Team,

Our company is in a difficult situation and the challenges we face together can hardly be overstated. Beyond managing our current environment, recovering our business requires difficult decisions and we must make structural changes to ensure we remain competitive and able to deliver to our customers over the long term.

We need to have a clear view of the work ahead and be realistic about how long it will take us to reach key milestones on the road to recovery. We also need to focus our resources on performance and innovation in the areas that are core to us, rather than spreading ourselves across too many efforts, which can often lead to poor performance and under-investment.

With that in mind, today I'm sharing some tough decisions and several program updates:

For the 777X program, the development challenges we faced, as well as the flight test pause and ongoing work stoppage, will delay our program schedule. We have informed customers that we now expect the first delivery in 2026.

We plan to build and deliver the remaining 767 freighters ordered by our customers and then complete production of the commercial program in 2027. Production for the KC-46A tanker continues.

At BDS, our performance on fixed price development programs is simply not where it should be. We expect significant new losses at BDS this quarter due to the commercial derivatives work stoppage, ongoing program challenges and our decision to complete production of the 767 cargo aircraft. I will provide additional oversight of this business and programs.

In addition to the above measures, we also need to adjust our staffing levels to align with our financial reality and set more targeted priorities. In the coming months, we plan to reduce the number of our total workforce by around 10 percent. These cuts apply to executives, managers and employees. Next week, your leadership team will share tailored information about what this means for your company. Due to this decision, we will not continue the next vacation cycle.

As we move through this process, we will continue to consistently focus on safety, quality and customer delivery. We know these decisions will cause hardship for you, your families and our team, and I sincerely wish we could avoid them. However, our company's situation and our future recovery require aggressive action.

We will be transparent with you about the timing and impact of these steps, and we will provide professional support and assistance to everyone along the way.

Thank you for all you are doing at Boeing during this very challenging time. We will navigate through this moment. We will realign our company and restore trust with everyone who depends on us.

Kelly