The increase in fuel prices cannot stop aviation demand! GE Aerospace (GE.US) Q3 revenue surpassed expectations by 16%, raising guidelines for the eighth time in a row

The Zhitong Finance App learned that GE Aerospace (GE.US) released financial results for the third quarter of 2026 before the US stock market on Tuesday. The company's revenue and adjusted earnings per share exceeded market expectations, and the annual profit and free cash flow guidelines were raised again, indicating that demand for aero engine spare parts and maintenance services is still strong, even though the recovery in aviation fuel prices has raised concerns in the industry. After the financial report was released, the company's stock price rose by nearly 3% before the market. As of press release, the stock had declined by about 1%.

Financial reports show that GE Aerospace's third-quarter revenue increased 16% year over year to US$14.12 billion; adjusted revenue was US$13.29 billion, higher than LSEG IBES's agreed estimate of US$12.87 billion, up about 18% year on year. Adjusted earnings per share were $2.25, which was significantly higher than the forecast of $2.01, up approximately 36% year over year. Under GAAP, earnings per share from continuing operations were $2.32 billion; net profit of US$2.8 billion, up 12% year over year; and operating profit of US$3 billion.

The order side continues to provide visibility. The quarter's order volume was 19 billion US dollars, and the commercial service order reserve exceeded 170 billion US dollars. Looking at the breakdown, commercial engine and service (CES) orders for the quarter were US$15.3 billion, a sharp increase of 58% over the previous year. CES revenue was $10.34 billion, up 21% year over year; defense and propulsion technology (DPT) revenue was $3.47 billion, up 7% year over year.

The company said that this reserve size directly supports management's judgment on service revenue, and expects the commercial service business to achieve low double-digit growth in 2027; in contrast, CES business revenue growth is expected to be “20 percentage points lower” this year.

Another increase in full-year guidance is the core focus of this financial report. The adjusted EPS guidance rose from $7.65-7.85 in the second quarter to $8.00-8.10. The median value of $8.05 was $0.20 higher than the upper end of the original range; the market consensus was $7.92, and the median value of the new guidance was about 1.6% higher than the consensus. Free cash flow guidelines were raised simultaneously from US$8.9-92 billion to US$91.94 billion, and the market expected to be around US$9.12 billion. The company also raised its free cash flow and operating profit forecasts; adjusted revenue growth guidelines remained at around 19% — 20%.

Notably, this is the company's eighth upward guidance since January 2024.

As the world's largest jet engine manufacturer, GE Aerospace continues to benefit from the spare parts and maintenance services required by airlines to maintain fleet operations. The business has grown rapidly since the pandemic. However, the conflict between the US and Iran and the subsequent jump in fuel prices have caused the market to worry about whether the aviation industry can maintain recent momentum; after the US and Israel launched an attack on Iran in February, some airlines cut flight plans, and aviation fuel prices have recently risen again after falling back in the summer. This week, a number of major US airlines will announce their latest quarterly results and provide business updates.

On the supply chain and orders side, the company agreed to acquire Consolidated Precision Products for nearly $12 billion in September to include a number of highly engineered castings critical to aerospace and defense products.

The company also signed a memorandum of understanding with Air India IndiGo to order more than 1,000 LEAP-1A engines to power 510 Airbus A320neo series aircraft; this is the largest single engine order received by CFM International. CFM is a joint venture between GE and Safran Group. Additionally, Philippine Airlines selected GenX-1B engines for 15 Boeing 787-10s, and aviation leasing company AerCap selected GenX-1B for 15 Boeing 787 Dreamliners. According to the company, commercial service revenue has increased 26% year to date, and total engine deliveries have increased 21%.