total remaining program. For long-term contracts, the amount reported as cost of sales is recognized as incurred. Substantially all contracts at our BDS segment and certain contracts at our BGS segment are long-term contracts with the U.S. government and other customers that generally extend over several years. Cost of sales for commercial spare parts is recorded at average cost.
29
The following table summarizes cost of sales:
| (Dollars in millions) | ||||||||||||||||||||||||||
| Years ended December 31 | 2025 | 2024 | Change | 2024 | 2023 | Change | ||||||||||||||||||||
| Cost of sales | $85,174 | $68,508 | $16,666 | $68,508 | $70,070 | ($1,562) | ||||||||||||||||||||
| Cost of sales as a % of Revenues | 95.2 | % | 103.0 | % | (7.8) | % | 103.0 | % | 90.1 | % | 12.9 | % | ||||||||||||||
Cost of sales increased by $16,666 million in 2025 compared with 2024, primarily due to higher deliveries and an increase in reach-forward losses at BCA, partially offset by lower charges on BDS fixed-price development programs. Cost of sales as a percentage of Revenues decreased in 2025 compared to 2024 primarily due to lower charges on BDS fixed-price development programs, partially offset by higher combined reach-forward losses on the 777X and 767 programs at BCA.
Cost of sales decreased by $1,562 million in 2024 compared with 2023, primarily due to lower revenues at BCA, partially offset by the reach-forward losses on the 777X and 767 programs and higher charges on the BDS fixed-price development programs. Cost of sales as a percentage of Revenues increased in 2024 compared to 2023 primarily due to the reach-forward losses on the 777X and 767 programs, lower margins at BCA, and higher charges on the BDS fixed-price development programs.
Research and Development
The following table summarizes our Research and development expense:
| (Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Commercial Airplanes | $2,202 | $2,386 | $2,036 | ||||||||||||
| Defense, Space & Security | 877 | 917 | 919 | ||||||||||||
| Global Services | 125 | 132 | 107 | ||||||||||||
| Other | 411 | 377 | 315 | ||||||||||||
| Total | $3,615 | $3,812 | $3,377 | ||||||||||||
Research and development expense decreased by $197 million in 2025 compared with 2024. The decrease in expense was primarily due to lower spending at BCA.
Research and development expense increased by $435 million in 2024 compared with 2023 primarily due to the 777X program at BCA and higher enterprise investments in product development.
30
Backlog
Our backlog at December 31 was as follows:
| (Dollars in millions) | ||||||||||
| Years ended December 31, | 2025 | 2024 | ||||||||
| Commercial Airplanes | $567,290 | $435,175 | ||||||||
| Defense, Space & Security | 84,786 | 64,023 | ||||||||
| Global Services | 29,720 | 21,403 | ||||||||
| Unallocated items, eliminations and other | 411 | 735 | ||||||||
| Total Backlog | $682,207 | $521,336 | ||||||||
| Contractual backlog | $639,721 | $498,802 | ||||||||
| Unobligated backlog | 42,486 | 22,534 | ||||||||
| Total Backlog | $682,207 | $521,336 | ||||||||
Contractual backlog of unfilled orders excludes purchase options, announced orders for which definitive contracts have not been executed, orders where customers have the unilateral right to terminate, and unobligated U.S. and non-U.S. government contract funding. The increase in contractual backlog during 2025 was primarily due to an increase in BCA backlog. We may experience reductions to backlog and/or significant order cancellations due to various factors including delivery delays, production disruptions and delays to entry into service of the 777X, 737-7 and/or 737-10.
Unobligated backlog includes U.S. and non-U.S. government definitive contracts for which funding has not been authorized. The increase in unobligated backlog during 2025 was due to an increase in BDS backlog.
Additional Considerations
U.S. Government Funding Considerable uncertainty exists regarding how future U.S. government budget and program decisions will unfold, including the spending priorities of the Administration and Congress.
From October 1 through November 12, 2025, funding for U.S. government departments and agencies, including the Department of War (DoW), the National Aeronautics and Space Administration (NASA), and the Department of Transportation (DOT), including the FAA, had lapsed. The Continuing Appropriations, Agriculture, Legislative Branch, Military Construction Veterans Affairs Appropriations Bill and Extensions Act, 2026, enacted November 12, 2025, largely funded the DoW, NASA and the DOT at fiscal year 2025 (FY25) appropriated levels through January 30, 2026. The Commerce, Justice Science; Energy and Water Development; and Interior and Environment Appropriations Act, 2026 (H.R. 6938), enacted January 23, 2026, funded certain federal departments and agencies, including NASA, through FY26.
After January 30, 2026, the government will enter a partial shutdown unless and until Congress and the President enact either full-year FY26 appropriations bills or an additional Continuing Resolution. We rely on the U.S. government in various aspects of our defense, commercial and services businesses. During a shutdown, requirements to furlough employees in the DoW, the DOT or other government agencies could result in payment delays, impair our ability to perform work on existing contracts or otherwise impact our operations, negatively impact future orders and/or cause other disruptions or delays that could have a material effect on our financial position, results of operations and/or cash flows.
31
Global Trade The global trade landscape is currently highly volatile. Various countries have announced plans for and/or have implemented new or modified tariffs or have eliminated tariffs previously imposed.
During 2025, the U.S. reached bilateral trade agreements that recognize tariff-free trade of products within the scope of the World Trade Organization Agreement on Trade in Civil Aircraft with countries including the United Kingdom, Japan, South Korea, Malaysia, and the European Union. As of December 31, 2025, the U.S. applies a diverse range of reciprocal tariffs to imports originating from countries that have not concluded bilateral trade agreements with the U.S. The updated reciprocal tariff rates originally announced during the second quarter of 2025 became effective on August 7, 2025. On November 1, 2025, the U.S. and China announced a bilateral trade arrangement and further extended the pause on the reciprocal and retaliatory tariffs on each other's imports until November 10, 2026. However, the current state of U.S.-China trade relations remains an ongoing watch item.
China is a significant market for commercial aircraft, and we have long-standing relationships with our Chinese customers. Overall, the U.S.-China trade relationship is challenged due to tariffs, sanctions, and export restrictions, as well as other economic and national security concerns. During 2025, certain customers in China temporarily paused accepting delivery of our aircraft in response to ongoing tariff negotiations between the U.S. and China.
In addition, as of December 31, 2025, the U.S. maintains tariffs announced during the first quarter of 2025 on goods imported from China, as well as goods imported from Canada and Mexico that are not compliant with the United States-Mexico-Canada Agreement (USMCA). We believe that the majority of our imports from Canada and Mexico are compliant with the provisions of the USMCA.
As of December 31, 2025, the U.S. also maintains new and modified tariffs on aluminum, steel, and copper imports implemented during 2025, and has announced reviews of additional sectors.
Collectively, these tariffs, and any retaliatory actions taken by countries in response to the U.S. tariffs, could have a material impact on our financial position, results of operations and/or cash flows. Our year-to-date results reflect our best estimate of the impacts of the tariffs enacted as of December 31, 2025, and certain potential mitigating actions.
We seek to comply with all U.S. and other government import requirements, export control requirements and sanctions. We continually monitor the global trade environment for new and/or changing tariffs, retaliatory actions, trade agreements, export restrictions, sanctions or other restrictions that may impact us or our supply chain or customers, and work to mitigate impacts to our business.
Supply Chain We and our suppliers are experiencing inflationary pressures, as well as supply chain disruptions as a result of global supply chain constraints and labor instability. Our supply chain is also being impacted by the tariffs and export restrictions discussed above. Certain of our suppliers are also experiencing financial difficulties. We continue to monitor the health and stability of the supply chain. These factors have reduced overall productivity and adversely impacted our financial position, results of operations and cash flows. During 2024, we recorded a reach-forward loss of $1,770 million on the T-7A Red Hawk program that was primarily driven by projected increases in supplier cost estimates. In addition, we recorded losses on the KC-46A Tanker and Commercial Crew programs that were partially attributable to higher supplier costs. We recorded a reach-forward loss on the 777X program during the third quarter of 2025 that was partially attributable to higher estimated supplier costs.
32
Segment Results of Operations and Financial Condition
Commercial Airplanes
Business Environment and Trends
Airline Industry Environment See Overview to Management’s Discussion and Analysis of Financial Condition and Results of Operations for a discussion of the airline industry environment.
Industry Competitiveness The commercial aircraft market and the airline industry both remain extremely competitive. Continued access to global markets remains vital to our ability to fully realize our sales potential and long-term investment returns. Approximately 85% of BCA’s total backlog, in dollar terms, is with non-U.S. airlines. We face aggressive international competitors who are intent on defending or increasing their market share. They offer competitive products and have access to most of the same customers and suppliers. This market environment has resulted in intense pressures on pricing and other competitive factors, and we expect these pressures to continue or intensify in the coming years.
Results of Operations
| (Dollars in millions) | |||||||||||||||
| Years ended December 31, | 2025 | 2024 | 2023 | ||||||||||||
| Revenues | $41,494 | $22,861 | $33,901 | ||||||||||||
| % of total company revenues | 46 | % | 34 | % | 44 | % | |||||||||
| Loss from operations | ($7,079) | ($7,969) | ($1,635) | ||||||||||||
| Operating margins | (17.1) | % | (34.9) | % | (4.8) | % | |||||||||
| Research and development | $2,202 | $2,386 | $2,036 | ||||||||||||
Revenues
BCA revenues increased by $18,633 million in 2025 compared with 2024 primarily due to higher deliveries across all programs and the absence of $443 million of 737-9 customer considerations related to the January 2024 grounding.
BCA revenues decreased by $11,040 million in 2024 compared with 2023 primarily due to lower deliveries across all programs and 737-9 customer considerations.
33
BCA deliveries, including intercompany deliveries, as of December 31 were as follows:
| 737 | * | 747 | 767 | * | 777 | 787 | Total | |||||||||||||||||||||||||
| 2025 | ||||||||||||||||||||||||||||||||
| Cumulative deliveries | 9,240 | 1,573 | 1,351 | 1,776 | 1,249 | |||||||||||||||||||||||||||
| Deliveries | 447 | (7) | 30 | (15) | 35 | 88 | 600 | |||||||||||||||||||||||||
| 2024 | ||||||||||||||||||||||||||||||||
| Cumulative deliveries | 8,793 | 1,573 | 1,321 | 1,741 | 1,161 | |||||||||||||||||||||||||||
| Deliveries | 265 | (5) | 18 | (8) | 14 | 51 | 348 | |||||||||||||||||||||||||
| 2023 | ||||||||||||||||||||||||||||||||
| Cumulative deliveries | 8,528 | 1,573 | 1,303 | 1,727 | 1,110 | |||||||||||||||||||||||||||
| Deliveries | 396 | (9) | 1 | 32 | (14) | 26 | 73 | 528 | ||||||||||||||||||||||||
* Intercompany deliveries identified by parentheses
Loss From Operations
BCA loss from operations was $7,079 million in 2025 compared with $7,969 million in 2024 reflecting higher deliveries across all programs, the absence of 737-9 customer considerations related to the January 2024 grounding, lower abnormal production costs, and lower research and development costs, partially offset by higher combined reach-forward losses of $5,283 million on the 777X and 767 programs in 2025 and lower program margins.
BCA loss from operations was $7,969 million in 2024 compared with $1,635 million in 2023 reflecting reach-forward losses of $4,079 million on the 777X and 767 programs in 2024, $443 million of 737-9 customer considerations related to the January 2024 grounding, lower deliveries, lower margins driven by production disruption including the IAM 751 work stoppage and new agreement, and higher research and development expense, partially offset by $1,271 million of lower abnormal production costs.
Backlog
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-05-20 | TILDEN BRADLEY D | Director | Buy | +1,370 | $218.50 | $299,345 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-07-28 10-Q expected by 2026-08-11 (in 52 days)
- ~2026-10-28 10-Q expected by 2026-11-11 (in 144 days)
- ~2027-01-29 10-K expected by 2027-03-02 (in 237 days)
- ~2027-04-21 10-Q expected by 2027-05-05 (in 319 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-04-22 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-22 10-Q Quarterly Report
- 2026-01-30 10-K Annual Report
- 2026-01-27 8-K Earnings Release; Financial Statements and Exhibits
- 2025-12-03 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-10-29 10-Q Quarterly Report
- 2025-10-29 8-K Earnings Release; Financial Statements and Exhibits
- 2025-08-28 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
- 2025-07-29 10-Q Quarterly Report
- 2025-07-29 8-K Earnings Release; Financial Statements and Exhibits
- 2025-07-03 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-06-04 8-K Material Agreement Entered; Financial Statements and Exhibits
- 2025-04-24 8-K Material Agreement Entered; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-04-23 10-Q Quarterly Report
- 2025-04-23 8-K Earnings Release; Financial Statements and Exhibits