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Shares of Boeing Are Crashing After This Dismal Outlook

January 27, 2016, 3:40 PM UTC
US-AVIATION-BOEING-737MAX
Boeing's first 737 MAX named the "Spirit of Renton" is parked on the tarmac at the Boeing factory in Renton, Washington on December 8, 2015. The latest version of Boeing's best-selling 737, introduced in the mid-1960s, is due to make its first flight early next year and reach customers in 2017. It will burn an estimated 14 percent less fuel per seat than current 737s and fly farther, allowing airlines to open new routes. AFP PHOTO/JASON REDMOND / AFP / JASON REDMOND (Photo credit should read JASON REDMOND/AFP/Getty Images)
Photograph by Jason Redmond — AFP/Getty Images

Boeing (BA) forecast lower-than-estimated 2016 core earnings, and said it expected to deliver fewer commercial planes this year, sending its shares down 10%.

The Dow Jones Industrial Average component said it expects to deliver 740-745 planes in 2016, its centenary year.

Boeing delivered 762 jetliners in 2015, exceeding its target of 755 to 760 planes.

The company said it expects 2016 core earnings, which exclude some pension and other costs, to be between $8.15 and $8.35 per share.

Analysts on average were expecting $9.43 per share, according to Thomson Reuters I/B/E/S.

The world’s largest jetliner maker’s net income fell to $1.03 billion, or $1.51 per share, in the fourth quarter ended Dec. 31, from $1.47 billion, or $2.02 per share, a year earlier.

Core earnings fell to $1.60 per share from $2.31.

 

The company said last week it would cut production of its 747-8 jumbo jet in half and take a $569 million charge in the fourth quarter.

Revenue fell about 4% to $23.57 billion.