Spirit AeroSystems Cash Burn Continues Amid Aircraft Delivery Woes, and More

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Spirit AeroSystems Misses Q2 Expectations, Delivers Fewer 737 Fuselages

Spirit AeroSystems reported disappointing Q2 2024 results, with revenues of $1.5 billion and an adjusted loss per share of $2.73, significantly missing analyst expectations.

The company continues to face financial challenges and burn through cash as it delivered fewer than anticipated Boeing 737 fuselages.

Key Points

• Delivered only 27 Boeing 737 fuselages, lower than expected, despite producing at a rate of 31 per month

• Cash used in operations ballooned to $566 million, compared to $183 million in Q2 2023

• Free cash flow usage was $597 million in the quarter

• Ended Q2 with just $206 million in cash, down from $824 million at the start of 2024

• Total debt stands at $4.061 billion, while the cash balance raises concerns about liquidity

• Recognized $214 million in net forward losses in the quarter

• Withdrew financial guidance due to pending merger agreement with Boeing

What It Means

The results paint a concerning picture for Spirit AeroSystems' financial health and liquidity position.

The substantial cash burn and dwindling cash balance put the company in a bad situation as it struggles with delivery delays and production issues on the 737 MAX program.

The pending merger with Boeing, set to close in mid-2025, adds uncertainty to Spirit's outlook.

As a key supplier to Boeing, Spirit's challenges could have ripple effects on the broader aerospace supply chain.

Both companies need to work together to address production issues, improve delivery rates, and stabilize their financial positions to ensure long-term sustainability and meet customer commitments.

Other key Aviation and Aerospace Industry updates for today 👇

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Delta blames CrowdStrike, which argues Delta refused onsite help and is pushing a misleading narrative. The U.S. Department of Transportation is investigating.

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Activist Investor Elliott Reveals 7% Stake in Southwest Airlines

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Elliott aims to propose board candidates and seeks shareholder voting, potentially leading to a boardroom challenge.

Frontier Airlines Cuts Four Routes at Milwaukee Airport Amid Nationwide Network Update

Frontier Airlines has cut four nonstop routes from Milwaukee, including new routes to Philadelphia and Raleigh-Durham that started in May.

Routes to Orlando and Fort Myers have also ended. Milwaukee travelers can still access these destinations via other airlines.

All remaining Frontier flights from Milwaukee will now connect to Denver.

Joby Aviation Seeks Aircraft Certification in Australia, Paving Way for Electric Air Taxis

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The move builds on a bilateral agreement with the FAA, advancing Joby's goal of launching zero-emission, low-noise air taxis in Australia.