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February 12, 2025
2025 01 23 142131
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GE Aerospace reported its fourth-quarter results this morning, exceeding Wall Street expectations. The company reported adjusted EPS of $1.32, beating Wall Street expectations of $1.04 by 27% and up 102.6% year over year. Stronger-than-expected revenues and higher-than-expected margins combined to produce a stellar quarter for the company despite continued supply chain issues that constrained engine deliveries.

GE aerospace

GE Aerospace Chairman and CEO H. Lawrence Culp, Jr. said, “GE Aerospace delivered a strong finish to 2024 given robust demand for our services and products with fourth quarter orders up 46%, EPS more than doubling, and free cash flow increasing over 20%. Our performance capped off a monumental first year as a standalone company with $1.7 billion of profit growth and $1.3 billion of free cash flow growth.”

Revenue grew to $9.879B for the fourth quarter, up 15.6% year over year. Operating margin rose to 20.1%, up from 15.6% in 2023. The business mix between commercial and military segments remained roughly the same, with CES revenues of $7.650B in the quarter versus $2.523B for defense, approximately a 75%- 25% mix.

GE also provided its 2025 outlook, anticipating revenue growth in the low double digits, adjusted EPS of $5.10 to $5.45, and Free Cash Flow of $6.3-$6.8 billion.  The company delivered 378 LEAP engines in the fourth quarter, up from 365 last year and in line with an overall decline of 10% year over year.

The LEAP is the exclusive engine for the Boeing 737MAX family, so Boeing’s difficulties move down the supply chain, impacting GE’s OEM production. Fortunately, as aircraft stay in service longer while awaiting delayed new aircraft, the high-margin maintenance business continues to grow.

The company is addressing supply chain constraints, with meaningful improvements from the first to the year’s second half. During that period, material input rose 26% for priority suppliers. While some constraints are shrinking, a few key issues continue that the company hopes to resolve in 2025.

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author avatar
Ernest Arvai
President AirInsight Group LLC

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