Airbus Cuts Its Delivery Outlook. Why the Stock Is Up.

Coming into Wednesday trading, Airbus stock was up about 23% this year and up 27% over the past 12 months. (GIUSEPPE CACACE/AFP via Getty Images)

Key Points

• Airbus reduced its full-year delivery forecast for 2025 to 790 jets, a decrease of 30 planes from its previous guidance.
• Airbus’s stock rose over 4% despite the guidance cut, as investors were already aware of production issues and a recent jet recall.
• Boeing’s stock was flat in early trading, following a 10% gain on Tuesday after its CFO reaffirmed a $10 billion annual free cash flow goal.

Building airplanes hasn’t been easy lately.

On Wednesday, Boeing peer Airbus cut its full-year delivery forecast by 30 planes. It now expects to deliver about 790 jets in 2025, down from prior guidance, given in October, for 820 jets.

Guidance cuts aren’t great news for investors, but Airbus stock rose 4% in overseas trading. A couple of factors are helping stocks zig when investors might have expected a zag.

For starters, investors were aware of production issues with fuselage panels that could slow production. And coming into Wednesday trading, shares were down about 7% for the week, falling after the company announced a recall of about 6,000 A320 family jets due to a rare condition in which solar or cosmic radiation could affect the onboard computers’ flight control data. That problem was fixed relatively quickly with a software patch sufficient for most of the jets.

With that as the background, a modest cut to guidance was a relief. What’s more, guidance for 2025 operating profit of €7 billion and free cash flow of €4.5 billion was left unchanged.

It’s been harder to build planes lately, with supply chains still recovering from the Covid-19 shock. Airbus delivered 863 planes in 2019. It hasn’t delivered 800 in a year since then. Wall Street expects deliveries of 900 planes in 2026.

Boeing delivered 806 planes in 2018, the year before the second tragic 737 MAX crash. Its best year since then was 528 planes delivered in 2023. Boeing is expected to deliver about 600 jets in 2025, and Wall Street expects 700 deliveries in 2026. Wall Street projects more than 800 jets delivered in 2028.

Boeing stock dropped 1.4% to $202.54 on Wednesday, while the S&P 500 and Dow Jones Industrial Average added 0.3% and 0.9%, respectively.

Boeing shares gained 10% on Tuesday after CFO Jay Malave spoke at an investors conference and backed Boeing’s goal to produce $10 billion in annual free cash flow eventually. Boeing generated almost $14 billion in free cash flow in 2018. It has used tens of billions in cash since the 737 MAX crisis. Free cash flow is expected to be negative in 2025, and Wall Street projects positive free cash flow of $2.2 billion for 2026.

Write to Al Root at allen.root@dowjones.com