Boeing reported a quarterly loss that surpassed analyst expectations on Tuesday, booking a $280 million charge on its troubled Air Force One replacement program. However, the company's free cash flow turned positive, signaling growing momentum in its turnaround plan.

The charge was driven by higher engineering costs required to ensure the delivery of two delayed presidential aircraft replacements by 2028. This contributed to a second-quarter net loss of $428 million. Despite the charge and the larger-than-expected loss, Boeing shares rose 4% in afternoon trading, as investors appeared to respond positively to the company's steady progress in production improvements and the growth in free cash flow for the quarter.

According to data from the London Stock Exchange Group (LSEG), core loss per share was 76 cents, significantly higher than the average analyst estimate of a 30-cent loss per share, but an improvement from the core loss of $1.24 per share in the same period last year.

Boeing generated $631 million in free cash flow, compared to a negative $200 million in the second quarter of 2025. The company attributed the increase in cash flow partly to higher-than-expected customer payments.

The U.S. aircraft manufacturer maintained its full-year free cash flow guidance of $1 billion to $3 billion—which would mark the first positive figure since 2023—while also increasing production of its best-selling 737 MAX narrow-body jet.

Capital investments in the quarter also increased compared to last year, primarily driven by spending to expand 787 production capacity in South Carolina and military jet production capabilities in the St. Louis, Missouri area.

Boeing is also working to deliver two 747-8 jets for the Air Force One program, a project covered under a $3.9 billion fixed-price contract signed in 2018. The program is currently four years behind schedule and has seen cost overruns exceeding $1 billion.

President Donald Trump accepted a donated 747-8 jet from Qatar as a temporary Air Force One, but stated this month that the aircraft would soon be sent for upgrades after raising questions about its safety performance.

Production Improvements, Deliveries Increase

Boeing is currently increasing monthly production of its best-selling 737 MAX from 42 units to 47 units. Boosting output is critical to the company's ongoing financial recovery—after years of crisis, net debt has climbed to nearly $26 billion, and its reputation has been damaged. The company aims to raise monthly production to 52 units by early next year, and subsequently to 57 units.

CEO Kelly Ortberg warned that reaching a monthly production rate of 57 units would require stronger performance from suppliers. He added that Boeing needs to ensure a smooth ramp-up in the production of key components, such as the 737 wing assembly.

Regarding the 787 Dreamliner, Ortberg stated that GE Aerospace's engine deliveries remain a key factor in increasing monthly production to 10 units. The U.S. manufacturer is working closely with GE to develop a recovery plan, as engine shipments fell behind schedule in the first half of the year.