How did BA's Q4 2024 earnings surprise investors?

The Boeing Company's (BA) Q4 2024 earnings report disappointed investors further due to a significant decline in earnings and revenue, amid ongoing production challenges and strike impacts.

1. **Earnings Per Share (EPS) and Revenue**: The estimated EPS for Q4 2024 was -$2.44, which is a substantial loss and a stark contrast to the positive earnings per share of $2.90 reported in the same quarter of the previous year. The estimated revenue for the quarter was $16.17 billion, representing a decline from the previous year's revenue of $16.87 billion. This decline in revenue adds to the concerns over the company's financial performance.

2. **Production Challenges and Strike Impacts**: The ongoing challenges in production, including the impact of the IAM strike, have severely affected Boeing's performance. The company reported a core loss per share of $10.44, primarily due to the IAM work stoppage and charges on commercial and defense programs. The IAM strike has been a significant drag on the company's productivity and profitability.
3. **Free Cash Flow and Debt Levels**: Boeing's free cash flow was negative, with a usage of $2 billion in Q4 2024, which is a clear indication of the company's cash flow struggles. The company ended the quarter with $57.7 billion in debt, which is a significant concern for investors regarding the company's financial stability.
4. **Analyst Estimates and Market Sentiment**: Analysts had lowered their estimates for Q4 2024, with Seaport Res Ptn anticipating an EPS of -$2.09 and a revenue of $17.22 billion for the full year FY2024, which was lower than the previous year's revenue. This reflected broader market sentiment, indicating that investors were already braced for a challenging quarter.

In conclusion, Boeing's Q4 2024 earnings report reflected a company grappling with significant production and financial challenges. The company's substantial loss, revenue decline, and negative free cash flow, along with high debt levels, have likely contributed to a negative sentiment among investors. The ongoing impact of the IAM strike and the need to stabilize operations remain critical factors for investors to monitor.