Core Insights - GE Aerospace reported strong fourth-quarter 2025 results, with revenues and earnings exceeding expectations, following its spin-off from General Electric in April 2024 [1][2] Financial Performance - Adjusted earnings for Q4 were $1.57 per share, surpassing the Zacks Consensus Estimate of $1.44, reflecting a 19% year-over-year increase [2][8] - Total revenues reached $12.7 billion, an 18% increase year-over-year, with adjusted revenues at $11.87 billion, up 20% year-over-year, beating the consensus estimate of $11.26 billion [2][3] - For the full year 2025, adjusted revenues were $42.3 billion, a 21% increase year-over-year, and adjusted earnings were $6.37 per share, up 38% year-over-year [3] Segment Performance - Revenues from the Commercial Engines & Services segment increased by 24% year-over-year to $9.47 billion, driven by higher shop visit work, spare parts, and favorable pricing, with total orders rising 76% to $22.8 billion [4] - The Defense & Propulsion Technologies segment reported revenues of $2.84 billion, a 13% increase year-over-year, with total orders up 61% to $4.57 billion [5] Cost and Margin Analysis - Cost of sales surged 23.7% year-over-year to $8.36 billion, while selling, general, and administrative expenses decreased by 13.8% to $997 million [6] - Research and development expenses rose 16.4% to $448 million, with operating profit (non-GAAP) at $2.3 billion, a 14% increase year-over-year, resulting in a margin of 19.2%, down 90 basis points year-over-year [6] Balance Sheet and Cash Flow - At the end of Q4 2025, GE Aerospace had cash and cash equivalents of $12.4 billion, down from $13.6 billion at the end of December 2024, with long-term borrowings increasing to $18.8 billion from $17.2 billion [7] - Adjusted free cash flow for Q4 was $1.76 billion, compared to $1.53 billion in the same quarter last year [9] Future Outlook - For 2026, GE expects low-double-digit revenue growth, with operating profit estimated between $9.85 billion and $10.25 billion, and adjusted earnings projected to be between $7.10 and $7.40 per share [10] - Free cash flow is anticipated to be in the range of $8.0 billion to $8.4 billion, with a conversion rate of over 100% [10] - The Commercial Engines & Services segment is expected to grow in the mid-teens range, while the Defense & Propulsion Technologies segment is projected to increase in the mid-to-high single-digit range [11]
GE Aerospace Q4 Earnings & Revenues Top Estimates, Increase Y/Y