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Item 8. Financial Statements and Supplementary Data

2024-01-31 compared with 2023-01-27 · 338 added, 383 removed, 1500 unchanged (32% of the section changed)

15 unchanged sentences

Note 8 - Contracts with Customers

Note 9 - Customer Financing

Note 9 - Financing Receivables and Operating Lease Equipment

Note 10 - Property, Plant and Equipment

11 unchanged sentences

Note 22 - Segment and Revenue Information

N ote 23 - Su bsequent Events

Reports of Independent Registered Public Accounting Firm

8 unchanged sentences

Cost of services ( 10,206 ) ( 9,109 ) ( 9,283 )

Boeing Capital interest expense ( 28 ) ( 32 ) ( 43 )

Total costs and expenses ( 70,070 ) ( 63,078 ) ( 59,237 )

7,724 3,530 3,049

(Loss)/income from operating investments, net ( 16 ) 210 9

Income/(loss) from operating investments, net 46 ( 16 ) 210

General and administrative expense ( 5,168 ) ( 4,187 ) ( 4,157 )

17 unchanged sentences

Net loss ($ 2,242 ) ($ 5,053 ) ($ 4,290 )

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

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

Currency translation adjustments 33 ( 62 ) ( 75 )

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

Unrealized gain/(loss) on certain investments, net of tax of $ 0 , $ 0 and $ 0

Derivative instruments:

Unrealized (loss)/gain arising during period, net of tax of $ 12 , ($ 16 ) and ($ 4 )

Reclassification adjustment for loss/(gain) included in net earnings, net of tax of ($ 3 ), $ 2 and ($ 7 )

Total unrealized (loss)/gain on derivative instruments, net of tax ( 30 ) 49 41

Unrealized gain/(loss) arising during period, net of tax of ($ 11 ), $ 12 and ($ 16 )

Reclassification adjustment for (gain)/loss included in net loss, net of tax of $ 1 , ($ 3 ) and $ 2

( 5 ) 10 ( 6 )

Total unrealized gain/(loss) on derivative instruments, net of tax

Defined benefit pension plans & other postretirement benefits:

Net actuarial gain/(loss) arising during the period, net of tax of ($ 22 ), ($ 32 ) and $ 111

Net actuarial (loss)/gain arising during the period, net of tax of $ 13 , ($ 22 ) and ($ 32 )

( 722 ) 1,533 4,262

Amortization of actuarial loss included in net periodic pension cost, net of tax of ($ 11 ), ($ 8 ) and ($ 52 )

Amortization of actuarial (gain)/loss included in net periodic pension cost, net of tax of $ 0 , ($ 11 ) and ($ 8 )

( 2 ) 791 1,155

Settlements included in net (loss)/income, net of tax of $ 0 , ($ 2 ) and $ 0

Settlement (gain)/loss included in net periodic cost, net of tax of $ 0 , $ 0 and ($ 2 )

Amortization of prior service credits included in net periodic pension cost, net of tax of $ 1 , $ 2 and $ 1

( 102 ) ( 114 ) ( 114 )

Prior service (credit)/cost arising during the period, net of tax of $ 0 , $ 0 and ($ 2 )

Prior service credit arising during the period, net of tax of $ 0 , $ 0 and $ 0

Pension and postretirement (cost)/benefit related to our equity method investments, net of tax of $ 0 , $ 0 and ($ 2 )

Total defined benefit pension plans & other postretirement benefits, net of tax ( 826 ) 2,202 5,500

Other comprehensive income/(loss), net of tax 2,109 5,474 ( 980 )

Other comprehensive (loss)/income, net of tax

( 755 ) 2,109 5,474

Comprehensive (loss)/income, net of tax ( 2,997 ) ( 2,944 ) 1,184

10 unchanged sentences

Unbilled receivables, net 8,317 8,634

Current portion of customer financing, net 154 117

Current portion of financing receivables, net 99 154

Inventories 79,741 78,151

1 unchanged sentence

Total current assets 109,275 109,523

Customer financing, net 1,450 1,695

Financing receivables and operating lease equipment, net 860 1,450

Property, plant and equipment, net 10,661 10,550

35 unchanged sentences

Net loss ($ 2,242 ) ($ 5,053 ) ($ 4,290 )

Adjustments to reconcile net loss to net cash used by operating activities:

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

Non-cash items –

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Investment/asset impairment charges, net 46 112 98

Customer financing valuation adjustments 37 12

Gain on dispositions, net ( 2 ) ( 6 ) ( 277 )

787 and 777X reach-forward losses 3,460 6,493

787 reach-forward loss 3,460

Other charges and credits, net 3 401 360

10 unchanged sentences

Pension and other postretirement plans ( 1,049 ) ( 1,378 ) ( 972 )

Customer financing, net 142 210 173

Financing receivables and operating lease equipment, net

Other 119 307 304

7 unchanged sentences

Other ( 158 ) ( 11 ) 5

Net cash provided/(used) by investing activities 4,370 9,324 ( 18,366 )

Net cash (used)/provided by investing activities ( 2,437 ) 4,370 9,324

Cash flows – financing activities:

3 unchanged sentences

Employee taxes on certain share-based payment arrangements ( 408 ) ( 40 ) ( 66 )

Dividends paid ( 1,158 )

Net cash (used)/provided by financing activities ( 1,266 ) ( 5,600 ) 34,955

Net cash used by financing activities ( 5,487 ) ( 1,266 ) ( 5,600 )

Effect of exchange rate changes on cash and cash equivalents 30 ( 73 ) ( 39 )

Net increase/(decrease) in cash & cash equivalents, including restricted 6,543 269 ( 1,736 )

Net (decrease)/increase in cash & cash equivalents, including restricted ( 1,934 ) 6,543 269

Cash & cash equivalents, including restricted, at beginning of year 14,647 8,104 7,835

15 unchanged sentences

( 4,202 ) ( 88 ) ( 4,290 )

Other comprehensive loss, net of tax of $ 52

( 980 ) ( 980 )

Other comprehensive income, net of tax of ($ 57 )

Share-based compensation 833 833

2 unchanged sentences

( 98 ) 35 ( 63 )

Treasury shares contributed to pension plans

952 2,048 3,000

Treasury shares issued for 401(k) contribution 558 675 1,233

Changes in noncontrolling interests ( 8 ) ( 8 )

Balance at December 31, 2021 $ 5,061 $ 9,052 ($ 51,861 ) $ 34,408 ($ 11,659 ) $ 153 ($ 14,846 )

8 unchanged sentences

( 2,222 ) ( 20 ) ( 2,242 )

Other comprehensive income, net of tax of ($ 22 )

Other comprehensive loss, net of tax of $ 4

( 755 ) ( 755 )

Share-based compensation 690 690

3 unchanged sentences

Treasury shares issued for 401(k) contribution 627 888 1,515

Subsidiary shares purchased from noncontrolling interests

( 267 ) ( 267 )

Other changes in noncontrolling interests ( 10 ) ( 10 )

Balance at December 31, 2023 $ 5,061 $ 10,309 ($ 49,549 ) $ 27,251 ($ 10,305 ) $ 5 ($ 17,228 )

9 unchanged sentences

Global Services 19,127 17,611 16,328

Boeing Capital 199 272 261

Unallocated items, eliminations and other ( 167 ) ( 191 ) ( 296 )

Total revenues $ 77,794 $ 66,608 $ 62,286

(Loss)/earnings from operations:

Loss from operations:

Commercial Airplanes ($ 1,635 ) ($ 2,341 ) ($ 6,377 )

1 unchanged sentence

Global Services 3,329 2,727 2,017

Boeing Capital 29 106 63

Segment operating loss ( 70 ) ( 3,158 ) ( 2,816 )

20 unchanged sentences

All significant intercompany accounts and transactions have been eliminated.

As described in Note 22, we operate in four reportable segments:

Commercial Airplanes (BCA), Defense, Space & Security (BDS), Global Services (BGS) and Boeing Capital (BCC).

As described in Note 22, we now operate in three reportable segments:

Commercial Airplanes (BCA), Defense, Space & Security (BDS), and Global Services (BGS).

As a result, prior period amounts have been reclassified to conform to current period presentation.

Use of Estimates

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government contracts, the customer typically controls the work in process as evidenced either by contractual termination clauses or by our rights to payment of the transaction price associated with work performed to date on products or services that do not have an alternative use to the Company.

The accounting for long-term contracts involves a judgmental process of estimating total sales, costs and profit for each performance obligation.

The accounting for long-term contracts involves a judgmental process of estimating total revenues, costs and profit for each performance obligation.

Cost of sales is recognized as incurred.

3 unchanged sentences

When the current estimates of total revenues and costs at completion for a long-term contract indicate a loss, a provision for the entire reach-forward loss on the long-term contract is recognized.

The table below reflects the impact of net cumulative catch-up adjustments for changes in estimated revenues and costs at completion across all long-term contracts including the impact to Loss from operations from increases in estimated losses on unexercised options for the years ended December 31:

The table below reflects the impact of net cumulative catch-up adjustments for changes in estimated revenues and costs at completion across all long-term contracts including the impact to Loss from operations from estimated losses on unexercised options for the years ended December 31:

2023 2022 2021

1 unchanged sentence

Increase to Loss from operations ($ 2,943 ) ($ 5,253 ) ($ 880 )

Decrease to Diluted EPS ($ 8.88 ) ($ 1.28 ) ($ 1.37 )

Significant adjustments during the three years ended December 31, 2022 included losses on VC-25B, KC-46A Tanker, MQ-25, Commercial Crew and T-7A Red Hawk programs.

Increase to Diluted loss per share

($ 5.43 ) ($ 8.88 ) ($ 1.28 )

Significant adjustments during the three years ended December 31, 2023 included losses on VC-25B, KC-46A Tanker, MQ-25, Commercial Crew and T-7A Red Hawk programs in addition to lower earnings on F-15 and satellites.

Due to the significance of judgment in the estimation process, changes in underlying assumptions/estimates, internal and supplier performance, inflationary trends, or other circumstances may adversely or positively affect financial performance in future periods.

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The amount of Unbilled receivables or Advances and progress billings is determined for each contract.

Financial services revenue We record financial services revenue associated with sales-type/finance leases, operating leases and loans in Sales of services on the Consolidated Statements of Operations.

Financial services revenue We record financial services revenue associated with sales-type leases, operating leases and loans in Sales of services on the Consolidated Statements of Operations.

For sales-type leases, we recognize selling profit or loss at lease inception if collection of the lease payments is probable.

For sales-type and direct finance leases, we record customer financing receivables at lease inception.

A customer financing receivable is recorded at the aggregate of future minimum lease payments, estimated residual value of the leased equipment, and any deferred incremental direct costs less unearned income.

For sales-type leases, we record financing receivables at lease inception.

A financing receivable is recorded at the aggregate of future lease payments, estimated residual value of the leased equipment, and any deferred incremental direct costs less unearned income.

Income is recognized over the life of the lease to approximate a level rate of return on the net investment.

For notes receivable, we record customer financing receivables net of any unamortized discounts and deferred incremental direct costs.

For notes receivable, we record financing receivables net of any unamortized discounts and deferred incremental direct costs.

Interest income and amortization of any discounts are recorded ratably over the related term of the note.

Income recognition is generally suspended for customer financing receivables that are uncollectible.

We determine that a customer financing receivable is uncollectible when, based on current information and events, it is probable that we will be unable to collect amounts due according to the original contractual terms.

We determine a customer financing receivable is past due when cash has not been received upon the due date specified in the contract.

We evaluate the collectability of customer financing receivables at commencement and on a recurring basis.

If a customer financing receivable is determined to be uncollectible, the customer is categorized as non-accrual status.

Income recognition is generally suspended for financing receivables that are uncollectible.

We determine that a financing receivable is uncollectible when, based on current information and events, it is probable that we will be unable to collect amounts due according to the original contractual terms.

We determine a financing receivable is past due when cash has not been received upon the due date specified in the contract.

We evaluate the collectability of financing receivables at commencement and on a recurring basis.

If a financing receivable is determined to be uncollectible, the customer is categorized as non-accrual status.

When a customer is in non-accrual status at commencement, sales-type lease revenue is deferred until substantially all cash has been received or the customer is removed from non-accrual status.

If we have a direct finance lease and/or a note receivable with a customer that is in non-accrual status, or a sales-type lease with a customer that changes to non-accrual status after commencement, we recognize contractual interest income as payments are received to the extent there is sufficient collateral and payments exceed past due principal payments.

If we have a note receivable with a customer that is in non-accrual status, or a sales-type lease with a customer that changes to non-accrual status after commencement, we recognize contractual interest income as payments are received to the extent there is sufficient collateral and payments exceed past due principal payments.

Residual values, which are reviewed periodically, represent the estimated amount we expect to receive at lease termination from the disposition of the leased equipment.

2 unchanged sentences

For operating leases, revenue on leased aircraft and equipment is recorded on a straight-line basis over the term of the lease.

Operating lease assets, included in Customer financing, net, are recorded at cost and depreciated to an estimated residual value using the straight-line method over the period that we project we will hold the asset.

Operating lease assets, included in Financing receivables and operating lease equipment, net, are recorded at cost and depreciated to an estimated residual value using the straight-line method over the period that we project we will hold the asset.

We periodically review our estimates of residual value and recognize forecasted changes by prospectively adjusting depreciation expense.

12 unchanged sentences

Accordingly, the amounts funded by the customer are recognized as an offset to our research and development expense rather than as contract revenues.

Research and development expense included bid and proposal costs of $ 217 , $ 213 and $ 224 in 2022, 2021 and 2020, respectively.

Research and development expense, net included bid and proposal costs of $ 188 , $ 217 and $ 213 in 2023, 2022 and 2021, respectively.

Share-Based Compensation

We provide various forms of share-based compensation to our employees.

For awards settled in shares, we measure compensation expense based on the grant-date fair value net of estimated forfeitures.

For awards settled in shares, we measure compensation expense based on the grant-date fair value net of estimated

For awards settled in cash, or that may be settled in cash, we measure compensation expense based on the fair value at each reporting date net of estimated forfeitures.

46 unchanged sentences

The determination of net realizable value of long-term contract costs is based upon quarterly reviews that estimate costs to be incurred to complete all contract requirements.

When actual contract costs and

the estimate to complete exceed total estimated contract revenues, a loss provision is recorded.

When actual contract costs and the estimate to complete exceed total estimated contract revenues, a loss provision is recorded.

The determination of net realizable value of commercial aircraft program costs is based upon quarterly program reviews that estimate revenue and cost to be incurred to complete the program accounting quantity.

When estimated costs to complete exceed estimated program revenues to go, a program loss provision is recorded in the current period for the estimated loss on all undelivered units in the accounting quantity.

Used aircraft purchased by the Commercial Airplanes segment and general stock materials are stated at cost not in excess of net realizable value.

Used aircraft purchased by our BCA segment and general stock materials are stated at cost not in excess of net realizable value.

Spare parts inventory is stated at lower of average unit cost or net realizable value.

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and machinery and equipment, sum-of-the-years’ digits.

Capitalized internal use software is included in Other assets and amortized using the straight line method over 5 years.

Capitalized software as a service is included in Other assets and amortized using the straight line method over the term of the hosting arrangement, which is typically no greater than 10 years.

Capitalized internal use software is included in Other assets, net and amortized using the straight line method over 5 years.

Capitalized costs of software purchased as a service are included in Other assets, net and amortized using the straight line method over the term of the hosting arrangement, which is typically no greater than 10 years.

We periodically evaluate the appropriateness of remaining depreciable lives assigned to long-lived assets, including assets that may be subject to a management plan for disposition.

3 unchanged sentences

Leases We determine if an arrangement is, or contains, a lease under which we are the lessee at the inception date.

Operating lease assets are included in Other assets, with the related liabilities included in Accrued liabilities and Other long-term liabilities.

Assets under finance leases, which primarily represent computer equipment, are included in Property, plant and equipment, net, with the related

liabilities included in Short-term debt and current portion of long-term debt and Long-term debt on the Consolidated Statements of Financial Position.

Operating lease assets are included in Other assets, net, with the related liabilities included in Accrued liabilities and Other long-term liabilities.

Assets under finance leases, which primarily represent computer equipment, are included in Property, plant and equipment, net, with the related liabilities included in Short-term debt and current portion of long-term debt and Long-term debt on the Consolidated Statements of Financial Position.

Operating lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

Operating lease assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term.

We use our estimated incremental borrowing rate in determining the present value of lease payments.

We use our estimated incremental borrowing rate in

determining the present value of lease payments.

Variable components of the lease payments such as fair market value adjustments, utilities and maintenance costs are expensed as incurred and not included in determining the present value.

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We evaluate the potential impairment of finite-lived acquired intangible assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

If the carrying value is no longer recoverable based upon the undiscounted future cash flows of the asset, the amount of the impairment is the difference between the carrying amount and the fair value of the asset.

If the carrying

value is no longer recoverable based upon the undiscounted future cash flows of the asset, the amount of the impairment is the difference between the carrying amount and the fair value of the asset.

Time deposits are held-to-maturity investments that are carried at cost.

Available-for-sale debt securities include commercial paper, U.S.

Available-for-sale debt investments include commercial paper, U.S.

government agency securities and corporate debt securities.

Available-for-sale debt securities are recorded at fair value, and unrealized gains and losses are recorded, net of tax, as a component of accumulated other comprehensive income.

Realized gains and losses on available-for-sale debt securities are recognized based on the specific identification method.

Available-for-sale debt securities are assessed for impairment quarterly.

Available-for-sale debt investments are recorded at fair value, and unrealized gains and losses are recorded, net of tax, as a component of accumulated other comprehensive income.

Realized gains and losses on available-for-sale debt investments are recognized based on the specific identification method.

Available-for-sale debt investments are assessed for impairment quarterly.

The equity method of accounting is used to account for investments for which we have the ability to exercise significant influence, but not control, over an investee.

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Operating investments align strategically and are integrated with our operations.

Earnings from operating investments, including our share of income or loss from equity method investments, dividend income from other equity investments, and any impairments or gain/loss on the disposition of these investments, are recorded in (Loss)/Income from operating investments, net.

Non-operating investments are those we hold for non-strategic purposes.

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Allowances for Losses on Certain Financial Assets

We establish allowances for credit losses on accounts receivable, unbilled receivables, customer financing receivables and certain other financial assets.

The adequacy of these allowances is assessed quarterly through consideration of factors such as customer credit ratings, bankruptcy filings, published or estimated credit default rates, age of the receivable, expected loss rates and collateral exposures.

We establish allowances for credit losses on accounts receivable, unbilled receivables, financing receivables and certain other financial assets.

The adequacy of these allowances is assessed quarterly through consideration of factors such as customer credit ratings, bankruptcy filings, published or

estimated credit default rates, age of the receivable, expected loss rates and collateral exposures.

Collateral exposure is the excess of the carrying value of a financial asset over the fair value of the related collateral.

1 unchanged sentence

Our rating categories are comparable to those used by major credit rating agencies.

Customer financing receivables are collateralized by security in the related asset.

Financing receivables are collateralized by security in the related asset.

We use a median calculated from published collateral values from multiple third-party aircraft value publications based on the type and age of the aircraft to determine the fair value of aircraft collateral.

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The majority of our warranties are issued by our BCA segment.

Generally, aircraft sales are accompanied by a 3 to 4 -year standard warranty for systems, accessories, equipment, parts, and software manufactured by us or manufactured to certain standards under our authorization.

Generally, aircraft sales are accompanied by a 3 to 4 -year standard

warranty for systems, accessories, equipment, parts, and software manufactured by us or manufactured to certain standards under our authorization.

These warranties are included in the programs’ estimate at completion.

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Claims against suppliers under these agreements are included in Inventories and recorded as a reduction in Cost of products at delivery of the related aircraft.

These performance warranties and claims against suppliers are included in the programs’ estimate at completion.

These performance warranties and claims against suppliers are included in estimates to complete the related programs.

Supplier Penalties

We may incur penalties to suppliers under certain circumstances such as a contract termination.

We record an accrual for supplier penalties when an event occurs that makes it probable we will incur a supplier penalty and the amount is reasonably estimable.

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Balance at December 31, 2022 $ 1,316 $ 3,224 $ 3,432 $ 85 $ 8,057

Acquisitions 3 11 16 30

Goodwill adjustments 6 6

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Total $ 5,373 $ 3,678 $ 5,351 $ 3,439

During 2020, we recorded impairments of $ 178 within Cost of Sales related to our distribution rights, primarily driven by airlines' decisions to retire certain aircraft.

Amortization expense for acquired finite-lived intangible assets for the years ended December 31, 2023 and 2022 was $ 235 and $ 241 .

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Participating securities and common shares have equal rights to undistributed earnings.

Basic earnings per share is calculated by taking net earnings, less earnings available to participating securities, divided by the basic weighted average common shares outstanding.

Diluted earnings per share is calculated by taking net earnings, less earnings available to participating securities, divided by the diluted weighted average common shares outstanding.

Basic earnings per share is calculated by taking net earnings attributable to Boeing Shareholders, less earnings available to participating securities, divided by the basic weighted average common shares outstanding.

Diluted earnings per share is calculated by taking net earnings attributable to Boeing Shareholders, less earnings available to participating securities, divided by the diluted weighted average common shares outstanding.

Diluted weighted average common shares outstanding is calculated using the treasury stock method.

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

1 unchanged sentence

Years ended December 31, 2023 2022 2021

Net loss attributable to Boeing Shareholders ($ 2,222 ) ($ 4,935 ) ($ 4,202 )

earnings available to participating securities

Net loss available to common shareholders ($ 2,222 ) ($ 4,935 ) ($ 4,202 )

4 unchanged sentences

605.8 594.9 587.6

Basic weighted average shares outstanding

595.2 588.0 569.0

Dilutive potential common shares (1)

Diluted weighted average shares outstanding

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( 3.67 ) ( 8.30 ) ( 7.15 )

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

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

As a result of incurring a net loss in 2022, 2021 and 2020, potential common shares of 3.5 million, 2.6 million and 1.6 million, respectively, were excluded from diluted loss per share because the effect would have been antidilutive.

The following table represents all shares that were excluded from the calculation of diluted loss per share during the respective period but may be dilutive potential common shares in future periods.

This includes potential common shares that were excluded because the effect was either antidilutive or the performance condition was not met.

The following table represents potential common shares that were not included in the computation of Diluted loss per share because the effect was antidilutive based on their strike price or the performance condition was not met.

(Shares in millions)

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Stock options 0.8 0.8 0.3

In addition, potential common shares of 5.7 million, 3.5 million, and 2.6 million for the years ended December 31, 2023, 2022 and 2021 were excluded from the computation of Diluted loss per share, because the effect would have been antidilutive as a result of incurring a net loss in those periods.

Note 4 – Income Taxes

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Total ($ 2,005 ) ($ 5,022 ) ($ 5,033 )

Income tax (benefit)/expense consisted of the following:

Income tax (expense)/benefit consisted of the following:

Years ended December 31, 2023 2022 2021

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federal 6 ( 62 ) ( 855 )

5 ( 3 ) ( 12 )

state 19 54 24

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Total income tax expense/(benefit) $ 237 $ 31 ($ 743 )

Net income tax (refunds)/payments were ($ 1,317 ), ($ 1,480 ) and $ 37 in 2022, 2021 and 2020, respectively.

Net income tax payments/(refunds) were $ 204 , ($ 1,317 ) and ($ 1,480 ) in 2023, 2022 and 2021, respectively.

The following is a reconciliation of the U.S.

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activities 35 ( 1.8 ) 64 ( 1.3 ) 47 ( 0.9 )

Impact of CARES Act (1)

( 5 ) 0.1 3 ( 0.1 ) ( 1,175 ) 8.1

Impact of subsidiary shares purchased from noncontrolling interests

Other provision adjustments 49 ( 2.5 ) 116 ( 2.3 ) 38 ( 0.9 )

Audit settlements (2)

Income tax expense/(benefit) $ 237 ( 11.8 ) % $ 31 ( 0.6 ) % ($ 743 ) 14.7 %

(1) On March 27, 2020, the CARES Act was enacted, which includes a five year net operating loss (NOL) carryback provision which enabled us to benefit from the 2020 U.S.

federal tax NOL at the former federal tax rate of 35 %.

In 2022, 2021, and 2020, we recorded tax benefits of $ 5 , tax expense of $ 3 , and tax benefits of $ 1,175 related to the NOL carryback provision.

(2) In the fourth quarter of 2020, we recorded a tax benefit of $ 587 related to the settlement of the 2015-2017 federal tax audit.

Significant components of our deferred tax assets/(liabilities) at December 31 were as follows:

Inventory and long-term contract methods of income recognition ($ 5,115 ) ($ 4,369 )

Research expenditures 2,873 1,464

Federal net operating loss, credit, interest and other carryovers (1)

Fixed assets, intangibles and goodwill ( 1,566 ) ( 1,641 )

Research expenditures 1,464

Pension benefits 1,178 1,146

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federal and state tax jurisdictions.

federal tax perspective, the Company generated a tax NOL in 2020 that was carried back to prior years when the tax rate was 35 % due to the CARES Act benefit as described above.

The Company generated tax NOL in 2021 and interest carryovers in 2021 and 2022 that can be carried forward indefinitely and federal research and development credits that can be carried forward 20 years.

In the fourth quarter of 2020 and throughout 2021 and 2022, the Company was in a three-year cumulative pre-tax loss position.

We also normalized earnings and other comprehensive income (OCI) for certain non-recurring items and reached a normalized three-year cumulative loss position in 2021.

Adjustments to normalize earnings included non-recurring items for certain 737 MAX expenses, an agreement with the Department of Justice, severance costs and remeasurement gains and losses from the annual remeasurement of pension and other postretirement benefit obligations.

federal tax perspective, the Company generated tax net operating losses in 2021 and interest carryovers in 2021, 2022, and 2023 that can be carried forward indefinitely and federal research and development credits that can be carried forward 20 years.

Throughout 2021, 2022, and 2023, the Company was in a three-year cumulative pre-tax loss position.

For purposes of assessing the recoverability of deferred tax assets, the Company determined that it could not include future projected earnings in the analysis due to recent history of losses.

As of December 31, 2022 and 2021, the Company has recorded valuation allowances of $ 3,162 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.

As of December 31, 2023 and 2022, the Company has recorded valuation allowances of $ 4,550 and $ 3,162 primarily for certain domestic deferred tax assets, and certain domestic net operating losses, tax

credit and interest carryforwards.

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.

Based on these methods, deferred tax liabilities are assumed to reverse and generate taxable income over the next 5 to 10 years while deferred tax assets related to pension and other postretirement benefit obligations are assumed to reverse and generate tax deductions over the next 15 to 20 years.

The valuation allowance primarily results from not having sufficient income from deferred tax liability reversals in the appropriate future periods to support the realization of deferred tax assets.

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.

During 2022, the Company increased the valuation allowance by $ 739 .

This reflects a tax expense of $ 1,199 recorded in continuing operations and an increase of $ 18 related to the associated federal benefit of state impacts.

This was partially offset by a tax benefit of $ 478 included in OCI primarily due to the net actuarial gains that resulted from the annual remeasurement of pension assets and liabilities.

The valuation allowance results from not having sufficient income from deferred tax liability reversals in the appropriate future periods to support the realization of deferred tax assets.

During 2023, the Company increased the valuation allowance by $ 1,388 , primarily due to tax credits and other carryforwards generated in 2023 that cannot be realized in 2023.

This reflects a tax expense of $ 1,150 recorded in continuing operations, an increase of $ 31 related to the associated federal benefit of state impacts, a tax expense of $ 173 included in Other comprehensive income (OCI) primarily due to the net actuarial losses that resulted from the annual remeasurement of pension assets and liabilities, and an increase of $ 34 included in additional paid-in capital.

Until the Company generates sustained levels of profitability, additional valuation allowances may have to be recorded with corresponding adverse impacts on earnings and/or OCI.

The Tax Cuts and Jobs Act (TCJA) one-time repatriation tax and Global Intangible Low Tax Income liabilities effectively taxed the undistributed earnings previously deferred from U.S.

The Tax Cuts and Jobs Act one-time repatriation tax and Global Intangible Low Tax Income liabilities effectively taxed the undistributed earnings previously deferred from U.S.

income taxes.

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Gross decreases – current period tax positions

Settlements ( 109 )

Unrecognized tax benefits – December 31 $ 1,131 $ 915 $ 858

As of December 31, 2023, 2022 and 2021, the total amount of unrecognized tax benefits include $ 1,088 , $ 878 and $ 790 , respectively, that would affect the effective tax rate, if recognized.

As of December 31, 2022, these amounts are primarily associated with the amount of research tax credits claimed and various other matters.

As of December 31, 2023, these amounts were primarily associated with the amount of research tax credits claimed and various other matters.

Federal income tax audits have been settled for all years prior to 2018.

The Internal Revenue Service (IRS) began the 2018-2019 federal tax audit in the first quarter of 2021 and added tax year 2020 to the audit in the fourth quarter of 2021.

The Internal Revenue Service is currently auditing the 2018-2020 tax years.

We are also subject to examination in major state and international jurisdictions for the 2010-2022 tax years.

We believe appropriate provisions for all outstanding tax issues have been made for all jurisdictions and all open years.

Audit outcomes and the timing of audit settlements are subject to significant uncertainty.

It is reasonably possible that within the next 12 months, unrecognized tax benefits related to federal tax matters under audit may decrease by up to $ 620 based on current estimates.

The Organization for Economic Co-operation and Development has issued Pillar Two model rules introducing a new global minimum tax of 15% intended to be effective on January 1, 2024.

While the US has not yet adopted the Pillar Two rules, various other governments around the world are enacting legislation.

As currently designed, Pillar Two will ultimately apply to our worldwide operations.

Considering we do not have material operations in jurisdictions with tax rates lower than the Pillar Two minimum, these rules are not expected to materially increase our global tax costs.

There remains uncertainty as to the final Pillar Two model rules.

We will continue to monitor US and global legislative action related to Pillar Two for potential impacts.

Note 5 – Accounts Receivable, net

Accounts receivable at December 31 consisted of the following:

Accounts receivable, net at December 31 consisted of the following:

government contracts (1)

$ 800 $ 1,180

Commercial Airplanes 57 293

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The change in allowances for expected credit losses for the years ended December 31, 2023 and 2022 consisted of the following:

Accounts receivable Unbilled receivables Other Current Assets Customer financing Other Assets Total

Accounts receivable Unbilled receivables Other Current Assets Financing receivables Other Assets Total

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

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Inventories at December 31 consisted of the following:

Long-term contracts in progress $ 582 $ 872

Commercial aircraft programs $ 68,683 $ 67,702

Long-term contracts in progress 686 582

Capitalized precontract costs (1)

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Total $ 79,741 $ 78,151

(1) Capitalized precontract costs at December 31, 2022 includes amounts related to KC-46A Tanker, Commercial Crew, and T-7 Production Options.

(1) Capitalized precontract costs at December 31, 2023 and 2022 includes amounts related to KC-46A Tanker, Commercial Crew, and T-7A Red Hawk Production Options.

Commercial Aircraft Programs

The decrease in commercial aircraft programs inventory during 2022 reflects a decrease in 737 and 787 inventory, offset by growth in 777X inventory.

Commercial aircraft programs inventory includes approximately 250 737 aircraft and 100 787 aircraft at December 31, 2022 as compared with 335 737 aircraft and 110 787 aircraft at December 31, 2021.

At December 31, 2023 and 2022, commercial aircraft programs inventory included the following amounts related to the 737 program:

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At December 31, 2023 and 2022, commercial aircraft programs inventory included the following amounts related to the 777X program:

$ 4,059 and $ 3,363 of work in process, $ 1,330 and $ 652 of

deferred production costs, and $ 3,774 and $ 3,521 of unamortized tooling and other non-recurring costs.

In April 2022, we decided to pause production of the 777X-9 during 2022 and 2023.

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 $ 325 during the year ended December 31, 2022.

The 777X program has near break-even margins at December 31, 2022.

During the fourth quarter of 2021, we determined that estimated costs to complete the 787 program plus costs already included in 787 inventory exceed estimated revenues from the program.

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

$ 4,638 and $ 4,059 of work in process, $ 1,792 and $ 1,330 of deferred production costs, and $ 4,063 and $ 3,774 of unamortized tooling and other non-recurring costs.

In April 2022, we decided to pause production of the 777X-9 during 2022 and 2023, which resulted in abnormal production costs of $ 513 and $ 325 during the years ended December 31, 2023 and 2022.

In the fourth quarter of 2023, the 777X program resumed production.

At December 31, 2023 and 2022, commercial aircraft programs inventory included the following amounts related to the 787 program:

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At December 31, 2023, $ 12,384 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 $ 1,480 is expected to be recovered from units included in the program accounting quantity that represent expected future orders.

We are currently producing at abnormally low rates resulting in abnormal production costs that are being expensed as incurred.

We produced at abnormally low production rates resulting in abnormal production costs that were expensed as incurred from the third quarter of 2021 through the third quarter of 2023.

We expensed abnormal production costs of $ 1,014 , $ 1,240 , and $ 468 during the years ended December 31, 2023, 2022 and 2021.

The remaining abnormal costs associated with rework are not expected to be significant.

Commercial aircraft programs inventory included amounts credited in cash or other consideration (early issue sales consideration) to airline customers totaling $ 4,126 and $ 3,586 at December 31, 2023 and 2022.

Note 8 – Contracts with Customers

Unbilled receivables increased from $ 8,620 at December 31, 2021 to $ 8,634 at December 31, 2022, primarily driven by revenue recognized in excess of billings at BGS, partially offset by billings in excess of revenue recognized at BDS.

Advances and progress billings increased from $ 52,980 at December 31, 2021 to $ 53,081 at December 31, 2022, primarily driven by advances on orders received at BCA, partially offset by revenue recognized at BDS and BGS.

Revenues recognized for the years ended December 31, 2022 and 2021 from amounts recorded as Advances and progress billings at the beginning of each year were $ 12,087 and $ 11,336 .

Unbilled receivables decreased from $ 8,634 at December 31, 2022 to $ 8,317 at December 31, 2023, primarily driven by an increase in billings at BDS and BGS.

The following table summarizes our contract assets under long-term contracts that were unbillable or related to outstanding claims as of December 31:

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Unbilled receivables related to claims are items that we believe are earned, but are subject to uncertainty concerning their determination or ultimate realization.

Note 9 – Customer Financing

Customer financing primarily relates to our BCC segment.

Financing arrangements typically range in terms from 1 to 12 years and may include options to extend or terminate the lease.

Certain leases include provisions to allow the lessee to purchase the underlying aircraft at a specified price.

Customer financing consisted of the following at December 31:

Advances and progress billings increased from $ 53,081 at December 31, 2022 to $ 56,328 at December 31, 2023, primarily driven by advances on orders received at BCA, partially offset by revenue recognized at BDS.

Revenues recognized for the years ended December 31, 2023 and 2022 from amounts recorded as Advances and progress billings at the beginning of each year were $ 15,298 and $ 12,087 .

Note 9 – Financing Receivables and Operating Lease Equipment

Financing receivables and operating lease equipment, net consisted of the following at December 31:

Financing receivables:

Investment in sales-type/finance leases $ 804 $ 944

Investment in sales-type leases $ 556 $ 804

Notes 102 385

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Total $ 959 $ 1,604

The components of investment in sales-type/finance leases at December 31 were as follows:

Minimum lease payments receivable $ 924 $ 1,099

Estimated residual value of leased assets 86 110

Financing arrangements typically range in terms from 1 to 12 years and may include options to extend or terminate.

Certain leases include provisions to allow the lessee to purchase the underlying aircraft at a specified price.

At December 31, 2023 and 2022, $ 44 and $ 405 were determined to be uncollectible financing receivables and placed on non-accrual status.

The allowance for losses on receivables remained largely unchanged during the year ended December 31, 2023.

The components of investment in sales-type leases at December 31 were as follows:

Gross lease payments receivable $ 697 $ 924

Unearned income ( 162 ) ( 206 )

Net lease payments receivable 535 718

Unguaranteed residual assets 21 86

Total $ 556 $ 804

At December 31, 2022 and 2021, $ 405 and $ 378 were determined to be uncollectible financing receivables and placed on non-accrual status.

The increase in allowance for losses on receivables during the year ended December 31, 2022 was primarily due to impacts of the war in Ukraine.

Customer financing interest income received for the years ended December 31, 2022 and 2021 was $ 13 and $ 18 .

There were no past due customer financing receivables as of December 31, 2022.

Financing interest income received for the years ended December 31, 2023 and 2022 was $ 108 and $ 13 .

Financing receivables that were past due as of December 31, 2023 totaled $ 9 .

Our financing receivable balances at December 31, 2023 by internal credit rating category and year of origination consisted of the following:

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BB $ 73 $ 32 $ 198 $ 103 $ 36 53 495

CCC 19 370 389

Total carrying value of financing receivables $ 73 $ 32 $ 233 $ 103 $ 48 $ 169 $ 658

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We applied default rates that averaged 100.0 %, 0.0 %, 2.4 % and 0.1 %, respectively, to the exposure associated with those receivables.

Customer Financing Exposure

The majority of our customer financing portfolio is concentrated in the following aircraft models at December 31:

717 Aircraft ($ 45 and $ 62 accounted for as operating leases)

747-8 Aircraft (Accounted for as sales-type/finance leases) 394 435

Financing Receivables Exposure

The majority of our financing receivables and operating lease equipment portfolio is concentrated in the following aircraft models at December 31:

717 Aircraft ($ 0 and $ 45 accounted for as operating leases)

747-8 Aircraft (Accounted for as sales-type leases)

737 Aircraft ($ 148 and $ 174 accounted for as operating leases)

MD-80 Aircraft (Accounted for as sales-type/finance leases) 96 142

757 Aircraft (Accounted for as sales-type/finance leases) 107 126

777 Aircraft ($ 194 and $ 209 accounted for as operating leases)

MD-80 Aircraft (Accounted for as sales-type leases)

757 Aircraft (Accounted for as sales-type leases)

747-400 Aircraft (Accounted for as sales-type leases)

Operating lease equipment primarily includes large commercial jet aircraft.

Impairment charges related to customer financing operating lease assets for the years ended December 31 were as follows:

2022 2021 2020

Boeing Capital $ 2 $ 23 $ 32

Other Boeing 5 8 ( 8 )

Total $ 7 $ 31 $ 24

Lease income recorded in Revenue on the Consolidated Statements of Operations for the years ended December 31, 2022 and 2021 included $ 69 and $ 54 from sales-type/finance leases, and $ 65 and $ 68 from operating leases .

Profit at the commencement of sales-type leases was recorded in revenue for the years ended December 31, 2022 and 2021 in the amount of $ 28 and $ 78 .

As of December 31, 2022, undiscounted cash flows for notes receivable, sales-type/finance and operating leases over the next five years and thereafter are as follows:

Notes receivable Sales-type/finance leases Operating leases

Impairment charges related to operating lease assets were $ 0 , $ 7 , and $ 31 for the years ended December 31, 2023, 2022 and 2021.

Lease income recorded in Sales of services on the Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021 included $ 55 , $ 69 , and $ 54 of interest income from

sales-type leases, and $ 60 , $ 65 , and $ 68 from operating lease payments.

Profit at the commencement of sales-type leases was recorded in Sales of services for the years ended December 31, 2023, 2022 and 2021 in the amount of $ 32 , $ 28 , and $ 78 .

As of December 31, 2023, undiscounted cash flows for notes receivable, sales-type and operating leases over the next five years and thereafter are as follows:

Notes receivable Sales-type leases

Operating leases

Year 1 $ 17 $ 149 $ 69

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At December 31, 2023 and December 31, 2022, unguaranteed residual values were $ 21 and $ 86 .

Guaranteed residual values at December 31, 2022 were not significant.

Note 10 – Property, Plant and Equipment

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Our investments, which are recorded in Short-term and other investments or Investments, consisted of the following at December 31:

Equity method investments (1)

Time deposits (1)

Available for sale debt instruments 479 464

$ 2,753 $ 2,093

Equity method investments (2)

Available-for-sale debt investments (1)

Equity and other investments 69 36

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Total $ 4,309 $ 3,589

(1) Included in Short-term and other investments on our Consolidated Statements of Financial Position.

(2) Dividends received were $ 31 and $ 111 during 2023 and 2022.

Retained earnings at December 31, 2023 include undistributed earnings from our equity method investments of $ 110 .

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.

(3) 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.

Contributions to investments and Proceeds from investments on our Consolidated Statements of Cash Flows primarily relate to time deposits and available-for-sale debt investments.

Cash used for the purchase of time deposits during 2023, 2022 and 2021 was $ 15,794 , $ 4,358 and $ 34,905 , respectively.

Cash proceeds from the maturities of time deposits during 2023, 2022 and 2021 were $ 15,140 , $ 9,943 and $ 44,372 , respectively.

Allowance for losses on available-for-sale debt investments are assessed quarterly.

All instruments are considered investment grade, and we have not recognized an allowance for credit losses as of December 31, 2023.

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Weighted average discount rate 3.21 % 4.13 %

Operating lease assets are included in Other assets, net, with the related liabilities included in Accrued liabilities and Other long-term liabilities.

Maturities of operating lease liabilities for the next five years are as follows:

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Accrued compensation and employee benefit costs $ 6,721 $ 6,351

737 MAX grounding customer concessions and other considerations 1,864 2,940

737 MAX customer concessions and other considerations

Other customer concessions and considerations 1,300 1,102

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Total $ 22,331 $ 21,581

737 MAX Grounding

737 MAX Customer Concessions and Other Considerations

The following table summarizes changes in the 737 MAX customer concessions and other considerations liability during 2023 and 2022.

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Ending balance – December 31 $ 1,327 $ 1,864

The liability balance of $ 1.9 billion at December 31, 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 $ 0.8 billion expected to be liquidated by lower customer delivery payments, $ 0.7 billion expected to be paid in cash and $ 0.1 billion in other concessions.

Of the cash payments to customers, we expect to pay $ 0.1 billion in 2023 and the remaining $ 0.6 billion in future years.

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

At December 31, 2023, $ 0.1 billion of the liability balance remains subject to negotiations with customers.

We expect to pay $ 0.6 billion in 2024 while the remaining amounts are expected to be liquidated by lower customer delivery payments.

Environmental

The following table summarizes environmental remediation activity during the years ended December 31, 2022 and 2021.

The following table summarizes changes in environmental remediation liabilities during the years ended December 31, 2023 and 2022.

Beginning balance – January 1 $ 752 $ 605

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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 costs 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.

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Product Warranties

The following table summarizes product warranty activity recorded during the years ended December 31, 2022 and 2021.

The following table summarizes changes in product warranty liabilities recorded during the years ended December 31, 2023 and 2022.

Beginning balance – January 1 $ 2,275 $ 1,900

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Other Financial Commitments

We have financial commitments to make additional capital contributions totaling $ 270 related to certain joint ventures over the next five years .

We have financial commitments to make additional capital contributions totaling $ 264 related to certain joint ventures over the next nine years .

Standby Letters of Credit and Surety Bonds

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As we have the right to offset the loans against the cash surrender value of the policies, we present the net asset in Other assets on the Consolidated Statements of Financial Position as of December 31, 2023 and 2022.

Supply Chain Financing Programs

The Company has supply chain financing programs in place under which participating suppliers may elect to obtain payment from an intermediary.

The Company confirms the validity of invoices from participating suppliers and agrees to pay the intermediary an amount based on invoice totals.

The majority of amounts payable under these programs are due within 30 to 90 days but may extend up to 12 months.

At December 31, 2023 and 2022, Accounts payable included $ 2.9 billion and $ 2.5 billion payable to suppliers who have elected to participate in these programs.

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

Government Assistance

In 2022, we adopted Accounting Standards Update (ASU) 2021-10, Government Assistance (Topic 832) , which requires certain disclosures for those government assistance transactions for which we have applied a grant accounting model.

Certain states and localities in which we operate offer or have offered various business incentives related to investment and/or job creation.

Between 2010 and 2016, we received cash grants totaling $ 346 related to our investment in operations in South Carolina.

The grants were recorded in Other liabilities and are being amortized, primarily to

inventory, over the useful life of the Property, plant and equipment extending through 2052.

During 2022, we amortized $ 11 to Inventory, and recorded a benefit of $ 5 in Cost of Sales.

At December, 31, 2022, inventory included a benefit of $ 64 and Accrued liabilities included a balance of $ 106 .

The grants were recorded in Accrued liabilities and are being amortized, primarily to inventory, over the useful life of the Property, plant and equipment extending through 2052.

During 2023 and 2022, we amortized $ 10 and $ 11 to Inventories, and recorded a benefit of $ 12 and $ 5 in cost of sales.

At December 31, 2023 and 2022, Inventories included a benefit of $ 62 and $ 64 and Accrued liabilities included a balance of $ 97 and $ 106 .

We are eligible to claim tax refunds from the State of Missouri and City of Irving, Texas primarily related to job creation and retention through 2031.

During 2022, we received $ 30 in cash and recorded a benefit of $ 21 in Cost of sales.

At December 31, 2022, Other current assets includes receivables of $ 20 .

During 2023 and 2022, we received $ 22 and $ 30 in cash and recorded a benefit of $ 28 and $ 21 in cost of sales.

At December 31, 2023 and 2022, Other current assets includes receivables of $ 26 and $ 20 .

As of December 31, 2023, $ 60 of refunds, plus interest, is subject to clawback if we fail to meet certain conditions, including employment levels.

We are eligible to claim cash grants through 2032 of up to $ 62 , related to operations in Queensland, Australia.

During 2022, $ 7 cash was received and recorded as a benefit in Cost of Sales.

During 2023 and 2022, $ 5 and $ 7 cash was received and recorded as a benefit in cost of sales.

At December 31, 2023, $ 4 is subject to clawback if we fail to meet certain conditions, including employment levels.

Industrial Revenue Bonds (IRB) issued by St.

Louis County were used to finance the purchase and/or construction of real and personal property at our St.

Tax benefits associated with IRBs include a twelve-year property tax abatement and sales tax exemption from St.

Louis County.

Louis County and the city of St.

Charles, Missouri were used to finance the purchase and/or construction of real and personal property at our St.

Louis and St.

Charles sites.

Tax benefits associated with IRBs include twelve-year property tax abatements and sales tax exemptions from St.

Louis County and a 22 year property tax abatement and sales tax exemption from the city of St.

We record these properties on our Consolidated Statements of Financial Position.

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The liabilities and IRB assets are equal and are reported net in the Consolidated Statements of Financial Position.

As of December 31, 2022 and 2021, the assets and liabilities associated with the IRBs were $ 271 .

As of December 31, 2023 and 2022, the assets and liabilities associated with the IRBs were $ 333 and $ 271 .

Recoverable Costs on Government Contracts

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Fixed-Price Contracts

Substantially all contracts at BDS and the majority of contracts at BGS Government are long-term contracts.

Long-term contracts that are contracted on a fixed-price basis could result in losses in future periods.

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VC-25B Presidential Aircraft

The Company’s firm fixed-price contract for the Engineering, Manufacturing, and Development (EMD) effort on the U.S.

The Company’s firm fixed-price contract for the Engineering and Manufacturing Development (EMD) effort on the U.S.

Air Force’s (USAF) VC-25B Presidential Aircraft, commonly known as Air Force One, is a $ 4 billion program to develop and modify two 747-8 commercial aircraft.

During the year ended December 31, 2022, we increased the reach-forward loss on the contract by $ 1,452 primarily driven by increases to cost estimates associated with factory modification labor and support engineering resources due to labor instability 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.

During 2022, we increased

the reach-forward loss on the contract by $ 1,452 .

This year we made progress completing engineering and production requirements.

During 2023, we increased the reach-forward loss on the contract by $ 482 driven by engineering changes to support the build and installation process;

the resolution of supplier negotiations;

and factory performance related to labor instability.

While we have provisioned for all of our anticipated costs to complete the contract, 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.

Since 2016, the USAF has authorized ten low rate initial production (LRIP) lots for a total of 139 aircraft, including lots 9 and 10 that were authorized in 2023.

The EMD contract and authorized LRIP lots total approximately $ 27 billion as of December 31, 2023.

During 2022, we increased the reach-forward loss on the KC-46A Tanker program by $ 1,374 .

During 2023, we increased the reach-forward loss on the KC-46A Tanker program by $ 309 primarily resulting from factory disruption and additional rework due to a supplier quality issue.

As of December 31, 2023, we had approximately $ 125 of capitalized precontract costs and $ 48 of potential termination liabilities to suppliers related to unexercised future lots.

During the year ended December 31, 2022, we increased the reach-forward loss on the KC-46A Tanker program by $ 1,374 primarily reflecting higher production and supply chain costs partially driven by labor instability and supply chain disruption, most of which was recorded during the third quarter of 2022.

The increase in production costs was primarily driven by factory unit time performance expectations that assume continued production disruption due to labor instability 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 current year losses also reflect 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.

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

During the year ended December 31, 2022, we increased the MQ-25 reach-forward loss by $ 579 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 engineering design challenges, additional testing and certification activities, and flight test support.

During 2022, we increased the MQ-25 reach-forward loss by $ 579 .

During 2023, we increased the reach-forward loss by $ 231 primarily driven by production and flight testing delays as well as higher than anticipated production costs to complete EMD aircraft attributable to recent factory performance.

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

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

During the year ended December 31, 2022, we recorded earnings charges of $ 203 related to the T-7A Red Hawk fixed-price EMD contract, which has a reach-forward loss at December 31, 2022.

Current year losses were primarily due to supply chain and hardware qualification issues, as well as schedule delays in achieving Military Flight Release and additional cost growth to resolve technical issues and other engineering design changes identified during 2022.

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.

In 2018, we recorded a loss of $ 400 associated with the 11 production lots and associated support options for 346 T-7A Red Hawk aircraft that we believe are probable of being exercised.

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

We increased the estimated reach-forward loss by $ 552 during the year ended December 31, 2022 primarily driven by ongoing supply chain negotiations (which are impacted by supply chain constraints and inflationary pressures), and design revisions, 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.

During the year ended December 31, 2022, we recorded earnings charges of $ 203 related to the T-7A Red Hawk fixed-price EMD contract, which had a reach-forward loss at December 31, 2022.

The production portion of the contract includes 11 production lots for aircraft and related services for 346 T-7A Red Hawk aircraft that we believe are probable of being exercised.

We expect the first production and support contract option to be exercised in 2025.

During 2022, we increased the reach-forward loss by $ 552 .

During 2023, we increased the reach-forward loss by $ 275 primarily reflecting higher estimated production costs.

At December 31, 2023, we had approximately $ 185 of capitalized precontract costs and $ 249 of potential termination liabilities to suppliers related to future production lots.

Commercial Crew

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 year ended December 31, 2022, we increased the reach-forward loss by $ 288 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.

Most of this increase was recorded in the third quarter of 2022, 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.

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

During 2022, we increased the reach-forward loss by $ 288 .

During 2023, we also increased the reach-forward loss by $ 288 primarily as a result of delaying the crewed flight test previously scheduled for July 2023 following

notification by a parachute supplier of an issue identified through testing.

A crewed flight test is now planned for April 2024.

At December 31, 2023, we had approximately $ 226 of capitalized precontract costs and $ 160 of potential termination liabilities to suppliers related to unauthorized future missions.

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

Note 14 – Arrangements with Off-Balance Sheet Risk

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Credit Guarantees We have issued credit guarantees where we are obligated to make payments to a guaranteed party in the event that the original lessee or debtor does not make payments or perform certain specified services.

Generally, these guarantees have been extended on behalf of guaranteed parties with less than investment-grade credit and are collateralized by certain assets.

Generally, these guarantees have been extended on behalf of guaranteed parties with less than investment-grade credit.

Current outstanding credit guarantees expire through 2036.

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We are unable to assess the potential number of future claims that may be asserted under these indemnifications, nor the amounts thereof (if any).

As a result, we cannot estimate the maximum potential amount of future payments under these indemnities and therefore, no liability has been recorded.

As a result, we cannot estimate the maximum potential amount of future payments under these indemnities.

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 13.

Note 15 – Debt

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 credit facility has a one-year term out option which allows us to extend the maturity of any borrowings one year beyond the aforementioned expiration date.

In the third quarter of 2023, we entered into a $ 3,000 five-year revolving credit agreement expiring in August 2028 and a $ 800 364 -day revolving credit agreement expiring in August 2024.

The 364 -day credit facility has a one-year term out option which allows us to extend the maturity of any borrowings until August 2025.

The legacy three-year revolving credit agreement expiring in August 2025, which consists of $ 3,000 of total commitments, and the legacy five-year revolving credit agreement expiring in October 2024, as amended, which consists of $ 3,200 of total commitments, each remain in effect.

As of December 31, 2023, we had $ 10,000 currently available under credit line agreements.

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Interest incurred, including amounts capitalized, was $ 2,560 , $ 2,650 and $ 2,790 for the years ended December 31, 2023, 2022 and 2021, respectively.

Interest expense recorded by BCC is reflected as Boeing Capital interest expense on our Consolidated Statements of Operations.

Total Company interest payments were $ 2,572 , $ 2,583 and $ 1,925 for the years ended December 31, 2022, 2021 and 2020, respectively.

Total Company interest payments, net of amounts capitalized, were $ 2,408 , $ 2,572 and $ 2,583 for the years ended December 31, 2023, 2022 and 2021, respectively.

Short-term debt and current portion of long-term debt at December 31 consisted of the following:

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2024 2025 2026 2027 2028

Debt $ 5,128 $ 5,081 $ 4,306 $ 7,966 $ 3,300

Debt and other notes

$ 5,128 $ 4,581 $ 7,983 $ 3,300 $ 1,800

Minimum finance lease obligations $ 84 $ 76 $ 55 $ 24 $ 3

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We also have other postretirement benefits (OPB) other than pensions which consist principally of health care coverage for eligible retirees and qualifying dependents, and to a lesser extent, life insurance to certain groups of retirees.

Retiree health care is provided principally until age 65 for approximately three-fourths of those participants who are eligible for health care coverage.

Retiree health care is provided principally until age 65 for approximately three-fourths of those participants who are eligible for retiree health care coverage.

Certain employee groups, including employees covered by most United Auto Workers bargaining agreements, are provided lifetime health care coverage.

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Net periodic benefit cost included in Loss from operations $ 2 $ 3 $ 3 $ 62 $ 79 $ 90

Net periodic benefit (income)/cost included in Other income, net ( 881 ) ( 528 ) ( 340 ) ( 58 ) ( 1 ) 16

Net periodic benefit income included in Other income, net ( 529 ) ( 881 ) ( 528 ) ( 58 ) ( 58 ) ( 1 )

Net periodic benefit (income)/cost included in Loss before income taxes

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Interest cost 2,820 2,080 148 98

Actuarial (gain)/loss ( 17,605 ) ( 3,249 ) ( 914 ) ( 401 )

Settlement/other ( 870 )

Actuarial loss/(gain) 1,217 ( 17,605 ) ( 152 ) ( 914 )

Gross benefits paid ( 4,837 ) ( 4,971 ) ( 375 ) ( 406 )

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Plan participants’ contributions 4 6

Settlement payments

Benefits paid ( 4,698 ) ( 4,824 ) ( 4 ) ( 11 )

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Net amount recognized ($ 5,434 ) ($ 5,292 ) ($ 2,488 ) ($ 2,838 )

Amounts recognized in Accumulated other comprehensive loss at December 31 were as follows:

Amounts recognized in Accumulated other comprehensive loss (AOCI) at December 31 were as follows:

Pension Other Postretirement Benefits

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Prior service credits ( 1,143 ) ( 1,224 ) ( 19 ) ( 41 )

Total recognized in Accumulated other comprehensive loss $ 16,224 $ 17,725 ($ 1,903 ) ($ 1,168 )

Total recognized in AOCI

$ 17,032 $ 16,224 ($ 1,871 ) ($ 1,903 )

The accumulated benefit obligation (ABO) for all pension plans was $ 53,671 and $ 54,481 at December 31, 2023 and 2022.

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A key element of our strategy is to de-risk the plan as the funded status of the plan increases.

During 2022, the funded status of the plans increased as compared to 2021, and additional assets were reallocated to fixed income.

During 2023, we completed a strategy review including an asset/liability study and, as a result, target allocations were updated with a modest increase to risk assets.

The changes in the asset allocation are reflected in the table below.

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Investment managers are retained for explicit investment roles specified by contractual investment guidelines.

Certain investment managers are authorized to use derivatives, such as equity or bond futures, swaps, options and currency futures or forwards.

Derivatives are used to achieve the desired

market exposure of a security or an index, transfer value-added performance between asset classes, achieve the desired currency exposure, adjust portfolio duration or rebalance the total portfolio to the target asset allocation.

Certain investment managers are authorized to use derivatives, such as equity or bond

futures, swaps, options and currency futures or forwards.

Derivatives are used to achieve the desired market exposure of a security or an index, transfer value-added performance between asset classes, achieve the desired currency exposure, adjust portfolio duration or rebalance the total portfolio to the target asset allocation.

As a percentage of total pension assets, derivative net notional amounts were 38.3 % and 37.1 % for fixed income, including to-be-announced mortgage-backed securities and treasury forwards, and 2.1 % and ( 5.6 %) for global equity and commodities at December 31, 2023 and 2022.

I n November 2020, the Company elected to contribute $ 3,000 of our common stock to the pension fund.

In November 2020, the Company elected to contribute $ 3,000 of our common stock to the pension fund.

An independent fiduciary was retained to manage and liquidate the stock over time at its discretion.

Plan assets included $ 1,782 and $ 1,883 of our common stock as of December 31, 2022 and 2021.

At December 31, 2022, plan assets included $ 1,782 of our common stock, which was liquidated during 2023.

Risk Management In managing the pension assets, we review and manage risk associated with funded status risk, interest rate risk, market risk, counterparty risk, liquidity risk and operational risk.

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Real estate and real assets:

Real estate 413 413

Real assets 385 349 33 3 362 310 47 5

Assets 1 1 8 8

Liabilities ( 8 ) ( 7 ) ( 1 )

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$ 70 $ 5 ($ 16 ) $ 59

government and

agencies ( 1 ) $ 1

Mortgage backed and

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Municipal 32 ( 5 ) ( 27 )

Sovereign 9 ( 9 )

Equity securities:

preferred stock 5 ( 45 ) ( 2 ) 42

Real assets 4 ( 1 ) 3

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$ 53 ($ 19 ) $ 3 $ 33 $ 70

government and agencies

Mortgage backed and asset backed

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Total $ 198 ($ 90 ) $ 31 $ 129 $ 268

For the year ended December 31, 2023, the changes in unrealized gains/(losses) for Level 3 assets still held at December 31, 2023 were $ 2 for corporate fixed income securities, $ 6 for mortgage backed and asset backed fixed income securities, and $ 3 for other fixed income securities.

For the year ended December 31, 2022, the changes in unrealized gains/(losses) for Level 3 assets still held at December 31, 2022 were ($ 16 ) for corporate fixed income securities, ($ 11 ) for mortgage backed and asset backed fixed income securities, ($ 14 ) for municipal fixed income securities, and ($ 1 ) for real asset securities.

For the year ended December 31, 2021, the changes in unrealized gains/(losses) for Level 3 assets still held at December 31, 2021 were ($ 1 ) for mortgage backed and asset backed fixed income securities and ($ 8 ) for sovereign.

OPB Plan Assets The majority of OPB plan assets are invested in a balanced index fund which is comprised of approximately 60 % equities and 40 % debt securities.

The index fund is valued using a

market approach based on the quoted market price of an identical instrument (Level 1).

The index fund is valued using a market approach based on the quoted market price of an identical instrument (Level 1).

The expected rate of return on these assets does not have a material effect on the net periodic benefit cost.

Contributions Required pension contributions under the Employee Retirement Income Security Act (ERISA), as well as rules governing funding of our non-US pension plans, are not expected to be significant in 2024.

During the fourth quarter of 2020, we contributed $ 3,000 in common stock to the pension fund.

We do not expect to make discretionary contributions to our pension plans in 2024.

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Share-Based Compensation

Our 2003 Incentive Stock Plan, as amended and restated, permits awards of incentive and non-qualified stock options, stock appreciation rights, restricted stock or units, performance shares, performance restricted stock or units, performance units and other stock and cash-based awards to our employees, officers, directors, consultants, and independent contractors.

The aggregate number of shares of our stock authorized for issuance under the plan is 87,000,000 .

Our 2023 Incentive Stock Plan, permits awards of incentive and non-qualified stock options, stock appreciation rights, restricted stock or units, performance restricted stock or units, and other stock and cash-based awards to our employees, officers, directors, consultants, and independent contractors.

The aggregate number of shares of our stock authorized for issuance under the plan is 12,900,000 , plus shares that remain available, undelivered, or retained under our 2003 Incentive Stock Plan, as amended and restated.

Following approval of our 2023 Incentive Stock Plan in 2023, no further awards have been or may be granted under our 2003 Incentive Stock Plan.

Shares issued as a result of stock option exercises or conversion of stock unit awards will be funded out of treasury shares, except to the extent there are insufficient treasury shares, in which case new shares will be issued.

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The model includes no expected dividend yield.

Stock options granted during 2023 were not material.

On February 16, 2022, we granted 348,769 premium-priced stock options to our executive officers as part of our long-term incentive program.

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These stock options have an exercise price equal to 120 % of the fair market value of our stock on the date of grant.

During 2021, we also granted 148,322 stock options to certain executives to encourage retention or to award various achievements, of which 40,322 had an exercise price equal to 120 % of the fair market value of our stock on the date of grant, and the remaining 108,000 had an exercise price equal to the fair market value on the date of grant.

During 2021, we also granted 148,322 stock options to certain executives, of which 40,322 had an exercise price equal to 120 % of the fair market value of our stock on the date of grant, and the remaining 108,000 had an exercise price equal to the fair market value of our stock on the date of grant.

The grant date fair market values of these awards were not significant.

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Exercised ( 597,030 ) 77.06

Expired ( 664 ) 130.72

Forfeited ( 31,077 ) 260.26

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At December 31, 2023, there was $ 11 of total unrecognized compensation cost related to options which is expected to be recognized over a weighted average period of 1.2 years.

No options vested during the years ended December 31, 2022, 2021 and 2020.

Restricted Stock Units

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These RSUs are labeled executive long-term incentive program in the table below.

In December 2020, we granted to our employees (excluding executives and certain union-represented employees), a one-time grant of 5,163,425 RSUs with a grant date fair value of $ 233.00 per unit.

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

If an employee terminates employment because of retirement, layoff, disability or death, the employee (or beneficiary) may receive a proration of stock units based on active employment during the three-year service period.

In all other cases, the RSUs will not vest and all rights to the stock units will terminate.

These RSUs are labeled employee long-term incentive program in the table below.

In addition to RSUs awarded under our long-term incentive programs, we granted RSUs to certain executives and employees to encourage retention or to reward various achievements.

In addition to RSUs awarded under our long-term incentive programs, we granted RSUs to certain executives and employees.

These RSUs are labeled other RSUs in the table below.

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Weighted average remaining amortization period (years)

Performance Restricted Stock Units

On February 16, 2023, we granted 199,899 performance restricted stock units (PRSU) to our executive officers as part of our long-term incentive program that will result in that number of PRSUs being paid out if the target performance metric is achieved.

The PRSUs granted under this program have a grant date fair value of $ 214.35 per unit.

The award payout can range from 0 % to 200 % of the initial PRSU grant based on cumulative free cash flow achievement over the period January 1, 2023 through December 31, 2025 as compared to the target set at the start of the performance period.

The PRSUs granted under this program will vest at the payout amount determined on the third anniversary of the grant date and settle in common stock (on a one-for-one basis).

If an executive terminates employment because of retirement, layoff, disability, or death, the executive (or beneficiary) remains eligible under the award and, if the award is earned, may receive some or all of their stock units depending on certain age and service conditions.

In all other cases, the PRSUs will not vest and all rights to the stock units will terminate.

During the year ended December 31, 2023, there were no forfeitures or distributions.

At December 31, 2023, unrecognized compensation cost was $ 31 , and the weighted average remaining amortization period was 2.1 years.

Performance-Based Restricted Stock Units

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The award payout can range from 0 % to 200 % of the initial PBRSU grant.

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

If an executive terminates employment because of retirement, layoff, disability or death, the employee (or beneficiary) remains eligible under the award and, if the award is earned, will receive a proration of stock units based on active employment during the three-year service period.

In all other cases, the PBRSUs will not vest and all rights to the stock units will terminate.

In February 2020, we granted to our executives 290,202 PBRSUs as part of our long-term incentive program.

Compensation expense for the award is recognized over the three-year performance period based upon the grant date fair value.

The grant date fair values were estimated using a Monte-Carlo simulation model with the assumptions presented below.

The model includes no expected dividend yield.

Grant Year Grant Date Performance Period Expected Volatility Risk Free Interest Rate Grant Date Fair Value Per Unit

2020 2/24/2020 3 years 27.0 % 1.2 % $ 357.38

PBRSU activity for the year ended December 31, 2022 was as follows:

Executive Long-Term Incentive Program

Number of units:

Outstanding at beginning of year 383,401

Performance based adjustment (1)

Forfeited ( 10,647 )

Outstanding at end of year 210,206

Unrecognized compensation cost $ 4

Weighted average remaining amortization period (years)

(1) Represents adjustment to 0 % payout for units granted in 2019.

Performance Awards

During 2020, we granted Performance Awards to our executives, which are cash units that pay out based on the achievement of long-term financial goals at the end of a three-year period.

Each unit had an initial value of $ 100 dollars.

The Compensation Committee has the discretion to pay these awards in cash, stock or a combination of both after the three-year performance period.

As of December 31, 2022 these performance awards have expired with a payout of $ 0 .

During 2023, these performance awards expired with a payout of 0 %.

Employee Stock Purchase Plan

The Company has an employee stock purchase plan which permits eligible employees to purchase Boeing stock at 95 % of the fair market value on the last trading day of each three-month period using payroll deduction.

The aggregate number of shares of our stock authorized for issuance under the plan is 12,000,000 .

During the year ended December 31, 2023, approximately 216,719 shares were purchased at an average price of $ 193.52 per share.

Deferred Compensation

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Participants can diversify these amounts among 23 investment funds including a Boeing stock unit account.

Total (income)/expense related to deferred compensation was ($ 117 ), $ 126 and $ 93 in 2022, 2021 and 2020, respectively.

Total expense/(income) related to deferred compensation was $ 188 , ($ 117 ) and $ 126 in 2023, 2022 and 2021, respectively.

As of December 31, 2023 and 2022, the deferred compensation liability which is being marked to market was $ 1,640 and $ 1,499 .

Note 18 – Shareholders’ Equity

On December 17, 2018, the Board approved a repurchase plan for up to $ 20,000 of common stock.

In March 2020, the Board of Directors terminated its prior authorization to repurchase shares under this plan.

As of December 31, 2023 and 2022, there were 1,200,000,000 shares of common stock and 20,000,000 shares of preferred stock authorized.

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Balance at December 31, 2023 1,012,261,159 402,746,136

Additional Paid-in Capital

During the year ended December 31, 2023, Additional paid-in capital included a decrease of $ 267 related to a non-cash transaction to purchase shares in a consolidated subsidiary from the noncontrolling interests.

Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss (AOCI) by component for the years ended December 31, 2022, 2021 and 2020 were as follows:

Changes in AOCI by component for the years ended December 31, 2023, 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)

Balance at January 1, 2021 ($ 30 ) $ 1 ($ 43 ) ($ 17,061 ) ($ 17,133 )

Other comprehensive income/(loss) before reclassifications 98 14 ( 1,929 ) (2)

Other comprehensive (loss)/income before reclassifications

( 75 ) 55 4,268 (2)

Amounts reclassified from AOCI

Net current period Other comprehensive income/(loss) 98 41 ( 1,119 ) ( 980 )

( 6 ) 1,232 (3)

Net current period Other comprehensive (loss)/income

( 75 ) 49 5,500 5,474

Balance at December 31, 2021 ($ 105 ) $ 1 $ 6 ($ 11,561 ) ($ 11,659 )

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Balance at December 31, 2022 ($ 167 ) ($ 24 ) ($ 9,359 ) ($ 9,550 )

Other comprehensive (loss)/income before reclassifications

Other comprehensive income/(loss) before reclassifications

33 2 41 ( 722 ) (2)

Amounts reclassified from AOCI

Net current period Other comprehensive (loss)/income

( 5 ) ( 104 ) (3)

Net current period Other comprehensive income/(loss)

33 2 36 ( 826 ) ( 755 )

Balance at December 31, 2023 ($ 134 ) $ 2 $ 12 ($ 10,185 ) ($ 10,305 )

(1) Net of tax.

(2) Primarily related to remeasurement of assets and benefit obligations related to the Company's pension and other postretirement benefit plans resulting in an actuarial gain/(loss) of $ 1,533 , $ 4,262 and ($ 1,956 ) (net of tax of ($ 22 ), ($ 32 ) and $ 111 ) for the years ended December 31, 2022, 2021 and 2020.

(3) Primarily related to amortization of actuarial losses for the years ended December 31, 2022, 2021 and 2020 totaling $ 791 , $ 1,155 and $ 917 (net of tax of ($ 11 ), ($ 8 ) and ($ 52 )), respectively.

These are included in the net periodic pension cost.

(4) Included 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.

(2) Primarily related to remeasurement of assets and benefit obligations related to the Company's pension and other postretirement benefit plans resulting in an actuarial (loss)/gain of ($ 722 ), $ 1,533 and $ 4,262 (net of tax of $ 13 , ($ 22 ) and ($ 32 )) for the years ended December 31, 2023, 2022 and 2021.

(3) Amounts reclassified from AOCI for the year ended December 31, 2023, primarily related to amortization of prior service credits totaling ($ 102 ) (net of tax of $ 1 ).

Amounts reclassified from AOCI for the years ended December 31, 2022 and 2021, primarily related to amortization of actuarial losses totaling $ 791 and $ 1,155 (net of tax of ($ 11 ) and ($ 8 )).

These are included in net periodic pension cost.

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

Note 19 – Derivative Financial Instruments

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Our cash flow hedges include foreign currency forward contracts, commodity swaps and commodity purchase contracts.

We use foreign currency forward contracts to manage currency risk associated with certain transactions, specifically forecasted sales and purchases made in foreign currencies.

Our foreign currency contracts hedge forecasted transactions through 2031.

We use foreign currency forward contracts to manage currency risk associated with certain expected sales and purchased through 2031.

We use commodity derivatives, such as fixed-price purchase commitments and swaps to hedge against potentially unfavorable price changes for commodities used in production.

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General and administrative expense 7 10 5

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 years ended December 31, 2022 and 2021.

During the twelve months ended December 31, 2022, we reclassified losses associated with certain cash flow hedges of $ 50 from AOCI to Other income, net because it became probable the forecasted transactions would not occur.

Gains/(losses) related to undesignated derivatives on foreign exchange and commodity cash flow hedging transactions recognized in Other income, net were insignificant for the years ended December 31, 2023, 2022 and 2021.

Based on our portfolio of cash flow hedges, we expect to reclassify gains of $ 14 (pre-tax) out of Accumulated other comprehensive loss into earnings during the next 12 months.

Based on our portfolio of cash flow hedges, we expect to reclassify losses of $ 39 (pre-tax) out of AOCI into earnings during the next 12 months.

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

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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.

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 years ended December 31 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 Losses

Total Losses Fair Value

Investments ($ 18 ) ($ 31 )

Customer financing assets

$ 47 $ 47 ( 7 ) $ 110 $ 110 ( 31 )

Operating lease equipment

Property, plant and equipment $ 14 ( 26 ) ( 19 )

Other Assets and Acquired intangible assets 15 15 ( 55 ) 1 1 ( 9 )

( 2 ) 15 ( 55 )

Total $ 14 ($ 46 ) $ 62 ($ 112 )

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.

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

The fair value of the impaired operating lease equipment is derived by calculating a median collateral value from a consistent group of third party aircraft value publications.

The values provided by the third party aircraft publications are derived from their knowledge of market trades and other market factors.

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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 year ended December 31, 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

Technique(s) Unobservable Input Range

Median or Average

Customer financing assets $ 47 Market approach Aircraft value publications $ 40 - $ 51 (1)

Aircraft condition adjustments ($ 4 ) - $ 5 (2)

(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.

Fair Value Disclosures

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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.

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.

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Various legal proceedings, claims and investigations related to products, contracts, employment and other matters are pending against us.

In addition, we are subject to various U.S.

government inquiries and investigations from which civil, criminal or administrative proceedings could result or have resulted in the past.

In addition, we are subject to various government inquiries and investigations from which civil, criminal or administrative proceedings could result or have resulted in the past.

Such proceedings involve or could involve claims by the government for fines, penalties, compensatory and treble damages, restitution and/or forfeitures.

Under government regulations, a company, or one or more of its operating divisions or subdivisions, can also be suspended or debarred from government contracts, or lose its export privileges, based on the results of investigations.

Except as described below, we believe,

based upon current information, that the outcome of any such legal proceeding, claim, or government dispute and investigation will not have a material effect on our financial position, results of operations or cash flows.

Where it is reasonably possible that we will incur losses in excess of recorded amounts in connection with any of the matters set forth below, we will disclose either the amount or range of reasonably possible losses in excess of such amounts or, where no such amount or range can be reasonably estimated, the reasons why no such estimate can be made.

Multiple legal actions have been filed against us as a result of the October 29, 2018 accident of Lion Air Flight 610 and the March 10, 2019 accident of Ethiopian Airlines Flight 302.

During 2021, we entered into (i) a Deferred Prosecution Agreement with the U.S.

Department of Justice that resolved the Department of Justice’s previously disclosed investigation into us regarding the evaluation of the 737 MAX by the Federal Aviation Administration (FAA) as well as (ii) a proposed settlement with plaintiffs in a shareholder derivative lawsuit that resulted in the Company receiving $ 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.

We cannot reasonably estimate a range of loss, if any, not covered by available insurance that we may incur as a result of any remaining pending lawsuits or other matters related to the accidents and the 737 MAX.

government regulations, a company, or one or more of its operating divisions or subdivisions, can also be suspended or debarred from government contracts, or lose its export privileges, based on the results of investigations.

We believe, based upon current information, that the outcome of any currently pending legal proceeding, claim, or government dispute, inquiry or investigation will not have a material effect on our financial position, results of operations or cash flows.

With respect to the matters set forth below, we cannot reasonably estimate a range of loss in excess of recorded amounts, if any.

Multiple legal actions and inquiries were initiated as a result of the October 29, 2018 accident of Lion Air Flight 610 and the March 10, 2019 accident of Ethiopian Airlines Flight 302.

On January 7, 2021, we entered into a Deferred Prosecution Agreement (DPA) with the U.S.

Department of Justice that resolved the Department of Justice’s investigation into us regarding the evaluation of the 737 MAX by the Federal Aviation Administration (FAA).

Among other obligations, the DPA includes a three-year reporting period, which ended earlier this month.

The Department is currently considering whether we fulfilled our obligations under the DPA and whether to move to dismiss the information, which motion will require court approval.

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

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In 2020, we exercised our contractual right to terminate these agreements based on Embraer’s failure to meet certain required closing conditions.

Embraer has disputed our right to terminate the agreements, and the dispute is currently in arbitration.

We cannot reasonably estimate a range of loss, if any, that may result from the arbitration, which we currently expect to be completed in late 2023 or early 2024.

Embraer has disputed our right to terminate the agreements, and the dispute is currently in arbitration, which we currently expect to be resolved in 2024.

Note 22 – Segment and Revenue Information

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

We operate in four reportable segments:

BCA, BDS, BGS and BCC.

Segment results reflect the realignment of the Boeing Customer Financing team and portfolio into the BCA segment during the first quarter of 2023.

Interest and debt expense now includes interest and debt expense previously attributable to Boeing Capital and classified as a component of Total Costs and Expenses ("Cost of Sales").

Prior period amounts have been reclassified to conform to current period presentation.

Our primary profitability measurement to review segment operating results is Loss from operations.

We operate in three reportable segments:

BCA, BDS, and BGS.

All other activities fall within Unallocated items, eliminations and other.

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Revenue on other contracts is generally recognized over the contract term (over time) as costs are incurred.

BCC facilitates, arranges, structures and provides selective financing solutions for our customers.

While our principal operations are in the United States, Canada and Australia, some key suppliers and subcontractors are located in Europe and Japan.

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Years ended December 31, 2023 2022 2021

Asia $ 8,393 $ 5,845 $ 5,931

Europe $ 10,520 $ 7,916 $ 8,967

Asia 10,013 8,393 5,845

Middle East 6,594 5,047 4,653

Canada 1,612 969 1,302

Oceania 1,655 1,576 1,147

Canada 1,256 1,612 969

Africa 825 418 239

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Earnings in Equity Method Investments

For the year ended December 31, 2022, our share of income from equity method investments was $ 56 , primarily driven by investments held in Unallocated items, eliminations and other.

For the years ended December 31, 2021 and 2020, our share of income from equity method investments was $ 40 and $ 86 , primarily in our BDS segment.

During the years ended December 31, 2023, 2022, and 2021, our share of income from equity method investments was $ 70 , $ 56 , and $ 40 , respectively.

In 2023 and 2021, earnings in equity method investments were primarily driven by investments held at our BDS segment.

In 2022, earnings in equity method investments were primarily driven by investments held in Unallocated items, eliminations and other.

Our total backlog includes contracts that we and our customers are committed to perform.

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We expect approximately 16 % to be converted to revenue through 2024 and approximately 62 % through 2027, with the remainder thereafter.

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, 737-7 and/or 737-10, 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 737 and 787 deliveries from inventory and timing of entry into service of the 777X, 737-7 and/or 737-10.

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 aircraft sold to our BCC segment that are leased by BCC to customers and considered transferred to the BCC segment.

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

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

federal cost accounting standards.

Government Cost Accounting Standards (CAS).

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

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Unallocated items, eliminations and other ($ 1,759 ) ($ 1,504 ) ($ 1,227 )

Pension FAS/CAS service cost adjustment $ 849 $ 882 $ 1,024

Postretirement FAS/CAS service cost adjustment 294 291 359

FAS/CAS service cost adjustment $ 1,143 $ 1,173 $ 1,383

Pension and Other Postretirement Benefit Expense

Pension costs, comprising GAAP service and prior service costs, are allocated to BCA and the commercial operations at BGS.

Pension costs are allocated to BDS and BGS businesses supporting government customers using U.S.

Government Cost Accounting Standards (CAS), which employ different actuarial assumptions and accounting conventions than GAAP.

Pension costs are allocated to BDS and BGS businesses supporting government customers using CAS, which employ different actuarial assumptions and accounting conventions than GAAP.

These costs are allocable to government contracts.

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These expenses are included in Other income, net.

Components of FAS/CAS service cost adjustment are shown in the following table:

Years ended December 31, 2023 2022 2021

Pension FAS/CAS service cost adjustment $ 799 $ 849 $ 882

Postretirement FAS/CAS service cost adjustment 257 294 291

FAS/CAS service cost adjustment $ 1,056 $ 1,143 $ 1,173

Segment assets are summarized in the table below.

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Global Services 16,193 16,149

Boeing Capital 1,510 1,735

Unallocated items, eliminations and other 28,851 29,700

Total $ 137,012 $ 137,100

Assets included in Unallocated items, eliminations and other primarily consist of Cash and cash equivalents, Short-term and other investments, tax assets, capitalized interest, and assets managed centrally on behalf of the four principal business segments and intercompany eliminations.

Assets included in Unallocated items, eliminations and other primarily consist of Cash and cash equivalents, Short-term and other investments, tax assets, capitalized interest and assets managed centrally on behalf of the three principal business segments and intercompany eliminations.

Capital Expenditures

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Total $ 1,527 $ 1,222 $ 980

Capital expenditures for Unallocated items, eliminations and other relate primarily to assets managed centrally on behalf of the four principal business segments.

Capital expenditures for Unallocated items, eliminations and other relate primarily to assets managed centrally on behalf of the three principal business segments.

Depreciation and Amortization

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Global Services 320 346 414

Boeing Capital Corporation 46 59 66

Centrally Managed Assets (1)

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In 2021, $ 669 was included in the primary business segments, of which $ 387 , $ 222 and $ 60 was included in BCA, BDS and BGS, respectively.

Note 23 – Subsequent Events

On January 5, 2024, an Alaska Airlines 737-9 flight made an emergency landing after a mid-exit door plug detached in flight.

Following the accident, the Federal Aviation Administration (FAA) grounded and required inspections of all 737-9 aircraft with a mid-exit door plug, which constitute the large majority of the approximately 220 737-9 aircraft in the in-service fleet .

On January 24, 2024, the FAA approved an

enhanced maintenance and inspection process that must be performed on each of the grounded 737-9 aircraft.

Our 737-9 operators have begun returning their fleets to service, and many 737-9s have completed inspections and resumed revenue flights.

All 737-9 aircraft in production will undergo this same enhanced inspection process prior to delivery.

On January 10, 2024, the FAA notified Boeing that the FAA has initiated an investigation into Boeing’s quality control system.

On January 24, 2024, the FAA stated that it will not approve production rate increases or additional production lines for the 737 MAX until it is satisfied that Boeing is in full compliance with required quality control procedures.

We are currently unable to reasonably estimate what impact the accident and the related FAA actions will have on our financial position, results of operations and cash flows.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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The operational and technical complexities of fixed-price development contracts create financial risk, which could increase the estimates of costs and result in lower margins or material reach-forward losses.

The ongoing effects of macroeconomic challenges, including supply chain disruption, labor shortages, and inflationary pressures compound these complexities and related financial risks.

Given the complexities of certain of the Company’s fixed-price development contracts, including the KC-46A Tanker, Commercial Crew, United States Air Force VC-25B Presidential Aircraft, T-7A Redhawk, and MQ-25 contracts, the limited amount of historical data available in certain instances and significant judgments necessary to estimate future costs at completion, auditing these estimates involved extensive audit effort, a high degree of auditor judgment, and required audit professionals with specialized industry experience.

The ongoing effects of supply chain and labor disruption compound these complexities and related financial risks.

Given the operational and technical complexities of certain of the Company’s fixed-price development contracts, including the KC-46A Tanker, Commercial Crew, VC-25B Presidential Aircraft, T-7A Redhawk, and MQ-25 contracts and the limited amount of historical data available in certain instances and significant judgments necessary to estimate future costs at completion, auditing these estimates involved extensive audit effort, a high degree of auditor judgment, and required audit professionals with specialized industry experience.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the cost estimates for the KC-46A Tanker, Commercial Crew, United States Air Force VC-25B Presidential Aircraft, T-7A Redhawk, and MQ-25 fixed-price development contracts included the following, among others:

Our audit procedures related to the cost estimates for the KC-46A Tanker, Commercial Crew, VC-25B Presidential Aircraft, T-7A Redhawk, and MQ-25 fixed-price development contracts included the following, among others:

• We evaluated the appropriateness and consistency of management’s methods used in developing its estimates.

• We evaluated the reasonableness of judgments made and significant assumptions used by management relating to key cost and schedule estimates, including the effects of supply chain disruptions, labor shortages, and inflationary pressures.

We also evaluated the ranges and probabilities of reasonably possible outcomes, and where management set its point estimate within the range.

• We evaluated the appropriateness of the timing of changes to key estimates, including evaluating the timeline of key events and knowledge points that led to management’s determination that a change in estimate was necessary.

• We inquired of project managers, engineers, supply chain leadership, and others directly involved with the execution of contracts to evaluate management’s ability to achieve the key cost and schedule estimates, as well as evaluate project status and challenges which may affect total estimated costs to complete.

We also evaluated the range and probabilities of reasonably possible outcomes, and where management set its point estimate within the range.

• We evaluated the appropriateness of the timing of the incorporation of changes to key estimates, including evaluating the timeline of key events and knowledge points that led to management’s determination that a change in estimate was necessary.

• We inquired of project management, engineers, supply chain leadership, and others directly involved with the execution of contracts to evaluate management’s ability to achieve the key

cost and schedule estimates, as well as evaluate project status and challenges which may affect total estimated costs to complete.

• We observed the project work site when key estimates related to tangible or physical progress of the project.

• We tested the accuracy and completeness of the key data used in developing estimates.

developed independent expectations of reasonable outcomes using, in part, the program’s data and compared our expectations to management’s estimates.

• We performed retrospective reviews when evaluating the thoroughness and precision of management’s estimation process and effectiveness of the related internal controls by comparing actual outcomes to previous estimates and the related financial statement impact, and evaluating key judgments made by management when determining the timing of changes to key estimates.

We developed independent expectations of reasonable outcomes using, in part, the program’s data and compared our expectations to management’s estimates.

• We performed retrospective reviews when evaluating the thoroughness and precision of management’s estimation process and effectiveness of the related internal controls by comparing actual outcomes to previous estimates and the related financial statement impact, and evaluating key judgements made by management when determining the timing of changes to key estimates.

• We tested the effectiveness of internal controls including, those over the review of significant judgments made and assumptions used to develop key estimates, key data used in developing the estimates and the mathematical extrapolation of such data.

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The Company uses program accounting to compute cost of sales and margin for each commercial airplane sold.

The use of program accounting requires estimating and demonstrating customer demand for the number of units included in the program (program accounting quantity) and estimating the sales and costs over the expected life of each program.

In particular, estimating the sales and costs associated with the initial program accounting quantity and the unsold units within the program accounting quantity involve measurement uncertainty resulting in a range of reasonable outcomes.

Additionally, the level of effort to meet regulatory requirements and achieve certification may be challenging to predict, including potential delays in the timing of entry into service and corresponding increases in estimated costs.

Changes to the revenue and cost estimates related to the program accounting quantity or regulatory requirements to achieve certification could occur, resulting in lower margins or material reach-forward losses.

Auditing the estimated revenues and costs for the 777X program involved extensive audit effort, a high degree of auditor judgment, and required audit professionals with specialized industry experience.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the estimated revenues and costs for the anticipated 777X initial program accounting quantity included the following, among others:

• We inquired of management, including individuals responsible for sales and pricing, to evaluate the status of current sales campaigns, short and long-term market demand, and status of negotiations with individual customers.

• We compared management’s estimate of market demand to external industry sources of expected demand.

• We evaluated management’s ability to estimate program revenue by comparison to historical estimates and actual results on other commercial programs.

• We evaluated the consistency of management’s methods and the appropriateness of significant assumptions used in developing its revenue estimates related to the initial program accounting quantity and unsold units within the program accounting quantity.

• We evaluated the appropriateness and consistency of management’s methods used in developing its cost estimates.

• We inquired of those directly involved with the certification of the aircraft to evaluate the challenges and timeline to achieve certification, which may affect total estimated costs.

• We evaluated communications with regulatory bodies for information contradictory with management’s certification timeline assumptions.

• We tested the effectiveness of internal controls, including those over the review of significant judgments made and assumptions used to develop key estimates, key data used in developing the estimates and the mathematical extrapolation of such data.

Program Accounting Revenue Estimates for the 787 Program — Refer to Notes 1, 7, and 22 to the financial statements

Critical Audit Matter Description

Production quality issues and supply chain disruption for the 787 program have resulted in increased risk associated with forecasted revenue estimates primarily due to the difficulty in assessing the value of consideration expected to be provided to customers as a result of delivery delays.

The Company uses program accounting to compute cost of sales and margin for each commercial airplane sold.

The use of program accounting requires estimating the revenue expected to be earned upon delivery of the aircraft included in the program’s accounting quantity.

While the 787 program resumed deliveries in 2022, the forecasted delivery schedule and the value of the consideration expected to be provided to customers for delivery delays continue to be key factors that affect estimated revenue.

There is estimation uncertainty related to the revenue forecasts of aircraft which have reached or are expected to reach a delivery delay period that provides the customer with a contractual termination right.

Changes to the expected delivery schedule could result in additional consideration to customers.

This could result in lower margins or material reach-forward losses.

Auditing the estimated revenues for the 787 program involved extensive audit effort, a high degree of auditor judgment, and required professionals with specialized industry experience.

The use of program accounting requires estimating the costs over the expected life of each program.

In particular, the level of effort to meet regulatory requirements and achieve certification may be challenging to predict, including potential delays in the timing of achieving certification that would delay entry into service and corresponding increases in estimated costs.

Changes to the cost estimates related to regulatory requirements to achieve certification could occur, resulting in lower margins or material reach-forward losses.

Auditing these estimated costs for the 777X program involved extensive audit effort, a high degree of auditor judgment, and required audit professionals with specialized industry experience.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the estimated revenues for the 787 program included the following, among others:

• We inquired of management, including operational and supply chain leadership, to assess the assumptions related to the supply chain disruption impacts on the delivery schedule and the estimated timeline for completion of rework.

• We evaluated the appropriateness and consistency of management’s method used in developing the delivery schedule assumptions, including the impact of production quality issues and supply chain disruption.

• We inquired of management, including individuals responsible for sales and pricing, to evaluate the status of current contracts with customers and estimated consideration to be provided to customers.

• We evaluated the consistency of management’s methods and the appropriateness of significant assumptions used in developing its estimates related to forecasted revenue for aircraft which have or are expected to have delivery delays.

Our audit procedures related to the estimated costs for the 777X program included the following, among others:

• We evaluated the appropriateness and consistency of management’s methods used in developing its cost estimates related to regulatory requirements to achieve certification.

• We performed procedures to evaluate new changes in estimated costs driven by changes in regulatory requirements to achieve certification.

• We evaluated the timeline of key events and knowledge points that informs management’s determination to change the cost estimate related to regulatory requirements to achieve certification.

• We inquired of those directly involved with the certification of the aircraft to evaluate project status and challenges which may affect total estimated costs to certify the aircraft.

• We obtained and evaluated communications with regulatory bodies for consistency between management’s certification timeline assumptions and cost estimates related to regulatory requirements.

• We tested the effectiveness of internal controls, including those over the data used in developing the cost estimates, the mathematical extrapolation of such data, and management’s judgment regarding the range of possible outcomes relating to the specific cost estimates in the current regulatory environment.

/s/ Deloitte & Touche LLP

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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-K

Item 8. Financial Statements and Supplementary Data