Every GE Aerospace Investor Should Keep an Eye on This Number

Core Insights - The key metric for GE Aerospace investors in 2025 is the operating margin of its commercial engines and services (CES) segment, which significantly impacts the company's overall profitability [1] - The CES segment generates 6.6 times the profit of the defense & propulsion technologies (DPT) segment, highlighting its importance to the company's financial health [1] Revenue and Profit Margins - In 2024, CES revenue was $6.43 billion, with an operating profit margin of 23.3$1.5 billion, with expectations for higher figures in 2025, aiming for a range of $7.6 billion to$7.9 billion [3] Market Dynamics - The CES business model typically involves selling engines at a loss initially, followed by long-term profitability through aftermarket parts and services [2] - A 7.9% decline in the number of engines produced in 2024, including a 10.4% drop in LEAP engines, resulted in an improved profit margin compared to 2023 [2] Future Outlook - Investors should monitor the balance between LEAP engine deliveries and profit margins, as maintaining 2024's quarterly margins would be a positive outcome for GE Aerospace [4] - Management anticipates mid-teens percentage growth in CES revenues for 2025, indicating a positive outlook for the segment despite potential margin pressures [4]