- The company''s financial guidance reflects strong business performance forecasts at IDS and BCA, increasing commercial airplane deliveries, decreasing investment in new airplane development and company-wide productivity gains. The outlook reflects the impact of the previously announced 787 schedule changes.
- Revenue guidance is unchanged at between $67 billion and $68 billion.
- Earnings-per-share guidance is reaffirmed at $5.70 to $5.85 per share.
- Operating cash flow guidance is unchanged at greater than $2.5 billion.

- Commercial Airplanes'' 2008 delivery guidance remains between 475 and 480 airplanes and is sold out. BCA revenue guidance remains between $34.5 billion and $35 billion, and operating margin guidance is unchanged at approximately 11.5%.
- IDS revenue guidance is unchanged at $32 billion to $33 billion. Operating margins are expected to be approximately 10.5%.

- Boeing''s total R&D forecast is increased to between $3.6 billion and $3.8 billion, up from between $3.2 billion and $3.4 billion due to the new 787 schedule announced earlier this month and additional 747-8 costs.
- Annual capital expenditures are expected to be approximately $1.8 billion in 2008.
- The company''s non-cash pension expense is expected to be approximately $0.8 billion.
- Discretionary cash funding of Boeing''s pension plans is expected to be approximately $0.5 billion in each of 2008 (contributed during the first quarter) and 2009, though the company will continue to evaluate making additional discretionary contributions to its pension plans.

Fiscal 2009 Outlook

- The company expects revenues between $72 billion and $73 billion.
- Earnings-per-share guidance is set at between $6.80 and $7 per share.
- Operating cash flow is expected to exceed $6 billion.

- BCA expects to deliver between 500 and 505 commercial airplanes - including approximately 25 Dreamliners - and is essentially sold out. Commercial Airplanes'' revenue in 2009 is expected to grow to between $37 billion and $38 billion accompanied by margins of approximately 11.5%. The company expects to deliver more airplanes in 2010 than in 2009.
- IDS expects revenue to grow to $33.5 billion to $34.5 billion, with operating margins exceeding 10.5%.

- R&D spending is expected to decline in 2009 to between $3.1 billion and $3.3 billion. Annual capital expenditures are expected to decline to approximately $1.7 billion.
- The company''s non-cash pension expense is expected to fall to approximately $0.5 billion, though it may vary due to discount rates and investment returns. Discretionary cash funding of Boeing''s pension plans is expected to be approximately $0.5 billion in each of 2008 (contributed during the first quarter) and 2009, though the company will continue to evaluate making additional discretionary contributions to its pension plans.

Key questions from the first quarter earnings call conducted by The Boeing Company on May 23, 2008.

Steve Binder: You are assuming zero margin with 787 program. Since you had not fully scrubbed supplier payments, renegotiation with suppliers, as well as your new schedule as far as your ramp cost with respect to a new production schedule, would you characterize your cost estimates to be on the initial block size to be conservative, such that you want to meet figure with forward charge?

James Bell: I would say that it is our best ability to estimate, but a couple of things that we have high confidence in. One we have confidence that we have almost 900 orders today which would help us relative to set what the pricing is, relative to that. We have negotiated the subcontractor cost and we have good idea of how we are going to finish in negotiating as it relates to some of the impacts or some of the changes we have experienced. The area that is less certainty is how we settle all of the issues we have with our customers. Although, we think we are being relatively conservative by starting out with the zero margin.

Steve Binder: If the R&D decreases mainly coming out of BCA and you take out the 787 sales and zero profit contribution, it looks like you are still assuming some decline in your matured business and services business and margin in 2009 versus 2008. Is that just conservatism?

James Bell: No. It is what we have talked about before. Prior to putting these airplanes to 787 into service we have some expense associated with that that would come out and what we would call out fleets support area out of our cap area. In terms of trainee menus and things of that nature that support the entry into the service and new airplanes. That is some of the impact that you see.

Steve Binder: Are you assuming 747-8 deliveries in 2009?

James Bell: Yes.

Troy Lahr: Can you give more insight into discussions with international costumers specifically those that have taken deliveries over the next 2 to 3 years?

Jim McNerney: Internationally we have had little indication that the customers want to reschedule. That is then a relatively stable situation, the financial turmoil as we have seen it has mostly been US centered. So answer to your first question is, hardly any.

Troy Lahr: What are you hearing from the domestic carriers regarding recapitalization efforts now that oils at 117, are you still on track to start seeing more domestic orders in 2008 and 2009?

Jim McNerney: The new oil reality is a hard one for them to be deal with. It is impossible from me to know exactly what oil price they were assuming in their models as we begun discussions with them. We are in active discussions with most of them, and that should unfold over the next 12 to 18 months. If there is an impact, we have not seen it yet. The new reality has hit us quickly here. We are all in an ongoing situation that it will unfold, but no direct indication there either.

Troy Lahr: Do you think the domestic are still recapitalized within a year, year and a half?

Jim McNerney: If anything the oil price situation could accelerate some moves that would in the minds of the airline management strengthen their businesses. You look at the proposed Delta, Northwest merger which has yet to play out fully, but that is a move to strengthen, introduce more scale and insulate competitively from all kinds of price in marketplace pressure. To the extent to which this accelerates that that could get you there faster actually.