VSE Posts Record $1.1B Revenue, Guides 19–23% Growth, Plans $2.025B Acquisition
VSE delivered Q4 rev $301M (+32%) and EBITDA $52M (+55%), lifting full-year rev to $1.1B (+41%) and EBITDA to $183M. The company guides 19–23% revenue growth and 16.8–17.3% EBITDA margins for 2026 while advancing a $2.025B Precision Aviation Group acquisition expected to add $615M revenue with over 20% EBITDA margins.
1. Q4 and Full-Year Financial Performance
VSE reported Q4 2025 revenue of $301 million, a 32% year-over-year increase, and adjusted EBITDA of $52 million, up 55% with a 17.2% margin. Full-year revenue reached $1.1 billion, up 41%, while adjusted EBITDA rose 56% to $183 million, driving adjusted net income to $83 million and EPS to $3.92.
2. 2026 Guidance and Cash Flow Impact
VSE guides 2026 revenue growth of 19–23% and adjusted EBITDA margins of 16.8–17.3%, excluding the PAG transaction. An exclusive APU distribution program requires a $45 million initial inventory build, weighing on first-quarter and full-year free cash flow while management anticipates stronger free cash flow in H2 2026.
3. Precision Aviation Group Acquisition Details
VSE agreed to acquire Precision Aviation Group for $2.025 billion ($1.75B cash, $275M equity), expecting to add $615 million of 2025 revenue with over 20% EBITDA margins. The deal includes up to $125 million in contingent earnouts and will be funded with $1.28 billion of equity proceeds and debt, targeting more than $15 million in annual phase-one synergies.
4. Proprietary Program Wins and M&A Integration
During 2025, VSE integrated Kellstrom operations ahead of synergy targets and completed acquisitions of Turbine Weld and Aero3, enhancing engine-component repair and wheel and brake MRO. Management also secured exclusive OEM agreements to manufacture PT6 fuel pumps and distribute over 2,500 APU components across four platforms.