Boeing posts first profit in almost two years, propelled by 737 MAX deliveries

(Reuters) -Boeing Co on Wednesday posted its first quarterly profit in almost two years, as deliveries of its best-selling 737 MAX jets to airlines gained traction amid a sharp rebound in travel bookings following an increase in global COVID-19 vaccinations.

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The 737 MAX is integral to Boeing’s financial recovery, as the U.S. planemaker scrambles to recoup billions of dollars in lost sales from the pandemic, and deals with production-related structural defects of its bigger, more profitable 787 planes.

Boeing shares were up 3.8% in premarket trading following the results.

Chief Executive Officer David Calhoun said the company now plans to keep staffing levels stable at around 140,000 employees, after previously targeting a reduction to 130,000 by the end of 2021.

“While our commercial market environment is improving, we’re closely monitoring COVID-19 case rates, vaccine distribution and global trade as key indicators for our industry’s stability,” Boeing Chief Executive Dave Calhoun said in remarks accompanying results.

While he sounded a note of optimism, Boeing’s recovery has been hobbled by low levels of international travel and tensions between Washington and Beijing.

It is also grappling with costly repairs and forensic inspections due to production-related structural defects on its 787 program. It said earlier this month it would cut 787 production after finding a new issue, first reported by Reuters, and would deliver fewer than half of the lingering 100 or so 787 Dreamliners in its inventory this year – instead of the “vast majority” it had expected.

Boeing said it is building 16 737 MAX jets per month at its Seattle-area factory. The company has said it would lift the jet’s output to 31 a month by early 2022.

Boeing’s core operating profit was $755 million in the second quarter ended June 30, compared with a loss of $3.32 billion a year earlier.

Revenue rose 44% to about $17 billion.

Analysts had on average expected Boeing to report a quarterly loss of $454.8 million on revenue of $16.54 billion, according to IBES data from Refinitiv.

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