The contract entails desiging a next-generation engine for small Collaborative Combat Aircraft (CCA).How GE’s New Engine Redefines AffordabilityAnnounced on Feb. 23, 2026, this initiative focuses on creating the GEK1500 engine, designed to meet high-performance standards while maintaining cost-effectiveness.Additionally, the GEK1500 engine is set to offer a 1,500-pound thrust capacity, potentially powering unmanned aerial systems, collaborative combat aircraft and missiles. The design leverages lessons from ...

Group 1 - Safran has increased its 2028 forecasts due to strong performance in the civil engines aftermarket, which includes maintenance and repairs [1] - The company is also experiencing growing demand in the defense sector, contributing to its optimistic outlook [1]

Core Insights - The primary growth driver for GE Aerospace is the Commercial Engines & Services segment, which saw a 24% year-over-year increase in organic revenues in Q4 2025, accounting for over 75% of the company's business [1][8] - Orders in the Commercial Engines & Services segment surged 76% year-over-year to $22.8 billion in Q4 2025, driven by strong demand for LEAP, GEnx, and GE9X engines [1][8] Business Performance - GE Aerospace is experiencing growth due to a rising installed base and increased utilization of engine platforms, supported by robust demand in both commercial and defense sectors [2] - The company secured over 500 engine wins at the Dubai Airshow in 2025, including significant orders from flydubai, Riyadh Air, and Cathay Pacific, as well as a landmark deal with Qatar Airways for over 400 GE9X and GEnx engines [3] Market Context - The commercial and military aircraft programs are expected to continue benefiting from strong air travel and defense budgets, positioning GE for sustained demand momentum in the future [4] - Competitors like Howmet Aerospace and RTX Corporation are also seeing growth in the commercial aerospace market, with Howmet reporting a 15% year-over-year revenue increase and RTX achieving 12.1% sales growth in Q3 2025 [5][6] Financial Metrics - GE Aerospace's stock has increased by 49.7% over the past year, outperforming the industry average growth of 29.5% [7] - The company is currently trading at a forward price-to-earnings ratio of 40.81X, which is above the industry average of 32.60X, and holds a Value Score of F [10] - The Zacks Consensus Estimate for GE's earnings for 2026 and 2027 has been rising over the past 60 days, indicating positive market sentiment [11]

Financial Data and Key Metrics Changes - In Q4 2025, orders increased by 74%, revenue grew by 20%, and EPS rose by 19% to $1.57, with free cash flow up 15% [5][17] - For the full year, orders were up 32%, revenue increased by 21%, operating profit grew by $1.8 billion, and free cash flow rose by $1.5 billion [5][18] - Operating profit for the year was $9.1 billion, with margins expanding by 70 basis points to 21.4% [18] Business Line Data and Key Metrics Changes - In the Commercial Engine Services (CES) segment, orders were up 35% and revenue grew by 24%, with services orders up 27% and revenue up 26% [5][20] - In the Defense and Power Technologies (DPT) segment, orders increased by 19% and revenue was up 11%, with profit rising by 22% to $1.3 billion [5][21] Market Data and Key Metrics Changes - The company reported a backlog of approximately $190 billion, up nearly $20 billion from the previous year [7] - The installed base of engines is 80,000, with over 2.3 billion flight hours accumulated [27][28] Company Strategy and Development Direction - The company aims for substantial revenue, EPS, and cash growth in 2026, with expectations for revenue to increase in low double digits and operating profit to reach $9.85 billion to $10.25 billion [7][8] - Investments are being made in U.S. manufacturing to support both commercial and defense customers, with a focus on improving time on wing and reducing cost of ownership [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand environment, citing robust orders and a strong backlog as indicators of future performance [32][33] - The company is focused on continuous improvement and leveraging technology to enhance customer value and operational efficiency [28][29] Other Important Information - The company is transitioning its segment reporting to reflect organizational changes, with aeroderivative engines moving from CES to DPT [22][23] - The company plans to invest approximately $500 million in MRO to support LEAP engine capacity expansion [11] Q&A Session Summary Question: Can you elaborate on the commercial aftermarket backdrop? - Management noted strong momentum in services growth and expressed confidence in achieving mid-teens growth in 2026, driven by increased work scopes and pricing [31][32] Question: What is the profitability outlook for LEAP engines? - Management confirmed that LEAP original equipment is expected to be profitable in 2026, with improvements in supply chain visibility and readiness [40][44] Question: How are turnaround times improving for mature engines? - Management indicated that improvements in turnaround times are driven by better material availability and efficient execution on the shop floor, which enhances productivity [48][50] Question: What are the implications of the agreement with FTAI? - The agreement is aimed at enhancing third-party aftermarket options, which supports asset values and lowers costs of ownership for customers [93] Question: What is the expected cash flow outlook for 2026? - Management indicated that there are no abnormal cash flow expectations for 2026, with a focus on managing inventory growth and contract assets [94][95]

Financial Data and Key Metrics Changes - In Q4 2025, orders increased by 74%, revenue grew by 20%, and EPS rose by 19% to $1.57, with free cash flow up 15% [5][17] - For the full year, orders were up 32%, revenue increased by 21%, operating profit grew by $1.8 billion, and free cash flow rose by $1.5 billion [5][18] - Operating profit for the year was $9.1 billion, with margins expanding by 70 basis points to 21.4% [18] Business Line Data and Key Metrics Changes - In the Commercial Engine Services (CES) segment, orders were up 35%, revenue grew by 24%, and profit increased by 26% to $8.9 billion [5][19] - In the Defense and Power Technologies (DPT) segment, orders increased by 19%, revenue grew by 11%, and profit rose by 22% to $1.3 billion [5][20] Market Data and Key Metrics Changes - The backlog reached approximately $190 billion, up nearly $20 billion from the previous year [6] - The installed base of LEAP engines is expected to triple between 2024 and 2030, with significant capacity expansions planned across the global MRO network [10][11] Company Strategy and Development Direction - The company aims for substantial revenue, EPS, and cash growth in 2026, with expectations for revenue to increase in the low double digits [6][24] - Investments are being made in U.S. manufacturing to support both commercial and defense customers, with a focus on improving time on wing and reducing cost of ownership [7][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand environment, citing robust orders and a strong backlog as indicators of future growth [30][31] - The company is focused on leveraging its extensive installed base and R&D investments to drive continuous improvement and customer value [26][72] Other Important Information - The company is transitioning its segment reporting to reflect organizational changes, with no impact on total company metrics [22] - A significant portion of R&D spending is directed towards improving customer experience and developing next-generation technologies [71] Q&A Session Summary Question: Can you elaborate on the commercial aftermarket backdrop? - Management noted that there are no concerns about demand momentum continuing into 2026, supported by a strong backlog and expected growth in shop visits and spare parts [30][31] Question: What is the status of LEAP profitability? - Management confirmed that LEAP original equipment is expected to be profitable in 2026, aligning with previous plans [41] Question: How are turnaround times improving for mature engines? - Improvements in turnaround times are driven by better material availability and efficient execution on the shop floor, leading to increased productivity [44] Question: What are the expected losses from the GE9X program? - Losses for the GE9X program were around a couple of hundred million in 2025, with expectations for these losses to double in 2026 [48] Question: How is R&D spending allocated? - R&D spending focuses on enhancing customer experience, developing new technologies, and supporting next-generation defense programs [71]

January 22, 2026 GE Aerospace fourth quarter & full year 2025 performance Financial results & company highlights Caution concerning forward-looking statements: This document contains "forward-looking statements" – that is, statements related to future events that by their nature address matters that are, to different degrees, uncertain. For details on the uncertainties that may cause our actual future results to be materially different than those expressed in our forward-looking statements, see www.geaerosp ...

Group 1 - GE Aerospace is set to release its fourth-quarter earnings on January 22, with expected earnings of $1.43 per share, an increase from $1.32 per share in the same period last year [1] - The consensus estimate for GE Aerospace's quarterly revenue is $11.21 billion, up from $9.88 billion reported last year [1] - On January 13, GE Aerospace announced a deal with Delta Air Lines for GEnx engines to power 30 new Boeing 787-10s, which includes options for 30 more aircraft and long-term services support [2] Group 2 - UBS analyst maintained a Buy rating and raised the price target from $366 to $368 [4] - Citigroup analyst maintained a Buy rating but cut the price target from $386 to $378 [4] - Susquehanna analyst initiated coverage with a Positive rating and a price target of $386 [4] - B of A Securities analyst maintained a Buy rating and raised the price target from $310 to $365 [4] - JP Morgan analyst maintained an Overweight rating and raised the price target from $275 to $325 [4]

Core Viewpoint - GE Aerospace is expected to report strong growth in its fourth quarter 2025 financials, supported by solid demand and operational efficiency, despite recent subdued share performance [1][5]. Financial Performance - For the first nine months of 2025, adjusted revenue increased by 21% year-over-year, with operating margins expanding by 140 basis points, indicating volume growth and operational efficiency [2]. - Adjusted earnings per share surged nearly 46%, showcasing strong operating leverage within the business [2]. - Free cash flow reached $5.9 billion, and the company exited the third quarter with a $175 billion backlog, providing a robust foundation for future revenue growth [2]. Market Sentiment - The ongoing momentum in GE's businesses is expected to contribute to strong growth in Q4, with the stock's 14-day Relative Strength Index (RSI) at 59.55, indicating potential for upward movement if results exceed expectations [3]. - Derivatives markets anticipate a moderate reaction to the earnings release, with options pricing suggesting a post-earnings move of approximately 4.6% in either direction [4]. Business Drivers - GE Aerospace's business is benefiting from a large installed base of aircraft engines, strong demand for aftermarket services, and a steady recovery in engine deliveries, which are expected to support revenue growth and profitability [5]. - Strength is anticipated across major operating segments, particularly in the Commercial Engines & Services business, driven by rising services revenue and improving equipment sales [6]. - Increased demand for servicing and spare parts, as more engines cycle through Maintenance, Repair, and Overhaul facilities, is allowing the company to capitalize on higher volumes and favorable pricing conditions [6].

Core Insights - GE Aerospace operates through two main segments: Commercial Engines and Services, and Defense Propulsion Technologies [2] Group 1 - The presentation is led by Peter Arment, a senior aerospace defense analyst at Baird, who introduces GE Aerospace and its executive Rahul Ghai [1] - Rahul Ghai has a long history in the aerospace and multi-industrial sectors, having joined GE Aerospace in 2023 before the spin-off in 2024 [1]

Summary of GE Aerospace FY Conference Call Company Overview - **Company**: GE Aerospace (NYSE: GE) - **Industry**: Aerospace and Defense - **Key Segments**: Commercial engines and services, Defense propulsion technologies Core Points and Arguments 1. **Market Leadership**: GE Aerospace has the largest engine install base in the industry with 78,000 engines, powering three out of every four commercial aircraft and two out of three U.S. combat aircraft [4][5] 2. **Revenue Composition**: In 2025, approximately 70% of revenue is expected to come from services, supported by a $175 billion backlog, primarily driven by the install base [5][6] 3. **Growth Projections**: - Services orders growth has increased by over 30% year-to-date, leading to a 25% growth in commercial services revenue [5][6] - Full-year outlook for commercial services has been raised to low to mid-20s growth, translating to an additional $1 billion in services revenue [6] - Defense propulsion technologies (DPT) revenue expectations have been increased to high single digits from mid-single digits [6][12] 4. **Operational Improvements**: The implementation of the FlightDeck operating model has improved material flow by over 30% year-over-year, enhancing operational efficiency and supplier performance [6][7][29] 5. **Future Outlook for 2026**: - Anticipated growth in air traffic and engine shop visits, with a projected double-digit increase in shop visits over 2025 [10][11] - LEAP engine deliveries expected to grow by 15%-20%, reaching around 2,000 engines [12][13] - Services growth is expected to normalize to a double-digit growth rate between 2024 and 2028 [12][16] 6. **LEAP Engine Performance**: - LEAP engines are achieving performance levels comparable to CFM56 engines, with expectations for improved durability and profitability in the coming years [18][20] - External shop visits for LEAP engines are projected to increase significantly, unlocking spare parts revenue [20][39] Additional Important Insights 1. **Supply Chain Management**: GE Aerospace has focused on improving transparency and communication with suppliers, which has been crucial for meeting demand and resolving issues [36][38] 2. **Defense Propulsion Technologies Growth**: - DPT has seen an 80% increase in defense engine shipments year-over-year, with a $19 billion backlog driving future growth [42][43] - Growth opportunities are identified in international markets and classified projects, with expectations for mid-single digit growth in DPT [47][48] 3. **Cultural Shift**: The FlightDeck initiative has transformed the company culture towards greater transparency and accountability, enhancing overall operational performance [29][34] Conclusion - GE Aerospace is positioned for strong performance in 2025 and optimistic growth in 2026, with a solid backlog and operational improvements driving future revenue [48][49]