Core Viewpoint - General Electric Aerospace (GE.US) reported strong financial performance in Q2, with revenue of $10.2 billion, a year-over-year increase of 24.1%, leading to an upgraded outlook for 2025-2028 [1][4] Financial Performance - Q2 2025 revenue, profit margins, EBIT, earnings per share (EPS), and free cash flow (FCF) all exceeded FactSet consensus expectations [1] - Adjusted revenue growth forecast for 2025 raised to 15% from low double digits, surpassing market consensus of 16.5% [1] - Operating profit range adjusted to $8.2 billion - $8.5 billion, narrowing from $7.8 billion - $8.2 billion, covering market forecast of $8.4 billion [1] - EPS adjusted to $5.60 - $5.80, up from $5.10 - $5.45, also higher than market consensus of $5.62 [1] - FCF revised to $6.5 billion - $6.9 billion from $6.3 billion - $6.8 billion, exceeding market prediction of $6.7 billion [1] Long-term Goals - GE Aerospace's 2028 strategic plan anticipates a compound annual growth rate (CAGR) of high single digits from 2025 to 2028, significantly up from previous expectations [2] - Operating profit target raised to approximately $11.5 billion from about $10 billion, reflecting a 15% increase [2] - EPS target set at $8.40 and FCF target at $8.5 billion, indicating improved profitability through product iteration and cost optimization [2] Business Growth Drivers - Growth primarily driven by two core segments: Commercial Engine Services (CES) and Defense Propulsion Technologies (DPT) [3] - CES revenue increased by approximately 30% year-over-year, supported by parts sales growth, increased internal repair visits, and price optimization [3] - DPT revenue grew by about 7%, with price and volume increases offsetting weak service demand and adverse engine mix impacts [3] - Both CES and DPT segments exceeded EBIT margin expectations, highlighting the synergy of service networks and digital solutions [3] Investment Rationale - Goldman Sachs maintains a "buy" rating based on three core reasons: GE Aerospace's technological barriers and market share are difficult to replicate; upward revisions in profit expectations indicate strong management execution; and increased FCF targets provide ample room for capital returns and R&D investments [3]