The Boeing Company (NYSE: BA)

Boeing (NYSE:BA) | Products & Business Segments

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The Boeing Company, together with its subsidiaries, is one of the world's largest aerospace companies and a leading manufacturer of commercial jet aircraft and defense, space and security systems. The company supports airlines and U.S. and allied government customers in 150 countries. Boeing's products and services include commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, advanced information and communication systems, as well as performance-based logistics and training. In 1916, Boeing was incorporated in Seattle by William Boeing (as Pacific Aero Products Co.) but renamed the Boeing Airplane Co. the following year. Today, the company is incorporated in Delaware with corporate offices located in Chicago.

Boeing operates in five principal business segments:

 

Commercial Airplanes
Boeing Defense, Space & Security (BDS)
      Boeing Military Aircraft (BMA)
      Network & Space Systems (N&SS)
      Global Services & Support (GS&S)
Boeing Capital Corporation (BCC)
• Other.



The following table highlights Boeing's sales from 2014 to 2016 by segment:
Boeing's Segment Sales


Boeing Commercial Airplanes (BCA)

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Boeing Commercial Airplanes (BCA) develops, produces and markets commercial jet aircraft and provides related support services, principally to the commercial airline industry worldwide. Boeing is a leading producer of commercial aircraft and offers a family of commercial jetliners designed to meet a broad spectrum of passenger and cargo requirements of domestic and non-U.S. airlines. This family of commercial jet aircraft in production includes the 737 narrow-body model and the 747, 767, 777 and 787 wide-body models. In November 2013, Boeing launched the 777X, which features a new composite wing, new engines and folding wing-tips all designed to deliver greater efficiency and significant fuel savings. Development continues on the 787-10 and 737 MAX derivatives and the 777X program. BCA also offers aviation services support, aircraft modifications, spares, training, maintenance documents and technical advice to commercial and government customers worldwide.

BCA's primary commercial airplane manufacturing and assembly locations are Everett and Renton in Washington State and Charleston, South Carolina. At Everett, Boeing assembles the company's wide-body aircraft families: 747-8, 767, 777 and 787. At Renton, Boeing assembles its 737NG Family of narrow-body aircraft. Boeing South Carolina is home to the company's second 787 Dreamliner final assembly and delivery facility.

     Financial results for Boeing's Commercial Airplanes segment were as follows:
Performance of Boeing's principal lines of business

BCA revenues decreased by $979 million or 1% in 2016 compared with 2015 primarily due to lower deliveries. Revenues increased by $6,058 million or 10% in 2015 compared with 2014 primarily due to higher new airplane deliveries and mix.

Earnings from operations in 2016 decreased by $2,027 million compared with the same period in 2015. The decrease in earnings and operating margins is primarily due to higher research and development costs of $1,415 million, delivery mix and higher reach-forward losses on the 747 program of $1,258 million compared with $885 million in 2015. Research and development expense in 2016 reflect the reclassification from inventory to research and development expense of $1,235 million related to the fourth and fifth 787 flight test aircraft and higher planned spending related to the 777X program. Earnings include reach-forward losses related to the KC-46A Tanker of $772 million recorded in 2016 compared with $513 million in 2015.

     Deliveries of commercial aircraft by model: Boeing - deliveries of commercial aircraft


Boeing Defense, Space & Security (BDS)

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The BDS operations principally involve research, development, production, modification and support of the following products and related systems: global strike systems, including fighters, bombers, combat rotorcraft systems, weapons and unmanned systems; global mobility systems, including transport and tanker aircraft, rotorcraft transport and tilt-rotor systems; airborne surveillance and reconnaissance aircraft, including command and control, battle management and airborne anti-submarine aircraft; network and tactical systems, including information and battle management systems; intelligence and security systems; missile defense systems; space and intelligence systems, including satellites and commercial satellite launching vehicles; and space exploration. BDS focuses on providing affordable, best-of-industry solutions and brings value to customers through its ability to solve the most complex problems utilizing expertise in large-scale systems integration, knowledge of legacy platforms and development of common network-enabled solutions across all customers' domains.

BDS consists of three capabilities-driven businesses: Boeing Military Aircraft (BMA), Network & Space Systems (N&SS), and Global Services & Support (GS&S). Additionally, the Phantom Works group is an integrated team that works with the three businesses via product development, rapid prototyping and customer engagement through experimentation and enterprise technology investment strategies.

     Financial results for Boeing's BDS segment were as follows:
Performance of Boeing's principal lines of business

BDS revenues in 2016 decreased by $890 million compared with the same period in 2015 due to lower revenues of $909 million and $705 million in the BMA and N&SS segments, partially offset by higher revenues of $724 million in the GS&S segment.

BDS earnings from operations in 2016 decreased by $266 million compared with the same period in 2015 due to lower earnings of $233 million and $80 million in the N&SS and BMA segments, partially offset by higher earnings of $47 million in the GS&S segment. Included above are net unfavorable cumulative contract catch-up adjustments, which were $429 million higher in 2016 compared with 2015, primarily reflecting the absence of favorable F-15 program adjustments recorded in 2015 and the charge of $162 million on the Commercial Crew program recorded at N&SS during 2016.

During 2016, 2015 and 2014, BDS earnings from operations include reach-forward losses of $356 million, $322 million and $187 million on the KC-46A Tanker program.



Boeing Military Aircraft


Boeing Military Aircraft (BMA) is engaged in the research, development, production and modification of manned and unmanned military weapons systems for the global strike, mobility and surveillance and engagement markets as well as related services. The major programs in this segment include for global strike: EA-18G Growler Airborne Electronic Attack Aircraft, F/A-18E/F Super Hornet, F-15 Strike Eagle, and Joint Direct Attack Munition; for vertical lift: AH-64 Apache, CH-47 Chinook, and V-22 Osprey; for unmanned airborne systems programs: Insitu ScanEagle and RQ-21 Blackjack (formerly called the Integrator); and for mobility, surveillance and engagement: Airborne Early Warning and Control (AEW&C), P-8A Poseidon, and KC-46 Tanker.

Boeing ceased production of the C-17 Globemaster III in late 2015. During 2011, BMA production deliveries concluded on the F-22 Raptor and KC-767 International Tanker programs.

Financial results for BDS' BMA group were as follows:
Performance of Boeing's principal lines of business

BMA revenues in 2016 decreased by $909 million compared with 2015 primarily due to lower revenues of $973 million related to fewer C-17 deliveries and timing and mix of deliveries on the CH-47 Chinook and F/A-18 programs.

BMA earnings from operations in 2016 decreased by $80 million compared with 2015 primarily due to lower volume and mix on the CH-47 Chinook, and C-17, partially offset by higher volume and mix on the Apache and P-8 programs. BMA recorded charges of $356 million in 2016 compared with $322 million in 2015 related to the USAF KC-46A Tanker contract. Net unfavorable cumulative contract catch-up adjustments were $253 million higher in 2016 than in 2015 primarily driven by the absence of favorable F-15 program adjustments recorded in 2015 and higher USAF KC-46A Tanker charges recorded in 2016.

     Deliveries of new-build production aircraft, excluding remanufactures and modifications: Boeing - deliveries of military aircraft



Network & Space Systems


The Network & Space Systems (N&SS) segment is engaged in the research, development, production and modification of the following products and related services: electronics and information solutions, including command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR), cyber and information solutions, and intelligence systems; strategic missile and defense systems; space and intelligence systems, including satellites and commercial satellite launch vehicles; and space exploration.

The major programs in this segment include for strategic missile and defense systems: Ground-based Midcourse Defense (GMD); for space and intelligence systems: commercial, civil and military satellites, including the Global Positioning System (GPS) and Wideband Global SATCOM system; and for space exploration: Space Launch System (SLS), Commercial Crew program, and International Space Station (ISS).

During 2011, the Brigade Combat Team Modernization (BCTM) and Space Shuttle programs concluded.

This segment also includes Boeing's joint venture operations related to United Launch Alliance (ULA) and United Space Alliance (USA).

     Financial results for BDS' N&SS group were as follows:
Performance of Boeing's principal lines of business

N&SS revenues in 2016 decreased by $705 million compared with 2015 primarily due to lower revenue of $838 million related to the Commercial Crew program, lower milestone revenue on government satellite programs, and lower volume on proprietary programs. These decreases were partially offset by higher volume on the SLS program.

N&SS earnings from operations in 2016 decreased by $233 million compared with 2015 primarily due to a charge of $162 million during the third quarter of 2016 and lower volume on the Commercial Crew program. Net unfavorable cumulative contract catch-up adjustments were $186 million higher in 2016 than 2015 primarily reflecting the charge on the Commercial Crew program during 2016. These decreases were partially offset by higher equity earnings.

N&SS earnings from operations include equity earnings of $255 million, $183 million and $211 million primarily from Boeing's ULA joint venture in 2016, 2015 and 2014, respectively.

     Boeing Satellite deliveries were as follows: Boeing - deliveries of satellites and launch vehicles



Global Services & Support


Global Services & Support (GS&S) provides customers with mission readiness through total support solutions. Boeing's global services business sustains aircraft and systems with a full spectrum of products and services through integrated logistics, including supply chain management and engineering support; maintenance, modification and upgrades for aircraft; and training systems and government services, including pilot and maintenance training. GS&S international operations include Boeing Defence U.K. Ltd., and Boeing Defence Australia, as well as Alsalam Aircraft Company, Aviation Training International, and Boeing Sikorsky International Services, joint ventures.

Integrated logistics comprises an integrated array of services that address the complete life cycle of aircraft and systems. Major programs include the F/A-18E/F support program and domestic and international performance based logistic programs for the AH-64, CH-47 and other BDS platforms.

Maintenance, modification and upgrades for aircraft are performed at centers throughout the United States and around the world, providing rapid cycle time and aircraft services for military customers on a wide variety of BDS and non-BDS platforms. Major support programs include the C-17 Globemaster III Integrated Sustainment Program and F-15 support programs for the United States Air Force (USAF) and several international customers. Aircraft programs include the Airborne Early Warning and Control (AEW&C) Peace Eagle contract with Turkey and the Airborne Warning and Control Systems (AWACS) program.

Training systems and government services comprise a full range of training capabilities for domestic and international customers, including the design and development of trainers for multiple aircraft platforms and logistics and asset management solutions.

     Financial results for BDS' GS&S group were as follows:
Performance of Boeing's principal lines of business

GS&S revenues in 2016 increased by $724 million compared with the same period in 2015 primarily due to higher volume in several Aircraft Modernization & Sustainment (AM&S), Training Systems & Government Services (TSGS), and Integrated Logistics (IL) programs.

GS&S earnings from operations in 2016 increased by $47 million compared with the same period in 2015 primarily due to higher volume and mix across the segment partially offset by lower performance. The impact of cumulative contract catch-up adjustments was not significant in 2016.




Boeing Capital Corporation Segment

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In the commercial aircraft market, BCC facilitates, arranges, structures and provides selective financing solutions for Boeing's Commercial Airplanes customers. In the space and defense markets, BCC primarily arranges and structures financing solutions for Boeing's BDS government customers. BCC's portfolio consists of equipment under operating leases, finance leases, notes and other receivables, assets held for sale or re-lease and investments.

BCC provided customer financing of $1,376 million, $586 million, $489 million and $220 million during 2016, 2015, 2014 and 2013, respectively. BCC's customer financing and investment portfolio at December 31, 2016 totaled $4,115 million.

Company Information

Revenues ('16): $94,571M -1.6%

R&D ('16): $4,627M +38.9%

Net Profit ('16): $4,895M -5.4%

CAPEX ('16): $2,613M +6.7%

Boeing - OEM

Products News Subsidiaries Acquisitions Competitors Customers R&D Spending 5-Year Financials

Aerospace Sector:

   

Major Diversified OEM

Boeing Products:


Commercial wide-body jet aircraft; Commercial narrow-body jet aircraft; Commercial jet transport aircraft; Commercial aircraft financing solutions; Fighter and attack aircraft; Bombers; Military transport and tanker aircraft; Military rotorcraft and tilt-rotor aircraft; Airborne surveillance and reconnaissance aircraft; Airborne command and control aircraft; Naval warfare aircraft; UAVs/UAS; Air-to-ground missiles (AGM); Smart bombs; Smart bomb kits; Missile defense systems; Network and tactical systems; Battle management systems; Intelligence and security systems; Space and intelligence systems; Satellites; Satellite launch vehicles; Space exploration services.

Boeing's Major U.S. Defense Programs:


| A-10 | DoD Prime ContractorAH-64 | DoD Prime ContractorAV-8B | DoD Prime ContractorB-1B | DoD Prime ContractorB-52 | DoD Prime ContractorC-17 | DoD Prime ContractorC-40 | DoD Prime ContractorCH-47 | DoD Prime ContractorE-3 |
| DoD Prime ContractorE-4B | DoD Prime ContractorE-6B | DoD Prime ContractorEELV | DoD Prime ContractorF-15 | DoD Prime ContractorF/A-18E/F | DoD Prime ContractorEA-18G |
| DoD Prime ContractorF-22 Raptor | DoD Prime ContractorGMD | GPS | DoD Prime ContractorHellfire | DoD Prime ContractorKC-10 | DoD Prime ContractorKC-46 | DoD Prime ContractorJDAM | DoD Prime ContractorJTRS |
| DoD Prime ContractorP-8A Poseidon | DoD Prime ContractorRQ-21 | DoD Prime ContractorSmall Diameter Bomb | DoD Prime ContractorV-22 Osprey | DoD Prime ContractorVC-25 |
| DoD Prime ContractorWGS |

Boeing's Commercial Programs:


| Boeing: 737NG, 737 MAX (dev.), 747-8, 767, 777, 777X (dev.), 787 |

Sales 2012-2016 Net Income 2012-2016 R&D Spending 2012-2016 # Employees 2012-2016

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