ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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THE BOEING COMPANY
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Delaware
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91-0425694
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer Identification No.)
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100 N. Riverside Plaza, Chicago, IL
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60606-1596
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(Address of principal executive offices)
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(Zip Code)
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(312) 544-2000
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Part I. Financial Information (Unaudited)
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Page
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Part II. Other Information
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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(Dollars in millions, except per share data)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Sales of products
|
|
$64,848
|
|
|
|
$61,667
|
|
|
|
$22,463
|
|
|
|
$21,782
|
|
Sales of services
|
7,938
|
|
|
7,568
|
|
|
2,683
|
|
|
2,441
|
|
||||
Total revenues
|
72,786
|
|
|
69,235
|
|
|
25,146
|
|
|
24,223
|
|
||||
|
|
|
|
|
|
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|
|
|
|
|||||
Cost of products
|
(53,134
|
)
|
|
(50,936
|
)
|
|
(18,882
|
)
|
|
(18,050
|
)
|
||||
Cost of services
|
(6,215
|
)
|
|
(5,742
|
)
|
|
(2,140
|
)
|
|
(1,879
|
)
|
||||
Boeing Capital interest expense
|
(51
|
)
|
|
(53
|
)
|
|
(18
|
)
|
|
(27
|
)
|
||||
Total costs and expenses
|
(59,400
|
)
|
|
(56,731
|
)
|
|
(21,040
|
)
|
|
(19,956
|
)
|
||||
|
13,386
|
|
|
12,504
|
|
|
4,106
|
|
|
4,267
|
|
||||
Income from operating investments, net
|
112
|
|
|
169
|
|
|
32
|
|
|
49
|
|
||||
General and administrative expense
|
(3,345
|
)
|
|
(2,890
|
)
|
|
(1,154
|
)
|
|
(918
|
)
|
||||
Research and development expense, net
|
(2,417
|
)
|
|
(2,417
|
)
|
|
(826
|
)
|
|
(768
|
)
|
||||
Gain on dispositions, net
|
76
|
|
|
|
|
|
69
|
|
|
|
|
||||
Earnings from operations
|
7,812
|
|
|
7,366
|
|
|
2,227
|
|
|
2,630
|
|
||||
Other income, net
|
63
|
|
|
91
|
|
|
12
|
|
|
40
|
|
||||
Interest and debt expense
|
(317
|
)
|
|
(267
|
)
|
|
(106
|
)
|
|
(87
|
)
|
||||
Earnings before income taxes
|
7,558
|
|
|
7,190
|
|
|
2,133
|
|
|
2,583
|
|
||||
Income tax (expense)/benefit
|
(522
|
)
|
|
(2,052
|
)
|
|
230
|
|
|
(773
|
)
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
|
|
|
|
|
|
|
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||||||||
Basic earnings per share
|
|
$12.08
|
|
|
|
$8.49
|
|
|
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$4.11
|
|
|
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$3.03
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share
|
|
$11.95
|
|
|
|
$8.39
|
|
|
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$4.07
|
|
|
|
$2.99
|
|
|
|
|
|
|
|
|
|
||||||||
Cash dividends paid per share
|
|
$5.13
|
|
|
|
$4.26
|
|
|
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$1.71
|
|
|
|
$1.42
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average diluted shares (millions)
|
588.9
|
|
|
612.8
|
|
|
580.8
|
|
|
606.3
|
|
(Dollars in millions)
|
Nine months ended September 30
|
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Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|
||||||||
Currency translation adjustments
|
(55
|
)
|
|
121
|
|
|
2
|
|
|
44
|
|
||||
Unrealized gain/(loss) on certain investments, net of tax of ($1), $0, $0 and $0
|
3
|
|
|
|
|
|
|
|
|
||||||
Unrealized (loss)/gain on derivative instruments:
|
|
|
|
|
|
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Unrealized (loss)/gain arising during period, net of tax of $27, ($61), $1 and ($22)
|
(97
|
)
|
|
111
|
|
|
(4
|
)
|
|
40
|
|
||||
Reclassification adjustment for losses included in net earnings, net of tax of ($5), ($24), ($3) and ($5)
|
19
|
|
|
44
|
|
|
9
|
|
|
10
|
|
||||
Total unrealized (loss)/gain on derivative instruments, net of tax
|
(78
|
)
|
|
155
|
|
|
5
|
|
|
50
|
|
||||
Defined benefit pension plans and other postretirement benefits:
|
|
|
|
|
|
|
|
||||||||
Amortization of prior service credits included in net periodic pension cost, net of tax of $30, $47, $10 and $16
|
(106
|
)
|
|
(84
|
)
|
|
(35
|
)
|
|
(27
|
)
|
||||
Net actuarial gain arising during the period, net of tax of $0, ($1), $0 and $0
|
1
|
|
|
3
|
|
|
|
|
|
||||||
Amortization of actuarial losses included in net periodic pension cost, net of tax of ($182), ($217), ($60) and ($72)
|
657
|
|
|
394
|
|
|
219
|
|
|
131
|
|
||||
Settlements and curtailments included in net income, net of tax of ($3), $0, $0 and $0
|
6
|
|
|
|
|
|
|
|
|||||||
Pension and postretirement cost related to our equity method investments, net of tax of $1, $1, $0 and $0
|
(4
|
)
|
|
(2
|
)
|
|
(1
|
)
|
|
|
|||||
Total defined benefit pension plans and other postretirement benefits, net of tax
|
554
|
|
|
311
|
|
|
183
|
|
|
104
|
|
||||
Other comprehensive income, net of tax
|
424
|
|
|
587
|
|
|
190
|
|
|
198
|
|
||||
Comprehensive income related to noncontrolling interests
|
(12
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
|
|||||
Comprehensive income, net of tax
|
|
$7,448
|
|
|
|
$5,724
|
|
|
|
$2,551
|
|
|
|
$2,008
|
|
(Dollars in millions, except per share data)
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
|
$8,034
|
|
|
|
$8,813
|
|
Short-term and other investments
|
1,956
|
|
|
1,179
|
|
||
Accounts receivable, net
|
2,893
|
|
|
2,894
|
|
||
Unbilled receivables, net
|
9,936
|
|
|
8,194
|
|
||
Current portion of customer financing, net
|
431
|
|
|
309
|
|
||
Inventories
|
62,038
|
|
|
61,388
|
|
||
Other current assets
|
2,398
|
|
|
2,417
|
|
||
Total current assets
|
87,686
|
|
|
85,194
|
|
||
Customer financing, net
|
2,785
|
|
|
2,756
|
|
||
Property, plant and equipment, net of accumulated depreciation of $18,328 and $17,641
|
12,571
|
|
|
12,672
|
|
||
Goodwill
|
5,722
|
|
|
5,559
|
|
||
Acquired intangible assets, net
|
2,530
|
|
|
2,573
|
|
||
Deferred income taxes
|
323
|
|
|
321
|
|
||
Investments
|
1,190
|
|
|
1,260
|
|
||
Other assets, net of accumulated amortization of $466 and $482
|
1,852
|
|
|
2,027
|
|
||
Total assets
|
|
$114,659
|
|
|
|
$112,362
|
|
Liabilities and equity
|
|
|
|
||||
Accounts payable
|
|
$13,663
|
|
|
|
$12,202
|
|
Accrued liabilities
|
12,869
|
|
|
13,069
|
|
||
Advances and progress billings
|
51,496
|
|
|
48,042
|
|
||
Short-term debt and current portion of long-term debt
|
1,389
|
|
|
1,335
|
|
||
Total current liabilities
|
79,417
|
|
|
74,648
|
|
||
Deferred income taxes
|
1,738
|
|
|
2,188
|
|
||
Accrued retiree health care
|
5,394
|
|
|
5,545
|
|
||
Accrued pension plan liability, net
|
15,927
|
|
|
16,471
|
|
||
Other long-term liabilities
|
2,905
|
|
|
2,015
|
|
||
Long-term debt
|
10,487
|
|
|
9,782
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Common stock, par value $5.00 – 1,200,000,000 shares authorized; 1,012,261,159 shares issued
|
5,061
|
|
|
5,061
|
|
||
Additional paid-in capital
|
6,714
|
|
|
6,804
|
|
||
Treasury stock, at cost - 443,262,126 and 421,222,326 shares
|
(51,781
|
)
|
|
(43,454
|
)
|
||
Retained earnings
|
54,666
|
|
|
49,618
|
|
||
Accumulated other comprehensive loss
|
(15,949
|
)
|
|
(16,373
|
)
|
||
Total shareholders’ equity
|
(1,289
|
)
|
|
1,656
|
|
||
Noncontrolling interests
|
80
|
|
|
57
|
|
||
Total equity
|
(1,209
|
)
|
|
1,713
|
|
||
Total liabilities and equity
|
|
$114,659
|
|
|
|
$112,362
|
|
(Dollars in millions)
|
Nine months ended September 30
|
||||||
|
2018
|
|
|
2017
|
|
||
Cash flows – operating activities:
|
|
|
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
||||
Non-cash items –
|
|
|
|
||||
Share-based plans expense
|
150
|
|
|
151
|
|
||
Depreciation and amortization
|
1,531
|
|
|
1,470
|
|
||
Investment/asset impairment charges, net
|
63
|
|
|
75
|
|
||
Customer financing valuation (benefit)/expense
|
(3
|
)
|
|
4
|
|
||
Gain on dispositions, net
|
(76
|
)
|
|
|
|
||
Other charges and credits, net
|
158
|
|
|
196
|
|
||
Changes in assets and liabilities –
|
|
|
|
||||
Accounts receivable
|
10
|
|
|
(558
|
)
|
||
Unbilled receivables
|
(1,732
|
)
|
|
(1,805
|
)
|
||
Advances and progress billings
|
3,457
|
|
|
4,714
|
|
||
Inventories
|
(173
|
)
|
|
(800
|
)
|
||
Other current assets
|
(5
|
)
|
|
(337
|
)
|
||
Accounts payable
|
1,181
|
|
|
780
|
|
||
Accrued liabilities
|
890
|
|
|
(102
|
)
|
||
Income taxes receivable, payable and deferred
|
(252
|
)
|
|
1,507
|
|
||
Other long-term liabilities
|
1
|
|
|
25
|
|
||
Pension and other postretirement plans
|
(89
|
)
|
|
(550
|
)
|
||
Customer financing, net
|
(175
|
)
|
|
634
|
|
||
Other
|
403
|
|
|
(99
|
)
|
||
Net cash provided by operating activities
|
12,375
|
|
|
10,443
|
|
||
Cash flows – investing activities:
|
|
|
|
||||
Property, plant and equipment additions
|
(1,227
|
)
|
|
(1,304
|
)
|
||
Property, plant and equipment reductions
|
117
|
|
|
30
|
|
||
Acquisitions, net of cash acquired
|
(250
|
)
|
|
|
|
||
Contributions to investments
|
(2,145
|
)
|
|
(2,815
|
)
|
||
Proceeds from investments
|
1,369
|
|
|
2,612
|
|
||
Purchase of distribution rights
|
(56
|
)
|
|
(131
|
)
|
||
Other
|
(5
|
)
|
|
7
|
|
||
Net cash used by investing activities
|
(2,197
|
)
|
|
(1,601
|
)
|
||
Cash flows – financing activities:
|
|
|
|
||||
New borrowings
|
4,696
|
|
|
876
|
|
||
Debt repayments
|
(4,029
|
)
|
|
(83
|
)
|
||
Contributions from noncontrolling interests
|
35
|
|
|
|
|
||
Stock options exercised
|
70
|
|
|
291
|
|
||
Employee taxes on certain share-based payment arrangements
|
(247
|
)
|
|
(118
|
)
|
||
Common shares repurchased
|
(8,415
|
)
|
|
(7,500
|
)
|
||
Dividends paid
|
(2,976
|
)
|
|
(2,575
|
)
|
||
Net cash used by financing activities
|
(10,866
|
)
|
|
(9,109
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents, including restricted
|
(37
|
)
|
|
73
|
|
||
Net decrease in cash & cash equivalents, including restricted
|
(725
|
)
|
|
(194
|
)
|
||
Cash & cash equivalents, including restricted, at beginning of year
|
8,887
|
|
|
8,869
|
|
||
Cash & cash equivalents, including restricted, at end of period
|
8,162
|
|
|
8,675
|
|
||
Less restricted cash & cash equivalents, included in Investments
|
128
|
|
|
106
|
|
||
Cash and cash equivalents at end of period
|
|
$8,034
|
|
|
|
$8,569
|
|
|
Boeing shareholders
|
|
|
||||||||||||||||||
(Dollars in millions, except per share data)
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury Stock
|
|
Retained
Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Non-
controlling
Interests
|
|
Total
|
|
|||||||
Balance at January 1, 2017
|
|
$5,061
|
|
|
$4,762
|
|
|
($36,097
|
)
|
|
$41,754
|
|
|
($13,623
|
)
|
|
$60
|
|
|
$1,917
|
|
Net earnings
|
|
|
|
5,138
|
|
|
(1
|
)
|
5,137
|
|
|||||||||||
Other comprehensive loss, net of tax of ($255)
|
|
|
|
|
587
|
|
|
587
|
|
||||||||||||
Share-based compensation and related dividend equivalents
|
|
168
|
|
|
(18
|
)
|
|
|
150
|
|
|||||||||||
Treasury shares issued for stock options exercised, net
|
|
(80
|
)
|
370
|
|
|
|
|
290
|
|
|||||||||||
Treasury shares issued for other share-based plans, net
|
|
(178
|
)
|
64
|
|
|
|
|
(114
|
)
|
|||||||||||
Treasury shares contributed to pension plans
|
|
2,082
|
|
1,418
|
|
|
|
|
3,500
|
|
|||||||||||
Common shares repurchased
|
|
|
(7,500
|
)
|
|
|
|
(7,500
|
)
|
||||||||||||
Cash dividends declared ($2.84 per share)
|
|
|
|
(1,709
|
)
|
|
|
(1,709
|
)
|
||||||||||||
Balance at September 30, 2017
|
|
$5,061
|
|
|
$6,754
|
|
|
($41,745
|
)
|
|
$45,165
|
|
|
($13,036
|
)
|
|
$59
|
|
|
$2,258
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at January 1, 2018
|
|
$5,061
|
|
|
$6,804
|
|
|
($43,454
|
)
|
|
$49,618
|
|
|
($16,373
|
)
|
|
$57
|
|
|
$1,713
|
|
Net earnings
|
|
|
|
7,036
|
|
|
(12
|
)
|
7,024
|
|
|||||||||||
Other comprehensive income, net of tax of ($133)
|
|
|
|
|
424
|
|
|
424
|
|
||||||||||||
Share-based compensation and related dividend equivalents
|
|
167
|
|
|
(17
|
)
|
|
|
150
|
|
|||||||||||
Treasury shares issued for stock options exercised, net
|
|
(37
|
)
|
107
|
|
|
|
|
70
|
|
|||||||||||
Treasury shares issued for other share-based plans, net
|
|
(220
|
)
|
(19
|
)
|
|
|
|
(239
|
)
|
|||||||||||
Common shares repurchased
|
|
|
(8,415
|
)
|
|
|
|
(8,415
|
)
|
||||||||||||
Cash dividends declared ($3.42 per share)
|
|
|
|
(1,971
|
)
|
|
|
(1,971
|
)
|
||||||||||||
Changes in noncontrolling interests
|
|
|
|
|
|
35
|
|
35
|
|
||||||||||||
Balance at September 30, 2018
|
|
$5,061
|
|
|
$6,714
|
|
|
($51,781
|
)
|
|
$54,666
|
|
|
($15,949
|
)
|
|
$80
|
|
|
($1,209
|
)
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Commercial Airplanes
|
|
$43,409
|
|
|
|
$42,626
|
|
|
|
$15,276
|
|
|
|
$15,393
|
|
Defense, Space & Security
|
17,084
|
|
|
15,304
|
|
|
5,729
|
|
|
5,050
|
|
||||
Global Services
|
12,124
|
|
|
10,784
|
|
|
4,091
|
|
|
3,579
|
|
||||
Boeing Capital
|
214
|
|
|
234
|
|
|
77
|
|
|
70
|
|
||||
Unallocated items, eliminations and other
|
(45
|
)
|
|
287
|
|
|
(27
|
)
|
|
131
|
|
||||
Total revenues
|
|
$72,786
|
|
|
|
$69,235
|
|
|
|
$25,146
|
|
|
|
$24,223
|
|
Earnings/(loss) from operations:
|
|
|
|
|
|
|
|
||||||||
Commercial Airplanes
|
|
$5,175
|
|
|
|
$3,665
|
|
|
|
$2,023
|
|
|
|
$1,513
|
|
Defense, Space & Security
|
925
|
|
|
1,649
|
|
|
(245
|
)
|
|
486
|
|
||||
Global Services
|
1,790
|
|
|
1,687
|
|
|
543
|
|
|
495
|
|
||||
Boeing Capital
|
71
|
|
|
87
|
|
|
27
|
|
|
23
|
|
||||
Segment operating profit
|
7,961
|
|
|
7,088
|
|
|
2,348
|
|
|
2,517
|
|
||||
Unallocated items, eliminations and other
|
(1,168
|
)
|
|
(771
|
)
|
|
(458
|
)
|
|
(233
|
)
|
||||
FAS/CAS service cost adjustment
|
1,019
|
|
|
1,049
|
|
|
337
|
|
|
346
|
|
||||
Earnings from operations
|
7,812
|
|
|
7,366
|
|
|
2,227
|
|
|
2,630
|
|
||||
Other income, net
|
63
|
|
|
91
|
|
|
12
|
|
|
40
|
|
||||
Interest and debt expense
|
(317
|
)
|
|
(267
|
)
|
|
(106
|
)
|
|
(87
|
)
|
||||
Earnings before income taxes
|
7,558
|
|
|
7,190
|
|
|
2,133
|
|
|
2,583
|
|
||||
Income tax (expense)/benefit
|
(522
|
)
|
|
(2,052
|
)
|
|
230
|
|
|
(773
|
)
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
|
Nine months ended September 30, 2017
|
|
Three months ended September 30, 2017
|
||||||||||||||||||||
(Dollars in millions)
|
Reported
|
|
Impact of New Standards
|
|
Restated
|
|
Reported
|
|
Impact of New Standards
|
|
Restated
|
||||||||||||
Sales of products
|
|
$60,484
|
|
|
|
$1,183
|
|
|
|
$61,667
|
|
|
|
$21,825
|
|
|
|
($43
|
)
|
|
|
$21,782
|
|
Sales of services
|
7,540
|
|
|
28
|
|
|
7,568
|
|
|
2,484
|
|
|
(43
|
)
|
|
2,441
|
|
||||||
Total revenues
|
68,024
|
|
|
1,211
|
|
|
69,235
|
|
|
24,309
|
|
|
(86
|
)
|
|
24,223
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of products
|
(49,856
|
)
|
|
(1,080
|
)
|
|
(50,936
|
)
|
|
(18,050
|
)
|
|
|
|
|
(18,050
|
)
|
||||||
Cost of services
|
(5,730
|
)
|
|
(12
|
)
|
|
(5,742
|
)
|
|
(1,910
|
)
|
|
31
|
|
|
(1,879
|
)
|
||||||
Boeing Capital interest expense
|
(53
|
)
|
|
|
|
|
(53
|
)
|
|
(27
|
)
|
|
|
|
|
(27
|
)
|
||||||
Total costs and expenses
|
(55,639
|
)
|
|
(1,092
|
)
|
|
(56,731
|
)
|
|
(19,987
|
)
|
|
31
|
|
|
(19,956
|
)
|
||||||
|
12,385
|
|
|
119
|
|
|
12,504
|
|
|
4,322
|
|
|
(55
|
)
|
|
4,267
|
|
||||||
Income from operating investments, net
|
169
|
|
|
|
|
|
169
|
|
|
49
|
|
|
|
|
|
49
|
|
||||||
General and administrative expense
|
(2,888
|
)
|
|
(2
|
)
|
|
(2,890
|
)
|
|
(915
|
)
|
|
(3
|
)
|
|
(918
|
)
|
||||||
Research and development expense, net
|
(2,418
|
)
|
|
1
|
|
|
(2,417
|
)
|
|
(767
|
)
|
|
(1
|
)
|
|
(768
|
)
|
||||||
Earnings from operations
|
7,248
|
|
|
118
|
|
|
7,366
|
|
|
2,689
|
|
|
(59
|
)
|
|
2,630
|
|
||||||
Other income, net
|
94
|
|
|
(3
|
)
|
|
91
|
|
|
45
|
|
|
(5
|
)
|
|
40
|
|
||||||
Interest and debt expense
|
(267
|
)
|
|
|
|
|
(267
|
)
|
|
(87
|
)
|
|
|
|
|
(87
|
)
|
||||||
Earnings before income taxes
|
7,075
|
|
|
115
|
|
|
7,190
|
|
|
2,647
|
|
|
(64
|
)
|
|
2,583
|
|
||||||
Income tax expense
|
(2,010
|
)
|
|
(42
|
)
|
|
(2,052
|
)
|
|
(794
|
)
|
|
21
|
|
|
(773
|
)
|
||||||
Net earnings
|
|
$5,065
|
|
|
|
$73
|
|
|
|
$5,138
|
|
|
|
$1,853
|
|
|
|
($43
|
)
|
|
|
$1,810
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic earnings per share
|
|
$8.37
|
|
|
|
$0.12
|
|
|
|
$8.49
|
|
|
|
$3.10
|
|
|
|
($0.07
|
)
|
|
|
$3.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted earnings per share
|
|
$8.27
|
|
|
|
$0.12
|
|
|
|
$8.39
|
|
|
|
$3.06
|
|
|
|
($0.07
|
)
|
|
|
$2.99
|
|
(Dollars in millions)
|
December 31, 2017
|
||||||||||
Assets
|
Reported
|
|
Impact of New Standards
|
|
Restated
|
||||||
Cash and cash equivalents
|
|
$8,813
|
|
|
|
|
|
|
$8,813
|
|
|
Short-term and other investments
|
1,179
|
|
|
|
|
|
1,179
|
|
|||
Accounts receivable, net
|
10,516
|
|
|
|
($7,622
|
)
|
|
2,894
|
|
||
Unbilled receivables, net
|
|
|
|
8,194
|
|
|
8,194
|
|
|||
Current portion of customer financing, net
|
309
|
|
|
|
|
|
309
|
|
|||
Inventories
|
44,344
|
|
|
17,044
|
|
|
61,388
|
|
|||
Other current assets
|
|
|
|
2,417
|
|
|
2,417
|
|
|||
Total current assets
|
65,161
|
|
|
20,033
|
|
|
85,194
|
|
|||
Customer financing, net
|
2,740
|
|
|
16
|
|
|
2,756
|
|
|||
Property, plant and equipment, net
|
12,672
|
|
|
|
|
|
12,672
|
|
|||
Goodwill
|
5,559
|
|
|
|
|
|
5,559
|
|
|||
Acquired intangible assets, net
|
2,573
|
|
|
|
|
|
2,573
|
|
|||
Deferred income taxes
|
341
|
|
|
(20
|
)
|
|
321
|
|
|||
Investments
|
1,260
|
|
|
|
|
|
1,260
|
|
|||
Other assets, net of accumulated amortization
|
2,027
|
|
|
|
|
|
2,027
|
|
|||
Total assets
|
|
$92,333
|
|
|
|
$20,029
|
|
|
|
$112,362
|
|
Liabilities and equity
|
|
|
|
|
|
||||||
Accounts payable
|
|
$12,202
|
|
|
|
|
|
|
$12,202
|
|
|
Accrued liabilities
|
15,292
|
|
|
|
($2,223
|
)
|
|
13,069
|
|
||
Advances and billings in excess of related costs
|
27,440
|
|
|
(27,440
|
)
|
|
|
|
|||
Advances and progress billings
|
|
|
|
48,042
|
|
|
48,042
|
|
|||
Short-term debt and current portion of long-term debt
|
1,335
|
|
|
|
|
|
1,335
|
|
|||
Total current liabilities
|
56,269
|
|
|
18,379
|
|
|
74,648
|
|
|||
Deferred income taxes
|
1,839
|
|
|
349
|
|
|
2,188
|
|
|||
Accrued retiree health care
|
5,545
|
|
|
|
|
|
5,545
|
|
|||
Accrued pension plan liability, net
|
16,471
|
|
|
|
|
|
16,471
|
|
|||
Other long-term liabilities
|
2,015
|
|
|
|
|
|
2,015
|
|
|||
Long-term debt
|
9,782
|
|
|
|
|
|
9,782
|
|
|||
Shareholders’ equity:
|
|
|
|
|
|
|
|||||
Common stock
|
5,061
|
|
|
|
|
|
5,061
|
|
|||
Additional paid-in capital
|
6,804
|
|
|
|
|
|
6,804
|
|
|||
Treasury stock, at cost
|
(43,454
|
)
|
|
|
|
|
(43,454
|
)
|
|||
Retained earnings
|
45,320
|
|
|
4,298
|
|
|
49,618
|
|
|||
Accumulated other comprehensive loss
|
(13,376
|
)
|
|
(2,997
|
)
|
|
(16,373
|
)
|
|||
Total shareholders’ equity
|
355
|
|
|
1,301
|
|
|
1,656
|
|
|||
Noncontrolling interests
|
57
|
|
|
|
|
|
57
|
|
|||
Total equity
|
412
|
|
|
1,301
|
|
|
1,713
|
|
|||
Total liabilities and equity
|
|
$92,333
|
|
|
|
$20,029
|
|
|
|
$112,362
|
|
(Dollars in millions)
|
Nine months ended September 30, 2017
|
||||||||||
|
Reported
|
|
|
Impact of New Standards
|
Restated
|
|
|||||
Cash flows - operating activities:
|
|
|
|
|
|
||||||
Net earnings
|
|
$5,065
|
|
|
|
$73
|
|
|
|
$5,138
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Non-cash items -
|
|
|
|
|
|
||||||
Share-based plans expense
|
151
|
|
|
|
|
151
|
|
||||
Depreciation and amortization
|
1,487
|
|
|
(17
|
)
|
|
1,470
|
|
|||
Investment/asset impairment charges, net
|
75
|
|
|
|
|
75
|
|
||||
Customer financing valuation expense
|
4
|
|
|
|
|
4
|
|
||||
Other charges and credits, net
|
190
|
|
|
6
|
|
|
196
|
|
|||
Changes in assets and liabilities -
|
|
|
|
|
|
||||||
Accounts receivable
|
(1,983
|
)
|
|
1,425
|
|
|
(558
|
)
|
|||
Unbilled receivables
|
|
|
(1,805
|
)
|
|
(1,805
|
)
|
||||
Advances and progress billings
|
|
|
4,714
|
|
|
4,714
|
|
||||
Inventories
|
254
|
|
|
(1,054
|
)
|
|
(800
|
)
|
|||
Other current assets
|
|
|
(337
|
)
|
|
(337
|
)
|
||||
Accounts payable
|
778
|
|
|
2
|
|
|
780
|
|
|||
Accrued liabilities
|
112
|
|
|
(214
|
)
|
|
(102
|
)
|
|||
Advances and billings in excess of related costs
|
2,828
|
|
|
(2,828
|
)
|
|
|
||||
Income taxes receivable, payable and deferred
|
1,465
|
|
|
42
|
|
|
1,507
|
|
|||
Other long-term liabilities
|
25
|
|
|
|
|
25
|
|
||||
Pension and other postretirement plans
|
(550
|
)
|
|
|
|
(550
|
)
|
||||
Customer financing, net
|
635
|
|
|
(1
|
)
|
|
634
|
|
|||
Other
|
(96
|
)
|
|
(3
|
)
|
|
(99
|
)
|
|||
Net cash provided by operating activities
|
10,440
|
|
|
3
|
|
|
10,443
|
|
|||
Cash flows - investing activities:
|
|
|
|
|
|
||||||
Property, plant and equipment additions
|
(1,304
|
)
|
|
|
|
(1,304
|
)
|
||||
Property, plant and equipment reductions
|
30
|
|
|
|
|
30
|
|
||||
Contributions to investments
|
(2,847
|
)
|
|
32
|
|
|
(2,815
|
)
|
|||
Proceeds from investments
|
2,612
|
|
|
|
|
2,612
|
|
||||
Purchase of distribution rights
|
(131
|
)
|
|
|
|
(131
|
)
|
||||
Other
|
4
|
|
|
3
|
|
|
7
|
|
|||
Net cash used by investing activities
|
(1,636
|
)
|
|
35
|
|
|
(1,601
|
)
|
|||
Cash flows - financing activities:
|
|
|
|
|
|
||||||
New borrowings
|
876
|
|
|
|
|
876
|
|
||||
Debt repayments
|
(83
|
)
|
|
|
|
(83
|
)
|
||||
Stock options exercised
|
291
|
|
|
|
|
291
|
|
||||
Employee taxes on certain share-based payment arrangements
|
(118
|
)
|
|
|
|
(118
|
)
|
||||
Common shares repurchased
|
(7,500
|
)
|
|
|
|
(7,500
|
)
|
||||
Dividends paid
|
(2,575
|
)
|
|
|
|
(2,575
|
)
|
||||
Net cash used by financing activities
|
(9,109
|
)
|
|
|
|
(9,109
|
)
|
||||
Effect of exchange rate changes on cash & cash equivalents, including restricted
|
73
|
|
|
|
|
73
|
|
||||
Net (decrease)/increase in cash & cash equivalents, including restricted
|
(232
|
)
|
|
38
|
|
|
(194
|
)
|
|||
Cash & cash equivalents, including restricted*, at beginning of year
|
8,801
|
|
|
68
|
|
|
8,869
|
|
|||
Cash & cash equivalents, including restricted*, at end of period
|
|
$8,569
|
|
|
|
$106
|
|
|
8,675
|
|
|
Less restricted cash & cash equivalents, included in Investments
|
|
|
|
|
106
|
|
|||||
Cash and cash equivalents at end of period
|
|
|
|
|
|
$8,569
|
|
|
Boeing shareholders
|
|
|
||||||||||||||||||
(Dollars in millions)
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury Stock
|
|
Retained
Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Non-
controlling
Interests
|
|
Total
|
|
|||||||
Balance at January 1, 2017, as reported
|
|
$5,061
|
|
|
$4,762
|
|
|
($36,097
|
)
|
|
$40,714
|
|
|
($13,623
|
)
|
|
$60
|
|
|
$877
|
|
Cumulative Impact of Topic 606 at 1/1/2016
|
|
|
|
901
|
|
|
|
901
|
|
||||||||||||
Impact of Topic 606 on 2016 earnings
|
|
|
|
139
|
|
|
|
139
|
|
||||||||||||
Balance at January 1, 2017, as restated
|
|
$5,061
|
|
|
$4,762
|
|
|
($36,097
|
)
|
|
$41,754
|
|
|
($13,623
|
)
|
|
$60
|
|
|
$1,917
|
|
|
Boeing shareholders
|
|
|
||||||||||||||||||
(Dollars in millions)
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury Stock
|
|
Retained
Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Non-
controlling
Interests
|
|
Total
|
|
|||||||
Balance at December 31, 2017, as reported
|
|
$5,061
|
|
|
$6,804
|
|
|
($43,454
|
)
|
|
$45,320
|
|
|
($13,376
|
)
|
|
$57
|
|
|
$412
|
|
Cumulative Impact of Topic 606 at 1/1/2016
|
|
|
|
901
|
|
|
|
901
|
|
||||||||||||
Impact of Topic 606 on 2016 earnings
|
|
|
|
139
|
|
|
|
139
|
|
||||||||||||
Impact of Topic 606 on 2017 earnings
|
|
|
|
261
|
|
|
|
261
|
|
||||||||||||
Total impact of ASC 606 through December 31, 2017
|
|
|
|
1,301
|
|
|
|
1,301
|
|
||||||||||||
Impact of ASU 2018-02
|
|
|
|
2,997
|
|
(2,997
|
)
|
|
|
||||||||||||
Balance at December 31, 2017, as restated
|
|
$5,061
|
|
|
$6,804
|
|
|
($43,454
|
)
|
|
$49,618
|
|
|
($16,373
|
)
|
|
$57
|
|
|
$1,713
|
|
(In millions - except per share amounts)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
Less: earnings available to participating securities
|
5
|
|
|
4
|
|
|
2
|
|
|
2
|
|
||||
Net earnings available to common shareholders
|
|
$7,031
|
|
|
|
$5,134
|
|
|
|
$2,361
|
|
|
|
$1,808
|
|
Basic
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
582.7
|
|
|
605.6
|
|
|
574.8
|
|
|
598.3
|
|
||||
Less: participating securities
|
0.7
|
|
|
0.8
|
|
|
0.6
|
|
|
0.7
|
|
||||
Basic weighted average common shares outstanding
|
582.0
|
|
|
604.8
|
|
|
574.2
|
|
|
597.6
|
|
||||
Diluted
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
582.7
|
|
|
605.6
|
|
|
574.8
|
|
|
598.3
|
|
||||
Dilutive potential common shares(1)
|
6.2
|
|
|
7.2
|
|
|
6.0
|
|
|
8.0
|
|
||||
Diluted weighted average shares outstanding
|
588.9
|
|
|
612.8
|
|
|
580.8
|
|
|
606.3
|
|
||||
Less: participating securities
|
0.7
|
|
|
0.8
|
|
|
0.6
|
|
|
0.7
|
|
||||
Diluted weighted average common shares outstanding
|
588.2
|
|
|
612.0
|
|
|
580.2
|
|
|
605.6
|
|
||||
Net earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$12.08
|
|
|
|
$8.49
|
|
|
|
$4.11
|
|
|
|
$3.03
|
|
Diluted
|
11.95
|
|
|
8.39
|
|
|
4.07
|
|
|
2.99
|
|
(1)
|
Diluted earnings per share includes any dilutive impact of stock options, restricted stock units, performance-based restricted stock units and performance awards.
|
(Shares in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
Performance awards
|
2.6
|
|
|
4.6
|
|
|
2.2
|
|
|
3.4
|
|
Performance-based restricted stock units
|
0.3
|
|
|
0.6
|
|
|
0.2
|
|
|
0.1
|
|
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Long-term contracts in progress
|
|
$1,908
|
|
|
|
$1,854
|
|
Commercial aircraft programs
|
53,568
|
|
|
52,861
|
|
||
Commercial spare parts, used aircraft, general stock materials and other
|
6,562
|
|
|
6,673
|
|
||
Total
|
|
$62,038
|
|
|
|
$61,388
|
|
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Financing receivables:
|
|
|
|
||||
Investment in sales-type/finance leases
|
|
$1,153
|
|
|
|
$1,364
|
|
Notes
|
987
|
|
|
1,022
|
|
||
Total financing receivables
|
2,140
|
|
|
2,386
|
|
||
Operating lease equipment, at cost, less accumulated depreciation of $204 and $305
|
1,085
|
|
|
691
|
|
||
Gross customer financing
|
3,225
|
|
|
3,077
|
|
||
Less allowance for losses on receivables
|
(9
|
)
|
|
(12
|
)
|
||
Total
|
|
$3,216
|
|
|
|
$3,065
|
|
Rating categories
|
September 30
2018 |
|
|
December 31
2017 |
|
||
BBB
|
|
$1,001
|
|
|
|
$1,170
|
|
BB
|
443
|
|
|
627
|
|
||
B
|
286
|
|
|
177
|
|
||
CCC
|
410
|
|
|
412
|
|
||
Total carrying value of financing receivables
|
|
$2,140
|
|
|
|
$2,386
|
|
|
September 30
2018 |
|
|
December 31
2017 |
|
||
717 Aircraft ($226 and $269 accounted for as operating leases)
|
|
$963
|
|
|
|
$1,081
|
|
747-8 Aircraft ($134 and $138 accounted for as operating leases)
|
478
|
|
|
483
|
|
||
737 Aircraft ($267 and $127 accounted for as operating leases)
|
330
|
|
|
161
|
|
||
MD-80 Aircraft (accounted for as sales-type finance leases)
|
207
|
|
|
231
|
|
||
757 Aircraft ($25 and $27 accounted for as operating leases)
|
204
|
|
|
217
|
|
||
747-400 Aircraft ($56 and $88 accounted for as operating leases)
|
131
|
|
|
170
|
|
||
787 Aircraft (accounted for as notes)
|
115
|
|
|
|
|
||
777 Aircraft ($72 and $0 accounted for as operating leases)
|
83
|
|
|
14
|
|
||
767 Aircraft ($0 and $25 accounted for as operating leases)
|
|
|
|
98
|
|
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Equity method investments (1)
|
|
$1,149
|
|
|
|
$1,214
|
|
Time deposits
|
1,343
|
|
|
613
|
|
||
Available for sale debt instruments
|
480
|
|
|
490
|
|
||
Restricted cash & cash equivalents(2)
|
128
|
|
|
74
|
|
||
Equity and other investments
|
46
|
|
|
48
|
|
||
Total
|
|
$3,146
|
|
|
|
$2,439
|
|
(1)
|
Dividends received were $222 and $79 for the nine and three months ended September 30, 2018 and $195 and $47 during the same periods in the prior year.
|
(2)
|
Reflects amounts restricted in support of our workers’ compensation programs, employee benefit programs, and insurance premiums.
|
|
2018
|
|
|
2017
|
|
||
Beginning balance – January 1
|
|
$524
|
|
|
|
$562
|
|
Reductions for payments made
|
(17
|
)
|
|
(25
|
)
|
||
Changes in estimates
|
61
|
|
|
6
|
|
||
Ending balance – September 30
|
|
$568
|
|
|
|
$543
|
|
|
2018
|
|
|
2017
|
|
||
Beginning balance – January 1
|
|
$1,211
|
|
|
|
$1,414
|
|
Additions for current year deliveries
|
176
|
|
|
183
|
|
||
Reductions for payments made
|
(135
|
)
|
|
(193
|
)
|
||
Changes in estimates
|
(151
|
)
|
|
(213
|
)
|
||
Ending balance – September 30
|
|
$1,101
|
|
|
|
$1,191
|
|
|
Total
|
|
|
October through December 2018
|
|
$326
|
|
2019
|
2,736
|
|
|
2020
|
3,559
|
|
|
2021
|
2,796
|
|
|
2022
|
1,567
|
|
|
Thereafter
|
8,760
|
|
|
|
|
$19,744
|
|
|
Maximum
Potential Payments
|
|
Estimated Proceeds from
Collateral/Recourse
|
|
Carrying Amount of
Liabilities
|
|||||||||||||||
|
September 30
2018 |
|
December 31
2017 |
|
|
September 30
2018 |
|
December 31
2017 |
|
|
September 30
2018 |
|
December 31
2017 |
|
||||||
Contingent repurchase commitments
|
|
$1,729
|
|
|
$1,605
|
|
|
|
$1,729
|
|
|
$1,605
|
|
|
|
|
|
$9
|
|
|
Indemnifications to ULA:
|
|
|
|
|
|
|
|
|
||||||||||||
Contributed Delta program launch inventory
|
52
|
|
72
|
|
|
|
|
|
|
|
||||||||||
Contract pricing
|
261
|
|
261
|
|
|
|
|
|
|
$7
|
|
7
|
|
|||||||
Other Delta contracts
|
176
|
|
191
|
|
|
|
|
|
|
|
|
|
||||||||
Credit guarantees
|
106
|
|
109
|
|
|
51
|
|
55
|
|
|
16
|
|
16
|
|
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
Pension Plans
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Service cost
|
|
$322
|
|
|
|
$301
|
|
|
|
$107
|
|
|
|
$100
|
|
Interest cost
|
2,086
|
|
|
2,243
|
|
|
696
|
|
|
747
|
|
||||
Expected return on plan assets
|
(3,007
|
)
|
|
(2,883
|
)
|
|
(1,002
|
)
|
|
(961
|
)
|
||||
Amortization of prior service credits
|
(42
|
)
|
|
(29
|
)
|
|
(14
|
)
|
|
(9
|
)
|
||||
Recognized net actuarial loss
|
847
|
|
|
603
|
|
|
282
|
|
|
201
|
|
||||
Settlement/curtailment/other losses
|
43
|
|
|
1
|
|
|
|
|
|
|
|
||||
Net periodic benefit cost
|
|
$249
|
|
|
|
$236
|
|
|
|
$69
|
|
|
|
$78
|
|
|
|
|
|
|
|
|
|
||||||||
Net periodic benefit cost included in Earnings from operations
|
|
$237
|
|
|
|
$376
|
|
|
|
$79
|
|
|
|
$123
|
|
Net periodic benefit cost included in Other income/(loss), net
|
(98
|
)
|
|
(88
|
)
|
|
(50
|
)
|
|
(26
|
)
|
||||
Net periodic benefit cost included in Earnings before income taxes
|
|
$139
|
|
|
|
$288
|
|
|
|
$29
|
|
|
|
$97
|
|
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
Other Postretirement Plans
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Service cost
|
|
$71
|
|
|
|
$80
|
|
|
|
$24
|
|
|
|
$27
|
|
Interest cost
|
145
|
|
|
171
|
|
|
48
|
|
|
57
|
|
||||
Expected return on plan assets
|
(6
|
)
|
|
(5
|
)
|
|
(2
|
)
|
|
(1
|
)
|
||||
Amortization of prior service credits
|
(94
|
)
|
|
(102
|
)
|
|
(31
|
)
|
|
(34
|
)
|
||||
Recognized net actuarial (gain)/loss
|
(8
|
)
|
|
8
|
|
|
(3
|
)
|
|
2
|
|
||||
Net periodic benefit cost
|
|
$108
|
|
|
|
$152
|
|
|
|
$36
|
|
|
|
$51
|
|
|
|
|
|
|
|
|
|
||||||||
Net periodic benefit cost included in Earnings from operations
|
|
$63
|
|
|
|
$78
|
|
|
|
$21
|
|
|
|
$25
|
|
Net periodic benefit cost included in Other income/(loss), net
|
77
|
|
|
91
|
|
|
29
|
|
|
31
|
|
||||
Net periodic benefit cost included in Earnings before income taxes
|
|
$140
|
|
|
|
$169
|
|
|
|
$50
|
|
|
|
$56
|
|
|
Currency Translation Adjustments
|
|
|
Unrealized Gains and Losses on Certain Investments
|
|
|
Unrealized Gains and Losses on Derivative Instruments
|
|
|
Defined Benefit Pension Plans & Other Postretirement Benefits
|
|
|
Total (1)
|
|
|||||
Balance at January 1, 2017
|
|
($143
|
)
|
|
|
($2
|
)
|
|
|
($127
|
)
|
|
|
($13,351
|
)
|
|
|
($13,623
|
)
|
Other comprehensive income before reclassifications
|
121
|
|
|
|
|
111
|
|
|
1
|
|
|
233
|
|
||||||
Amounts reclassified from AOCI
|
|
|
|
|
44
|
|
|
310
|
|
(2)
|
354
|
|
|||||||
Net current period Other comprehensive income
|
121
|
|
|
|
|
155
|
|
|
311
|
|
|
587
|
|
||||||
Balance at September 30, 2017
|
|
($22
|
)
|
|
|
($2
|
)
|
|
|
$28
|
|
|
|
($13,040
|
)
|
|
|
($13,036
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at January 1, 2018
|
|
($15
|
)
|
|
|
($2
|
)
|
|
|
$54
|
|
|
|
($16,410
|
)
|
|
|
($16,373
|
)
|
Other comprehensive (loss)/income before reclassifications
|
(55
|
)
|
|
3
|
|
|
(97
|
)
|
|
(3
|
)
|
|
(152
|
)
|
|||||
Amounts reclassified from AOCI
|
|
|
|
|
19
|
|
|
557
|
|
(2)
|
576
|
|
|||||||
Net current period Other comprehensive (loss)/income
|
(55
|
)
|
|
3
|
|
|
(78
|
)
|
|
554
|
|
|
424
|
|
|||||
Balance at September 30, 2018
|
|
($70
|
)
|
|
|
$1
|
|
|
|
($24
|
)
|
|
|
($15,856
|
)
|
|
|
($15,949
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at June 30, 2017
|
|
($66
|
)
|
|
|
($2
|
)
|
|
|
($22
|
)
|
|
|
($13,144
|
)
|
|
|
($13,234
|
)
|
Other comprehensive income before reclassifications
|
44
|
|
|
|
|
40
|
|
|
|
|
84
|
|
|||||||
Amounts reclassified from AOCI
|
|
|
|
|
10
|
|
|
104
|
|
(2)
|
114
|
|
|||||||
Net current period Other comprehensive income
|
44
|
|
|
|
|
50
|
|
|
104
|
|
|
198
|
|
||||||
Balance at September 30, 2017
|
|
($22
|
)
|
|
|
($2
|
)
|
|
|
$28
|
|
|
|
($13,040
|
)
|
|
|
($13,036
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at June 30, 2018
|
|
($72
|
)
|
|
|
$1
|
|
|
|
($29
|
)
|
|
|
($16,039
|
)
|
|
|
($16,139
|
)
|
Other comprehensive (loss)/income before reclassifications
|
2
|
|
|
|
|
(4
|
)
|
|
(1
|
)
|
|
(3
|
)
|
||||||
Amounts reclassified from AOCI
|
|
|
|
|
9
|
|
|
184
|
|
(2)
|
193
|
|
|||||||
Net current period Other comprehensive income
|
2
|
|
|
|
|
5
|
|
|
183
|
|
|
190
|
|
||||||
Balance at September 30, 2018
|
|
($70
|
)
|
|
|
$1
|
|
|
|
($24
|
)
|
|
|
($15,856
|
)
|
|
|
($15,949
|
)
|
|
Notional amounts (1)
|
Other assets
|
Accrued liabilities
|
|||||||||||||||
|
September 30
2018 |
|
December 31
2017 |
|
September 30
2018 |
|
December 31
2017 |
|
September 30
2018 |
|
December 31
2017 |
|
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
|
$2,781
|
|
|
$2,930
|
|
|
$48
|
|
|
$131
|
|
|
($73
|
)
|
|
($63
|
)
|
Interest rate contracts
|
125
|
|
125
|
|
1
|
|
3
|
|
|
|
|
|||||||
Commodity contracts
|
40
|
|
56
|
|
5
|
|
4
|
|
(4
|
)
|
(6
|
)
|
||||||
Derivatives not receiving hedge accounting treatment:
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
591
|
|
406
|
|
8
|
|
16
|
|
(11
|
)
|
(5
|
)
|
||||||
Commodity contracts
|
614
|
|
563
|
|
|
|
|
|
|
|
||||||||
Total derivatives
|
|
$4,151
|
|
|
$4,080
|
|
|
$62
|
|
|
$154
|
|
|
($88
|
)
|
|
($74
|
)
|
Netting arrangements
|
|
|
(30
|
)
|
(61
|
)
|
30
|
|
61
|
|
||||||||
Net recorded balance
|
|
|
|
$32
|
|
|
$93
|
|
|
($58
|
)
|
|
($13
|
)
|
(1)
|
Notional amounts represent the gross contract/notional amount of the derivatives outstanding.
|
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Effective portion recognized in Other comprehensive income, net of taxes:
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
|
($100
|
)
|
|
|
$116
|
|
|
|
($7
|
)
|
|
|
$40
|
|
Commodity contracts
|
3
|
|
|
(5
|
)
|
|
3
|
|
|
|
|
||||
Effective portion reclassified out of Accumulated other comprehensive loss into earnings, net of taxes:
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
(20
|
)
|
|
(43
|
)
|
|
(11
|
)
|
|
(11
|
)
|
||||
Commodity contracts
|
1
|
|
|
(1
|
)
|
|
2
|
|
|
1
|
|
||||
Forward points recognized in Other income, net:
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
5
|
|
|
3
|
|
|
|
|
|
1
|
|
||||
Undesignated derivatives recognized in Other income, net:
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
(2
|
)
|
|
6
|
|
|
(1
|
)
|
|
1
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds
|
|
$2,263
|
|
|
|
$2,263
|
|
|
|
|
|
$1,582
|
|
|
|
$1,582
|
|
|
|
||||
Available-for-sale debt investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial paper
|
97
|
|
|
|
|
|
$97
|
|
|
70
|
|
|
|
|
|
$70
|
|
||||||
Corporate notes
|
384
|
|
|
|
|
384
|
|
|
382
|
|
|
|
|
382
|
|
||||||||
U.S. government agencies
|
18
|
|
|
|
|
18
|
|
|
47
|
|
|
|
|
47
|
|
||||||||
Other equity investments
|
14
|
|
|
14
|
|
|
|
|
18
|
|
|
18
|
|
|
|
||||||||
Derivatives
|
32
|
|
|
|
|
32
|
|
|
93
|
|
|
|
|
93
|
|
||||||||
Total assets
|
|
$2,808
|
|
|
|
$2,277
|
|
|
|
$531
|
|
|
|
$2,192
|
|
|
|
$1,600
|
|
|
|
$592
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
|
|
($58
|
)
|
|
|
|
|
($58
|
)
|
|
|
($13
|
)
|
|
|
|
|
($13
|
)
|
||||
Total liabilities
|
|
($58
|
)
|
|
|
|
|
($58
|
)
|
|
|
($13
|
)
|
|
|
|
|
($13
|
)
|
|
2018
|
|
2017
|
||||||||||||
|
Fair
Value
|
|
|
Total
Losses
|
|
|
Fair
Value
|
|
|
Total
Losses
|
|
||||
Operating lease equipment
|
|
$45
|
|
|
|
($16
|
)
|
|
|
$89
|
|
|
|
($31
|
)
|
Investments
|
|
|
(47
|
)
|
|
1
|
|
|
(30
|
)
|
|||||
Property, plant and equipment
|
|
|
|
|
|
|
8
|
|
|
(2
|
)
|
||||
Acquired intangible assets
|
|
|
|
|
14
|
|
|
(1
|
)
|
||||||
Total
|
|
$45
|
|
|
|
($63
|
)
|
|
|
$112
|
|
|
|
($64
|
)
|
|
Fair
Value
|
|
Valuation
Technique(s)
|
|
Unobservable Input
|
|
Range
Median or Average
|
Operating lease equipment
|
$45
|
|
Market approach
|
|
Aircraft value publications
|
|
$41 - $63(1)
Median $46
|
|
|
Aircraft condition adjustments
|
|
($4) - $3(2)
Net ($1)
|
(1)
|
The range represents the sum of the highest and lowest values for all aircraft subject to fair value measurement, according to the third party aircraft valuation publications that we use in our valuation process.
|
(2)
|
The negative amount represents the sum for all aircraft subject to fair value measurement, of all downward adjustments based on consideration of individual aircraft attributes and condition. The positive amount represents the sum of all such upward adjustments.
|
|
September 30, 2018
|
||||||||||||
|
Carrying
Amount
|
|
Total Fair
Value
|
|
Level 1
|
Level 2
|
|
Level 3
|
|
||||
Assets
|
|
|
|
|
|
||||||||
Notes receivable, net
|
|
$987
|
|
|
$1,006
|
|
|
|
$1,006
|
|
|
||
Liabilities
|
|
|
|
|
|
||||||||
Debt, excluding capital lease obligations and commercial paper
|
(11,131
|
)
|
(12,066
|
)
|
|
(11,974
|
)
|
|
($92
|
)
|
|
December 31, 2017
|
||||||||||||
|
Carrying
Amount
|
|
Total Fair
Value
|
|
Level 1
|
Level 2
|
Level 3
|
||||||
Assets
|
|
|
|
|
|
||||||||
Notes receivable, net
|
|
$1,022
|
|
|
$1,046
|
|
|
|
$1,046
|
|
|
||
Liabilities
|
|
|
|
|
|
||||||||
Debt, excluding capital lease obligations and commercial paper
|
(10,380
|
)
|
(11,923
|
)
|
|
(11,823
|
)
|
|
($100
|
)
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue from contracts with customers:
|
|
|
|
|
|
|
|
||||||||
Europe
|
|
$7,189
|
|
|
|
$6,519
|
|
|
|
$1,882
|
|
|
|
$1,754
|
|
China
|
9,433
|
|
|
7,510
|
|
|
4,677
|
|
|
4,016
|
|
||||
Asia, other than China
|
5,966
|
|
|
4,981
|
|
|
1,886
|
|
|
1,898
|
|
||||
Middle East
|
3,931
|
|
|
7,157
|
|
|
1,598
|
|
|
2,577
|
|
||||
Other
|
3,598
|
|
|
2,773
|
|
|
1,098
|
|
|
601
|
|
||||
Total non-U.S. revenues
|
30,117
|
|
|
28,940
|
|
|
11,141
|
|
|
10,846
|
|
||||
United States
|
12,170
|
|
|
12,120
|
|
|
3,821
|
|
|
3,872
|
|
||||
Total revenues from contracts with customers
|
42,287
|
|
|
41,060
|
|
|
14,962
|
|
|
14,718
|
|
||||
Intersegment revenues, eliminated on consolidation
|
1,122
|
|
|
1,566
|
|
|
314
|
|
|
675
|
|
||||
Total segment revenues
|
|
$43,409
|
|
|
|
$42,626
|
|
|
|
$15,276
|
|
|
|
$15,393
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue recognized on fixed price contracts
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Revenue recognized at a point in time
|
94
|
%
|
|
94
|
%
|
|
91
|
%
|
|
95
|
%
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue from contracts with customers:
|
|
|
|
|
|
|
|
||||||||
U.S. customers
|
|
$12,201
|
|
|
|
$11,924
|
|
|
|
$4,178
|
|
|
|
$3,917
|
|
Non U.S. customers(1)
|
4,883
|
|
|
3,380
|
|
|
1,551
|
|
|
1,133
|
|
||||
Total segment revenue from contracts with customers
|
|
$17,084
|
|
|
|
$15,304
|
|
|
|
$5,729
|
|
|
|
$5,050
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue recognized over time
|
98
|
%
|
|
98
|
%
|
|
97
|
%
|
|
98
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Revenue recognized on fixed-price contracts
|
65
|
%
|
|
64
|
%
|
|
64
|
%
|
|
63
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Revenue from the U.S. government(1)
|
86
|
%
|
|
88
|
%
|
|
85
|
%
|
|
85
|
%
|
(1)
|
Includes revenues earned from foreign military sales through the U.S. government.
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue from contracts with customers:
|
|
|
|
|
|
|
|
||||||||
Commercial
|
|
$7,276
|
|
|
|
$5,682
|
|
|
|
$2,431
|
|
|
|
$1,950
|
|
Government
|
4,703
|
|
|
5,064
|
|
|
1,608
|
|
|
1,617
|
|
||||
Total revenues from contracts with customers
|
11,979
|
|
|
10,746
|
|
|
4,039
|
|
|
3,567
|
|
||||
Intersegment revenues eliminated on consolidation
|
145
|
|
|
38
|
|
|
52
|
|
|
12
|
|
||||
Total segment revenues
|
|
$12,124
|
|
|
|
$10,784
|
|
|
|
$4,091
|
|
|
|
$3,579
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue recognized at a point in time
|
52
|
%
|
|
48
|
%
|
|
51
|
%
|
|
48
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Revenue recognized on fixed-price contracts
|
88
|
%
|
|
89
|
%
|
|
85
|
%
|
|
89
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Revenue from the U.S. government(1)
|
32
|
%
|
|
40
|
%
|
|
32
|
%
|
|
38
|
%
|
(1)
|
Includes revenues earned from foreign military sales through the U.S. government.
|
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Share-based plans
|
|
($60
|
)
|
|
|
($67
|
)
|
|
|
($24
|
)
|
|
|
($21
|
)
|
Deferred compensation
|
(112
|
)
|
|
(174
|
)
|
|
(56
|
)
|
|
(78
|
)
|
||||
Amortization of previously capitalized interest
|
(67
|
)
|
|
(68
|
)
|
|
(19
|
)
|
|
(22
|
)
|
||||
Eliminations and other unallocated items
|
(929
|
)
|
|
(462
|
)
|
|
(359
|
)
|
|
(112
|
)
|
||||
Unallocated items, eliminations and other
|
|
($1,168
|
)
|
|
|
($771
|
)
|
|
|
($458
|
)
|
|
|
($233
|
)
|
|
|
|
|
|
|
|
|
||||||||
Pension FAS/CAS service cost adjustment
|
|
$780
|
|
|
|
$811
|
|
|
|
$260
|
|
|
|
$271
|
|
Postretirement FAS/CAS service cost adjustment
|
239
|
|
|
238
|
|
|
77
|
|
|
75
|
|
||||
FAS/CAS service cost adjustment
|
|
$1,019
|
|
|
|
$1,049
|
|
|
|
$337
|
|
|
|
$346
|
|
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Commercial Airplanes
|
|
$65,509
|
|
|
|
$64,647
|
|
Defense, Space & Security
|
18,688
|
|
|
18,476
|
|
||
Global Services
|
12,843
|
|
|
12,491
|
|
||
Boeing Capital
|
3,120
|
|
|
3,156
|
|
||
Unallocated items, eliminations and other
|
14,499
|
|
|
13,592
|
|
||
Total
|
|
$114,659
|
|
|
|
$112,362
|
|
FORWARD-LOOKING STATEMENTS
|
|
This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “should,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates” and similar expressions generally identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact.
|
|
|
|
Forward-looking statements are based on expectations and assumptions that we believe to be reasonable when made, but that may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Among these factors are risks related to:
|
|
|
|
(1)
|
general conditions in the economy and our industry, including those due to regulatory changes;
|
|
|
(2)
|
our reliance on our commercial airline customers;
|
|
|
(3)
|
the overall health of our aircraft production system, planned commercial aircraft production rate changes, our commercial development and derivative aircraft programs, and our aircraft being subject to stringent performance and reliability standards;
|
|
|
(4)
|
changing budget and appropriation levels and acquisition priorities of the U.S. government;
|
|
|
(5)
|
our dependence on U.S. government contracts;
|
|
|
(6)
|
our reliance on fixed-price contracts;
|
|
|
(7)
|
our reliance on cost-type contracts;
|
|
|
(8)
|
uncertainties concerning contracts that include in-orbit incentive payments;
|
|
|
(9)
|
our dependence on our subcontractors and suppliers as well as the availability of raw materials;
|
|
|
(10)
|
changes in accounting estimates;
|
|
|
(11)
|
changes in the competitive landscape in our markets;
|
|
|
(12)
|
our non-U.S. operations, including sales to non-U.S. customers;
|
|
|
(13)
|
threats to the security of our or our customers' information;
|
|
|
(14)
|
potential adverse developments in new or pending litigation and/or government investigations;
|
|
|
(15)
|
customer and aircraft concentration in our customer financing portfolio;
|
|
|
(16)
|
changes in our ability to obtain debt on commercially reasonable terms and at competitive rates;
|
|
|
(17)
|
realizing the anticipated benefits of mergers, acquisitions, joint ventures, strategic alliances or divestitures;
|
(18)
|
the adequacy of our insurance coverage to cover significant risk exposures;
|
|
|
(19)
|
potential business disruptions, including those related to physical security threats, information technology or cyber attacks, epidemics, sanctions or natural disasters;
|
|
|
(20)
|
work stoppages or other labor disruptions;
|
|
|
(21)
|
substantial pension and other postretirement benefit obligations; and
|
|
|
(22)
|
potential environmental liabilities.
|
|
|
Additional information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Any forward-looking information speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions, except per share data)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues
|
|
$72,786
|
|
|
|
$69,235
|
|
|
|
$25,146
|
|
|
|
$24,223
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP
|
|
|
|
|
|
|
|
||||||||
Earnings from operations
|
|
$7,812
|
|
|
|
$7,366
|
|
|
|
$2,227
|
|
|
|
$2,630
|
|
Operating margins
|
10.7
|
%
|
|
10.6
|
%
|
|
8.9
|
%
|
|
10.9
|
%
|
||||
Effective income tax rate
|
6.9
|
%
|
|
28.5
|
%
|
|
(10.8
|
)%
|
|
29.9
|
%
|
||||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
Diluted earnings per share
|
|
$11.95
|
|
|
|
$8.39
|
|
|
|
$4.07
|
|
|
|
$2.99
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP (1)
|
|
|
|
|
|
|
|
||||||||
Core operating earnings
|
|
$6,793
|
|
|
|
$6,317
|
|
|
|
$1,890
|
|
|
|
$2,284
|
|
Core operating margins
|
9.3
|
%
|
|
9.1
|
%
|
|
7.5
|
%
|
|
9.4
|
%
|
||||
Core earnings per share
|
|
$10.55
|
|
|
|
$7.28
|
|
|
|
$3.58
|
|
|
|
$2.62
|
|
(1)
|
These measures exclude certain components of pension and other postretirement benefit expense. See page 53 for important information about these non-GAAP measures and reconciliations to the most comparable GAAP measures.
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Commercial Airplanes
|
|
$43,409
|
|
|
|
$42,626
|
|
|
|
$15,276
|
|
|
|
$15,393
|
|
Defense, Space & Security
|
17,084
|
|
|
15,304
|
|
|
5,729
|
|
|
5,050
|
|
||||
Global Services
|
12,124
|
|
|
10,784
|
|
|
4,091
|
|
|
3,579
|
|
||||
Boeing Capital
|
214
|
|
|
234
|
|
|
77
|
|
|
70
|
|
||||
Unallocated items, eliminations and other
|
(45
|
)
|
|
287
|
|
|
(27
|
)
|
|
131
|
|
||||
Total
|
|
$72,786
|
|
|
|
$69,235
|
|
|
|
$25,146
|
|
|
|
$24,223
|
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Commercial Airplanes
|
|
$5,175
|
|
|
|
$3,665
|
|
|
|
$2,023
|
|
|
|
$1,513
|
|
Defense, Space & Security
|
925
|
|
|
1,649
|
|
|
(245
|
)
|
|
486
|
|
||||
Global Services
|
1,790
|
|
|
1,687
|
|
|
543
|
|
|
495
|
|
||||
Boeing Capital
|
71
|
|
|
87
|
|
|
27
|
|
|
23
|
|
||||
Segment operating profit
|
7,961
|
|
|
7,088
|
|
|
2,348
|
|
|
2,517
|
|
||||
Pension FAS/CAS service cost adjustment
|
780
|
|
|
811
|
|
|
260
|
|
|
271
|
|
||||
Postretirement FAS/CAS service cost adjustment
|
239
|
|
|
238
|
|
|
77
|
|
|
75
|
|
||||
Unallocated Items, Eliminations and Other
|
(1,168
|
)
|
|
(771
|
)
|
|
(458
|
)
|
|
(233
|
)
|
||||
Earnings from operations (GAAP)
|
|
$7,812
|
|
|
|
$7,366
|
|
|
|
$2,227
|
|
|
|
$2,630
|
|
FAS/CAS service cost adjustment *
|
(1,019
|
)
|
|
(1,049
|
)
|
|
(337
|
)
|
|
(346
|
)
|
||||
Core operating earnings (Non-GAAP) **
|
|
$6,793
|
|
|
|
$6,317
|
|
|
|
$1,890
|
|
|
|
$2,284
|
|
*
|
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.
|
**
|
Core operating earnings is a Non-GAAP measure that excludes the FAS/CAS service cost adjustment. See page 53.
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Share-based plans
|
|
($60
|
)
|
|
|
($67
|
)
|
|
|
($24
|
)
|
|
|
($21
|
)
|
Deferred compensation
|
(112
|
)
|
|
(174
|
)
|
|
(56
|
)
|
|
(78
|
)
|
||||
Eliminations and other unallocated items
|
(996
|
)
|
|
(530
|
)
|
|
(378
|
)
|
|
(134
|
)
|
||||
Unallocated items, eliminations and other
|
|
($1,168
|
)
|
|
|
($771
|
)
|
|
|
($458
|
)
|
|
|
($233
|
)
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
Pension Plans
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Service cost
|
|
$322
|
|
|
|
$301
|
|
|
|
$107
|
|
|
|
$100
|
|
Interest cost
|
2,086
|
|
|
2,243
|
|
|
696
|
|
|
747
|
|
||||
Expected return on plan assets
|
(3,007
|
)
|
|
(2,883
|
)
|
|
(1,002
|
)
|
|
(961
|
)
|
||||
Amortization of prior service (credits)/costs
|
(42
|
)
|
|
(29
|
)
|
|
(14
|
)
|
|
(9
|
)
|
||||
Recognized net actuarial loss
|
847
|
|
|
603
|
|
|
282
|
|
|
201
|
|
||||
Settlement/curtailment/other losses
|
43
|
|
|
1
|
|
|
|
|
|
||||||
Net periodic benefit cost
|
|
$249
|
|
|
|
$236
|
|
|
|
$69
|
|
|
|
$78
|
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
Pension Plans
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Allocated to business segments
|
|
($1,017
|
)
|
|
|
($1,187
|
)
|
|
|
($339
|
)
|
|
|
($394
|
)
|
Pension FAS/CAS service cost adjustment
|
780
|
|
|
811
|
|
|
260
|
|
|
271
|
|
||||
Net periodic benefit cost included in Earnings from operations
|
|
($237
|
)
|
|
|
($376
|
)
|
|
|
($79
|
)
|
|
|
($123
|
)
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Earnings from operations
|
|
$7,812
|
|
|
|
$7,366
|
|
|
|
$2,227
|
|
|
|
$2,630
|
|
Other income, net
|
63
|
|
|
91
|
|
|
12
|
|
|
40
|
|
||||
Interest and debt expense
|
(317
|
)
|
|
(267
|
)
|
|
(106
|
)
|
|
(87
|
)
|
||||
Earnings from operations
|
7,558
|
|
|
7,190
|
|
|
2,133
|
|
|
2,583
|
|
||||
Income tax (expense)/benefit
|
(522
|
)
|
|
(2,052
|
)
|
|
230
|
|
|
(773
|
)
|
||||
Net earnings from continuing operations
|
|
$7,036
|
|
|
|
$5,138
|
|
|
|
$2,363
|
|
|
|
$1,810
|
|
(Dollars in millions)
|
Nine months ended September 30
|
Three months ended September 30
|
||||||||||||||||||
|
2018
|
|
|
2017
|
|
Change
|
|
2018
|
|
|
2017
|
|
Change
|
|
||||||
Cost of sales
|
|
$59,400
|
|
|
|
$56,731
|
|
|
$2,669
|
|
|
$21,040
|
|
|
|
$19,956
|
|
|
$1,084
|
|
Cost of sales as a % of Revenues
|
81.6
|
%
|
|
81.9
|
%
|
(0.3
|
%)
|
83.7
|
%
|
|
82.4
|
%
|
1.3
|
%
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Commercial Airplanes
|
|
$1,616
|
|
|
|
$1,755
|
|
|
|
$517
|
|
|
|
$538
|
|
Defense, Space & Security
|
613
|
|
|
599
|
|
|
211
|
|
|
207
|
|
||||
Global Services
|
119
|
|
|
101
|
|
|
48
|
|
|
38
|
|
||||
Other
|
69
|
|
|
(38
|
)
|
|
50
|
|
|
(15
|
)
|
||||
Total
|
|
$2,417
|
|
|
|
$2,417
|
|
|
|
$826
|
|
|
|
$768
|
|
Total Backlog (Dollars in millions)
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Commercial Airplanes
|
|
$413,064
|
|
|
|
$410,526
|
|
Defense, Space & Security
|
57,875
|
|
|
44,049
|
|
||
Global Services
|
20,240
|
|
|
19,605
|
|
||
Total Backlog
|
|
$491,179
|
|
|
|
$474,180
|
|
|
|
|
|
||||
Contractual backlog
|
|
$462,468
|
|
|
|
$456,524
|
|
Unobligated backlog
|
28,711
|
|
|
17,656
|
|
||
Total Backlog
|
|
$491,179
|
|
|
|
$474,180
|
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues
|
|
$43,409
|
|
|
|
$42,626
|
|
|
|
$15,276
|
|
|
|
$15,393
|
|
Earnings from operations
|
|
$5,175
|
|
|
|
$3,665
|
|
|
|
$2,023
|
|
|
|
$1,513
|
|
Operating margins
|
11.9
|
%
|
|
8.6
|
%
|
|
13.2
|
%
|
|
9.8
|
%
|
|
737
|
|
*
|
747
|
|
†
|
767
|
|
|
777
|
|
|
787
|
|
|
Total
|
|
Deliveries during the first nine months of 2018
|
407
|
|
(14)
|
5
|
|
|
13
|
|
|
37
|
|
|
106
|
|
|
568
|
|
Deliveries during the first nine months of 2017
|
381
|
|
(13)
|
8
|
|
(1)
|
7
|
|
|
58
|
|
|
100
|
|
|
554
|
|
Deliveries during the third quarter of 2018
|
138
|
|
(4)
|
2
|
|
|
4
|
|
|
12
|
|
|
34
|
|
|
190
|
|
Deliveries during the third quarter of 2017
|
145
|
|
(4)
|
4
|
|
|
2
|
|
|
16
|
|
|
35
|
|
|
202
|
|
Cumulative deliveries as of 9/30/2018
|
7,139
|
|
|
1,547
|
|
|
1,119
|
|
|
1,571
|
|
|
742
|
|
|
|
|
Cumulative deliveries as of 12/31/2017
|
6,732
|
|
|
1,542
|
|
|
1,106
|
|
|
1,534
|
|
|
636
|
|
|
|
†
|
Aircraft accounted for as revenues by and as a note receivable in consolidation identified by parentheses
|
|
Program
|
|
||||||||||||||||
As of 9/30/2018
|
737
|
|
†
|
747*
|
|
|
767
|
|
|
777
|
|
†
|
777X
|
|
|
787
|
|
†
|
Program accounting quantities
|
10,200
|
|
|
1,570
|
|
|
1,195
|
|
|
1,650
|
|
|
**
|
|
|
1,500
|
|
|
Undelivered units under firm orders
|
4,654
|
|
(75)
|
21
|
|
|
123
|
|
|
87
|
|
(1)
|
326
|
|
|
638
|
|
(28)
|
Cumulative firm orders
|
11,793
|
|
(75)
|
1,568
|
|
|
1,242
|
|
|
1,658
|
|
(1)
|
326
|
|
|
1,380
|
|
(28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
As of 12/31/2017
|
737
|
|
|
747
|
|
|
767
|
|
|
777
|
|
|
777X
|
|
|
787
|
|
|
Program accounting quantities
|
9,800
|
|
|
1,570
|
|
|
1,171
|
|
|
1,625
|
|
|
**
|
|
|
1,400
|
|
|
Undelivered units under firm orders***
|
4,613
|
|
|
12
|
|
|
98
|
|
|
97
|
|
|
326
|
|
|
640
|
|
|
Cumulative firm orders***
|
11,345
|
|
|
1,554
|
|
|
1,204
|
|
|
1,631
|
|
|
326
|
|
|
1,276
|
|
|
†
|
Aircraft ordered by BCC are identified in parentheses
|
*
|
At September 30, 2018, the 747 accounting quantity has 22 undelivered aircraft, including one already completed aircraft that has not been sold and is being remarketed.
|
**
|
The accounting quantity for the 777X will be determined in the year of first airplane delivery, targeted for 2020.
|
***
|
Cumulative firm orders adjusted to reflect the adoption of Topic 606 in the first quarter of 2018.
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues
|
|
$17,084
|
|
|
|
$15,304
|
|
|
|
$5,729
|
|
|
|
$5,050
|
|
Earnings/(loss) from operations
|
|
$925
|
|
|
|
$1,649
|
|
|
|
($245
|
)
|
|
|
$486
|
|
Operating margins
|
5.4
|
%
|
|
10.8
|
%
|
|
(4.3
|
)%
|
|
9.6
|
%
|
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
F/A-18 Models
|
10
|
|
18
|
|
5
|
|
6
|
F-15 Models
|
8
|
|
11
|
|
3
|
|
4
|
CH-47 Chinook (New)
|
11
|
|
6
|
|
2
|
|
2
|
CH-47 Chinook (Renewed)
|
14
|
|
28
|
|
6
|
|
9
|
AH-64 Apache (New)
|
|
|
8
|
|
|
|
3
|
AH-64 Apache (Remanufactured)
|
12
|
|
43
|
|
6
|
|
15
|
P-8 Models
|
10
|
|
14
|
|
2
|
|
5
|
Total
|
65
|
|
128
|
|
24
|
|
44
|
(Dollars in millions)
|
Nine months ended September 30
|
Three months ended September 30
|
|||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues
|
|
$12,124
|
|
|
|
$10,784
|
|
|
|
$4,091
|
|
|
|
$3,579
|
|
Earnings from operations
|
|
$1,790
|
|
|
|
$1,687
|
|
|
|
$543
|
|
|
|
$495
|
|
Operating margins
|
14.8
|
%
|
|
15.6
|
%
|
|
13.3
|
%
|
|
13.8
|
%
|
(Dollars in millions)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues
|
|
$214
|
|
|
|
$234
|
|
|
|
$77
|
|
|
|
$70
|
|
Earnings from operations
|
|
$71
|
|
|
|
$87
|
|
|
|
$27
|
|
|
|
$23
|
|
Operating margins
|
33
|
%
|
|
37
|
%
|
|
35
|
%
|
|
33
|
%
|
(Dollars in millions)
|
September 30
2018 |
|
|
December 31
2017 |
|
||
Customer financing and investment portfolio, net
|
|
$3,099
|
|
|
|
$3,003
|
|
Other assets, primarily cash and short-term investments
|
442
|
|
|
677
|
|
||
Total assets
|
|
$3,541
|
|
|
|
$3,680
|
|
|
|
|
|
||||
Other liabilities, primarily deferred income taxes
|
|
$529
|
|
|
|
$653
|
|
Debt, including intercompany loans
|
2,491
|
|
|
2,523
|
|
||
Equity
|
521
|
|
|
504
|
|
||
Total liabilities and equity
|
|
$3,541
|
|
|
|
$3,680
|
|
|
|
|
|
||||
Debt-to-equity ratio
|
4.8-to-1
|
|
|
5.0-to-1
|
|
(Dollars in millions)
|
Nine months ended September 30
|
||||||
|
2018
|
|
|
2017
|
|
||
Net earnings
|
|
$7,036
|
|
|
|
$5,138
|
|
Non-cash items
|
1,823
|
|
|
1,896
|
|
||
Changes in working capital
|
3,516
|
|
|
3,409
|
|
||
Net cash provided by operating activities
|
12,375
|
|
|
10,443
|
|
||
Net cash used by investing activities
|
(2,197
|
)
|
|
(1,601
|
)
|
||
Net cash used by financing activities
|
(10,866
|
)
|
|
(9,109
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(37
|
)
|
|
73
|
|
||
Net decrease in cash & cash equivalents, including restricted
|
(725
|
)
|
|
(194
|
)
|
||
Cash & cash equivalents, including restricted, at beginning of year
|
8,887
|
|
|
8,869
|
|
||
Cash & cash equivalents, including restricted, at end of period
|
|
$8,162
|
|
|
|
$8,675
|
|
(Dollars in millions, except per share data)
|
Nine months ended September 30
|
|
Three months ended September 30
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Revenues
|
|
$72,786
|
|
|
|
$69,235
|
|
|
|
$25,146
|
|
|
|
$24,223
|
|
Earnings from operations, as reported
|
|
$7,812
|
|
|
|
$7,366
|
|
|
|
$2,227
|
|
|
|
$2,630
|
|
Operating margins
|
10.7
|
%
|
|
10.6
|
%
|
|
8.9
|
%
|
|
10.9
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Pension FAS/CAS service cost adjustment (1)
|
|
($780
|
)
|
|
|
($811
|
)
|
|
|
($260
|
)
|
|
|
($271
|
)
|
Postretirement FAS/CAS service cost adjustment (1)
|
|
($239
|
)
|
|
|
($238
|
)
|
|
|
($77
|
)
|
|
|
($75
|
)
|
FAS/CAS service cost adjustment (1)
|
|
($1,019
|
)
|
|
|
($1,049
|
)
|
|
|
($337
|
)
|
|
|
($346
|
)
|
Core operating earnings (non-GAAP)
|
|
$6,793
|
|
|
|
$6,317
|
|
|
|
$1,890
|
|
|
|
$2,284
|
|
Core operating margins (non-GAAP)
|
9.3
|
%
|
|
9.1
|
%
|
|
7.5
|
%
|
|
9.4
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share, as reported
|
|
$11.95
|
|
|
|
$8.39
|
|
|
|
$4.07
|
|
|
|
$2.99
|
|
Pension FAS/CAS service cost adjustment (1)
|
(1.32
|
)
|
|
(1.32
|
)
|
|
(0.45
|
)
|
|
(0.45
|
)
|
||||
Postretirement FAS/CAS service cost adjustment (1)
|
(0.41
|
)
|
|
(0.39
|
)
|
|
(0.13
|
)
|
|
(0.12
|
)
|
||||
Non-operating pension expense (2)
|
(0.17
|
)
|
|
(0.15
|
)
|
|
(0.09
|
)
|
|
(0.05
|
)
|
||||
Non-operating postretirement expense (2)
|
0.13
|
|
|
0.15
|
|
|
0.05
|
|
|
0.05
|
|
||||
Provision for deferred income taxes on adjustments (3)
|
0.37
|
|
|
0.60
|
|
|
0.13
|
|
|
0.20
|
|
||||
Core earnings per share (non-GAAP)
|
|
$10.55
|
|
|
|
$7.28
|
|
|
|
$3.58
|
|
|
|
$2.62
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average diluted shares (in millions)
|
588.9
|
|
|
612.8
|
|
|
580.8
|
|
|
606.3
|
|
(1)
|
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. This adjustment is excluded from Core operating earnings (non-GAAP)
|
(2)
|
Non-operating pension and postretirement expenses represent the components of net periodic benefit costs other than service cost. These expenses are included in Other income/(loss), net and are excluded from Core earnings per share (non-GAAP)
|
(1)
|
We purchased an aggregate of 7,048,754 shares of our common stock in the open market pursuant to our repurchase program and 32,267 shares transferred to us from employees in satisfaction of minimum tax withholding obligations associated with the vesting of restricted stock units during the period. We did not purchase shares in swap transactions.
|
(2)
|
On December 11, 2017, we announced a new repurchase plan for up to $18 billion of common stock, replacing the plan previously authorized in 2016.
|
3.2
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
12
|
|
|
|
15
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
32.2
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
THE BOEING COMPANY
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
October 24, 2018
|
|
/s/ Robert E. Verbeck
|
(Date)
|
|
Robert E. Verbeck – Senior Vice President, Finance and Corporate Controller
|
|
TABLE OF CONTENTS
|
|
||
ARTICLE I Stockholders’ Meetings
|
1
|
|
||
SECTION 1
|
|
Annual Meetings.
|
1
|
|
SECTION 2
|
|
Special Meetings.
|
1
|
|
SECTION 3
|
|
Place of Meetings.
|
1
|
|
SECTION 4
|
|
Notice of Meetings.
|
1
|
|
SECTION 5
|
|
Waivers of Notice.
|
2
|
|
SECTION 6
|
|
Quorum; Required Vote.
|
2
|
|
SECTION 7
|
|
Proxies.
|
2
|
|
7.1
|
|
Appointment.
|
2
|
|
7.2
|
|
Delivery to Corporation; Duration.
|
2
|
|
SECTION 8
|
|
Inspectors of Election.
|
2
|
|
8.1
|
|
Appointment.
|
2
|
|
8.2
|
|
Duties.
|
3
|
|
8.3
|
|
Determination of Proxy Validity.
|
3
|
|
SECTION 9
|
|
Fixing the Record Date.
|
3
|
|
9.1
|
|
Meetings.
|
3
|
|
9.2
|
|
Consent to Corporate Action Without a Meeting.
|
3
|
|
9.3
|
|
Dividends, Distributions, and Other Rights.
|
3
|
|
9.4
|
|
Voting List.
|
4
|
|
SECTION 10
|
|
Action by Stockholders Without a Meeting.
|
4
|
|
SECTION 11
|
|
Notice of Nominations and Other Stockholder Business; Required Vote for Directors; Director Qualification; Inclusion of Stockholder Director Nominations in the Corporation’s Proxy Materials.
|
5
|
|
11.1
|
|
Notice of Nominations and Other Stockholder Business.
|
5
|
|
11.2
|
|
Required Vote for Directors.
|
8
|
|
11.3
|
|
Director Qualification: Submission of Questionnaire, Representation, and Agreement.
|
8
|
|
11.4
|
|
Inclusion of Stockholder Director Nominations in the Corporation’s Proxy Materials.
|
9
|
|
SECTION 12
|
|
Notice to Corporation.
|
14
|
|
SECTION 13
|
|
Organization and Conduct of Meetings.
|
14
|
|
ARTICLE II Board of Directors
|
14
|
|
||
SECTION 1
|
|
Number and Term of Office.
|
14
|
|
SECTION 2
|
|
Nomination and Election.
|
14
|
|
2.1
|
|
Nomination.
|
14
|
|
2.2
|
|
Election.
|
14
|
|
SECTION 3
|
|
Place of Meeting.
|
14
|
|
SECTION 4
|
|
Annual Meeting.
|
15
|
|
SECTION 5
|
|
Stated Meetings.
|
15
|
|
SECTION 6
|
|
Special Meetings.
|
15
|
|
6.1
|
|
Convenors and Notice.
|
15
|
|
6.2
|
|
Waiver of Notice.
|
15
|
|
SECTION 7
|
|
Quorum and Manner of Acting.
|
15
|
|
SECTION 8
|
|
Chairman of the Board.
|
15
|
|
SECTION 9
|
|
Resignations.
|
15
|
|
SECTION 10
|
|
Removal of Directors.
|
16
|
|
SECTION 11
|
|
Filling of Vacancies Not Caused by Removal.
|
16
|
|
SECTION 12
|
|
Director Compensation.
|
16
|
|
SECTION 13
|
|
Action Without a Meeting.
|
16
|
|
Annual Cash Retainer
|
|
$135,000
|
|
|
|
||
Annual Retainer in Deferred Stock Units
|
|
$200,000
|
|
|
|
||
Lead Director Annual Retainer
|
|
$35,000
|
|
|
|
||
Audit Committee Chair Annual Retainer
|
|
$25,000
|
|
|
|
||
Compensation Committee Chair Annual Retainer
|
|
$20,000
|
|
|
|
||
Governance, Organization and Nominating Committee Chair Annual Retainer
|
|
$20,000
|
|
|
|
||
Finance Committee Chair Annual Retainer
|
|
$20,000
|
|
|
|
||
Special Programs Committee Chair Annual Retainer
|
|
$15,000
|
|
|
TABLE OF CONTENTS
|
|
||
ARTICLE I
|
1
|
|
||
ARTICLE II
|
3
|
|
||
2.1
|
|
Account
|
3
|
|
2.2
|
|
Administrator
|
3
|
|
2.3
|
|
“Affiliate” or “Subsidiary”
|
3
|
|
2.4
|
|
Authorized Period of Absence
|
3
|
|
2.5
|
|
Base Salary
|
3
|
|
2.6
|
|
Base Salary Deferrals
|
4
|
|
2.7
|
|
Base Salary Rate
|
4
|
|
2.8
|
|
Beneficiary
|
4
|
|
2.9
|
|
Board of Directors
|
4
|
|
2.1
|
|
BSS Plan
|
4
|
|
2.11
|
|
Cash Incentive
|
4
|
|
2.12
|
|
Cash Incentive Deferrals
|
4
|
|
2.13
|
|
Code
|
4
|
|
2.14
|
|
Company
|
5
|
|
2.15
|
|
Company Contributions
|
5
|
|
2.16
|
|
Compensation
|
5
|
|
2.17
|
|
Compensation Committee
|
5
|
|
2.18
|
|
Contribution Credit
|
5
|
|
2.19
|
|
Controlled Group
|
5
|
|
2.2
|
|
DC SERP Contributions
|
5
|
|
2.21
|
|
Deferral Election
|
5
|
|
2.22
|
|
E-Series Payroll
|
5
|
|
2.23
|
|
Earnings Credits
|
6
|
|
2.24
|
|
Election Period
|
6
|
|
2.25
|
|
Eligibility Determination Date
|
6
|
|
2.26
|
|
Eligible Employee
|
6
|
|
2.27
|
|
Employee
|
6
|
|
2.28
|
|
Extra Deferral
|
6
|
|
2.29
|
|
Executive SSP+ Company Contribution
|
7
|
|
2.3
|
|
Mid-Year Election Period
|
7
|
|
2.31
|
|
Mid-Year Participation Period
|
7
|
|
2.32
|
|
Participant
|
7
|
|
2.33
|
|
Participant Deferrals
|
7
|
|
2.34
|
|
Performance Awards
|
7
|
|
2.35
|
|
Plan
|
7
|
|
2.36
|
|
Plan Year
|
7
|
|
2.37
|
|
PVP
|
7
|
|
2.38
|
|
Restoration Deferral
|
8
|
|
2.39
|
|
Restoration Matching Contributions
|
8
|
|
2.4
|
|
Restoration SSP+ Company Contribution
|
8
|
|
2.41
|
|
Separation from Service
|
8
|
|
2.42
|
|
Service
|
8
|
|
2.43
|
|
Specified Employee
|
8
|
|
APPENDIX A List of Excluded Entities
|
A-1
|
(i)
|
the Restoration Benefit, the purpose of which is to restore the benefits of certain employees under The Boeing Company Voluntary Investment Plan (“VIP”), to the extent that these qualified plan benefits are limited by Code sections 415 and 401(a)(17);
|
(ii)
|
Executive SSP+ Company Contributions, the purpose of which is to provide an additional contribution to this Plan equal to a percentage of the annual incentive plan payments for a select group of management or highly compensated employees; and
|
(iii)
|
the DC SERP, the purpose of which is to provide a supplemental retirement benefit for a select group of management and highly compensated employees; and
|
(iv)
|
Extra Deferrals, the purpose of which is to provide a means by which eligible employees may defer payment of their base salaries and awards made under eligible incentive compensation plans (a traditional deferred compensation benefit).
|
•
|
Aviall, Inc.
|
•
|
Inventory Locator Service, LLC
|
1.
|
Purpose.
|
2.
|
Definitions.
|
3.
|
Eligibility and Participation.
|
4.
|
Deferral Elections.
|
5.
|
Company Matching Contributions.
|
(A)
|
General
|
(B)
|
Forfeiture of Matching Contributions
|
6.
|
Accounts and Earnings Credits on Deferrals.
|
(A)
|
In General
|
(B)
|
Earnings Credit Methods
|
(i)
|
Interest Fund Method. A Participant’s Account shall be adjusted daily in accordance with changes in the unit value of the Account to reflect interest, based on the Participant’s Account balance.
|
(ii)
|
Boeing Stock Fund Method. A Participant’s Boeing Stock Fund Account shall be credited with the number of shares of the Company’s common stock that could be purchased with the amount credited to such account, based on the Fair Market Value of the Company’s common stock on the day the account is so credited (or on the next business day on which the New York Stock Exchange (the “Exchange”) is open, if the Exchange is closed on the day the account is credited) excluding commissions, taxes, and other charges. Such number shall be recorded as stock units in the Participant’s account, for bookkeeping purposes only. For purposes of the Plan, “Fair Market Value” means the mean of the high and low per share trading prices for the common stock of the Company as reported for the “New York Stock Exchange - Composite Transactions” for a single trading day. The number of stock units in an account shall be appropriately adjusted to reflect stock splits, stock dividends, and other like adjustments in the Company’s common stock.
|
(iii)
|
Other Investment Funds Method. In addition to the Interest Fund and Boeing Stock Fund methods of allocating earnings on Deferrals, a Participant may choose to diversify Deferrals eligible for diversification under paragraph 6(C) below by electing that the Participant’s Account be credited (or charged) with the expenses, income, gains and losses on investment funds similar to those offered under The Boeing Company Voluntary Investment Plan (excluding the Boeing Stock Fund and Stable Value Fund offered thereunder) as designated by the Committee from time to time, pursuant to an election by the Participant to have the Participant’s Account credited as though the Participant had elected to invest in such funds in such increments as the Participant shall direct in accordance with rules to be established by the Committee or its delegates; provided that the Committee may disregard such elections in its discretion.
|
(C)
|
Deferrals Eligible for Diversification.
|
(i)
|
Previous and future Deferrals of Base Salary (once earned);
|
(ii)
|
Previous and future Deferrals of cash Annual Incentive Awards (once earned);
|
(iii)
|
Vested Boeing Stock Unit (BSU) Deferrals;
|
(iv)
|
Unvested BSU Deferrals (once vested);
|
(v)
|
Performance Share Deferrals that were vested as of December 31, 2005;
|
(vi)
|
In the case of a Participant whose termination of employment occurred on or before December 31, 2005, any Matching Contributions credited to the Participant’s Accounts on or before January 3, 2006 (the next business day the Exchange is open); and
|
(vii)
|
Performance Awards.
|
(D)
|
Investment Election Changes and Restrictions
|
7.
|
Form and Timing of Distribution.
|
(A)
|
General Rule
|
(i)
|
Lump Sum Distribution
|
(ii)
|
Installment Payment
|
(B)
|
Changes to Distribution Election
|
(i)
|
A new distribution election must be submitted to the Committee or its delegate at least 12 months before the existing scheduled distribution date, and during the annual election period established by the Committee.
|
(ii)
|
The revised distribution election must not take effect for at least 12 months after it is made.
|
(iii)
|
The new distribution election must provide for an additional deferral period of at least 5 years beyond the original distribution date.
|
(C)
|
Separate Election for Matching Contributions
|
(D)
|
Separate Election for Annual Installments
|
(i)
|
The Participant’s nontransferable Performance Shares (Performance Shares that vested or vest after December 31, 2005, that are deferred into the Boeing Stock Fund), first, or
|
(ii)
|
A prorated payment of all the funds in the Participant’s Account each year.
|
(E)
|
Distributions At Age 70 ½
|
(F)
|
Specified Employees
|
(i)
|
the time elected under subsection (A),
|
(ii)
|
the first day of the month following completion of the six-month waiting period (for Specified Employees who Separate from Service between July 1 and December 31), and
|
(iii)
|
January of the first Plan Year following Separation from Service (for Specified Employees who Separate from Service between January 1 and June 30).
|
(G)
|
Distribution Due to Unforeseeable Emergency
|
8.
|
Death Benefits
|
9.
|
Payment in Stock or Cash.
|
10.
|
Tax and Other Withholding.
|
11.
|
Rehires
|
(A)
|
Participants Rehired After Commencing Benefits
|
(B)
|
Participants Rehired Before Commencing Benefits
|
12.
|
Termination or Amendment of the Plan.
|
13.
|
Participant’s Rights.
|
14.
|
Administration.
|
15.
|
Claims Procedures.
|
16.
|
Delays in Payment.
|
17.
|
Involuntary Inclusion in Income.
|
18.
|
Compliance with Code Section 409A.
|
19.
|
Construction.
|
20.
|
Legal Action.
|
|
Nine months ended
|
|
Years ended December 31,
|
||||||||||||
|
September 30, 2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
|||||
Earnings before income taxes (1)
|
|
$7,558
|
|
|
$10,107
|
|
|
$5,783
|
|
|
$7,155
|
|
|
$7,137
|
|
Fixed charges excluding capitalized interest
|
408
|
|
486
|
|
422
|
|
391
|
|
455
|
|
|||||
Amortization of previously capitalized interest
|
67
|
|
96
|
|
106
|
|
90
|
|
72
|
|
|||||
Net adjustment for earnings from affiliates
|
59
|
|
14
|
|
11
|
|
(34
|
)
|
7
|
|
|||||
Earnings available for fixed charges
|
|
$8,092
|
|
|
$10,703
|
|
|
$6,322
|
|
|
$7,602
|
|
|
$7,671
|
|
Fixed charges:
|
|
|
|
|
|
||||||||||
Interest and debt expense(2)
|
|
$368
|
|
|
$430
|
|
|
$365
|
|
|
$339
|
|
|
$402
|
|
Interest capitalized during the period
|
63
|
|
110
|
|
170
|
|
158
|
|
102
|
|
|||||
Rentals deemed representative of an interest factor
|
40
|
|
56
|
|
57
|
|
52
|
|
53
|
|
|||||
Total fixed charges
|
|
$471
|
|
|
$596
|
|
|
$592
|
|
|
$549
|
|
|
$557
|
|
Ratio of earnings to fixed charges
|
17.2
|
|
18.0
|
|
10.7
|
|
13.8
|
|
13.8
|
|
(1)
|
We adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606) on January 1, 2018, using the full retrospective method. 2017 and 2016 amounts have been adjusted to conform with the current year presentation. Amounts prior to 2016 have not been adjusted. See Note 1 – Basis of Presentation and and Note 2 - Impact of Adoption of New Standards of the Notes to the Condensed Consolidated Financial Statements for more information.
|
(2)
|
Amount does not include tax-related interest expense which is reported as a component of Income tax expense in our Condensed Consolidated Financial Statements.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Boeing Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Dennis A. Muilenburg
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Boeing Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Gregory D. Smith
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Dennis A. Muilenburg
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Gregory D. Smith
|
|