GE Aerospace delivered a standout fourth quarter, reporting adjusted earnings of $1.57 per share, a 10% beat over consensus estimates and up from $1.32 a year earlier. Revenue rose 20% year over year to $11.9 billion, driven by a 31% surge in services revenue and record LEAP engine deliveries exceeding 1,800 units. Operating margins widened by 180 basis points, reflecting enhanced production efficiency and higher aftermarket parts pricing. For the full 2025 fiscal year, adjusted EPS reached $6.37, representing a 15% increase over 2024, while total revenues climbed 17%, underscoring sustained demand across commercial and defense segments.

Management raised its 2026 profit guidance above Wall Street expectations, citing robust aftermarket parts and services demand as airlines prioritize maintenance in the face of aircraft supply constraints. Parts and services backlog expanded by 22% year over year to $50 billion, supported by long-term service agreements such as the recently announced Delta Air Lines contract for GEnx engine support on 787-10 aircraft. GE Aerospace projects mid-teens percentage growth in free cash flow for 2026, driven by higher margin aftermarket sales and continued ramp-up of advanced engine programs.

Shares experienced a pullback following the strong Q4 print—a classic sell-the-news reaction—but trading volume in call and put options surged to six times average levels, indicating investor repositioning ahead of the full-year outlook. Short interest declined by over 16% in the past month, reflecting reduced bearish sentiment. Analysts at UBS and Bank of America recently raised their price targets, while Citigroup trimmed but maintained its Buy rating. Given the company’s solid fundamentals, wider margins and favorable guidance, the current weakness presents a tactical entry point ahead of anticipated upside catalysts in 2026.