Boeing Co., the world's No. 2 commercial airplane maker, said Wednesday its third-quarter earnings plummeted 38 percent as a strike and supplier production problems hurt results. Its shares fell nearly 5 percent in morning trading.
The Chicago-based aerospace company said it earned $695 million, or 96 cents per share in the quarter, down from $1.11 billion, or $1.44 per share, a year earlier. The strike and production problems reduced Boeing's airplane deliveries, cutting profit by 60 cents per share during the period.
Quarterly revenue dipped 7 percent to $15.29 billion.
Analysts polled by Thomson Reuters, on average, expected earnings per share of 98 cents on revenue of $14.61 billion. Analyst estimates typically exclude one-time items.
Boeing shut down its commercial aircraft production facilities in September when about 27,000 workers from its Machinists' union went on strike after talks over a new labor contract failed.
Delivery of some aircraft was delayed by the strike and problems getting galleys from suppliers for certain wide-body planes.
Without the strike, Boeing would have delivered 119 planes during the quarter, but ended up with a total of 84 deliveries, or 35 fewer than planned.
Boeing said it will provide updated financial guidance and information about the schedule for its affected airplanes after the strike ends.
"While the suspension of commercial airplane deliveries had a major impact on the quarter, we effectively executed the remainder of our business and kept our focus on the strong balance sheet we have built over the past few years," Jim McNerney Boeing's chairman, president and chief executive, said in a statement.
Demand for new, fuel-efficient commercial planes remains strong and exceeds supply, the company said.
Boeing's new 787 passenger jet, which has been hampered by lengthy production delays, has been touted for its promise of greater fuel efficiency due to its construction from lightweight carbon-fiber composite parts.
Work on the plane progressed during the quarter, Boeing said, with a successful hydraulic system test, landing gear test and pressurization test of the static airframe. The company also began testing the flight controls and started final assembly of its fourth flight-test plane. Fifty-eight customers have ordered 895 of the planes to date.
Boeing said it may need to finance some airplane deliveries beginning in 2009, the first such financing since 2006, but declined to specify the deliveries.
Boeing has made backstop financing commitments for 3 percent of its commercial airplane backlog, mostly for 787s, related to deliveries through the end of the next decade, the companies said.
Shares of Boeing slid $2.20, or 4.8 percent, to $44.20 in morning trading on Wednesday.