GE Aerospace Q3 Earnings & Revenues Surpass Estimates, Increase Y/Y

GE Aerospace GE reported third-quarter 2025 results, wherein both revenues and earnings surpassed the Zacks Consensus Estimate.

It is worth noting that in April 2024, GE Aerospace emerged as a separate public company, following the spin-off of GE Vernova Inc. GEV from General Electric.

Inside GE’s Headlines

The company’s third-quarter adjusted earnings were $1.66 per share, which beat the Zacks Consensus Estimate of $1.46. The bottom line surged 44% year over year.

Total revenues were $12.2 billion, indicating a year-over-year increase of 24%. Total orders grew 2% on a year-over-year basis to $12.8 billion.

Adjusted revenues were $11.3 billion, marking a year-over-year increase of 26%. The metric beat the consensus estimate of $10.3 billion.

GE Aerospace Price, Consensus and EPS Surprise

GE Aerospace price-consensus-eps-surprise-chart | GE Aerospace Quote

GE’s Segmental Discussion

Revenues from the company’s Commercial Engines & Services business jumped 27% year over year to $8.88 billion. The Zacks Consensus Estimate for the business’ revenues was pegged at $8.25 billion. The results were driven by higher shop visit work scope, increased revenues from spare parts and equipment and favorable pricing. Total orders in the segment rose 5% year over year to $10.3 billion.

The Defense & Propulsion Technologies segment’s revenues totaled $2.83 billion, up 26% year over year. The Zacks Consensus Estimate for the segment’s revenues was pegged at $2.52 billion. Results benefited from the strong momentum in the Defense & Systems and Propulsion & Additive Technologies businesses. Total orders in the segment decreased 5% year over year to $2.9 billion owing to timing issues across quarters.

GE’s Margin Profile

GE Aerospace’s cost of sales (comprising costs of equipment and services sold) surged 24.7% year over year at $7.76 billion. Selling, general and administrative expenses decreased 10.2% year over year to $1.2 billion. Research and development expenses totaled $415 million, reflecting a year-over-year rise of 25.4%.

GE Aerospace’s operating profit (non-GAAP) was $2.3 billion, up 26.5% year over year. The margin was 20.3%, relatively stable year over year.

GE Aerospace’s Balance Sheet & Cash Flow

Exiting the third quarter of 2025, GE Aerospace had cash, cash equivalents and restricted cash of $12.5 billion compared with $13.6 billion at the end of December 2024. The company’s long-term borrowings were $18.8 billion compared with $17.2 billion at the end of December 2024.

In the third quarter, the adjusted free cash flow was $2.36 billion compared with $1.82 billion in the year-ago quarter.

In the same quarter, GE rewarded its shareholders with a dividend payment of $0.4 billion. The company repurchased shares for approximately $1.8 billion during the same period.

GE’s Outlook

For 2025, GE expects adjusted revenues to grow in the high-teens range from the year-ago period's actual. Operating profit is estimated to be in the band of $8.65-$8.85 billion. Adjusted earnings are predicted to be in the range of $6.00-$6.20 per share. The free cash flow is anticipated to be in the band of $7.1-$7.3 billion, with the conversion rate projected to be more than 100%.

GE Aerospace expects the Commercial Engines & Services segment’s revenues to grow in the low twenties range, whereas operating profit is anticipated to be in the band of $8.45-$8.65 billion. For the Defense & Propulsion Technologies segment, revenues are projected to increase in the high-single-digit range, whereas operating profit is anticipated to be in the band of $1.2-$1.3 billion.

Zacks Rank and Stocks to Consider

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A couple of better-ranked stocks from the same space are discussed below: 

General Dynamics Corporation GD presently carries a Zacks Rank #2 (Buy). General Dynamics’s earnings surpassed the consensus estimate thrice and missed once in the trailing four quarters. The average earnings surprise was 1.2%. In the past 60 days, the Zacks Consensus Estimate for General Dynamics’ 2025 earnings has inched up 0.2%.

Textron Inc. TXT currently carries a Zacks Rank of 2. Textron’s earnings topped the consensus estimate thrice and missed once in the trailing four quarters. The average earnings surprise was 4.9%.  In the past 60 days, the Zacks Consensus Estimate for Textron’s 2025 earnings has risen 0.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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