Boeing Defense, Space & Security’s first-quarter revenue decreased to $6.0 billion primarily driven by a charge on the U.S. Air Force KC-46A Pegasus aerial refueling tanker program.
First-quarter operating margin decreased to (3.2) percent primarily due to a pre-tax charge of $827 million for the KC-46A Tanker, of which $551 million was driven by costs associated with the agreement signed in April with the U.S. Air Force to develop and integrate a new Remote Vision System, while the remaining costs reflect productivity inefficiencies and COVID-19 related factory disruption. A number of other programs were also impacted by COVID-19, further reducing margin in the quarter.
During the quarter, Defense, Space & Security received an award for 18 P-8A Poseidon maritime patrol aircraft, as well as a contract to develop a SB>1 DEFIANT™ prototype for the U.S. Army’s Future Long Range Assault Aircraft (FLRAA) program. Defense, Space & Security also completed the System Design Review for MQ-25 Stingray aerial refueling drone.
Backlog at Defense, Space & Security was $64 billion, of which 28 percent represents orders from customers outside the U.S.