Boeing Eyes $19B Cash Boost Amid Financial Pressures

WASHINGTON — Boeing is taking critical steps to address its liquidity challenges amid a contentious strike. The aerospace giant plans to raise approximately $19 billion through a stock offering.

On Monday, Boeing Co. announced it will issue 90 million shares of common stock along with $5 billion in depositary shares. The company’s stock closed at $155.01 last Friday, reflecting investor sentiment in the company amidst these turbulent times.

The proceeds from the stock offering are earmarked for general corporate purposes, potentially including debt repayment, working capital enhancements, capital expenditures, and investments in its subsidiaries.

The urgency for cash comes as Boeing faces extended disruptions. The company’s factory workers recently voted against the latest contract offer, choosing to continue a six-week strike that has suspended the production of its most popular jetliners.

Local union representatives in Seattle reported that 64% of the International Association of Machinists and Aerospace Workers members who voted opposed the proposal. This labor standoff adds to an already difficult year for Boeing, which has recently been scrutinized by federal investigators following an incident in January where a door panel detached from a 737 Max during an Alaska Airlines flight.

The ongoing strike has exacerbated Boeing’s financial woes, significantly cutting off revenue from new aircraft deliveries. The company revealed a staggering third-quarter loss exceeding $6 billion, marking its second-worst quarterly performance in history. Since 2018, Boeing has struggled to return to profitability.

Boeing’s financial struggles have led to a cash burn of nearly $2 billion this past quarter, further straining its balance sheet, which carries $58 billion in debt. Chief Financial Officer Brian West indicated that the company does not anticipate positive cash flow until the latter half of next year.

In response to these developments, Boeing’s shares slipped by nearly 2% ahead of market opening. The challenges ahead are significant, as the company navigates both labor disputes and its financial recovery.