Boeing has appointed Robert "Kelly" Ortberg as its new CEO, effective August 8, 2024. AP News reported that Ortberg, a veteran in the aerospace industry, will succeed David Calhoun, who is retiring at the end of the year.
However, the new CEO appointment comes as the company had been left with major financial losses and ongoing regulatory challenges.
In its second-quarter earnings report, Boeing revealed a staggering loss of $1.4 billion, surpassing Wall Street's expectations. The company's revenue fell by 15% to $16.87 billion, driven by a sharp decline in deliveries of commercial airplanes and increased costs in its defense and space divisions.
This loss contrasts sharply with the $149 million loss reported in the same period last year. Analysts had predicted a loss of $1.90 per share, but Boeing's actual loss worked out to $2.90 per share.
Boeing Pleads Guilty to Fraud
The company's financial troubles were mostly driven and worsen by a series of legal and regulatory issues.
Earlier this month, VCPost reported that Boeing agreed to plead guilty to federal fraud charges related to its 737 Max jetliner, which was implicated in two fatal crashes.
At the same time, the Federal Aviation Administration (FAA) has intensified its oversight of the company, raising concerns about manufacturing quality following an incident involving an Alaska Airlines jet. Boeing is also dealing with supply chain disruptions and ongoing production issues.
Ortberg's appointment comes after a thorough search process, according to Boeing Chairman Steven Mollenkopf. Ortberg, previously CEO of aerospace supplier Rockwell Collins, is expected to address the company's challenges, including improving safety standards and managing production setbacks.
Investors are optimistic about Boeing's new leadership as reflected in its stock seeing a 2% increase in premarket trading, according to Nasdaq.
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