GE Aerospace Q2 Earnings & Revenues Beat Estimates, Increase Y/Y

Core Insights - GE Aerospace reported strong second-quarter 2025 results, with revenues and earnings exceeding expectations, following its spin-off from General Electric in April 2024 [2][3] Financial Performance - Adjusted earnings were $1.66 per share, surpassing the Zacks Consensus Estimate of $1.43, marking a 38% year-over-year increase [3][8] - Total revenues reached $11 billion, a 21% year-over-year increase, while adjusted revenues were $10.2 billion, up 23% year-over-year, exceeding the consensus estimate of $9.7 billion [3][4] - Total orders grew 27% year-over-year to $14.2 billion [3] Segment Performance - Revenues from the Commercial Engines & Services segment increased 30% year-over-year to $7.99 billion, driven by higher shop visit work, spare parts sales, and pricing [4] - The Defense & Propulsion Technologies segment reported revenues of $2.56 billion, a 7% year-over-year increase, with total orders rising 24% year-over-year to $2.9 billion [5] Cost and Margin Analysis - Cost of sales rose 22.8% year-over-year to $6.85 billion, while selling, general, and administrative expenses increased 10.4% to $1.02 billion [6] - Research and development expenses totaled $359 million, reflecting a 19.7% year-over-year rise [6] - Operating profit (non-GAAP) was $2.3 billion, up 23% year-over-year, with a margin of 23%, down 10 basis points [6] Balance Sheet and Cash Flow - As of the end of Q2 2025, GE Aerospace had cash and cash equivalents of $10.9 billion, down from $13.6 billion at the end of December 2024 [7] - Adjusted free cash flow was $2.1 billion, compared to $1.1 billion in the same quarter last year [7] Future Outlook - For 2025, GE expects adjusted revenues to grow in the mid-teens range, with operating profit estimated between $8.2 billion and $8.5 billion [10] - Adjusted earnings are projected to be in the range of $5.60 to $5.80 per share, with free cash flow anticipated between $6.5 billion and $6.9 billion [10] - The Commercial Engines & Services segment is expected to see revenue growth in the high-teens range, while the Defense & Propulsion Technologies segment is projected to grow in the mid to high-single-digit range [11]