Company Overview

GE Aerospace delivered exceptional Q4 2025 earnings on January 28th—about three weeks ago—reporting adjusted earnings per share of $1.92 that crushed analyst estimates of $1.68, with revenue of $10.7 billion (up 13% year-over-year). The company, which became a pure-play aerospace business following the 2024 separation from GE HealthCare and GE Vernova, operates the world’s largest commercial jet engine business with over 44,000 engines in service globally.

What makes GE Aerospace particularly compelling right now is the convergence of strong commercial aviation recovery and massive aftermarket revenue growth. During the January 28th earnings call, management highlighted that commercial engines orders reached record levels in Q4, with airlines placing orders for over 1,800 LEAP engines (which power Boeing 737 MAX and Airbus A320neo aircraft). More importantly, services revenue—the high-margin aftermarket business of maintaining the 44,000+ installed engines—grew 17% year-over-year to reach a $40+ billion annual run rate as flight hours approach pre-pandemic levels.

Key Technical and Fundamental Drivers

Strong Q4 Beat → January 28th Results
GE Aerospace reported Q4 2025 results three weeks ago showing $1.92 adjusted EPS (crushing $1.68 estimates), $10.7B revenue (up 13% YoY), and raised 2026 guidance.

Record Engine Orders → 1,800+ LEAP Engines Q4
Commercial engine orders reached record levels with over 1,800 LEAP engine orders in Q4 alone, as airlines expand fleets to meet surging global air travel demand.

Aftermarket Revenue Surge → $40B+ Run Rate
High-margin services revenue grew 17% year-over-year reaching a $40+ billion annual run rate, as flight hours recover and the installed engine base requires maintenance.

Flight Hours Recovery → Near Pre-Pandemic Levels
Global commercial flight hours reached 95%+ of 2019 levels in Q4 2025, driving shop visits and spare parts demand that generate 2-3x higher margins than new engines.

Defense Business Strength → F-35 and Military Contracts
The defense segment showed robust growth with GE engines powering the F-35 fighter jet program and other military aircraft, providing stable government contract revenue.

Market Takeaway

GE Aerospace’s January 28th earnings—three weeks old—demonstrate why the aerospace aftermarket is one of the most attractive business models in industrial manufacturing. The company’s strategy is elegantly simple: sell commercial jet engines at modest margins (or even losses) to win airline contracts, then generate exceptional profits over 20-30 years maintaining those engines. With 44,000+ engines installed globally and each requiring regular maintenance, part replacements, and overhauls, GE has a captive customer base generating predictable, high-margin revenue.

The aftermarket revenue growing 17% to a $40+ billion run rate is the key metric investors should focus on. As flight hours return to pre-pandemic levels, airlines must perform more frequent engine maintenance—creating a powerful earnings tailwind that will compound for years. The record 1,800+ LEAP engine orders in Q4 aren’t just current revenue; they represent future aftermarket streams that will generate profits for decades. Each LEAP engine sold today creates an estimated $40-50 million in lifetime aftermarket revenue versus $10-15 million in initial engine sale price. The pure-play structure following the 2024 separations eliminates the conglomerate discount that historically plagued GE, allowing investors to own a focused aerospace business with best-in-class operating margins expanding toward 20%+. With global air traffic projected to grow 4-5% annually for the next decade and GE’s installed base providing a massive recurring revenue moat, the company offers exposure to the commercial aviation recovery with exceptional operating leverage as margins expand.