Company: BA
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0000012927-25-000062
Chunk: 72

Company: BOEING CO
Filing Date: 2025-07-29
Form: 10-Q
Item: Item 1
Chunk 72
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 aircraft program equals the product of (i) revenue recognized in connection with customer deliveries and (ii) the estimated cost of sales percentage applicable to the total remaining program. For long-term contracts, the amount reported as cost of sales is recognized as incurred. Substantially all contracts at our BDS segment and certain contracts at our Global Services (BGS) segment are long-term contracts with the U.S. government and other customers that generally extend over several years. Cost of sales for commercial spare parts is recorded at average cost.

The following table summarizes cost of sales:

(Dollars in millions)Six months ended June 30Three months ended June 3020252024Change20252024ChangeCost of sales$37,393 $30,330 $7,063 $20,314 $15,637 $4,677 Cost of sales as a % of Revenues88.5 %90.7 %(2.2)%89.3 %92.7 %(3.4)%

Cost of sales for the six months ended June 30, 2025, increased by $7,063 million, or 23%, compared with the same period in 2024, primarily due to higher revenues at BCA. Cost of sales as a percentage of Revenues decreased during the six months ended June 30, 2025, compared with the same period in 2024, primarily due to lower charges on BDS fixed-price development programs and the absence of 737-9 customer considerations at BCA, partially offset by lower program margins at BCA.

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Cost of sales for the three months ended June 30, 2025, increased by $4,677 million, or 30%, compared with the same period in 2024, primarily due to higher revenues at BCA. Cost of sales as a percentage of Revenues decreased during the three months ended June 30, 2025, compared with the same period in 2024 primarily due to lower charges on BDS fixed-price development programs, partially offset by lower program margins at BCA.

Research and Development

Research and development expense, net is summarized in the following table:

(Dollars in millions)Six months ended June 30Three months ended June 302025202420252024Commercial Airplanes$1,092 $1,073 $558 $555 Defense, Space & Security420 494 221 259 Global Services59 67 30 41 Other183