GE Aerospace delivered a blockbuster Q2, raising full-year guidance across all metrics on the back of relentless aftermarket demand and improved supply chain execution. Management emphasized that the bottleneck is supply, not demand, with a massive $170B services backlog and a record shop visit pipeline. The tone is strongly bullish, with confidence in durable double-digit growth. Raised 2026 guidance for revenue, operating profit, EPS, and free cash flow, citing robust commercial services demand and supply chain improvements.
Buzzberg 분석GE raised 2026 guidance across all metricsGE Aerospace delivered a blockbuster Q2, raising full-year guidance across all metrics on the back of relentless aftermarket demand and improved supply chain execution. Management emphasized that the bottleneck is supply, not demand, with a massive $170B services backlog and a record shop visit pipeline. The tone is strongly bullish, with confidence in durable double-digit growth. Raised 2026 guidance for revenue, operating profit, EPS, and free cash flow, citing robust commercial services demand and supply chain improvements.전체 분석 보기분석 접기
GE Aerospace delivered a blockbuster Q2, raising full-year guidance across all metrics on the back of relentless aftermarket demand and improved supply chain execution. Management emphasized that the bottleneck is supply, not demand, with a massive $170B services backlog and a record shop visit pipeline. The tone is strongly bullish, with confidence in durable double-digit growth. Raised 2026 guidance for revenue, operating profit, EPS, and free cash flow, citing robust commercial services demand and supply chain improvements.
Commercial services revenue up 26% in Q2, driven by record internal shop visits (LEAP up 50%) and 25%+ spare parts growth.
Spare parts delinquency still grew 20% sequentially, revealing that supply chain remains the primary constraint on growth.
LEAP durability kit for -1B certified, expected to double time-on-wing and drive a full production cutover in 2027.
Revenue$13.349B
+8% QoQ
EPS$2.02
+9% QoQ
Gross margin35.03%
reported
Op margin18.65%
reported
이번 분기에 달라진 점
01
Guidance
GE raised 2026 guidance across all metrics
Guidance · revenue to 17%
02
Backlog
Commercial services backlog of ~$170B underpins growth visibility
Raised 2026 guidance for revenue, operating profit, EPS, and free cash flow, citing robust commercial services demand and supply chain improvements.
Commercial services revenue up 26% in Q2, driven by record internal shop visits (LEAP up 50%) and 25%+ spare parts growth.
04
Demand
Management sees no customer behavior change despite flat departures
Management raised full-year guidance across the board and repeatedly cited robust demand and strong execution while acknowledging supply-side work remains.
AI, 자본지출 및 수요 분석
AI
플랫폼 및 수익화
Management positioned AI as an operational force multiplier within Flight Deck rather than a product or revenue driver. On the turbine airfoil team, AI automation after simplifying the process cut demand signals in half and reduced processing time by nearly 90% across 190 parts, which they said helps focus suppliers and supports higher output.
수요
수주 및 전환
Management sees no customer behavior change despite flat departures. Management raised full-year guidance across the board and repeatedly cited robust demand and strong execution while acknowledging supply-side work remains.
자본지출
투자 및 생산능력
Management reiterated ongoing investment in capacity and next-generation technology, citing roughly $3 billion in annual R&D and over $1 billion in CapEx. They are expanding LEAP aftermarket capacity, including MTU's new Fort Worth facility, and using Flight Deck to break supply-chain constraints, with no indication of capex cuts.
톤 · Confident
Management raised full-year guidance across the board and repeatedly cited robust demand and strong execution while acknowledging supply-side work remains.
병목
Components
Component availability is constraining production
“With demand increasing for the F-110 engine, At our site in Lynn, Massachusetts, we used Flight Deck to reduce overall production lead time for a critical component by roughly 60% through the consolidation of key process steps and reducing”
Spare parts delinquency grew 20% sequentially despite strong revenue growth, indicating supply chain remains the key constraint and not demand.
“Even with strong revenue growth, given robust orders, Spare parts delinquency, which represents shipments that have been delayed due to material availability constraints, grew 20% sequentially in the second quarter.”
Internal shop visit output was a record, and the engine shop visit pipeline for the next quarter is over 40% above the full-year target, showing demand visibility is high.
“Engines already off-wing and the pipeline of planned removals in the third quarter exceed our full-year shop visit guide by over 40%.”
GE's pricing power is evident: spare parts revenue grew over 25% even with only flat departures, driven by material availability and price.
“Spare part sales increased over 25% from improved material availability that helped us fulfill strong customer demand, growth in LEAP external channel, and price.”
Larry, thank you. And good morning, everyone. The GE Aerospace team continues to execute with discipline and focus, with our customers at the center of everything we do. Our 57,000 employees remain committed to our purpose, inventing the future of flight, lifting people up, and bringing them home safely. I'd like to open by saying CFM International is supporting our customer Ryanair and assisting with the investigation into flight 1879. Safety is our top priority at all times, and our thoughts are with the passengers, pilots, and crew who were on board. The second quarter marked another quarter of significant growth driven by robust commercial services. Overall orders were up 17% with both segments up at least low double digits. Revenue increased 24% with CES up 27% and DPT up 16%. Operating profit grew 18% with both segments up at least high teens. And EPS increased 22% and Free Cash Flow grew 43% with conversion over 140%. These results close out an exceptional first half with orders up 49%, revenue up 27%, EPS growing 24% and Free Cash Flow increasing 31% with 115% conversion. Flight Deck is helping us drive the operational improvements which undergird the significant output …
… digits sequentially and year over year again in the second quarter. This supported commercial services revenue up 32% in the first half, including record internal shop visit output in the second quarter and first half total engine deliveries up 31% including LEAP engines up 41%. We're also expanding capacity to meet growing aftermarket demand for LEAP as the installed base is expected to more than double between now and 2030. Last week we celebrated with MTU the grand opening of their new maintenance facility in Fort Worth which recently inducted their first LEAP-1B engine. All in, we're making meaningful progress with Flight Deck and while there's always more to do, we delivered substantial improvement in the first half and our team remained focused on meeting customer expectations. Shifting to slide five, while the environment remains dynamic, aftermarket demand has been resilient. First half departures were roughly flat, but we have not observed any changes in customer behavior. We expect a gradual return to modest departures growth in the second half. and combined with our commercial services backlog of roughly $170 billion, we remain well positioned for services growth …
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