Boeing reported its first quarter net rose to $0.9bn, or $1.22 per share, on revenue of $19.4bn.  EPS rose 56% reflecting continued strong  performance across the business, which more than offset higher pension expense. Boeing reaffirmed its 2012 revenue and operating cash flow guidance.

Typical reaction to the results were positive. The company did better than expected. And the rise in the share price since then has reflected this sentiment. As Reuters put it, "Boeing raked in orders while accelerating production on all its commercial airplane programs. The achievements helped erase concerns in the industry about Boeing's credibility, which was tarnished in the last decade by problems bringing the long-overdue 787 Dreamliner to market."

Key items to watch at Boeing include:

• Ramp up of 787 production 2.5 to 3.5 airplanes per month. Boeing has had a tough time making its complex supply chain strong enough to withstand shocks – today the company rolls out its first 787 in Charleston.  The gestation of the 787 has been very hard on the company's people and pocket. And it seems its not over yet.  The 787-8 was tough, but the -9 and -10 should be much easier projects because the learning curve is no longer so steep. The supply chain will be more robust as  it finds a steady pace.  But it seems clear the idea of a building a 787 every three days is no longer spoken about.
• 747-8 is going more slowly than Boeing would like. They continue to discuss the program in glowing terms but there have been no orders for a while. It seems airlines buying VLAs have moved on to the A380, or decided to stick with the far more efficient 777.  Unfortunately the 777 has a growing following and this may be hurting the 747-8 for the passenger version. With cargo traffic still looking soft, the 747-8F is not getting new orders either.
• MAX is hot and may get hotter this year. Beware to focus too much on orders; remember the 787 order mania? MAX is more complex than generally thought. Its true the 737 is probably the most understood program at Boeing. But it is also the oldest commercial program by decades and that means the core design is limited.  Boeing has done a remarkable job with a deign from the 1960s. Unlike its B-52 program with one customer with highly focused needs, the 737 has hundreds of customers with ever changing needs. Trying to make the old design stay current is tough – the NG was an almost new airplane. MAX will be more so. The FAA might not let the re-certification pass by so easily again. In addition the airplane will have a new engine and systems. As the bread and butter program it should be watched very carefully. Boeing has proven itself, time and again, the master of information flow. The rumors swirling about the GTF as an engine option may even be coming from within Boeing to press CFM. (There is a clamp down on rumors now). MAX is a big stakes bet made under pressure.
• The 777x is being worked on and customers are encouraging a program refresh. On the one hand Boeing has its ideas of what it can do, while certain customers are vocal about what they want. There will be always be a gap between the two. The question is whose cheese gets moved? Boeing will want to focus on the 90%+ solution as it sees it, while the airlines will want an airplane that can everything but cost 20% less. It is a tough gig – and after the roaring success of the 777-300ER, a tough hurdle to beat. New materials, new engines, a new wing and so on – lots of seemingly small things. But put them all in one program and it gets complicated quickly.

Boeing is like any other aerospace OEM – it has limited resources. Especially in people, which is why the recent news about Russian engineers was so interesting. Airbus is also chasing the same talent. Airbus is developing competing models for the MAX and 777x. Its 747-8 competitor is off and running and getting way more orders. The environment is tough and therefore even as Boeing seems to be doing better, one cannot assume the latest results speak to a better future performance with any certainty. Aerospace remains a highly capital intensive, high risk business. Which is what makes it so much fun to watch. We hope Boeing succeeds because that is great for the entire industry.