Spirit AeroSystems Holdings, Inc. (NYSE: SPR) recently shared its financial performance for the first quarter of 2025. The company faced challenges but also saw some positive developments.
This article breaks down the key points, including revenue, earnings, and updates on the pending acquisition by Boeing.
Spirit AeroSystems Q1 Performance
Revenue Overview
In Q1 2025, Spirit’s revenue dropped compared to the same period in 2024. The main reason was reduced production on several Boeing programs, especially the Boeing 737.
Last year, Boeing 737 production was higher as the company prepared for planned rate increases that were later postponed. However, increased activity on Airbus programs helped offset some of this decline.
Despite the revenue dip, Spirit delivered more units in Q1 2025 than in Q1 2024. Boeing 737 deliveries, in particular, rose significantly. This increase followed delays in 2024 caused by a joint product verification process with Boeing.
At the end of Q1 2025, Spirit’s backlog stood at an impressive $48 billion, covering work on all commercial platforms for both Airbus and Boeing.
Earnings Performance
Spirit’s operating loss in Q1 2025 improved compared to Q1 2024, showing signs of recovery. However, the quarter included net forward losses of $293 million and unfavorable cumulative catch-up adjustments of $8 million.
These losses stemmed mainly from the Airbus A350 ($90 million), Airbus A220 ($86 million), and Boeing 787 ($38 million) programs. Factors like schedule changes, production inefficiencies, and rising supply chain costs drove these challenges.
Boeing Acquisition Update
On June 30, 2024, Spirit signed a merger agreement with Boeing. If completed, Spirit will become a wholly owned subsidiary of Boeing.
The deal is expected to close in Q3 2025, pending regulatory approvals and the divestiture of Spirit’s Airbus-related business. This divestiture is a key condition of the merger.
Asset Sale to Airbus
On April 28, 2025, Spirit announced a deal to transfer certain assets and sites involved in Airbus aerostructures production to Airbus SE.
Airbus will acquire these assets, excluding any sold to third parties, and pay $439 million in cash for a nominal fee of one U.S. dollar.
Adjustments to the deal may occur based on working capital and third-party asset sales. This transaction, also set to close in Q3 2025, aligns with the Boeing merger timeline and requires regulatory approval.
Commercial Segment Insights
The commercial segment saw lower revenue in Q1 2025 compared to Q1 2024, driven by reduced Boeing program activity, particularly the Boeing 737 MAX.
Operating margins also declined due to lower production volumes, reduced margins on Boeing programs, and a warranty reserve. However, fewer estimate change charges in Q1 2025 compared to Q1 2024 provided some relief.
Looking Ahead
Spirit AeroSystems is navigating a complex period with lower Boeing production and significant strategic moves. The pending acquisition and Airbus divestiture mark critical steps in reshaping the company’s future.
While challenges like forward losses and supply chain costs persist, Spirit’s strong backlog and improved operating loss signal resilience. Investors and industry watchers will closely monitor the company’s progress as these deals unfold.
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