The Boeing Company
2015 annual report

a message from the chairman

Over the past 100 years, generations of talented Boeing employees helped build the world’s largest aerospace company—and shaped the course of history with amazing innovations along the way. In that time, human beings went from walking on Earth to walking on the moon, and from riding horses to flying jet airplanes and spaceships. With each decade, aerospace technology crossed another frontier, and with each crossing, the world changed.

Dennis A. Mulenburg Chairman, President and Cheif Executive Officer

Standing now at the beginning of our second century, the opportunity for further discovery and achievement is as vast and exciting for us as it was for Bill Boeing and the other pioneers of aviation a century ago. Drawing on our founders’ passion for innovation, integrity and technical excellence, we are eager and ready to solve the world’s toughest challenges

for our customers and embrace the unique role our company plays in global advancement. As we recognize our accomplishments of the past year, and review our strong financial and market positions, our eyes are fixed on the future and our commitment to build an even bigger, better Boeing and an even stronger team for winning in our second century.

2015 Financial Highlights

At Boeing, we aspire to be the strongest, best and bestintegrated aerospace-based company in the world—and a global industrial champion—for today and tomorrow.

*Non-GAAP Measures

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2015 Financial Highlights

Achieved record revenues of $96.1 billion on record commercial deliveries, while reporting solid core operating earnings of $7.7 billion* and core earnings per share of $7.72* reflecting charges taken on the 747 and KC-46A tanker programs.

Increased operating cash flow to $9.4 billion and maintained strong liquidity of $12.1 billion in cash and marketable securities.

Announced a 20 percent increase in our quarterly dividend and authorized $14 billion of share repurchase—the largest share repurchase authorization in company history.

Achieved near-record backlog of $489 billion, which includes net orders of $83 billion during the year.

Delivered an industry-record 762 commercial airplanes to further extend our market-share lead in deliveries.

Delivered 186 military aircraft, along with 15,787 weapons systems and four satellites, as we continue to see solid support for our major programs in our defense, space and security markets.

Booked 768 net new commercial airplane orders, maintaining a strong, diverse backlog of approximately 5,800 airplanes valued at $432 billion.

Maintained a solid defense, space and security backlog of $58 billion with new and follow-on business that included awards from NASA for the first two commercial human space flights of CST-100 Starliner to the International Space Station; a contract for 15 EA-18G Growlers for the U.S. Navy; contracts for 43 AH-64E Apache helicopters for the U.S. Army, along with orders from India for 22 Apaches and 15 Chinook heavylift helicopters and from Japan for five V-22 tiltrotor aircraft; and a $1.5 billion contract with the U.S. Navy for the P-8A Poseidon, including the first P-8A for Australia.

Achieved significant Commercial Airplanes milestones, including deliveries of the 100th 747-8 and the 350th 787; delivery of the first Boeing South Carolina 787-9 and rollout of the 100th 787 built there; assembly and rollout of the first 737 MAX; opening of the newly expanded Seattle Delivery Center to support increased 737 production; and completion of detailed design of the 787-10 and firm configuration of the 777X.

The Boeing Company
Shareholders and Investors

2015 in Review

Thanks to the tremendous efforts of more than 160,000 employees and our global partners, Boeing extended its leadership of the aerospace industry in 2015 with record deliveries and revenues at Boeing Commercial Airplanes and solid sales and healthy margins in Boeing Defense, Space and Security. We continued to deliver on our strategies to convert our record backlog into profitable growth; drive productivity and greater affordability throughout the company; and invest in our people, products and services to strengthen and grow our businesses for the future. We also demonstrated our commitment to provide increasing returns and significant cash to our shareholders.

Total company revenues rose 6 percent in 2015 to a record $96.1 billion, and new orders for ourmarket-leading products and services worth $83 billion sustained our backlog at a near-record total of$489 billion.

Core earnings per share of $7.72* for the year reflected strong operating performance across the company, offset by charges taken on the KC-46A tanker and 747 programs. Core operating earnings reached $7.7 billion*, and operating cash flow increased 6 percent year-over-year to $9.4 billion.

We also continued our balanced cash deployment strategy by repurchasing 47 million shares for $6.8 billion and paying $2.5 billion in dividends. In December 2015, based on our consistently strong cash generation and positive outlook, the Boeing board of directors raised our share repurchase authorization to $14 billion and increased the quarterly dividend 20 percent. reported record revenue of $66 billion in 2015 fueled by an industry record 762 deliveries that extended our global market-share lead for a fourth consecutive year.

By capturing an additional 768 net new airplane orders valued at $57 billion, we held our record unit backlog at nearly 5,800 airplanes worth some $432 billion; that’s approximately seven years of production at current rates. Full-year operating margins were 7.8 percent.

Our market leadership in twin-aisle airplane programswas punctuated in 2015 with deliveries of an industryrecord 135 787s from our production centers in Everett, Washington, and North Charleston, South Carolina. At the end of February, cumulative 787 deliveries totaled 380 airplanes to 43 customers. Market demand for the 787 is extensive and broad based as its game-changing capabilities continue to improve the way the world flies. For example, thanks to the 787’s unprecedented combination of range and fuel efficiency, airlines flying it soon will operate more than 90 new nonstop routes between cities that previously haven’t had nonstop service.

Demand also remains strong for our next new twinaisle airplane, the 777X, which has a backlog of 306 orders from six customers and is on track for first delivery in 2020. Ensuring a smooth production transition between today’s 777 and the 777X is a top priority. Our confidence in efficiently bridging between the two models is high, given our backlog of more than 200 current-model 777s, ongoing market demand and a strong value proposition for customers. In addition, in 2015, we began introducing fastener automation technology on the 777 program to reduce cost and flow time in assembly. We are maturing this technology on the current production line before transitioning it to the 777X.

In the highly competitive single-aisle market, the 737 family reached 588 net new orders and 495 deliveries in 2015, with a total program backlog at year-end of nearly 4,400 airplanes. The first 737 MAX test airplane rolled out of the factory on schedule in December 2015 and in January 2016 began its flight test program with a successful first flight. The highly fuel-efficient new 737 MAX has won nearly 3,100 orders since launch from a diverse set of the world’s best airlines. We are on track to deliver the first 737 MAX, to Southwest Airlines, in the third quarter of 2017.

Overall, the commercial airplane market represents a substantial growth opportunity, with a combination of fleet expansions and replacement demand expected to drive the need for more than 38,000 airplanes worldwide over the next 20 years. This ongoing demand, coupled with our record unit backlog, reinforces our production rate plans and positions us for significant revenue, earnings and cash growth in the years ahead.

Boeing Defense, Space and Security had another strong year in 2015—with solid revenue, healthy margins and progress on numerous key milestones. Revenues totaled $30.4 billion, and operating margins grew to 10.8 percent. We delivered 186 aircraft, along with 15,787 weapons systems and four satellites. New orders reached $27 billion, resulting in a solid year-end backlog of $58 billion. International customers represented roughly one-third of revenue and 40 percent of current backlog.

With early signs of an improving U.S. defense budget environment, we remain confident about our prospects for continued success in the global defense, space and security market worth $3 trillion over the next decade.

2015 Defense Related Milestones

The first flight of the KC-46A tanker and its first international sale to Japan.

Completion of the final C-17 after a successful 20-year production run.

A five-year contract extension to provide engineering support services, resources and personnel for International Space Station operations.

The first EA-18G rollout to the Royal Australian Air Force.

The selection of the 747-8 to replace the current U.S. presidential aircraft.

NASA’s completion of the critical design review of the Space Launch System, including the Boeingbuilt core rocket stage and avionics system.

The fourth and final AEW&C delivery to Turkey.

A successful flight software demonstration on the CST-100 spacecraft.

12 successful launches in 2015 by our United Launch Alliance joint venture, extending our streak to more than 100 launches.

Business Highlights

Our backlog remains strong at $489 billion with net orders of $83 billion for 2015, as we continued to focus on productivity and positioning Boeing to deliver sustained growth and strong business performance for years to come. We delivered a record 762 commercial airplanes and grew our services business while continuing to improve productivity and quality, prepare the production system for the transition to new models, and adjust rates.

Increased production rates, superior new commercial airplanes and continued innovation will help keep Boeing competitive across addressable markets, valued at $3.7 trillion over the next 10 years.

With proven products and services and a commitment to improved productivity and affordability, Boeing remains well positioned in global defense, space and security markets worth $3.0 trillion over the next decade.

Financial Results

Revenues in 2015 rose 6 percent to a record $96.1 billion driven by record commercial deliveries and solid performance in our defense, space and security business. Core earnings per share reflected charges for the KC-46A tanker and 747 programs, which were partially offset by strong core operating performance across the company.

In 2015, our operating cash flow continued to grow, supporting a 20 percent increase in our dividend and a new share repurchase authorization of $14 billion.

The Boeing Company

Executive Council

  • Timothy J. Keating
    Senior Vice President, Government Operations
  • John J. Tracy
    Senior Vice President, Engineering, Operations & Technology and Chief Technology Officer
  • Heidi B. Capozzi
    Senior Vice President, Human Resources
  • Raymond L. Conner
    Vice Chairman; President and Chief Executive Officer, Boeing Commercial Airplanes
  • Gregory D. Smith
    Executive Vice President of Corporate Development & Strategy and Chief Financial Officer
  • Leanne G. Caret
    Executive Vice President; President and Chief Executive Officer, Boeing Defense, Space & Security
  • Thomas J. Downey
    Senior Vice President, Communications
  • Diana L. Sands
    Senior Vice President, Office of Internal Governance and Administration
  • Bertrand-Marc Allen
    Senior Vice President; President, Boeing International
  • J. Michael Luttig
    Executive Vice President and General Counsel

The Board of Directors

  • David L. Calhoun
    Senior Managing Director, The Blackstone Group; Former Chairman and Chief Executive Officer, Nielsen Holdings plc Boeing director since 2009 Committees: Compensation; Governance, Organization and Nominating
  • Arthur D. Collins, Jr.
    Senior Advisor, Oak Hill Capital Partners; Former Chairman and Chief Executive Officer, Medtronic, Inc. Boeing director since 2007 Committees: Compensation (Chair); Governance, Organization and Nominating
  • Kenneth M. Duberstein
    Chairman and Chief Executive Officer, The Duberstein Group; Former White House Chief of Staff Boeing director since 1997 Boeing Independent Lead Director Committees: Compensation; Governance, Organization and Nominating (Chair)
  • Edmund P. Giambastiani, Jr.
    Admiral, U.S. Navy (Retired); Seventh Vice Chairman of the U.S. Joint Chiefs of Staff; Former NATO Supreme Allied CommanderTransformation; Former Commander, U.S. Joint Forces Command Boeing director since 2009 Committees: Audit; Finance; Special Programs
  • Lynn J. Good
    Chairman, President and Chief Executive Officer, Duke Energy Corporation Boeing director since 2015 Committees: Audit; Finance
  • Lawrence W. Kellner
    President, Emerald Creek Group LLC; Former Chairman and Chief Executive Officer, Continental Airlines, Inc. Boeing director since 2011 Committees: Audit; Finance (Chair)
  • Edward M. Liddy
    Former Chairman and Chief Executive Officer,The Allstate Corporation Boeing director since 2010 Committees: Audit (Chair); Finance
  • Dennis A. Muilenburg
    Chairman, President and Chief Executive Officer, The Boeing Company Boeing director since 2015 Committee: Special Programs (Chair)
  • Susan C. Schwab
    Professor, University of Maryland School of Public Policy; Former U.S. Trade Representative Boeing director since 2010 Committees: Audit; Finance
  • Randall L. Stephenson
    Chairman and Chief Executive Officer, AT&T Inc. Boeing director since 2016 Committees: Audit; Finance; Special Programs
  • Ronald A. Williams
    Chairman and Chief Executive Officer, RW2 Enterprises, LLC; Former Chairman and Chief Executive Officer, Aetna Inc. Boeing director since 2010 Committees: Compensation; Governance, Organization and Nominating; Special Programs
  • Mike S. Zafirovski
    Executive Advisor, The Blackstone Group; President, The Zaf Group; Former President and Chief Executive Officer, Nortel Networks Corporation Boeing director since 2004 Committees: Compensation; Governance, Organization and Nominating

Company Officers

  • Bertrand-Marc Allen
    Senior Vice President President, Boeing International
  • Heidi B. Capozzi
    Senior Vice President, Human Resources
  • Leanne G. Caret
    Executive Vice President President and Chief Executive Officer, Boeing Defense, Space and Security
  • Christopher M. Chadwick
    Executive Vice President
  • Raymond L. Conner
    Vice Chairman President and Chief Executive Officer, Boeing Commercial Airplanes
  • David A. Dohnalek*
    Senior Vice President, Finance and Treasurer
  • Thomas J. Downey
    Senior Vice President, Communications
  • Timothy J. Keating
    Senior Vice President, Government Operations
  • Michael F. Lohr
    Vice President, Assistant General Counsel and Corporate Secretary
  • Robert E. Verbeck
    Senior Vice President, Finance and Corporate Controller
  • Dennis A. Muilenburg
    Chairman, President and Chief Executive Officer
  • Anthony M. Parasida
    Senior Vice President
  • Diana L. Sands
    Senior Vice President, Office of Internal Governance and Administration
  • Gregory D. Smith
    Chief Financial Officer Executive Vice President, Corporate Development and Strategy
  • John J. Tracy
    Chief Technology Officer Senior Vice President, Engineering, Operations and Technology

The Boeing Company
Connect, Protect, Explore, and Inspire


The 787-10 Dreamliner will connect people and cargo to more nonstop destinations with unprecedented efficiency when it begins flying in 2018. Leveraging the design of the 787-9, the 787-10 will improve fuel use and reduce emissions 25 percent over replacement airplanes—10 percent better than the competition.

To further reduce greenhouse gas emissions, Boeing conducted Subsonic Ultra Green Aircraft Research studies, part of a NASA program to advance aerospace science for public benefit. The SUGAR Volt airplane would connect people using some electric power on shortrange flights and conventional fuels for longer-range flights.

Boeing continues to explore applications for supersonic flight, which has the potential to connect the world in less time. Innovation in aerodynamics, propulsion, materi als and other areas will be needed to develop aircraft that meet future market requirements as well as customer needs.


Operated by the U.S. Navy and Royal Australian Air Force, the combat-proven F/A-18E/F Super Hornet multirole strike fighter outdistances threats now and far into the future. It can modernize any country’s fighter fleet and will be the backbone of the Navy’s carrier air wings through 2040.

The H-47 Chinook is used around the world to move military troops and equipment, as well as for humanitarian relief, medical evacuations, and firefighting. The Block II modernization is advancing the helicopter’s capabilities to keep it in service through the 2030s.

Ground-based Midcourse Defense is the United States’ only operational protection against long-range missile threats, meeting real-time requirements 24/7/365.The Boeing-led industry team ensures readiness through ground and flight testing and keeps the system at pace with growing


Through an innovative partnership with NASA’s Commercial Crew Program, Boeing’s CST-100 Starliner system is on a course to return human launch capabilities to the United States. The spacecraft will safely carry a mix of crew and cargo to the International Space Station and other low Earth orbit destinations.

America’s heavylift rocket, NASA’s Space Launch System, will power humankind into deep space by launching larger payloads farther into our solar system, faster than ever before possible, to enable exploration, science and security missions.

Almost three quarters of the Earth’s surface is covered by water, with areas that remain unexplored. Boeing’s fully autonomous Echo Seeker unmanned underwater vehicle is designed to explore ocean depths to 20,000 feet and operate for 50 to 75 hours.

CST-100 Starliner System

Havylift Rocket

Boeings Autonommous Echo Seeker


FIRST® (For Inspiration and Recognition of Science and Technology)

Boeing and its employees support FIRST® (For Inspiration and Recognition of Science and Technology), a national robotics program that engages students in exciting mentorbased learning and competition, building technology skills, inspiring innovation and fostering self-confidence, communication and leadership skills.

The X-37B program is demonstrating a reliable, reusable unmanned space test platform for the Air Force. Its objectives include space experimentation, risk reduction and concept-ofoperations development for reusable space vehicle technologies that could become key enablers for future space missions.