Spirit AeroSystems has doubts about its ability to continue operations as it reported a net loss of $477 million in Q3, the company said in a Nov. 5 securities filing.
“The Company will require additional liquidity to continue its operations over the next 12 months,” Spirit AeroSystems said in the filing.
While the fuselage supplier saw a 2% increase year over year in net revenue at approximately $1.5 billion in Q3, it doesn’t ease Spirit AeroSystems’ concerns about continuing operations. The company’s losses for 2024 have soared as it deals with the impacts of Boeing’s worker strike. As of Sept. 26, losses totaled approximately $1.5 billion, a 121% year-over-year spike, according to an Oct. 23 press release.
Spirit AeroSystems implemented a plan to cut costs last month, including a 21-day furlough on Oct. 28 for approximately 700 employees who worked Boeing’s 767 and 777 planes at its Wichita, Kansas, facility.
Boeing’s second financial advance
Spirit AeroSystems is still on track to close its acquisition with Boeing by mid-2025, President and CEO Pat Shanahan said in the earnings release.
However, the strike’s impact has lingered on suppliers like Spirit AeroSystems. The company’s backlog in Q3 was approximately $48 billion, which includes work for both Boeing and Airbus, according to the Q3 securities filing.
Boeing committed to pay Spirit AeroSystems up to $350 million in advance to support production and preparation to manufacture Boeing’s aircraft under contract according to a Nov. 12 securities filing. Spirit AeroSystems has until the end of 2026 to repay Boeing, according to the securities filing.
Boeing’s advance will go toward Spirit AeroSystems’ higher factory costs as a result of improving product quality verification processes, which Boeing implemented shortly after the Alaska Airlines door plug blowout in January.
This is the second advance Boeing has issued Spirit AeroSystems this year. In Q1, the company advanced Spirit AeroSystems $425 million to support factory operations, most of which was expected to be repaid in Q3.
Airbus provides a credit line
Boeing’s financial support is not the only funding Spirit AeroSystems secured recently. After months of negotiations, Spirit AeroSystems finally reached an agreement for a line of credit from its other major customer, Airbus, earlier this month.
Airbus will provide Spirit AeroSystems a $107 million line of credit without interest, according to a Nov. 12 release. Much like Boeing’s cash advance, the supplier will put the funds toward Airbus’ airplanes, per the Nov. 12 securities filing. Spirit AeroSystems has until April 1, 2026, to repay Airbus.
