What changed in this filing

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Item 1. Financial Statements

2022-10-26 compared with 2022-07-27 · 229 added, 187 removed, 741 unchanged (36% of the section changed)

2 unchanged sentences

Condensed Consolidated Statements of Operations

(Dollars in millions, except per share data) Six months ended June 30 Three months ended June 30

(Dollars in millions, except per share data) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

14 unchanged sentences

Interest and debt expense ( 1,901 ) ( 2,021 ) ( 621 ) ( 669 )

(Loss)/earnings before income taxes ( 1,241 ) ( 23 ) 377 549

Income tax benefit/(expense) 159 29 ( 217 ) 18

Net (loss)/earnings ( 1,082 ) 6 160 567

Loss before income taxes ( 4,373 ) ( 333 ) ( 3,132 ) ( 310 )

Income tax (expense)/benefit ( 17 ) 207 ( 176 ) 178

Net loss ( 4,390 ) ( 126 ) ( 3,308 ) ( 132 )

net loss attributable to noncontrolling interest ( 89 ) ( 67 ) ( 33 ) ( 23 )

Net (loss)/earnings attributable to Boeing Shareholders ($ 1,026 ) $ 50 $ 193 $ 587

Basic (loss)/earnings per share ($ 1.73 ) $ 0.09 $ 0.32 $ 1.00

Diluted (loss)/earnings per share ($ 1.73 ) $ 0.09 $ 0.32 $ 1.00

Net loss attributable to Boeing Shareholders ($ 4,301 ) ($ 59 ) ($ 3,275 ) ($ 109 )

Basic loss per share ($ 7.24 ) ($ 0.10 ) ($ 5.49 ) ($ 0.19 )

Diluted loss per share ($ 7.24 ) ($ 0.10 ) ($ 5.49 ) ($ 0.19 )

Weighted average diluted shares (millions) 594.0 587.3 596.3 589.0

2 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income

(Dollars in millions) Six months ended June 30 Three months ended June 30

(Dollars in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

Net (loss)/earnings ($ 1,082 ) $ 6 $ 160 $ 567

Net loss ($ 4,390 ) ($ 126 ) ($ 3,308 ) ($ 132 )

Other comprehensive income/(loss), net of tax:

Currency translation adjustments ( 123 ) ( 63 ) ( 71 ) ( 41 )

Unrealized loss on certain investments, net of tax of $0, $0, $0 and $0

Unrealized (loss)/gain on derivative instruments:

10 unchanged sentences

469 690 155 227

Settlements included in net (loss)/earnings, net of tax of $ 0 , ($ 1 ), $ 0 and ($ 1 )

Pension and postretirement cost related to our equity method investments, net of tax of $ 0 , ($ 1 ), $ 0 and $ 0

Settlements included in net loss, net of tax of $ 0 , ($ 11 ), $ 0 and ($ 10 )

Pension and postretirement (cost)/benefit related to our equity method investments, net of tax of $ 0 , ($ 1 ), $ 0 and $ 0

( 2 ) 2 ( 2 ) ( 1 )

Total defined benefit pension plans and other postretirement benefits, net of tax 399 2,320 131 1,889

6 unchanged sentences

Condensed Consolidated Statements of Financial Position

(Dollars in millions, except per share data) June 30

(Dollars in millions, except per share data) September 30

2022 December 31

43 unchanged sentences

Condensed Consolidated Statements of Cash Flows

(Dollars in millions) Six months ended June 30

(Dollars in millions) Nine months ended September 30

Cash flows – operating activities:

Net (loss)/earnings ($ 1,082 ) $ 6

Adjustments to reconcile net (loss)/earnings to net cash used by operating activities:

Net loss ($ 4,390 ) ($ 126 )

Adjustments to reconcile net loss to net cash provided/(used) by operating activities:

Non-cash items –

19 unchanged sentences

Other 232 225

Net cash used by operating activities ( 3,135 ) ( 3,870 )

Net cash provided/(used) by operating activities 55 ( 4,132 )

Cash flows – investing activities:

1 unchanged sentence

Proceeds from disposals of property, plant and equipment 19 385

Acquisitions, net of cash acquired ( 6 )

Contributions to investments ( 2,773 ) ( 27,902 )

Proceeds from investments 10,182 35,664

Other ( 11 ) 6

Net cash provided by investing activities 6,521 7,389

14 unchanged sentences

Condensed Consolidated Statements of Equity

For the six months ended June 30, 2022 and 2021

For the nine months ended September 30, 2022 and 2021

Boeing shareholders

5 unchanged sentences

Balance at January 1, 2021 $ 5,061 $ 7,787 ($ 52,641 ) $ 38,610 ($ 17,133 ) $ 241 ($ 18,075 )

Net earnings 50 ( 44 ) 6

Net loss ( 59 ) ( 67 ) ( 126 )

Other comprehensive income, net of tax of ($ 298 )

4 unchanged sentences

Treasury shares issued for 401(k) contribution 441 510 951

Balance at June 30, 2021 $ 5,061 $ 8,481 ($ 52,223 ) $ 38,660 ($ 16,661 ) $ 197 ($ 16,485 )

Balance at September 30, 2021 $ 5,061 $ 8,796 ($ 52,030 ) $ 38,551 ($ 14,818 ) $ 174 ($ 14,266 )

Balance at January 1, 2022 $ 5,061 $ 9,052 ($ 51,861 ) $ 34,408 ($ 11,659 ) $ 153 ($ 14,846 )

5 unchanged sentences

Treasury shares issued for 401(k) contribution 225 703 928

Balance at June 30, 2022 $ 5,061 $ 9,475 ($ 51,319 ) $ 33,382 ($ 11,487 ) $ 97 ($ 14,791 )

Balance at September 30, 2022 $ 5,061 $ 9,705 ($ 51,054 ) $ 30,107 ($ 11,518 ) $ 64 ($ 17,635 )

See Notes to the Condensed Consolidated Financial Statements.

1 unchanged sentence

Condensed Consolidated Statements of Equity

For the three months ended June 30, 2022 and 2021

For the three months ended September 30, 2022 and 2021

Boeing shareholders

4 unchanged sentences

Interests Total

Balance at April 1, 2021 $ 5,061 $ 8,155 ($ 52,395 ) $ 38,073 ($ 16,952 ) $ 217 ($ 17,841 )

Net earnings 587 ( 20 ) 567

Balance at July 1, 2021 $ 5,061 $ 8,481 ($ 52,223 ) $ 38,660 ($ 16,661 ) $ 197 ($ 16,485 )

Net loss ( 109 ) ( 23 ) ( 132 )

Other comprehensive income, net of tax of ($ 167 )

4 unchanged sentences

Treasury shares issued for 401(k) contribution 145 178 323

Balance at June 30, 2021 $ 5,061 $ 8,481 ($ 52,223 ) $ 38,660 ($ 16,661 ) $ 197 ($ 16,485 )

Balance at April 1, 2022 $ 5,061 $ 9,295 ($ 51,573 ) $ 33,189 ($ 11,370 ) $ 130 ($ 15,268 )

Net earnings 193 ( 33 ) 160

Balance at September 30, 2021 $ 5,061 $ 8,796 ($ 52,030 ) $ 38,551 ($ 14,818 ) $ 174 ($ 14,266 )

Balance at July 1, 2022 $ 5,061 $ 9,475 ($ 51,319 ) $ 33,382 ($ 11,487 ) $ 97 ($ 14,791 )

Net loss ( 3,275 ) ( 33 ) ( 3,308 )

Other comprehensive loss, net of tax of ($ 11 )

4 unchanged sentences

Treasury shares issued for 401(k) contribution 61 255 316

Balance at June 30, 2022 $ 5,061 $ 9,475 ($ 51,319 ) $ 33,382 ($ 11,487 ) $ 97 ($ 14,791 )

Balance at September 30, 2022 $ 5,061 $ 9,705 ($ 51,054 ) $ 30,107 ($ 11,518 ) $ 64 ($ 17,635 )

See Notes to the Condensed Consolidated Financial Statements.

2 unchanged sentences

Summary of Business Segment Data

(Dollars in millions) Six months ended June 30 Three months ended June 30

(Dollars in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

5 unchanged sentences

Total revenues $ 46,628 $ 47,493 $ 15,956 $ 15,278

Earnings/(loss) from operations:

(Loss)/earnings from operations:

Commercial Airplanes ($ 1,744 ) ($ 2,021 ) ($ 643 ) ($ 693 )

8 unchanged sentences

Interest and debt expense ( 1,901 ) ( 2,021 ) ( 621 ) ( 669 )

(Loss)/earnings before income taxes ( 1,241 ) ( 23 ) 377 549

Income tax benefit/(expense) 159 29 ( 217 ) 18

Net (loss)/earnings ( 1,082 ) 6 160 567

Loss before income taxes ( 4,373 ) ( 333 ) ( 3,132 ) ( 310 )

Income tax (expense)/benefit ( 17 ) 207 ( 176 ) 178

Net loss ( 4,390 ) ( 126 ) ( 3,308 ) ( 132 )

Net loss attributable to noncontrolling interest ( 89 ) ( 67 ) ( 33 ) ( 23 )

Net (loss)/earnings attributable to Boeing Shareholders ($ 1,026 ) $ 50 $ 193 $ 587

Net loss attributable to Boeing Shareholders ($ 4,301 ) ($ 59 ) ($ 3,275 ) ($ 109 )

This information is an integral part of the Notes to the Condensed Consolidated Financial Statements.

6 unchanged sentences

In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation are reflected in the interim financial statements.

The results of operations for the period ended June 30, 2022 are not necessarily indicative of the operating results for the full year.

The results of operations for the period ended September 30, 2022 are not necessarily indicative of the operating results for the full year.

The interim financial statements should be read in conjunction with the audited Consolidated Financial Statements, including the notes thereto, included in our 2021 Annual Report on Form 10-K.

Liquidity Matters

During the first six months of 2022, net cash used by operating activities was $ 3.1 billion.

Our operating cash flows continue to be impacted by lower commercial airplane deliveries and concessions paid to 737 MAX customers.

During the first nine months of 2022, net cash provided by operating activities was $ 0.1 billion.

Our operating cash flows continue to be impacted by lower commercial airplane deliveries.

We expect a negative impact on our operating cash flows until commercial deliveries ramp up.

As a result, our cash and short-term investment balance was $ 11.4 billion at June 30, 2022, down from $ 16.2 billion at December 31, 2021.

Our debt balance of $ 57.2 billion at June 30, 2022 is down from $ 58.1 billion at December 31, 2021.

Short-term debt and the current portion of long-term debt increased to $ 5.4 billion at June 30, 2022 from $ 1.3 billion at December 31, 2021.

Charges recorded on BDS fixed-price development contracts are expected to negatively impact cash flows in future periods.

Our cash and short-term investment balance was $ 14.3 billion at September 30, 2022, down from $ 16.2 billion at December 31, 2021.

Our debt balance of $ 57.2 billion at September 30, 2022 is down from $ 58.1 billion at December 31, 2021.

Short-term debt and the current portion of long-term debt increased to $ 5.4 billion at September 30, 2022 from $ 1.3 billion at December 31, 2021.

The current portion of long-term debt includes term notes of $ 0.3 billion maturing in the fourth quarter of 2022, $ 1.7 billion maturing in the first quarter of 2023, and $ 3.4 billion maturing in the second quarter of 2023.

As of June 30, 2022, our unused borrowing capacity on revolving credit agreements is $ 14.7 billion, unchanged from December 31, 2021.

As of September 30, 2022, our unused borrowing capacity is $ 12.0 billion, down from $ 14.7 billion at June 30, 2022.

In August 2022, we renewed the 364-day facility for $ 5.8 billion, which now expires in August 2023.

This 364-day facility has a one-year term out option that allows us to extend the maturity of any borrowings one additional year.

We anticipate that these credit lines will remain undrawn and primarily serve as back-up liquidity to support our general corporate borrowing needs.

Our borrowing capacity includes $ 6.3 billion scheduled to expire in October 2022, of which $ 3.1 billion has a one-year term out option that allows us to extend the maturity of any borrowings one additional year.

Our short-term and long-term credit ratings remained unchanged during the first half of 2022.

Our short-term and long-term credit ratings remained unchanged during the first nine months of 2022.

There is risk for future downgrades.

At June 30, 2022 and December 31, 2021, trade payables included $ 2.4 billion and $ 2.3 billion payable to suppliers who have elected to participate in supply chain financing programs.

At September 30, 2022 and December 31, 2021, trade payables included $ 2.2 billion and $ 2.3 billion payable to suppliers who have elected to participate in supply chain financing programs.

We do not believe that future changes in the availability of supply chain financing will have a significant impact on our liquidity.

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generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

We believe that the accounting estimates and assumptions are appropriate, however, given the increased uncertainties surrounding the severity and duration of the impacts of the COVID-19 pandemic actual results could differ from those estimates.

Actual results could differ from those estimates.

Long-term Contracts

2 unchanged sentences

Net cumulative catch-up adjustments to prior periods' revenue and earnings, including certain losses, across all long-term contracts were as follows:

(In millions - except per share amounts) Six months ended June 30 Three months ended June 30

(In millions - except per share amounts) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

(Decrease)/increase to Revenue ($ 2,204 ) $ 167 ($ 1,319 ) ($ 63 )

(Decrease)/increase to (Loss)/earnings from operations ($ 1,541 ) $ 58 ($ 411 ) $ 234

(Decrease)/increase to Diluted EPS ($ 2.27 ) ($ 0.03 ) ($ 0.29 ) $ 0.41

Increase to (Loss)/(decrease) to earnings from operations ($ 3,965 ) ($ 84 ) ($ 2,424 ) ($ 142 )

Decrease to Diluted EPS ($ 6.70 ) ($ 0.05 ) ($ 4.29 ) ($ 0.10 )

Note 2 – Earnings Per Share

5 unchanged sentences

The elements used in the computation of basic and diluted earnings per share were as follows:

(In millions - except per share amounts) Six months ended June 30 Three months ended June 30

(In millions - except per share amounts) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

Net (loss)/earnings attributable to Boeing Shareholders ($ 1,026 ) $ 50 $ 193 $ 587

earnings available to participating securities

Net (loss)/earnings available to common shareholders ($ 1,026 ) $ 50 $ 193 $ 587

Net loss available to common shareholders ($ 4,301 ) ($ 59 ) ($ 3,275 ) ($ 109 )

Basic weighted average shares outstanding

4 unchanged sentences

593.7 586.9 596.0 588.6

Basic weighted average shares outstanding

592.8 586.4 594.0 587.5

Dilutive potential common shares (2)

Diluted weighted average shares outstanding

4 unchanged sentences

593.7 586.9 596.0 588.6

Net (loss)/earnings per share:

Net loss per share:

($ 7.24 ) ($ 0.10 ) ($ 5.49 ) ($ 0.19 )

1 unchanged sentence

(1) Participating securities include certain instruments in our deferred compensation plan.

(2) Diluted earnings per share includes any dilutive impact of stock options, restricted stock units, performance-based restricted stock units and performance awards.

As a result of incurring a net loss for the six months ended June 30, 2022, 3.0 million potential common shares were excluded from diluted loss per share because the effect would have been antidilutive.

3.2 million, 3.5 million, 2.3 million and 2.7 million potential common shares were excluded from the diluted loss per share calculation for the nine and three months ended September 30, 2022 and 2021, respectively, because the effect would have been antidilutive as a result of incurring a net loss in those periods.

In addition, the following table includes the number of shares that may be dilutive potential common shares in the future.

These shares were not included in the computation of diluted loss per share because the effect was either antidilutive or the performance condition was not met.

(Shares in millions) Six months ended June 30 Three months ended June 30

(Shares in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

4 unchanged sentences

Note 3 – Income Taxes

Our income tax expense or benefit for interim periods is normally determined using an estimate of our annual effective tax rate, adjusted for discrete items.

In the second quarter of 2022, we determined that we could not make a reliable estimate of the annual effective tax rate primarily due to the sensitivity of the estimated annual tax rate to changes in forecasted pre-tax earnings in relation to significant permanent differences.

As a result, the effective tax rate for the six months ended June 30, 2022 was calculated based on 2022 year-to-date results.

We recorded a tax benefit of $ 159 for the six months ended June 30, 2022 primarily reflecting the 2022 operating losses.

The difference between the 2022 year-to-date effective tax rate of 12.8 % and the current federal tax rate of 21 % is primarily driven by increases to the valuation allowance in 2022, which reduced our recorded income tax benefit.

As of December 31, 2021, the Company had recorded valuation allowances of $ 2,423 primarily for certain federal deferred tax assets, as well as for certain federal and state net operating loss and tax credit carryforwards.

Our effective tax rate for the nine months ended September 30, 2022 was ( 0.4 )% and primarily reflects the 21 % federal tax rate and research and development tax credits which are more than offset by an increase to the valuation allowance and other permanent items.

The effective tax rate for the three months ended September 30, 2022 reflects additional tax expense to adjust prior quarters' results to the annual effective tax rate.

As of September 30, 2022 and December 31, 2021, the Company had recorded valuation allowances of $ 3,569 and $ 2,423 primarily for certain federal deferred tax assets, as well as for certain federal and state net operating loss and tax credit carryforwards.

The increase in the valuation allowance during 2022 is primarily due to tax credits and other carryforwards generated in 2022 that cannot be realized in 2022.

To measure the valuation allowance, the Company estimated in what year each of its deferred tax assets and liabilities would reverse using systematic and logical methods to estimate the reversal patterns.

6 unchanged sentences

Note 4 – Allowances for Losses on Financial Assets

The changes in allowances for expected credit losses for the six months ended June 30, 2022 and 2021 consisted of the following:

The changes in allowances for expected credit losses for the nine months ended September 30, 2022 and 2021 consisted of the following:

Accounts receivable Unbilled receivables Other current assets Customer financing Other assets Total

2 unchanged sentences

Write-offs 21 1 13 35

Balance at June 30, 2021 ($ 413 ) ($ 129 ) ($ 74 ) ($ 16 ) ($ 176 ) ($ 808 )

Recoveries 1 1

Balance at September 30, 2021

($ 407 ) ($ 126 ) ($ 74 ) ($ 14 ) ($ 172 ) ($ 793 )

Balance at January 1, 2022 ($ 390 ) ($ 91 ) ($ 62 ) ($ 18 ) ($ 186 ) ($ 747 )

2 unchanged sentences

Recoveries 5 5

Balance at June 30, 2022 ($ 148 ) ($ 26 ) ($ 61 ) ($ 60 ) ($ 80 ) ($ 375 )

Balance at September 30, 2022

($ 139 ) ($ 25 ) ($ 77 ) ($ 56 ) ($ 84 ) ($ 381 )

Note 5 – Inventories

5 unchanged sentences

Total $ 79,777 $ 78,823

Commercial spare parts, used aircraft, general stock materials and other includes capitalized precontract costs of $ 763 at June 30, 2022 and $ 648 at December 31, 2021 primarily related to KC-46A Tanker and Commercial Crew.

Commercial spare parts, used aircraft, general stock materials and other includes capitalized precontract costs of $ 734 at September 30, 2022 and $ 648 at December 31, 2021 primarily related to KC-46A Tanker and Commercial Crew.

Commercial Aircraft Programs

The increase in commercial aircraft programs inventory during 2022 reflects a continued buildup of 787 aircraft, as well as growth in 777X inventory.

Commercial aircraft programs inventory includes approximately 290 737 MAX aircraft and 120 787 aircraft at June 30, 2022 as compared with 335 737 MAX aircraft and 110 787 aircraft at December 31, 2021.

The increase in commercial aircraft programs inventory during 2022 reflects growth in 777X inventory and continued buildup of 787 aircraft, partially offset by a decrease in 737 MAX inventory.

Commercial aircraft programs inventory includes approximately 270 737 MAX aircraft and 115 787 aircraft at September 30, 2022 as compared with 335 737 MAX aircraft and 110 787 aircraft at December 31, 2021.

A number of customers have requested to defer deliveries or to cancel orders.

1 unchanged sentence

If we are unable to successfully remarket the aircraft, determine further production rate reductions are necessary, and/or contract the program accounting quantities, future earnings may be reduced and/or additional reach-forward losses may have to be recorded.

At June 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 737 program:

At September 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 737 program:

deferred production costs of $ 2,387 and $ 1,296 and unamortized tooling and other non-recurring costs of $ 645 and $ 617 .

At June 30, 2022, $ 2,230 of 737 deferred production costs, unamortized tooling and other non-recurring costs are expected to be recovered from units included in the program accounting quantity that have firm orders and $ 13 is expected to be recovered from units included in the program accounting quantity that represent expected future orders.

At June 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 777X program:

At September 30, 2022, $ 3,012 of 737 deferred production costs, unamortized tooling and other non-recurring costs are expected to be recovered from units included in the program accounting quantity that have firm orders and $ 20 is expected to be recovered from units included in the program accounting quantity that represent expected future orders.

At September 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 777X program:

deferred production costs of $ 1,236 and $ 652 and $ 3,696 and $ 3,521 of unamortized tooling and other non-recurring costs.

1 unchanged sentence

The production pause is resulting in abnormal production costs that are being expensed as incurred until 777X-9 production resumes.

We expensed abnormal production costs of $ 102 during the three months ended June 30, 2022.

The 777X program has near break-even margins at June 30, 2022.

We expensed abnormal production costs of $ 213 during the nine months ended September 30, 2022.

The 777X program has near break-even margins at September 30, 2022.

The level of profitability on the 777X program will be subject to a number of factors.

These factors include continued market uncertainty, the impacts of COVID-19 on our production system as well as impacts on our supply chain and customers, further production rate adjustments for the 777X or other commercial aircraft programs, any contraction of the accounting quantity and potential risks associated with the testing program and the timing of aircraft certification.

These factors include continued market uncertainty, the lingering impacts of COVID-19 on our production system as well as impacts on our supply chain and customers, further production rate adjustments for the 777X or other commercial aircraft programs, any contraction of the accounting quantity and potential risks associated with the testing program and the timing of aircraft certification.

One or more of these factors could result in additional reach-forward losses on the 777X program in future periods.

1 unchanged sentence

The resulting reach-forward loss of $ 3,460 was recorded as a reduction to deferred production costs.

At June 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 787 program:

At September 30, 2022 and December 31, 2021, commercial aircraft programs inventory included the following amounts related to the 787 program:

deferred production costs of $ 11,868 and $ 11,693 , $ 1,946 and $ 1,907 of supplier advances, and $ 1,795 and $ 1,815 of unamortized tooling and other non-recurring costs.

At June 30, 2022, $ 9,018 of 787 deferred production costs, unamortized tooling and other non-recurring costs are expected to be recovered from units included in the program accounting quantity that have firm orders

and $ 4,860 is expected to be recovered from units included in the program accounting quantity that represent expected future orders.

We expensed abnormal production costs of $ 595 during the six months ended June 30, 2022.

Commercial aircraft programs inventory included amounts credited in cash or other consideration (early issue sales consideration) to airline customers totaling $ 3,354 and $ 3,290 at June 30, 2022 and December 31, 2021.

At September 30, 2022, $ 9,015 of 787 deferred production costs, unamortized tooling and other non-recurring costs are expected to be recovered from units included in the program accounting quantity that have firm orders and $ 4,648 is expected to be recovered from units included in the program accounting quantity that represent expected future orders.

We expensed abnormal production costs of $ 925 during the nine months ended September 30, 2022.

Commercial aircraft programs inventory included amounts credited in cash or other consideration (early issue sales consideration) to airline customers totaling $ 3,427 and $ 3,290 at September 30, 2022 and December 31, 2021.

Note 6 – Contracts with Customers

Unbilled receivables increased from $ 8,620 at December 31, 2021 to $ 9,394 at June 30, 2022, primarily driven by revenue recognized at Defense, Space & Security (BDS) and Global Services (BGS) in excess of billings.

Advances and progress billings decreased from $ 52,980 at December 31, 2021 to $ 52,066 at June 30, 2022, primarily driven by revenue recognized at BDS, Commercial Airplanes (BCA), and BGS and the return of BCA customer advances, partially offset by advances on orders received.

Revenues recognized during the six months ended June 30, 2022 and 2021 from amounts recorded as Advances and progress billings at the beginning of each year were $ 6,814 and $ 7,315 .

Revenues recognized during the three months ended June 30, 2022 and 2021 from amounts recorded as Advances and progress billings at the beginning of each year were $ 3,413 and $ 2,597 .

Unbilled receivables increased from $ 8,620 at December 31, 2021 to $ 9,316 at September 30, 2022, primarily driven by revenue recognized at Defense, Space & Security (BDS) and Global Services (BGS) in excess of billings.

Advances and progress billings increased from $ 52,980 at December 31, 2021 to $ 53,177 at September 30, 2022, primarily driven by advances on orders received at BDS and BGS, partially offset by revenue recognized and cash returns at Commercial Airplanes (BCA).

Revenues recognized during the nine months ended September 30, 2022 and 2021 from amounts recorded as Advances and progress billings at the beginning of each year were $ 9,501 and $ 10,131 .

Revenues recognized during the three months ended September 30, 2022 and 2021 from amounts recorded as Advances and progress billings at the beginning of each year were $ 2,687 and $ 2,816 .

Note 7 – Customer Financing

12 unchanged sentences

Total $ 1,669 $ 1,812

At June 30, 2022 and December 31, 2021, $ 406 and $ 378 were determined to be uncollectible financing receivables and placed on non-accrual status.

The increase in the allowance for losses on receivables during the six months ended June 30, 2022 was primarily due to impacts of the war in Ukraine.

Customer financing interest income received was $ 6 and $ 3 for the six and three months ended June 30, 2022 and $ 11 and $ 5 for the six and three months ended June 30, 2021.

Our financing receivable balances at June 30, 2022 by internal credit rating category and year of origination consisted of the following:

At September 30, 2022 and December 31, 2021, $ 406 and $ 378 were determined to be uncollectible financing receivables and placed on non-accrual status.

The increase in the allowance for losses on receivables during the nine months ended September 30, 2022 was primarily due to impacts of the war in Ukraine.

Customer financing interest income received was $ 10 and $ 4 for the nine and three months ended September 30, 2022 and $ 14 and $ 3 for the nine and three months ended September 30, 2021.

Our financing receivable balances at September 30, 2022 by internal credit rating category and year of origination consisted of the following:

Rating categories Current 2021 2020 2019 2018 Prior Total

3 unchanged sentences

Total carrying value of financing receivables $ 35 $ 258 $ 114 $ 61 $ 12 $ 768 $ 1,248

At June 30, 2022, our allowance for losses related to receivables with ratings of CCC, B, BB, and BBB.

At September 30, 2022, our allowance for losses related to receivables with ratings of CCC, B, BB, and BBB.

We applied default rates that averaged 99.1 %, 27.9 %, 3.0 %, and 0.1 %, respectively, to the exposure associated with those receivables.

10 unchanged sentences

Operating lease equipment primarily includes large commercial jet aircraft.

Lease income recorded in revenue on the Condensed Consolidated Statements of Operations for the six months ended June 30, 2022 and 2021 included $ 36 and $ 25 from sales-type/finance leases, and $ 32 and $ 37 from operating leases, of which $ 5 and $ 5 related to variable operating lease payments.

Lease income recorded in revenue on the Condensed Consolidated Statements of Operations for the three months ended June 30, 2022 and 2021 included $ 18 and $ 12 from sales-type/finance leases, and $ 17 and $ 19 from operating leases, of which $ 1 and $ 3 related to variable operating lease payments.

Profit at the commencement of sales-type leases was recorded in revenue for the six months ended June 30, 2022 and 2021 in the amount of $ 12 and $ 36 .

Profit at the commencement of sales-type leases was recorded in revenue for the three months ended June 30, 2022 and 2021 in the amount of $ 8 and $ 20 .

Lease income recorded in revenue on the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2022 and 2021 included $ 52 and $ 38 from sales-type/finance leases, and $ 50 and $ 53 from operating leases, of which $ 6 and $ 6 related to variable operating lease payments.

Lease income recorded in revenue on the Condensed Consolidated Statements of Operations for the three months ended September 30, 2022 and 2021 included $ 16 and $ 13 from sales-type/finance leases, and $ 18 and $ 16 from operating leases, of which $ 1 and $ 1 related to variable operating lease payments.

Profit at the commencement of sales-type leases was recorded in revenue for the nine months ended September 30, 2022 and 2021 in the amount of $ 16 and $ 57 .

Profit at the commencement of sales-type leases was recorded in revenue for the three months ended September 30, 2022 and 2021 in the amount of $ 4 and $ 21 .

Note 8 – Investments

7 unchanged sentences

Total $ 1,742 $ 9,167

(1) Dividends received were $ 43 and $ 16 during the six and three months ended June 30, 2022 and $ 43 and $ 38 during the same periods in the prior year.

(1) Dividends received were $ 95 and $ 52 during the nine and three months ended September 30, 2022 and $ 52 and $ 9 during the same periods in the prior year.

During the third quarter of 2021, Boeing and AE Industrial Partners announced a strategic partnership to establish a dedicated aerospace venture fund.

This transaction resulted in the deconsolidation of HorizonX and generated a gain of $ 117 which is included in (Loss)/income from operating investments, net.

(2) Reflects amounts restricted in support of our property sales, workers’ compensation programs, and insurance premiums.

Allowance for losses on available for sale debt instruments are assessed quarterly.

All instruments are considered investment grade and, as such, we have not recognized an allowance for credit losses as of June 30, 2022.

All instruments are considered investment grade and we have not recognized an allowance for credit losses as of September 30, 2022.

Note 9 – Commitments and Contingencies

3 unchanged sentences

The Civil Aviation Administration of China issued an airworthiness directive in the fourth quarter of 2021 outlining actions required for airlines to return to service.

While we expect 737 MAX deliveries to our customers in China to resume in 2022, subject to final regulatory approvals, risk remains around the timing and rate of those deliveries.

There is uncertainty regarding timing of return to service and resumption of deliveries in China which are still subject to final regulatory approvals.

We continue to work with a small number of customers who have requested to defer deliveries or to cancel orders for 737 MAX aircraft, and we are remarketing and/or delaying deliveries of certain aircraft included within inventory.

We increased the production rate to 31 per month in 2022, and expect to implement further gradual production rate increases based on market demand and supply chain capacity.

We expensed abnormal production costs of $ 188 during the three months ended March 31, 2022.

We have approximately 290 airplanes in inventory as of June 30, 2022 and we anticipate delivering most of these aircraft by the end of 2023.

Approximately half the aircraft in inventory are designated for customers in China.

In the event that we are unable to resume aircraft deliveries in China and/or ramp up deliveries consistent with our assumptions, our expectation of delivery timing and our expectation regarding future gradual production rate increases could be impacted.

The following table summarizes changes in the 737 MAX customer concessions and other considerations liability during the six months ended June 30, 2022 and 2021.

We have approximately 270 airplanes in inventory as of September 30, 2022.

Due to ongoing uncertainties the program is facing including uncertainty regarding timing of resumption of deliveries to Chinese customers, we now anticipate delivering most of these aircraft by the end of 2024.

We have approximately 140 aircraft in inventory that are designated for customers in China.

We are exploring options to remarket some of these aircraft to other customers.

In the event that we are unable to resume aircraft deliveries in China or remarket those aircraft and/or ramp up deliveries consistent with our assumptions, our expectation of delivery timing and our expectation regarding future gradual production rate increases could be impacted.

The following table summarizes changes in the 737 MAX customer concessions and other considerations liability during the nine months ended September 30, 2022 and 2021.

Beginning balance – January 1 $ 2,940 $ 5,537

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Changes in estimates ( 16 ) ( 1 )

Ending balance – June 30 $ 2,108 $ 3,964

The liability balance of $ 2.1 billion at June 30, 2022 includes $ 1.7 billion of contracted customer concessions and other liabilities and $ 0.4 billion that remains subject to negotiation with customers.

Ending balance – September 30 $ 1,936 $ 3,443

The liability balance of $ 1.9 billion at September 30, 2022 includes $ 1.6 billion of contracted customer concessions and other liabilities and $ 0.3 billion that remains subject to negotiation with customers.

The contracted amount includes $ 0.9 billion expected to be liquidated by lower customer delivery payments, $ 0.6 billion expected to be paid in cash and $ 0.1 billion in other concessions.

Of the cash payments to customers, we expect to pay $ 0.5 billion in 2022.

Of the cash payments to customers, we expect to pay $ 0.1 billion in 2023 and $ 0.5 billion in 2024.

The type of consideration to be provided for the remaining $ 0.3 billion will depend on the outcomes of negotiations with customers.

Environmental

The following table summarizes environmental remediation activity during the six months ended June 30, 2022 and 2021.

The following table summarizes environmental remediation activity during the nine months ended September 30, 2022 and 2021.

Beginning balance – January 1 $ 605 $ 565

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Changes in estimates 171 99

Ending balance – June 30 $ 725 $ 582

Ending balance – September 30 $ 754 $ 629

The liabilities recorded represent our best estimate or the low end of a range of reasonably possible costs expected to be incurred to remediate sites, including operation and maintenance over periods of up to 30 years.

It is reasonably possible that we may incur charges that exceed these recorded amounts because of regulatory agency orders and directives, changes in laws and/or regulations, higher than expected costs and/or the discovery of new or additional contamination.

It is reasonably possible that we may incur charges that exceed these recorded amounts because

of regulatory agency orders and directives, changes in laws and/or regulations, higher than expected costs and/or the discovery of new or additional contamination.

As part of our estimating process, we develop a range of reasonably possible alternate scenarios that includes the high end of a range of reasonably possible cost estimates for all remediation sites for which we have sufficient information based on our experience and existing laws and regulations.

There are some potential remediation obligations where the costs of remediation cannot be reasonably estimated.

At June 30, 2022 and December 31, 2021, the high end of the estimated range of reasonably possible remediation costs exceeded our recorded liabilities by $ 1,015 and $ 1,094 .

At September 30, 2022 and December 31, 2021, the high end of the estimated range of reasonably possible remediation costs exceeded our recorded liabilities by $ 1,066 and $ 1,094 .

Product Warranties

The following table summarizes product warranty activity recorded during the six months ended June 30, 2022 and 2021.

The following table summarizes product warranty activity recorded during the nine months ended September 30, 2022 and 2021.

Beginning balance – January 1 $ 1,900 $ 1,527

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Changes in estimates 355 439

Ending balance – June 30 $ 2,030 $ 1,768

Ending balance – September 30 $ 2,093 $ 1,855

Commercial Aircraft Commitments

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Trade-in commitments, which can be terminated by mutual consent with the customer, may be exercised only during the period specified in the agreement, and require advance notice by the customer.

Trade-in commitment agreements at June 30, 2022 have expiration dates from 2022 through 2029.

At June 30, 2022 and December 31, 2021 total contractual trade-in commitments were $ 1,270 and $ 612 .

As of June 30, 2022 and December 31, 2021, we estimated that it was probable we would be obligated to perform on certain of these commitments with net amounts payable to customers totaling $ 349 and $ 283 and the fair value of the related trade-in aircraft was $ 346 and $ 283 .

Trade-in commitment agreements at September 30, 2022 have expiration dates from 2022 through 2029.

At September 30, 2022 and December 31, 2021 total contractual trade-in commitments were $ 1,262 and $ 612 .

As of September 30, 2022 and December 31, 2021, we estimated that it was probable we would be obligated to perform on certain of these commitments with net amounts payable to customers totaling $ 310 and $ 283 and the fair value of the related trade-in aircraft was $ 309 and $ 283 .

Financing Commitments

Financing commitments related to aircraft on order, including options and those proposed in sales campaigns, and refinancing of delivered aircraft, totaled $ 13,081 and $ 12,905 as of June 30, 2022 and December 31, 2021.

The estimated earliest potential funding dates for these commitments as of June 30, 2022 are as follows:

July through December 2022 $ 1,209

Financing commitments related to aircraft on order, including options and those proposed in sales campaigns, and refinancing of delivered aircraft, totaled $ 16,495 and $ 12,905 as of September 30, 2022 and December 31, 2021.

The estimated earliest potential funding dates for these commitments as of September 30, 2022 are as follows:

October through December 2022 $ 829

Thereafter 3,830

As of June 30, 2022, all of these financing commitments relate to customers we believe have less than investment-grade credit.

As of September 30, 2022, all of these financing commitments relate to customers we believe have less than investment-grade credit.

We have concluded that no reserve for future potential losses is required for these financing commitments based upon the terms, such as collateralization and interest rates, under which funding would be provided.

Funding Commitments

We have commitments to make additional capital contributions of $ 243 to joint ventures over the next five years.

We have commitments to make additional capital contributions of $ 265 to joint ventures over the next six years.

Standby Letters of Credit and Surety Bonds

We have entered into standby letters of credit and surety bonds with financial institutions primarily relating to the guarantee of our future performance on certain contracts.

Contingent liabilities on outstanding letters of credit agreements and surety bonds aggregated approximately $ 3,410 and $ 3,634 as of June 30, 2022 and December 31, 2021.

We have entered into standby letters of credit and surety bonds with financial institutions primarily relating to the guarantee of our future performance on certain contracts and security agreements.

Contingent liabilities on outstanding letters of credit and surety bonds aggregated approximately $ 4,850 and $ 3,634 as of September 30, 2022 and December 31, 2021.

Recoverable Costs on Government Contracts

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Air Force’s (USAF) VC-25B Presidential Aircraft, commonly known as Air Force One, is a $ 4.3 billion program to develop and modify two 747-8 commercial aircraft.

During the first half of 2022, the reach-forward loss on the contract increased by $ 686 driven by higher supplier costs, higher costs to finalize certain technical requirements and schedule delays.

Risk remains that we may be required to record additional losses in future periods.

During the nine and three months ended September 30, 2022, we increased the reach-forward loss on the contract by $ 1,452 and $ 766 driven by higher costs to incorporate certain technical requirements, increases to factory modification labor and support engineering, schedule delays and higher supplier costs.

The increase in the third quarter of 2022 was primarily driven by increases to cost estimates associated with factory modification labor and support engineering resources due to labor shortages and inefficiencies that we now estimate will persist longer than previously anticipated, higher supplier cost estimates based on ongoing supplier negotiations and higher levels of engineering design changes due to technical requirements which are driving increased rework and schedule delays.

Risk remains that we may record additional losses in future periods.

KC-46A Tanker

In 2011, we were awarded a contract from the USAF to design, develop, manufacture, and deliver four next generation aerial refueling tankers as well as priced options for 13 annual production lots totaling 179 aircraft.

This EMD contract is a fixed-price incentive fee contract and involves highly complex designs and systems integration.

Since 2016, the USAF has authorized eight low rate initial production (LRIP) lots for a total of 109 aircraft.

The EMD contract and authorized LRIP lots total approximately $ 21 billion as of

September 30, 2022.

As of September 30, 2022, we had approximately $ 207 of capitalized precontract costs and $ 228 of potential termination liabilities to suppliers related to unexercised future lots.

During the nine and three months ended September 30, 2022, we increased the reach-forward loss on the KC-46A Tanker program by $ 1,374 and $ 1,165 primarily reflecting higher production and supply chain costs partially driven by labor shortages and supply chain disruption.

The increase in the reach-forward loss in the third quarter of 2022 is primarily driven by factory unit time performance expectations that assume continued production disruption due to labor shortages and supply chain disruption.

Factory unit time estimates also reflect reduced benefits from prior investments in productivity enablers and higher factory unit time to produce aircraft for the remaining life of the program.

The third quarter charge also reflects increased estimated change incorporation costs for flight test aircraft as well as schedule delays to complete the Remote Vision System.

Risk remains that we may record additional losses in future periods.

In the third quarter of 2018, we were awarded the MQ-25 EMD contract by the U.S.

The contract is a fixed-price contract that now includes development and delivery of seven aircraft and test articles at a contract price of $ 890 .

In connection with winning the competition, we recognized a reach-forward loss of $ 291 in the third quarter of 2018.

During the nine and three months ended September 30, 2022, we increased the MQ-25 reach-forward loss by $ 576 and $ 351 primarily driven by higher manufacturing and engineering support costs, additional testing and certification activities, supplier quality, and engineering design challenges.

The increase in the third quarter of 2022 is primarily driven by higher than anticipated costs to manufacture the EMD units reflecting recent performance which is resulting in additional factory resources and increased engineering costs to address design and supplier quality issues.

We also increased costs associated with flight test support this quarter.

Risk remains that we may record additional losses in future periods.

T-7A Red Hawk EMD Contract & Production Options

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The EMD portion of the contract is a $ 860 fixed-price contract and includes five aircraft and seven simulators.

In the first half of 2022, we recorded earnings charges of $ 103 related to the T-7A Red Hawk fixed-price EMD contract, which has a reach-forward loss at June 30, 2022, primarily due to customer testing requirements, supply chain delays and hardware qualification issues.

During the nine and three months ended September 30, 2022, we recorded earnings charges of $ 203 and $ 100 related to the T-7A Red Hawk fixed-price EMD contract, which has a reach-forward loss at September 30, 2022, primarily due to supply chain, hardware qualification issues and schedule delays and customer testing requirements.

The increase in the reach-forward loss in the third quarter of 2022 was primarily driven by delays in achieving Military Flight Release and additional cost growth to resolve technical issues and other engineering design changes that were identified during the third quarter.

EMD aircraft flight testing is now estimated to start in 2023.

The production portion of the contract includes 11 production lots for aircraft and related services.

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The first production and support contract option is expected to be exercised in 2024.

The estimated loss increased by $ 351 during the first half of 2022 primarily driven by ongoing supply chain negotiations which are impacted by supply chain constraints, COVID-19, and inflationary pressures.

Risk remains that we may be required to record additional losses in future periods.

In the third quarter of 2018, we were awarded the MQ-25 EMD contract by the U.S.

The contract is a fixed-price contract that now includes development and delivery of seven aircraft and test articles at a contract price of $ 890 .

In connection with winning the competition, we recognized a reach-forward loss of $ 291 in the third quarter of 2018.

The period of performance runs from 2018 through 2024.

During the first half of 2022, we increased the MQ-25 reach-forward loss by $ 225 primarily driven by additional testing and certification activities, supplier quality, and engineering design challenges.

Risk remains that we may be required to record additional losses in future periods.

KC-46A Tanker

In 2011, we were awarded a contract from the USAF to design, develop, manufacture, and deliver four next generation aerial refueling tankers.

This EMD contract is a fixed-price incentive fee contract and involves highly complex designs and systems integration.

Since 2016, the USAF has authorized seven low rate initial production (LRIP) lots for a total of 94 aircraft.

The EMD contract and authorized LRIP lots total approximately $ 19 billion as of June 30, 2022.

As of June 30, 2022, we had approximately $ 295 of capitalized precontract costs and $ 866 of potential termination liabilities to suppliers.

During the first half of 2022, we increased the reach-forward loss on the KC-46A Tanker program by $ 209 primarily reflecting higher supply chain and production disruption costs.

Risk remains that we may be required to record additional losses in future periods.

We increased the estimated reach-forward loss by $ 536 and $ 185 during the nine and three months ended September 30, 2022 primarily driven by ongoing supply chain negotiations (which are impacted by supply chain constraints and inflationary pressures), and design revisions.

The increase in the reach-forward loss in the third quarter of 2022 was primarily driven by cost growth as a result of engineering and design changes as well as an increase in the number of expected units in the initial production lots.

Risk remains that we may record additional losses in future periods.

Commercial Crew

National Aeronautics and Space Administration (NASA) has contracted us to design and build the CST-100 Starliner spacecraft to transport crews to the International Space Station.

During the second quarter of 2022 we successfully completed the uncrewed Orbital Flight Test.

A crewed flight test is now expected to be completed in 2023.

During the nine and three months ended September 30, 2022, we

increased the reach-forward loss by $ 288 and $ 195 primarily reflecting increases to estimated costs related to completing the crewed flight tests and revised schedules for both the crewed flight test and three post certification missions.

The increase recorded in the third quarter of 2022 was primarily driven by timing of the three future post certification missions which are now assumed to be completed by 2026 based on NASA’s revised launch plans.

We had previously assumed that the post certification missions would be completed by 2024.

Risk remains that we may record additional losses in future periods.

Note 10 – Arrangements with Off-Balance Sheet Risk

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2022 December 31

2021 September 30

2022 December 31

2021 September 30

2022 December 31

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To the extent that claims have been made under these indemnities and/or are probable and reasonably estimable, liabilities associated with these indemnities are included in the environmental liability disclosure in Note 9.

Note 11 – Debt

As of September 30, 2022, we had $ 12,000 currently available under credit line agreements.

In the third quarter of 2022, we entered into a $ 5,800 364-day revolving credit agreement expiring in August 2023, a $ 3,000 three-year revolving credit agreement expiring in August 2025, and amended our $ 3,200 five-year revolving credit agreement, which expires in October 2024, primarily to incorporate a LIBOR successor rate.

The 364-day facility has a one-year term out option that allows us to extend the maturity of any borrowings one additional year.

We continue to be in full compliance with all covenants contained in our debt or credit facility agreements.

Note 12 – Postretirement Plans

The components of net periodic benefit (income)/cost were as follows:

Six months ended June 30 Three months ended June 30

Nine months ended September 30 Three months ended September 30

Pension Plans 2022 2021 2022 2021

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Recognized net actuarial loss 681 924 227 304

Settlement/curtailment loss 4 3

Settlement/curtailment (gain)/loss ( 4 ) 156 ( 4 ) 152

Net periodic benefit income ($ 664 ) ($ 379 ) ($ 225 ) ($ 29 )

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Net periodic benefit income included in Other income, net ( 666 ) ( 381 ) ($ 225 ) ($ 29 )

Net periodic benefit income included in (Loss)/earnings before income taxes ($ 439 ) ($ 350 ) ($ 220 ) ($ 174 )

Six months ended June 30 Three months ended June 30

Net periodic benefit income included in Loss before income taxes ($ 664 ) ($ 379 ) ($ 225 ) ($ 29 )

Nine months ended September 30 Three months ended September 30

Other Postretirement Plans 2022 2021 2022 2021

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Net periodic benefit cost included in (Loss)/earnings from operations $ 59 $ 66 $ 20 $ 22

Net periodic benefit cost included in Other income, net ( 29 ) ( 10 ) ( 14 ) ( 5 )

Net periodic benefit cost included in (Loss)/earnings before income taxes $ 10 $ 34 $ 6 $ 17

Net periodic benefit income included in Other income, net ( 44 ) ( 16 ) ( 15 ) ( 6 )

Net periodic benefit cost included in Loss before income taxes $ 15 $ 50 $ 5 $ 16

In the third quarter of 2021, we recorded a $ 151 settlement charge in Other income, net and remeasured assets and benefit obligations related to one of the Company’s pension plans.

The remeasurement resulted in a net actuarial gain of $ 1,642 , which is included in Other comprehensive income.

The $ 1,642 reflects a gain of $ 923 primarily driven by an increase in the discount rate from approximately 2.6 % at December 31, 2020 to approximately 2.8 % as of the remeasurement date, as well as a gain of $ 719 primarily driven by asset returns in excess of expected returns.

Note 13 – Share-Based Compensation and Other Compensation Arrangements

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The RSUs granted under this program have a grant date fair value of $ 217.48 per unit.

On July 29, 2022, we also granted 2,568,112 RSUs with a grant date fair value of $ 157.69 per unit as part of our long-term incentive program, accelerating awards planned for 2023 to retain executives.

The RSUs granted under this program will generally vest and settle in common stock (on a one-for-one basis) on the third anniversary of the grant date.

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Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss (AOCI) by component for the six and three months ended June 30, 2022 and 2021 were as follows:

Changes in Accumulated other comprehensive loss (AOCI) by component for the nine and three months ended September 30, 2022 and 2021 were as follows:

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)

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Net current period Other comprehensive (loss)/income ( 63 ) 58 2,320 2,315

Balance at June 30, 2021 ($ 52 ) $ 1 $ 20 ($ 16,630 ) ($ 16,661 )

Balance at September 30, 2021 ($ 93 ) $ 1 $ 15 ($ 14,741 ) ($ 14,818 )

Balance at January 1, 2022 ($ 105 ) $ 1 $ 6 ($ 11,561 ) ($ 11,659 )

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Net current period Other comprehensive (loss)/income ( 123 ) ( 2 ) ( 133 ) 399 141

Balance at September 30, 2022 ($ 228 ) ($ 1 ) ($ 127 ) ($ 11,162 ) ($ 11,518 )

Balance at June 30, 2021 ($ 52 ) $ 1 $ 20 ($ 16,630 ) ($ 16,661 )

Balance at March 31, 2021 ($ 66 ) $ 1 ($ 34 ) ($ 16,853 ) ($ 16,952 )

Other comprehensive income before reclassifications 14 54 8 76

Other comprehensive (loss)/income before reclassifications ( 41 ) ( 1 ) 1,543 (2)

Amounts reclassified from AOCI

Net current period Other comprehensive income 14 54 223 291

( 4 ) 346 (3)

Net current period Other comprehensive (loss)/income ( 41 ) ( 5 ) 1,889 1,843

Balance at September 30, 2021 ($ 93 ) $ 1 $ 15 ($ 14,741 ) ($ 14,818 )

Balance at June 30, 2022 ($ 157 ) $ 1 ($ 38 ) ($ 11,293 ) ($ 11,487 )

Balance at March 31, 2022 ($ 81 ) $ 1 $ 135 ($ 11,425 ) ($ 11,370 )

Other comprehensive loss before reclassifications ( 71 ) ( 2 ) ( 83 ) ( 2 ) ( 158 )

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Net current period Other comprehensive (loss)/income ( 71 ) ( 2 ) ( 89 ) 131 ( 31 )

Balance at June 30, 2022 ($ 157 ) $ 1 ($ 38 ) ($ 11,293 ) ($ 11,487 )

Balance at September 30, 2022 ($ 228 ) ($ 1 ) ($ 127 ) ($ 11,162 ) ($ 11,518 )

(1) Net of tax.

(2) Primarily relates to amortization of actuarial losses for the six and three months ended June 30, 2022 of $ 314 and $ 155 (net of tax of ($ 84 ) and ($ 44 )) and the six and three months ended June 30, 2021 totaling $ 463 and $ 235 (net of tax of ($ 122 ) and ($ 57 )).

(2) Primarily relates to remeasurement of assets and benefit obligations related to the Company's pension plans resulting in an actuarial gain for the nine and three months ended September 30, 2021 of $ 1,551 and $ 1,544 (net of tax of ($ 106 ) and ($ 104 )).

(3) Primarily relates to amortization of actuarial losses for the nine and three months ended September 30, 2022 of $ 469 and $ 155 (net of tax of ($ 129 ) and ($ 45 )) and the nine and three months ended September 30, 2021 totaling $ 690 and $ 227 (net of tax of ($ 182 ) and ($ 60 )).

These are included in the net periodic pension cost.

(3) Includes losses of $ 39 (net of tax of ($ 11 )) from cash flow hedges reclassified to Other income, net because the forecasted transactions are no longer probable of occurring.

(4) Includes losses of $ 39 (net of tax of ($ 11 )) from cash flow hedges reclassified to Other income, net because the forecasted transactions are probable of not occurring.

Note 15 – Derivative Financial Instruments

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2022 December 31

2021 September 30

2022 December 31

2021 September 30

2022 December 31

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Gains/(losses) associated with our hedging transactions and forward points recognized in Other comprehensive income are presented in the following table:

Six months ended June 30 Three months ended June 30

Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

Recognized in Other comprehensive income, net of taxes:

Recognized in Other comprehensive income/(loss), net of taxes:

Foreign exchange contracts ($ 186 ) ($ 49 ) ($ 82 ) ($ 43 )

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Gains/(losses) associated with our hedging transactions and forward points reclassified from AOCI to earnings are presented in the following table:

Six months ended June 30 Three months ended June 30

Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

Foreign exchange contracts

Revenues $ 1 $ 1

Costs and expenses 9 $ 8 ( 1 ) $ 5

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General and administrative expense 6 4 4 1

Losses from cash flow hedges reclassified from AOCI to Other income, net because it is probable the forecasted transactions will not occur were $ 50 and $ 0 for the six months ended June 30, 2022 and 2021.

Losses related to undesignated derivatives on foreign exchange and commodity cash flow hedging transactions recognized in Other income, net were insignificant for the six and three months ended June 30, 2022 and 2021.

Losses from cash flow hedges reclassified from AOCI to Other income, net because it is probable the forecasted transactions will not occur were $ 50 and $ 0 for the nine months ended September 30, 2022 and 2021.

Losses related to undesignated derivatives on foreign exchange and commodity cash flow hedging transactions recognized in Other income, net were insignificant for the nine and three months ended September 30, 2022 and 2021.

Based on our portfolio of cash flow hedges, we expect to reclassify gains of $ 8 (pre-tax) out of Accumulated other comprehensive loss into earnings during the next 12 months.

We have derivative instruments with credit-risk-related contingent features.

For foreign exchange contracts with original maturities of at least five years, our derivative counterparties could require settlement if we default on our five-year credit facility.

For certain commodity contracts, our counterparties could require collateral posted in an amount determined by our credit ratings.

The fair value of foreign exchange and commodity contracts that have credit-risk-related contingent features that are in a net liability position at June 30, 2022 was $ 25 .

At June 30, 2022, there was no collateral posted related to our derivatives.

If we default on our five-year credit facility, our derivative counterparties could require settlement for foreign exchange and certain commodity contracts with original maturities of at least five years.

The fair value of those contracts in a net liability position at September 30, 2022 was $ 50 .

For other particular commodity contracts, our counterparties could require collateral posted in an amount determined by our credit ratings.

At September 30, 2022, there was no collateral posted related to our derivatives.

Note 16 – Fair Value Measurements

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The following table presents our assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy.

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Total Level 1 Level 2 Total Level 1 Level 2

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Commodity derivatives are valued using an income approach based on the present value of the commodity index prices less the contract rate multiplied by the notional amount.

Certain assets have been measured at fair value on a nonrecurring basis using significant unobservable inputs (Level 3).

The following table presents the nonrecurring losses recognized for the six months ended June 30 due to long-lived asset impairment and the fair value and asset classification of the related assets as of the impairment date:

Losses Total Total

Certain assets have been measured at fair value on a nonrecurring basis.

The following table presents the nonrecurring losses recognized for the nine months ended September 30 due to long-lived asset impairment and the fair value and asset classification of the related assets as of the impairment date:

Total Level 2 Level 3 Total

Losses Total Level 2 Level 3 Total

Investments ($ 31 ) ($ 8 )

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Total $ 48 $ 48 ($ 78 ) $ 120 $ 103 $ 17 ($ 72 )

Investments, Property, plant and equipment, Other assets and Acquired intangible assets were primarily valued using an income approach based on the discounted cash flows associated with the underlying assets.

Level 3 Investments, Property, plant and equipment, Other assets and Acquired intangible assets were primarily valued using an income approach based on the discounted cash flows associated with the underlying assets.

Level 2 Property, plant and equipment were valued based on a third party valuation using a combination of income and market approaches that considered estimates of net operating

income, capitalization rates and adjusted for as-is condition.

The fair value of the impaired customer financing assets includes operating lease equipment and investments in sales type-leases/finance leases and is derived by calculating a median collateral value from a consistent group of third party aircraft value publications.

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Under certain circumstances, we adjust values based on the attributes and condition of the specific aircraft or equipment, usually when the features or use of the aircraft vary significantly from the more generic aircraft attributes covered by third party publications, or on the expected net sales price for the aircraft.

For Level 3 assets that were measured at fair value on a nonrecurring basis during the period ended June 30, 2022, the following table presents the fair value of those assets as of the measurement date, valuation techniques and related unobservable inputs of those assets.

For Level 3 assets that were measured at fair value on a nonrecurring basis during the period ended September 30, 2022, the following table presents the fair value of those assets as of the measurement date, valuation techniques and related unobservable inputs of those assets.

Value Valuation

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The fair values and related carrying values of financial instruments that are not required to be remeasured at fair value on the Condensed Consolidated Statements of Financial Position were as follows:

June 30, 2022

September 30, 2022

Amount Total Fair

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For our debt that is not traded in the secondary market, the fair value is classified as Level 2 and is based on our indicative borrowing cost derived from dealer quotes or discounted cash flows.

The fair values of our debt classified as Level 3 are based on discounted cash flow models using the implied yield from similar securities.

The fair values of our debt classified as Level 3 are based on discounted cash flow models using the implied yield from

similar securities.

With regard to other financial instruments with off-balance sheet risk, it is not practicable to estimate the fair value of our indemnifications and financing commitments because the amount and timing of those arrangements are uncertain.

Items not included in the above disclosures include cash, restricted cash, time deposits and other deposits, commercial paper, money market funds, Accounts

receivable, Unbilled receivables, Other current assets, Accounts payable and long-term payables.

The carrying values of those items, as reflected in the Condensed Consolidated Statements of Financial Position, approximate their fair value at June 30, 2022 and December 31, 2021.

Items not included in the above disclosures include cash, restricted cash, time deposits and other deposits, commercial paper, money market funds, Accounts receivable, Unbilled receivables, Other current assets, Accounts payable and long-term payables.

The carrying values of those items, as reflected in the Condensed Consolidated Statements of Financial Position, approximate their fair value at September 30, 2022 and December 31, 2021.

The fair value of assets and liabilities whose carrying value approximates fair value is determined using Level 2 inputs, with the exception of cash (Level 1).

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As a result of the settlement, the Company received $ 219 in the second quarter of 2022.

In September 2022, we settled a previously disclosed investigation by the Securities and Exchange Commission related to the 737 MAX accidents and consented to a civil penalty, which resulted in an earnings charge of $ 200 that was paid in October 2022.

Further, we are subject to, and cooperating with ongoing governmental and regulatory investigations and inquiries relating to the accidents and the 737 MAX.

Among these is an ongoing investigation by the Securities and Exchange Commission, the outcome of which may be material.

We cannot reasonably estimate a range of loss, if any, not covered by available insurance that may result given the current status of the pending lawsuits, investigations, and inquiries related to the 737 MAX.

During 2019, we entered into agreements with Embraer S.A.

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Note 18 – Segment and Revenue Information

Our primary profitability measurements to review a segment’s operating results are Earnings/(loss) from operations and operating margins.

Our primary profitability measurements to review a segment’s operating results are (Loss)/earnings from operations and operating margins.

We operate in four reportable segments:

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BCA revenues by customer location consist of the following:

(Dollars in millions) Six months ended June 30 Three months ended June 30

(Dollars in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

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BDS revenues on contracts with customers, based on the customer's location, consist of the following:

(Dollars in millions) Six months ended June 30 Three months ended June 30

(Dollars in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

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BGS revenues consist of the following:

(Dollars in millions) Six months ended June 30 Three months ended June 30

(Dollars in millions) Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

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Backlog is converted into revenue, primarily based on the cost incurred or at delivery and acceptance of products, depending on the applicable revenue recognition model.

Our backlog at June 30, 2022 was $ 371,730 .

Our backlog at September 30, 2022 was $ 381,315 .

We expect approximately 23 % to be converted to revenue through 2023 and approximately 78 % through 2026, with the remainder thereafter.

There is significant uncertainty regarding the timing of when backlog will convert into revenue due to 787 production issues and associated rework, timing of 737 MAX delivery resumption in China, timing of entry into service of the 777X, 737 MAX 7 and/or 737 MAX 10, and the lingering effects of the COVID-19 pandemic.

There is significant uncertainty regarding the timing of when backlog will convert into revenue due to timing of 787 deliveries from inventory, timing of 737 MAX delivery resumption in China, timing of entry into service of the 777X, 737 MAX 7 and/or 737 MAX 10, and the lingering effects of the COVID-19 pandemic.

Unallocated Items, Eliminations and other

Unallocated items, eliminations and other include common internal services that support Boeing’s global business operations, intercompany guarantees provided to BCC and eliminations of certain sales between segments.

Such sales include airplanes sold to our BCC segment that are leased by BCC to customers under operating leases and considered transferred to the BCC segment.

Such sales include airplanes sold to our BCC segment that are leased by BCC to customers and considered transferred to the BCC segment.

We generally allocate costs to business segments based on the U.S.

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Components of Unallocated items, eliminations and other (expense)/income are shown in the following table.

Six months ended June 30 Three months ended June 30

Nine months ended September 30 Three months ended September 30

2022 2021 2022 2021

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Results of Review of Interim Financial Information

We have reviewed the accompanying condensed consolidated statement of financial position of The Boeing Company and subsidiaries (the “Company”) as of June 30, 2022, the related condensed consolidated statements of operations, comprehensive income, and equity for the three-month and six-month periods ended June 30, 2022 and 2021, and of cash flows for the six-month periods ended June 30, 2022 and 2021, and the related notes (collectively referred to as the "condensed consolidated interim financial information").

We have reviewed the accompanying condensed consolidated statement of financial position of The Boeing Company and subsidiaries (the “Company”) as of September 30, 2022, the related condensed consolidated statements of operations, comprehensive income, and equity for the three-month and nine-month periods ended September 30, 2022 and 2021, and of cash flows for the nine-month periods ended September 30, 2022 and 2021, and the related notes (collectively referred to as the "condensed consolidated interim financial information").

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying condensed consolidated interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

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Chicago, Illinois

July 27, 2022

October 26, 2022

FORWARD-LOOKING STATEMENTS

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements