GE Aerospace Raises Full-Year Outlook as Third-Quarter Orders Climb 49%

GE Aerospace (NYSE: GE ) shares fell in Tuesday’s premarket trading despite the company reporting better-than-expected third-quarter results and raising its 2026 outlook. The decline came as investors weighed lower free cash flow, narrower Commercial Engines & Services margins and uncertainty surrounding GE9X engine certification. Revenue rose 16% year over year to $14.118 billion, beating the analyst estimate of $12.849 billion. Adjusted revenue increased 18% to $13.285 billion. Adjusted earnings climbed 36% to $2.25 per share, beating the $2.00 consensus estimate. Commercial Engines & Services Drives Growth GAAP profit rose 12% to $2.805 billion, while adjusted operating profit jumped 30% to $2.988 billion. Adjusted operating margin expanded 220 basis points to 22.5%. Orders surged 49% to $19 billion. Commercial Engines & Services revenue and operating profit each increased 21%, reaching $10.342 billion and $2.887 billion, respectively. However, the segment’s operating margin narrowed 10 basis points to 27.9%. Services revenue grew 17%, supported by a 12% increase in internal shop visit revenue, driven by higher volume and heavier maintenance work. LEAP shop visits rose more than 40%, while spare parts sales increased over 20%. Equipment revenue jumped 38% as engine deliveries increased 8%, including 5% growth in LEAP deliveries. Meanwhile, GE Aerospace has delivered GE9X engines with upgraded midseals to Boeing Company (NYSE: BA ) since August. The company is targeting FAA certification of the upgraded midseal by the end of 2026, subject to regulatory approval. See More: Top Momentum Stocks Defense Business Expands As Backlog Strengthens Defense & Propulsion Technologies revenue increased 7% to $3.469 billion. Operating profit rose 8% to $475 million, with a margin of 13.7%. Defense & Systems revenue grew 5%, while Propulsion & Additive Technologies revenue increased 10%. Year-to-date commercial services revenue and engine deliveries each grew more than 20%. GE Aerospace reported a commercial services backlog exceeding $170 billion and expects low-double-digit services revenue growth in 2027. The company also secured more than 1,800 engine commitments at Farnborough, won a defense support contract worth up to $2.9 billion and announced plans to acquire Consolidated Precision Products. GE Aerospace Raises 2026 Earnings Outlook GE Aerospace raised its 2026 adjusted earnings guidance to $8.00 to $8.10 per share from $7.65 to $7.85, above the $7.92 analyst estimate. The company also increased its adjusted revenue growth forecast to approximately 19% to 20%. Management raised its adjusted operating profit outlook to $10.9 billion to $11 billion and free cash flow guidance to $9.1 billion to $9.4 billion. However, quarterly operating cash flow declined 14% to $2.203 billion, while free cash flow fell 14% to $2.042 billion. GE Aerospace ended the quarter with $8.8 billion in cash and $19.3 billion in borrowings. It also repurchased $2 billion of shar