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Boeing 777X jets at the company’s production facility in Everett, Wash. Boeing said it continued to expect the recovery to take years to unfold.Credit…Elaine Thompson/Associated Press

Boeing said Wednesday that it lost $561 million in the first three months of the year as it emerged from its prolonged 737 Max crisis and contended with new problems related to the 787 Dreamliner jet. Revenue fell 10 percent to $15.2 billion compared with the same period last year.

But, like his counterparts at major airlines, Dave Calhoun, Boeing’s chief executive, struck an optimistic tone.

“While the global pandemic continues to challenge the overall market environment, we view 2021 as a key inflection point for our industry as vaccine distribution accelerates and we work together across government and industry to help enable a robust recovery,” he said in a statement.

In an investor presentation, Boeing said it continued to expect the recovery to take years to unfold, with passenger traffic unlikely to return to 2019 levels until 2023 or 2024. It also said its financial results for this year “hinge” on a recovery in the commercial airplane market.

At the end of March, the company had a backlog of more than 4,000 commercial airplane orders, valued at $283 billion. Its defense and space backlog was valued at $61 billion.

The company’s results were weighed down by quality concerns with the 787, though deliveries of the plane resumed at the end of the quarter “following comprehensive reviews,” Boeing said in a statement. The company also suffered a $318 million charge related to development of the next Air Force One, which was affected by a pandemic slowdown and problems with a key supplier, which Boeing recently sued.

It was also the first full quarter since the Federal Aviation Administration’s decision in November to lift its ban on the 737 Max, which had been grounded globally nearly two years following two fatal crashes in which hundreds were killed.

Since the ban was lifted, Boeing has delivered more than 85 Max’s to customers worldwide. It also reported that it sold more planes than were canceled in February and March, its first months of positive sales in more than year. Nearly two dozen airlines have put the plane back into service on more than 26,000 flights, Boeing said.

Mr. Calhoun also provided an update on an electrical concern with some Max planes that was disclosed this month. The F.A.A. has said the issue could affect the operation of a backup power control unit in 106 planes worldwide, all of which have been grounded. Boeing is working with the agency on a fix that should take a “few days per airplane” once approved, Mr. Calhoun said in a letter to staff.

An Allbirds store in Manhattan.Credit…Jeenah Moon for The New York Times

Silicon Valley’s favorite shoe brand is headed to Wall Street. Allbirds is interviewing banks over the next few weeks to help it make a market debut, people familiar with the matter told the DealBook newsletter, requesting anonymity because the process is confidential. The direct-to-consumer company was last valued at around $1.7 billion.

The talks come as consumer brands that were founded with a heavy (if not exclusive) internet presence, including Honest Company and Warby Parker, are taking advantage of a pandemic-driven boom in online shopping to see if investor enthusiasm for tech offerings extends to them as well. Many of those companies, including Allbirds, have since opened some retail stores, which has proved an easier transition than the legacy retailers trying to build digital operations after making their names in the offline world.

Allbirds was founded by the New Zealand soccer star Tim Brown and Joey Zwillinger, a renewables expert. Its mantra is to “create better things in a better way,” and the company advertises that the merino wool in its shoes uses 60 percent less energy than typical synthetic materials.

“One of the worst offenders of the environment from a consumer product standpoint is shoes,” Mr. Zwillinger told The New York Times in 2017. “It’s not the making; it’s the materials.”

The brand’s flashy-but-logo-free shoes are popular among techies, celebrities (Leonardo DiCaprio is an investor) and former President Barack Obama. The company has raised more than $200 million since 2016.

Allbirds is a B Corp, a certification earned by focusing on social good as well as profit. (Mr. Zwillinger joined a DealBook Debrief call last year to talk about the purpose of business.) Wall Street hasn’t always taken kindly to such companies: Etsy had to drop the status after taking a beating from the public markets following its I.P.O. Allbirds, though, said the $100 million funding round it announced last September was “indication of investors’ continued enthusiasm for its stakeholder-centric business model.”

“Allbirds has always been focused on building a great company, and as a B Corp and Public Benefit Corporation, doing what is best for our stakeholders (planet, people, investors) at the right time and in a way that helps the business grow in a sustainable fashion,” a company spokeswoman said in a statement.

Deutsche Bank’s best quarter in seven years was a vindication for Christian Sewing, the chief executive who took over in 2018.Credit…Ralph Orlowski/Reuters

Deutsche Bank reported its best quarterly profit in seven years Wednesday as it benefited from lively financial markets and avoided losses from the investment firm Archegos Capital that has battered rivals.

The first-quarter profit of 900 million euros, or $1.1 billion, was better than expected and suggested that Deutsche Bank may be emerging from a decade of scandals and disasters that earned it a reputation as Europe’s most troubled lender.

James von Moltke, the chief financial officer of Deutsche Bank, said in response to a question about Archegos during an interview with Bloomberg News that the bank had been able to exit its involvement without a loss.

That is in contrast to rivals like Credit Suisse, which lost $4.7 billion it had lent to Archegos after the firm collapsed in March. Swiss bank UBS disclosed Tuesday that it lost $774 million from its involvement with Archegos.

Deutsche Bank, like most big corporations, is assessing how the pandemic may have permanently changed the way employees do their jobs. Mr. von Moltke said the bank was working on a plan that would allow employees to work from home two or three days a week.

Like many of its peers, Deutsche Bank has benefited from frenetic activity on financial markets, earning fees as it helped governments issue debt to finance stimulus programs or sell shares in blank-check investment vehicles known as SPACs.

The bank said it had also benefited from a European Central Bank stimulus program that effectively pays commercial lenders to provide credit to businesses and consumers in the eurozone. In addition, Deutsche Bank slashed the amount of money it set aside for bad loans.

The financial results are a vindication for Christian Sewing, the bank’s chief executive, who has been trying to show large shareholders like the private equity firm Cerberus Capital Management that he can generate consistent profits. Deutsche Bank shares rose 9 percent in Frankfurt trading Wednesday and are up more than 20 percent since the end of January.

“Our first quarter is further evidence that Deutsche Bank is on the right path,” Mr. Sewing said in a statement.

Federal Reserve Chair Jerome Powell.Credit…Pool photo by Susan Walsh

When Jerome H. Powell, the Federal Reserve chair, speaks to reporters in a webcast news conference on Wednesday afternoon, he’s likely to face questions about a simmering topic: inflation.

Prices are expected to pop in the coming months, both as inflation indexes lap very weak 2020 readings and as supply chains experience short-term reopening bottlenecks. The unknowns facing the Fed, and the investment world, are how big the jump will be and how long it will last.

Most forecasters and the Fed itself expect the increases to be only temporary. But some economists have warned that they could be significant enough to become a problem as businesses reopen, consumers start to spend their savings and the government pumps stimulus money into the economy.

If the increases are big enough and sustained, the Fed could find itself in a tough spot, forced to choose between letting prices rise or raising interest rates before the labor market is fully recovered.

Inflation also worries stock investors: If the Fed lifts interest rates to cool off the economy, it could make investing in bonds more attractive and corporate borrowing more expensive, both bad news for equities.

The Fed wants inflation to average 2 percent annually over time, and it defines that goal using the Commerce Department’s headline personal consumption expenditure index. But officials look at a variety of indicators to gauge conditions. Here’s where a handful of critical inflation measures stand and, when it’s relevant, where economists surveyed by Bloomberg expect them to go in the coming months:

• P.C.E., the Fed’s preferred gauge: 1.6 percent in February, and expected at 2.3 percent in March and 2.2 percent for the full year.

• Core P.C.E., which strips out volatile food and energy prices: 1.4 percent in February, and expected at 1.8 percent in March and 1.9 percent for the full year.

• Consumer Price Index, an important Labor Department gauge: 2.6 percent in March and expected at 2.6 percent for the full year.

• Producer Price Index, a measure of wholesale prices: 4.2 percent in March, the highest since 2011.

• University of Michigan consumer inflation expectation for next year: 3.7 percent as of this month, up from 3 percent at the start of the year.

• University of Michigan consumer inflation expectation for five years from now: 2.7 percent as of this month, little changed from start of the year.

• Five-year, five-year forward inflation expectation rate, a market-based measure: 2.25 percent in recent days, roughly matching 2018 levels.

Fed officials regularly point out that inflation has been too tepid in recent years, not too high, and they don’t expect that to change quickly. To raise rates, they say, they would need to see that inflation was going to remain higher sustainably — for instance, if it came alongside heftier wage increases.

Part of the Fed’s comfort with a period of faster price gains is that consumer and business expectations have remained relatively low, despite some recent increases. If people aren’t anticipating higher prices, it’s likely to put a lid on how much more companies can charge.

Google’s logo on a building in Zurich, Switzerland. Alphabet, Google’s parent company, reported a strong increase in revenue last quarter.Credit…Arnd Wiegmann/Reuters

Government bond yields jumped on Wednesday ahead of the latest Federal Reserve policy meeting.

Economists expect Fed officials to keep interest rates near zero and continue their bond-buying program, but central bank watchers will be looking for clues for how much longer the support will last as the U.S. economy improves. Higher yields on government bonds may reflect expectations that the Fed is inching closer signaling that it will change its policy, including raising its benchmark rate, even if that’s still years in the future.

Jerome H. Powell, the Fed chair, will speak to reporters Wednesday afternoon. Fed officials have said they would telegraph any changes well in advance and expected the current rise in inflation to be temporary, which would diminish the need for a monetary policy reaction.

The yield on 10-year Treasury notes as high as 1.65 percent on Wednesday. Yields on British and German government bonds also climbed.

“We think risks around this meeting are firmly skewed toward higher rates,” analysts at ING said of bond yields. “This is particularly true if the Fed breaks with its cautious tone of late, or simply decides to hedge its bets by saying it will react as appropriate if the economy overheats.”

Stocks

• The S&P 500 was slightly higher on Wednesday.

• Deutsche Bank rose nearly 11 percent after the German bank reported its best quarterly profit in seven years. The bank also avoided losses from the collapse of Archegos Capital Management that were a blow to some of its European rivals.

• Alphabet rose 4 percent after the tech company said revenue in its most recent quarter increased sharply from the same period a year ago, supported by strong demand for online advertising.

• Pinterest shares dropped more than 13 percent after the company said the growth in its number of users would probably slow down as pandemic restrictions were lifted.

• On Wednesday, Boeing, Apple, Facebook and Ford report earnings.

European Economy

• A group that monitors risk in the eurozone warned on Wednesday that corporate bankruptcies could surge after government support measures for businesses expire. “More than a year of restrictions on economic activity has so far not resulted in financial instability,” the European Systemic Risk Board said in a statement. “However, the threat of a wave of insolvencies looms large.”

• The risk board, led by Christine Lagarde, the president of the European Central Bank, said that governments needed to continue supporting businesses even after the economic effects of the pandemic fade.

Credit…Hiroko Masuike/The New York Times

• Google’s parent company, Alphabet, said on Tuesday that it posted revenue of $55.31 billion in the first three months of the year, up 34 percent from a year earlier, and net profit more than doubled to $17.93 billion in the first quarter. It was the third straight quarter of record profit for the company. Advertising revenue rose 32 percent in the quarter spurred by strong demand for search marketing. Alphabet also generated $6 billion in YouTube ads, an increase of 49 percent.

• Microsoft on Tuesday reported that its quarterly sales grew at one of its strongest rates in years, as the company was poised to cross $2 trillion in market value. Revenue rose to $41.7 billion for the fiscal third quarter, up 19 percent from a year earlier, its biggest quarterly increase since 2018. Profits jumped 44 percent to $15.5 billion. Gaming revenue grew 50 percent, fueled by spending on the new Xbox gaming console, which was launched late last year, as well as on Xbox content and services.

• The coffee giant Starbucks said that its sales in the United States made a “full recovery” in the first three months of the year. Same-store sales in the U.S. climbed 9 percent in the company’s second quarter compared with the same period last year, while global revenues climbed 11 percent to $6.7 billion. Starbucks made a profit of $659 million in the quarter.

California is expecting a roughly $15 billion budget surplus next fiscal year, which runs from July through June, according to its most recent forecast. The state is so flush that it is now running its own stimulus program, writing one-time checks of $600 or $1,200 to poorer households and spending some $2 billion on aid for small businesses.

Less than a year ago, the state was facing a $54 billion shortfall, Matt Phillips reports for The New York Times. Here’s how the state’s fortunes were turned around:

• Almost half of the personal income taxes that California collects comes from the top 1 percent of the state’s earners. Since much of that group’s income comes from stock holdings and stock-based compensation, their fortunes are tied to the performance of the stock market. After hitting a bottom in March 2020, the S&P 500 is up nearly 90 percent, creating close to $17 trillion in paper gains.

• Last year, 457 companies sent public, raising $167.8 billion, both records, according to Dealogic. Almost a quarter of those dollars were destined for the 100 California companies that made the jump — the most of any state.

• The governor’s office projects that revenue from capital gains taxes next fiscal year will top $18 billion, a key driver of the state’s surplus. “With Silicon Valley, when entrepreneurs get stock grants that they exercise, or stock options, California makes out very well,” said David Hitchcock, the primary analyst on California for bond-rating firm S&P Global.

• California’s budget rebound was aided by larger-than-expected federal government spending that kept people afloat and the economy from complete collapse. When California’s governor revises his most recent budget next month as required by law, analysts expect it will show an additional $26 billion in federal funding to California as a result of President Biden’s $1.9 trillion American Rescue Plan passed last month.