The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

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Fortune 500

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The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

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The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are electrical equipment and industrial machinery.

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The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-052-General-Electric

In January 2023, the once mighty American conglomerate successfully executed the first major step in a corporate restructuring plan publicly outlined in November 2021, cleaving off its health care division into an independent company: GE HealthCare. 
<ul> 
 	<li>Following a sudden collapse in stock price in 2017 under CEO Jeff Immelt, General Electric, now led by Larry Culp, devised a strategy to divide itself into three separate, publicly traded entities focused, respectively, on aerospace, health care, and energy and power.</li> 
 	<li>Following GE HealthCare’s spinoff, GE’s aerospace and energy and power companies are set to become independent in 2024.</li> 
 	<li>GE's renewable energy business continued to face supply-chain and inflationary pressures in 2023; it laid off 20% of its U.S. onshore wind workforce in October 2022.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022-General Electric

General Electric continues to reshape itself as its leaders slim down what was once one of America’s biggest conglomerates. In November 2021 the company announced what will likely amount to its final breakup: a plan to split into three separate companies focused on aircraft engines, health care, and energy and power, respectively. The health care and energy spinoffs are expected to be completed by the end of 2024. In the meantime, GE remains a major employer and a significant player in green energy, thanks to its leading role in such products as wind turbines and energy-efficiency software. On the latter front, GE’s software arm in January 2022 acquired Opus One, a Canadian startup that helps utilities optimize energy planning.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500 104 GENERAL ELECTRIC

General Electric continues to move forward on a long, bumpy road as it struggles to recover from its 2017 collapse. CEO Larry Culp, the first outsider CEO in GE’s 132-year history, continues his strategy of making the company simpler and more stable, focusing on four businesses: carbon-fueled power generating equipment, renewable energy, jet engines, and health care. All but renewable energy got walloped by the pandemic—especially the jet engine business, as airlines virtually shut down. GE has been gradually selling off its stake in the Baker Hughes oilfield services company and agreed in early 2021 to sell its aircraft leasing business, further focusing the company and raising cash to pay down debt.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-38-General Electric

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-077-General-Electric

GE is still in rescue mode more than three years after its historic collapse began in 2017. The epicenter of the disaster was GE’s power operation, which makes electricity-generating turbines and which continued to shrink in 2019. The renewable energy business booked a big loss last year and continues to suffer as rock-bottom oil prices sap demand. Even the company’s longtime stalwart, jet engines, faces serious headwinds. While the division delivered two-thirds of GE’s profits, Boeing’s 737 Max travails, followed by the coronavirus pandemic, have slowed its progress. Health care, at least, has performed well. CEO Larry Culp faces years more work before this rescue is accomplished. It could use a little luck, too.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-033-GE

GE is still in rescue mode more than three years after its historic collapse began in 2017. The epicenter of the disaster was GE’s power operation, which makes electricity-generating turbines and which continued to shrink in 2019. The renewable energy business booked a big loss last year and continues to suffer as rock-bottom oil prices sap demand. Even the company’s longtime stalwart, jet engines, faces serious headwinds. While the division delivered two-thirds of GE’s profits, Boeing’s 737 Max travails, followed by the coronavirus pandemic, have slowed its progress. Healthcare, at least, has performed well. CEO Larry Culp faces years more work before this rescue is accomplished. It could use a little luck, too.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 64th running of the list.

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The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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As of May 2025, the legendary General Electric, or GE, which was founded in 1892, completed its transformation from a diversified conglomerate into three distinct publicly traded entitites: GE Aerospace, GE Vernova, and GE HealthCare. GE Aerospace kept the ticker GE. It designs and produces commercial and defense aircraft engines; integrated engine components; as well as electric power and mechanical aircraft systems. It also offers aftermarket services to support its products. The company operates in Europe, Asia, the Americas, the Middle East, and Africa.

Q2 2026

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Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

GE Aerospace (GE): Company Profile, Stock Price, News, Rankings

legacy

GE Aerospace

ge aerospace

Good day, ladies and gentlemen, and welcome to the GE Aerospace Investor Update and Second Quarter twenty twenty five Earnings Webcast. At this time, all participants are in a listen only mode. My name is Liz, and I will be your conference coordinator today. If you experience issues with the webcast slides refreshing or there appears to be delays in the slide advancement, please hit F5 on your keyboard to refresh. As a reminder, this conference is being recorded.

I would now like to turn the program over to your host for today's conference, Blair Schorr from the GE Aerospace investor relations team. Please proceed.

Thanks, Liz. Welcome to GE Aerospace's twenty twenty five investor update and 2Q twenty five earnings call. I'm joined by Chairman and CEO, Larry Culp and CFO, Rahul Guy. Today, we will be sharing an update on our second quarter twenty twenty five results, financial guidance for 2025 and outlook for 2028, followed by a Q and A session. As usual, many of the statements we're making are forward looking and based on our view of the world and our businesses as we see them today.

As described in our SEC filings and website, those elements may change as the world changes. Additionally, Larry and Rahul will speak to total company and corporate financials as well as our guidance and outlook on a non GAAP basis. With that, I'll hand it over to Larry.

Thanks, Blair, and we appreciate everyone joining us today. The GE Aerospace team is guided by our purpose, to invent the future of flight, lift people up, and bring them home safely. At any given moment, nearly 1,000,000 people are flying with GE Aerospace technology under wing. That is a significant responsibility that our 53,000 employees carry with great pride. We use Flight Deck, our proprietary lean operating model, to continuously improve safety, quality, delivery, and cost always in that order as we strive to provide unrivaled customer service and deliver our roughly $175,000,000,000 backlog.

Before we dive in further, I want to acknowledge the tragedy of Air India flight one seven one. We extend our heartfelt sympathies to the families and loved ones of those who lost their lives. Since June 12, our focus has been and remains on supporting our customers and providing technical support to the regulators. While we were looking forward to a broader update with you in Paris, Rahul and I are here today to share our second quarter results and our increased outlook. We'll create additional opportunities later this year to share more of the operational details we expected to cover with you in Paris.

Turning to the next slide. Safety is and always will be foundational to everything we do. Through decades of experience, learning, and continuous improvement, we've built our reactive, proactive, and now predictive safety processes. GE Aerospace was the first manufacturer to have its safety management system or SMS accepted by the FAA. We established our SMS a decade before the agency proposed requiring it.

The system encourages our employees to report safety concerns voluntarily and ensures that they are thoroughly evaluated. SMS, together with our quality management system, are the foundation of our safety culture. While our approach to continuous improvement helps us drive safety up the value chain. Flight deck further standardizes our own processes to support safety investigations, leading to identifying corrective actions faster. We're also enhancing engine inspections to begin at the part level, extend through manufacturing, and continue into the aftermarket.

And now we're deploying AI enabled tools to further improve inspection accuracy and consistency, helping to predict potential safety threats. Everyone at GE Aerospace owns safety, and we never compete on safety. Turning to slide five. GE Aerospace is an exceptional franchise. As a global aerospace leader in propulsion, services, and systems, we're well positioned to benefit from favorable long term market trends across both commercial and defense.

Our commercial engines and services business or CES is servicing and growing the industry's most extensive commercial installed base. We're proud to be underway on three out of every four commercial flights, demonstrating our unmatched scale and scope across the world's most successful and innovative aircraft platforms. Our defense and propulsion technologies business or DPT powers two thirds of all US military combat and helicopter fleets. DPT offers both the leading defense programs of today while developing mission critical technology for the future. Let's take a closer look at GE Aerospace today.

As the industry's largest and growing engine fleet, our business model is highly resilient, largely due to our balanced exposure across narrow body, wide body, regional, and defense platforms. CES has more than 49,000 engines in service and growing. In 2024, we delivered a particularly strong year with $27,000,000,000 of revenue, growing 13%, with robust services demand and performance supporting higher profit. About half of our revenue comes from narrow body platforms, while wide body represents 35%. In DPT, we have more than 29,000 engines in service.

2024 was a solid year with nearly $10,000,000,000 in revenue, up 6%, and profit up double digits. Our defense and systems business accounts for roughly two thirds of DPT revenue, including over 70% of revenue from US customers and around 30% internationally. Propulsion and additive technologies represents the remaining third with exposure to commercial programs and localized European defense capabilities. Notably, 70% of our total revenue comes from recurring, predictable, and highly profitable services, including three quarters of CES revenue and more than half of DPT revenue. This represents a significant growth opportunity as our commercial installed base continues to grow at a low single to mid single digit compounded growth rate through the end of the decade.

Services also enable us to live the customer experience and strengthen our relationships, seeing and hearing their needs firsthand while shaping our product road maps to ensure alignment with their future priorities. Turning to slide seven. Given macroeconomic dynamics, we're watching demand near term. This quarter, departures grew nearly 4%, in line with our expectations. For 2025, we're still planning for low single digit departures growth, taking a more conservative view on the second half.

Broadly speaking, we support promoting free and fair trade, including the duty free environment that has long fueled The US aerospace sector, leading to more than 1,800,000 US jobs and a $75,000,000,000 annual trade surplus. We commend the administration for The US UK trade deal, eliminating tariffs on the aerospace sector and view this deal as a strong framework for future trade agreements. Longer term, GE Aerospace is operating from a position of strength. Our robust orders over the last several quarters have increased our commercial services backlog to now over $140,000,000,000, supporting growth for years to come. Across the commercial sector specifically, we see strong fundamentals.

Air traffic growth is expected to outpace global GDP, especially in Asia Pac and The Middle East. And new aircraft builds and airline expansions remain healthy, supporting the growth of our installed base. On the defense side, we see solid momentum globally toward modernization and localization. Domestically, we're pleased the reconciliation package includes funding for key defense propulsion initiatives with more than $1,000,000,000 for sixth generation aircraft programs. Internationally, we're expecting faster growth than in The US, largely in response to rising global tensions and the evolving geopolitical landscape.

Overall, we expect the market to grow at a mid single digit compounded growth rate through 2028, reaffirming our strong trajectory. Moving to slide eight. Our vision is clear, to be the company that defines flight for today, tomorrow, and in the future. For today, we're ramping up services and equipment to support our customers' fleets while fulfilling strong demand for new engines. For tomorrow, we're expanding capacity and capabilities to deliver on while growing our backlog.

This includes expanding our supply chain and service networks and investing in technologies to further enhance engine performance. And for the future, we're building the technological foundation that will define the future of flight across both commercial and defense. Flight deck is a systematic approach to running our company, translating strategy into outcomes while advancing our culture. Let me share here a few examples of FlightDeck in action to support our multiyear services and equipment ramp. Earlier this year, we launched a new technology and operations team to hardwire and accelerate the flight deck enhancements we made last year, often in partnership with our suppliers.

The team is providing greater stability and transparency to our demand signals and stronger collaboration to help identify and then break constraints. This helps our suppliers deliver today while investing to support the ramp in the future. We're also removing waste within our own operations with a focus on improving output and turnaround times. Take our largest MRO site in Selma, Brazil, which is responsible for a quarter of our global volume. Here, the CFM 56 fan module has been the key constraint to reaching our turnaround time target.

Our cross functional team used value stream mapping and implemented flow lines to reduce lead time by over 30%. Now CFM 56 turnaround time at Selma is below eighty days. Additionally, our recently deployed AI enabled blade inspection tool is improving inspection accuracy and consistency while reducing inspection time by roughly 50%. Improvements like this are driving turnaround times closer to ninety days for GE NX and CFM 56 in our larger shops. That said, we have more work to do on our other platforms.

And finally, we're expanding capacity with the LEAP installed base expected to roughly triple and GE NX to roughly double by 2030. We're growing our LEAP third party MRO network, which includes six premier partners. In this quarter, we saw significantly higher third party lead shop visits. Additionally, last year, we announced we'll invest more than $1,000,000,000 in our MRO and component repair facilities over the next five years. We've added Zeos in Poland in partnership with Glutanza Technique to our MRO network, which inducted its first leave engine earlier this year.

And we're investing more than $1,000,000,000 across our US factories and supply chain infrastructure to support growth. Overall, we expect to grow internal and external capacity by approximately 40% by the end of the decade. The impact of Flight Deck and our technology and operations team combined is delivering better operational outcomes with substantial momentum. In the second quarter, material input at our priority supplier sites was up 10% sequentially. Stability also continued to improve with suppliers delivering more than 95% of committed volume, up nearly twofold versus early last year.

This contributed significantly to second quarter output. CES services revenue was up nearly 30% year over year, supported by internal shop visit revenue up more than 20% and spare parts revenue up over 25%. Total engine deliveries were up 45% with commercial up 37, including LEAP up 38% and defense up 84%. And through the first half, we've delivered 12% growth in commercial units, including LEAP, up 10%, and 37% growth in defense deliveries. Overall, material input improvement has resulted in higher inventory as we accelerate output and grow LEAP deliveries 15 to 20% here in 2025.

But I do wanna pause here and just thank our teams and our suppliers who are working hand in hand to deliver for our customers, both near term and longer term. We move to slide 11. We've won some sizable deals so far in 2025. I'd like to highlight a few. Qatar Airways announced a significant expansion of their fleet with a deal for over 400 GE NX and GE nine X engines, marking the largest wide body win in GE Aerospace history.

IAG announced an agreement for 32 Boeing seven eighty seven aircraft powered by GE and X for British Airways. This further builds on upon our growing backlog for GE and X, and our life of program win rate now stands at 75%. And in defense, the US Air Force awarded a $5,000,000,000 contract for our f one ten engines to meet the evolving needs of allied operators. Today, we have more than 1,600 commercial and defense engines in backlog, and we're effectively sold out through the rest of this decade. Turning to slide 12.

GE Aerospace is a business with tremendous competitive advantages built on decades of experience and significant investment. With the world's largest installed base of engines, we've accumulated over 2,300,000,000 flight hours, providing us with unmatched insights on performance, opportunities for improvement, and future breakthroughs. Add to that r and d investment of approximately $3,000,000,000 in 2025 or six to 8% of revenue per year, we're well positioned to enhance our foundational and current generation platforms while inventing the future of flight. Here's a specific example, composite fan blades, a technology that only GE Aerospace and our partners have in service today. Compared to traditional metal blades, these lighter and stronger fan blades were first introduced on the GE 90.

Now with over 140,000,000 flight hours on more than 2,500 engines in service, these blades are helping us deliver industry leading departure reliability. Our experience with the GE 90 along with GE NX and LEAP has informed that GE nine x development with fourth generation composite fan blades. These blades contribute to the platform's overall performance with enhanced durability and fuel burn. And finally, we're designing composite fan blades for the CFM RISE program, combining thirty years of experience with continued investment to help deliver the next step change in durability and efficiency. More on that in a moment, but let me first share with you how our current generations of engines is ramping with customer needs in mind.

Looking at slide 13, durability and reliability are the top priorities to ensure consistent performance for our customers. Leveraging our experience over multiple product generations, we're maturing technologies to deliver meaningful durability gains. Take the GE NX, for example. We launched the platform back in 2011 and released our durability package back in 2021. This resulted in a more than two and a half times increase in time on wing, supporting increased utilization.

Today, the fleet leader hot and harsh environments is approaching 4,000 cycles and still running. This means customers are keeping engines on wing about five years between shop visits and even longer in neutral environments. This has been a differentiator for us in the marketplace, underpinning our 90% plus win rate since 2023. Through our hot and harsh experience here, we've refined durability testing to replicate dust challenges, innovate effective fixes, and validate them. And we're the only engine manufacturer able to leverage this extensive wide body experience for narrow body ends engines, which has accelerated the LEAP learning curve, getting to mature time on wing faster.

The LEAP one a durability kit released late last year that includes the upgraded HPT blade is now incorporated into all LEAP one a deliveries and shop visits. This will improve time on wing by more than twofold, matching our industry leading CFM 56 performance. Next up, we're working with Boeing to certify the LEAP one b durability kit in the first half of twenty twenty six. But we haven't stopped there. As we tested the upgraded HPT blade, our teams leveraging flight deck found further design improvements, which are already certified and set to enter production in the second half of twenty twenty five, further enhancing HPT blade producibility.

These durability enhancements have supported a win rate of over 70% on the eight three twenty family since 2023. Turning to slide 14. We're also using our experience to enhance new engine platforms before they enter service. Starting with the GE nine x, the most tested engine in GE Aerospace history with more than 30,000 cycles, the equivalent of six years of commercial flying. Drawing on our GE NX in LEAP experience, this is the first time we've completed dust testing prior to launch, which has informed product enhancements such as the second iteration of the HPT blades.

Importantly, we're ensuring that the GE nine x is as close to maturity as it can be at launch. We're also progressing the CFM RISE program, our most ambitious and transformative technological effort underway. To date, we've completed over 350 program tests with an early focus on durability. This includes advancing new HBT blade cooling technology and testing full size fan blades along with more than 3,000 endurance cycles. And earlier this year at the Airbus summit, we outlined our vision for the future of propulsion with open fan technology.

Airbus and CFM teams continue to work together on engine and airframe integration as we look forward to engine ground level and flight test this decade. Big picture, we're continuously applying learnings and improving durability to advance new programs, ensuring we deliver the best performing engines for our customers. Spending another moment on CFM Rise, which will be a game changer for customers, prioritizing safety, durability, and efficiency. Looking at the open fan architecture. First on safety.

Leveraging our experience with composite fan blades, the open fan will spin slower at one sixth the speed of a traditional jet engine. This helps provide a safe flying experience even without a nacelle, we also expect will result in a quieter engine than today's leap. Turning to durability. Ryze's open fan architecture gains efficiency through the fan system rather than the core. This reduces the need to push the core to higher temperatures as much as a ducted engine, a key driver of today's engine removals.

And finally, efficiency. Our customers need at least a 20% reduction in fuel burn to support investments in next generation technology. In our view, the open fan is the most promising path to accomplish this step change in efficiency. When it comes to delivering greater durability and fuel burn, we won't compromise on either as we recognize both are critical for our customers. With RISE, we believe we can accomplish the genius of the end, meeting customer needs for durability and delivering fuel efficiency.

Turning to slide 16. We're pursuing similar generational advancements in military propulsion. In The US, we completed testing on the XA 100 adaptive cycle engine, demonstrating significant gains in thrust and range. Building on that success, we're now progressing to the x a one zero two, aligned with the US Air Force's next generation adaptive propulsion or NGAP program. Importantly, earlier this month, congress funded $750,000,000 for the FA XX through the reconciliation bill in the coming years.

And the US Navy recognized its need for a sixth generation fighter as the only platform capable of delivering the combination of range, stealth, advanced sensors, and standoff capabilities necessary to operate across mission sets in highly contested environments. We stand ready to deliver and encourage the Pentagon to move forward with this important program that Congress has already funded. Through Avio Aero, we represent Italy as an equal propulsion partner with The UK and Japan in the global combat air program, a next gen indigenous European fighter. We're actively investing to support a targeted 2035 entry into service. And at the same time with Kratos, we're advancing propulsion technologies for affordable unmanned aerial systems by the end of the decade.

And to accelerate development of advanced hypersonic propulsion systems, we recently announced significant investments in our test infrastructure at select manufacturing sites, enabling us to conduct higher mach mission relevant testing. Inventing the future of flight has always motivated the GE Aerospace team. We're building upon our leadership positions across both defense and commercial. Shifting to the outlook on slide 17. Rahul will cover the second quarter results momentarily.

But so far in '25, we're off to an excellent start, enabling us to raise both our near and longer term outlook. For 2028, we're raising our outlook for profit and free cash flow by $1,500,000,000 versus our prior view, driven by strong operating and commercial services performance. We expect to sustain strong adjusted revenue growth at a double digit compounded rate, which will be supported by robust demand for services and equipment. We expect to drive meaningful operating leverage over that period with adjusted EPS reaching at roughly $8.40. Operating profit is expected to reach approximately 11 and a half billion dollars with margins expanding to more than 21%.

And we expect to generate substantial free cash flow of at least 8 and a half billion dollars with conversion around 100%. All in, this represents operating profit growth of more than $3,000,000,000 compared to our updated 25 guide driven by commercial services. We're well positioned for continued value creation for years to come. Let me pass it here over to Rahul.

Larry, thank you, and good morning, everyone. Starting with our results, we had a strong second quarter, with improvement across all key metrics. Orders were up 27%. Revenue was over $10,000,000,000 up 23%, with CES growing 30% and DPT up 7%. Profit was $2,300,000,000 up over 400,000,000 or 23%, driven by services volume and price, which supported margins reaching 23%.

EPS of $1.66 was up 38% from profit growth, a favorable tax rate, lower interest expense and a reduced share count. Free cash flow was $2,100,000,000 nearly doubling over last year. Looking closer at our businesses, CES delivered an excellent quarter with demand remaining robust. Orders for services were up 28% and equipment was up 26%. Continued demand, combined with material input improvement, drove meaningful revenue growth.

Service revenue was up 29%, with spare parts revenue up more than 25% from higher volume and price. This included strong CFM56 shop visit growth and higher late third party shop visits. Internal shop visit revenue grew more than 20% from higher output, increased work scopes and price. This included LEAP internal shop visit volume growth of over 20%. Equipment revenue grew 35%, with spare engine ratio down sequentially and year over year as expected.

Profit was $2,200,000,000 up 33%, primarily from services volume. CES margins expanded 50 basis points to 27.9%. Moving to DPT. Higher output supported a solid quarter. Orders were up 24% year over year, with defense book to bill of 1.2x.

Revenue grew 7%, with Defense and Systems up 6% and Propulsion and Additive Technologies up 9%. Profit was roughly $360,000,000 up 5% on a tough compare. Volume, productivity and price more than offset self funded next gen investments and inflation. Margins declined 20 basis points to 14.1%. At the midyear mark, we've delivered high teens revenue growth, dollars 1,000,000,000 of operating profit growth and nearly $800,000,000 of higher free cash flow.

Given the strength of our first half results and our expectations for remainder of the year, we are raising our 2025 guidance across the board. We now expect total revenue growth of mid teens, up from low double digits. With the absence of reciprocal tariffs in China thus far, we currently see reduced risk for spare engines and spare part deliveries. And material availability is improving, supporting higher spare parts growth. Therefore, we are increasing revenue growth expectations for commercial services to high teens and commercial equipment to high teens to 20%.

This supports total CES revenue growth of high teens. Our DPT expectations are unchanged from mid- to high single digit revenue growth. For total operating profit, we now expect to be in a range of 8,200,000,000.0 to $8,500,000,000 up $350,000,000 at the midpoint versus our April guide from improved services outlook. And we now expect adjusted EPS of $5.6 to $5.8 growing over 20% at the midpoint year over year, reflecting higher operating profit and a reduced tax rate. Additionally, as we shared in April, heightened tariffs are resulting in additional costs for us and our supply chain.

We are continuing to make progress on our operational plans to reduce the impact. Assuming that reciprocal tariffs are implemented after the current pause, we still expect the net impact of tariffs to be roughly $500,000,000 in 2025, which we are offsetting through cost controls and pricing actions. We now expect free cash flow to be in a range of 6,500,000,000 to $6,900,000,000 up from $6,300,000,000 to $6,800,000,000 driven by our improved profit outlook. With this raise, we expect to grow operating profit by over $1,000,000,000 for second year in a row, with free cash flow conversion remaining solidly above 100%. Now as we look at the longer term outlook on slide 20, win rates continue to be strong.

Backlog is at record levels. We are making operational progress to improve durability and delivery, and defense spending remains resilient. With this backdrop, we are expecting that the improvement in 2025 guidance will carry through to our 2028 outlook. Starting with revenue. We now expect double digit growth on an annualized basis between 2428%.

The main drivers will be growth in commercial installed base, largely from LEAP and GE and X an increase in work scopes as our fleets mature, supporting 25% growth in widebody revenue per shop visit favorable mix in defense with rising international defense shipments mid single digit growth or low single digit net price increases higher revenue will support double digit profit growth, with profit reaching approximately $11,500,000,000 in 2028. This growth, plus benefits from share buyback and a lower tax rate, will drive mid teens EPS growth. And we expect to convert 100% of net income to free cash flow, reaching roughly $8,500,000,000 of cash by 2028. Our updated outlook from profit and free cash flow both represent a raise of $1,500,000,000 versus our prior outlook. On slide 21, looking closer at our profit growth drivers between '25 and '28.

Starting on the left at our new '25 profit midpoint of $8,350,000,000 The most significant driver of profit growth will be nearly $8,000,000,000 of Commercial Services revenue growth between 2528%. This will be partially offset by a mid teens increase in equipment revenue, including higher LEAP and GE9X shipments, and the normalization of spare engine ratio. We expect incremental GE9X losses of a few $100,000,000 in 2028 versus 2025, given higher volume. DPT revenue growth of mid single digits at improving margins will also contribute to profit growth. Given ongoing supply chain constraints, we expect material inflation to stay elevated, but pricing actions should more than offset that impact.

And we are leveraging Flight Deck to drive two points of productivity annually, as we reduce waste by lowering the nonproductive and overtime in our shops and increase output per employee. At the same time, we are stepping up R and D investments to improve LEAP durability, support the GE9X ramp and advance technologies supporting the future of flight. Overall, these actions will add more than $3,000,000,000 of profit between '25 and '28. And despite the introduction of a new wide body platform and significant new product ramps, double digit annualized growth in services will support margin expansion. So let's unpack Commercial Services revenue in Slide '22.

As you can see, both narrowbody and widebody are well positioned to deliver sustainable growth. Today, CFM engines power approximately 75% of industry's narrowbody flights. This share continues to increase, as our LEAP fleet is expected to grow roughly 3x by 02/1930. Narrowbody revenue is exceeding our prior expectations, driven by LEAP growth and the extended longevity of CFM56 fleet. As a result, we now expect narrowbody revenue to grow at a low double digit CAGR and 28 revenue to be approximately 15% higher than our expectations last March.

Our widebody business remains a significant differentiator. We currently power more than half of industry's departures. We expect to maintain this position with GE9X I apologize, GE9X doubling its installed base by the end of the decade and continued utilization of GE90 fleet and the introduction of GE9X. We anticipate widebody services revenue will grow at high single digit CAGR through 02/1930, including GE NX at a low double digit CAGR. Taken together, the strength of our foundational suites, combined with our installed base growth, supports the annualized double digit services revenue growth.

Moving to Slide 23. On Commercial Services revenue growth and how that will translate into significant profit improvement. Narrowbody profit is expected to rise over 70%, primarily from LEAP, with CFM56 continuing to contribute meaningfully. And by the end of the decade, we expect LEAP and CFM56 profit to reach parity, reflecting the maturity and the scale of the LEAP program. Widebody profit is expected to grow more than 40%, supported by installed base growth and higher work scope shop visits for both GE90 and GEnx.

We also expect contributions from productivity, pricing and favorable mix as external shop visits increase. And even with LEAP shop visit volume growing at a 25% CAGR through 02/1930, we expect CES margins to stay at current levels as we are offsetting the impact of LEAP with better performance on other platforms. Altogether, we expect Services profit to grow over 50% between twenty four percent and twenty eight percent, with contributions from both foundational and current generation programs. Going deeper into the outlook for our foundational fleets on Slide 24. Currently, approximately 40% of CFM56 fleet has yet to undergo a first shop visit, and a majority of the operators anticipate keeping these engines in service well into 2030s.

This sustained demand is resulting in fewer retirements. We expect retirements of around 1.5% in 2025, rising to 2% to 3% in 2026 before normalizing at 3% to 4% increased shop visit activity, which we expect to peak in 2027, with approximately 600 additional shop visits through 2028 compared to our outlook last March. And we expect a gradual decline in volume post 2027 to roughly 2,000 shop visits by the end of the decade. With this shop visit outlook, we expect CSM 56 revenue peaks in '28, underpinned by increased work scopes and pricing. We are seeing similar dynamics with GE90.

Continued strong demand for freighter aircraft, coupled with a more gradual wide body production ramp, is extending the services demand across this fleet. We now expect internal shop visits for GE90 to grow to 28, representing approximately 100 incremental visits compared to our outlook last March. And as a reminder, wide body shop visits can be more than 2x the revenue of a narrow body shop visit, so this is a significant contributor to higher revenue. In addition, the scope for wide body shop visits typically increases by about 50% during the second shop visits. With approximately 70% of GE90 fleet yet to undergo a second shop visit, this dynamic is contributing to higher growth.

Better performance from both CFM56 and GE90 is a key driver of our improved outlook compared to last March. Another significant contributor to our profit outlook is the growing LEAP aftermarket on Slide 25. Overall, the LEAP installed base will approximately triple by the end of the decade, with internal shop visits growing roughly at the same pace. Beyond revenue, we are focused on improving the profitability of services as the program matures. Touching on a couple of ways we are improving performance.

First, we expect external shop visits to grow from 10% of the total in 2024 to fifteen percent in 2025 to 30% by the end of the decade. This increased volume drives spare parts sales and offers a mix benefit. Second, we expect to continue benefiting from catalog price increases. More importantly, we've significantly improved pricing in new service contracts as we move past launch. While these increases take time to materialize in the financials, higher shop visit pricing, combined with improved time on Wing, will support improved services profitability.

We continue to expect approximately 70% of LEAP shop visits to be performed by CFM, split equally between our JV partner Safran and us. To further reduce shop visit cost, we are investing in repair technology, which typically costs roughly 50% less than new parts. This offers customer significant economic benefit while also reducing turnaround time as we do not have to wait for new material. Year to date, we have developed over 200 new repairs for LEAP and 1,000 repairs across the commercial engines business. Our goal is to more than double the number of LEAP specific repairs by 28.

For context, we've developed nearly 3,000 repairs over the lifetime of the GE90 program, and we are targeting a similar number for LEAP at maturity. These actions give us confidence that we can navigate the impact from CFM56 retirement and that LEAP will not only equal CFM56 profit by the end of the decade, but the profitability levels will continue to improve beyond that. Now let's turn to how we plan to continue converting this profit growth into cash. We added approximately $3,000,000,000 of inventory between 2023 and 2024. And as a result, our inventory turns declined by about zero five point.

The majority of this increase is due to trapped inventory. Material we purchased but can't yet use because we don't have all the parts needed to complete a shop visit or deliver an engine. As material availability and stability improve, we expect inventory turns to begin recovering. We see a clear opportunity to improve at least one full turn from '24 to '28. We'll get there by reducing work in progress and raw material inventory, driven by better flow and continued implementation of our pool based system with our suppliers.

If you look to the right hand side of the page, you will see a growing installed base and increasing flight departures are fueling strong growth in billings. Take LEAP for example. Billings are expected to grow 2.5x between '24 and '28. For GE and X, we expect 1.5x increase over the same period. Given shop visit growth, the cash flow from contract assets will not contribute at the same levels as the last couple of years, but billings growth on these contracts continues to support cash flow growth.

This gives us a clear road map to sustain cash conversion at or above 100% through 2028. To summarize, GE Aerospace is a business with solid operational and financial fundamentals. Revenue growth will be driven by positive secular trends, our growing installed base and our best in class products, technology and people. Profit growth will be driven by volume, productivity and price, offsetting the typical headwinds associated with new product introductions. Given this strong profit and cash performance, we have ample opportunity to compound shareholder returns.

I'll now pass it back to Larry to cover capital allocation and share some closing remarks. Larry?

Rahul, thank you. Pulling this all together on Slide 27, as Rahul just walked you through, our operating performance and robust commercial services outlook underpins our increased guidance of sustainable revenue, earnings, and cash flow growth. 2024 was a strong year with approximately a billion dollars more in operating profit than we had originally expected at the start of the year. In 2025, we're again performing ahead of our expectations and raising guidance across all key metrics. Compared to our 2024 Investor Day outlook, this represents an increase of more than a billion dollars in operating profit.

Importantly, we expect this momentum extends into 2028 with operating profit growing more than $3,000,000,000 and free cash flow growing over a billion and a half dollars versus '25. We're also leveraging our strong balance sheet and free cash flow generation to support mid teens EPS growth. With respect to capital allocation, our principles remain the same. First, we will invest in the business to support growth in current and future programs. Next, we have a bias toward returning cash to shareholders and expect we'll return more than 100% of free cash flow to shareholders through 2026.

Last year, we shared plans to return roughly 19,000,000,000 of cash to shareholders between '24 and '26 between dividends and buybacks. Now subject to board approval, we're increasing that to $24,000,000,000, including about $19,000,000,000 of buybacks and roughly $5,000,000,000 of dividends at roughly 30% of net income. This is 20% higher than what we discussed a year ago. Beyond 2026, we expect to return at least 70% of free cash flow annually through a combination of dividends and buybacks. Finally, we're open to opportunistic bolt on m and a with a high threshold for strategic, operational, and financial fit.

We believe this balanced and disciplined approach best supports our goal of compounding long term shareholder returns. And to close, on slide 29, our strong operational and financial foundation supports our increased outlook, and our sustained competitive advantages will propel us to new heights. We have a diversified fleet of preferred platforms across the narrow body, wide body, and defense sectors. What we do and how we do it matter. Front and center are safety, quality, delivery, and cost always in that order.

Our services and technology offer industry leading operational reliability, including greater efficiency, extended time on wing, and faster turnaround times. We serve the industry's largest fleet of 78,000 engines with unrivaled customer service and flight support. This keeps us close to our customers through decade long life cycles, building meaningful relationships, and making us the partner of choice. Our talented engineering teams continue to develop breakthrough innovation to support our existing fleet and advance next generation technology. And finally, Flight Deck supports us in delivering results and lasting value for our customers and shareholders.

So we're still far from reaching our full potential, yet we couldn't be more optimistic about our path ahead. We appreciate you joining us for this extended call on both the quarter and our revised outlook. So with that, I'll throw it back to Blair for questions.

Before we open the line, I'd ask everyone in the queue to consider your fellow analysts and ask one question so that we can get to as many people as possible. Liz, can you please open the line?

Our first question comes from Scott Deuschle with Deutsche Bank.

Rahul, the high end of the 2025 guide implies second half EBIT nearly $500,000,000 lower than the first half. But over the last few years, the second half EBIT has actually been trending around $400,000,000 higher than the first half. So your guide essentially has nearly $1,000,000,000 spread versus the seasonality you've demonstrated over the last few years. I understand there's this GE9X headwind this year, but it is a very stark difference versus typical earnings cadence. So just wondering if you can reconcile that second half EBIT decline for us. Yes.

Scott, let me try and Larry please jump in here. So Scott, first, we're having a good year, right? Raised our revenue growth expectations from low double digit to mid teens. So about $900,000,000 of increase in revenue at the midpoint with about $350,000,000 of profit increase at the midpoint versus April. So we had a better second quarter than we expected.

But if you look at the $350,000,000 split $350,000,000 profit increase, it is split between what our overperformance in the second quarter and raising our expectations for the second half of the year. So the first half, second half thing, we've been we expected a strong start to the year this year. And we've been striving to have a more linear year than we did in 2024 just given the OE ramp in second half of the year, including 9x shipments that we expected a couple of million dollars of headwind versus the prior year and also expected a lower spare engine ratio in the second half. And then the corporate expenses also typically step up in the second half of the year, and you can see that in the corporate expenses in the first half versus what we are projecting for the full year. And then there's an R and D step up between the first half and second half as well.

And these expectations around all these factors have not changed from where we were back in April. But also, we are maintaining some conservatism that's around departures that Larry mentioned in his prepared remarks, which impacts our expectations for spare parts sales in the second half. And even with that, we're kind of expecting a mid teen services revenue growth in second half. But if you look at all of that, we should still see strong year over year profit growth in the second half at the midpoint of the guide. And overall, we feel better about the year than we did back in April.

And if you step back, it should be another year of more than $1,000,000,000 of profit growth and, you know, billion 5,000,000,000.25 at the at the high end. So

The next question comes from Myles Walton with Wolfe Research.

I wanted to touch on two assumptions, if I could.

One is the pricing assumption through twenty twenty eight twenty twenty four to 2028 and the low single digit assumption there, what would that imply for the go forward period '26 through '28? Would seem like it would imply no pricing. And then on the retirement step up to 3% to 4%, can you just give us some baseline as to, you know, for the last decade, the CFM 56 has been running about one and a half percent. Is there a prior period where you'd put this as similar where you'd have that quicker step up in retirement rates?

Miles, maybe I'll speak to price, and, Rahul can take retirements. Yeah. I think if you just step back for a moment, I think you you know well our our pricing philosophy. We, we make significant investments in in next generation platforms. Obviously, provide a lot of value to our customers while taking on considerable risk.

So we we really try to price more more broadly with, appropriate returns, around those, those commitments in in mind. I think the way we've looked at price here is really to to have price more than offset inflation in '25 between what we're doing in in CES services, you know, call it, up at a mid single digit level on a, on a net basis. That includes spare parts, right, where in some instances, we might, do a little bit better than that. It's really dependent on on on which program we're talking about. But I think as we look forward, we're probably looking at something on a mid single digit basis at a gross level, low single digit on a on a net basis, at least with respect to to to spare parts.

But also keep in mind that as as we move past launch, I think Rahul touched on this in his prepared remarks, we anticipate to see better better pricing dynamics. And fundamentally, it's all about moving beyond launch. Right? LEAP is is well into the life cycle now. But it does take time to, to see that, fall through typically, call it eight years, thereabouts, post an agreement to really see that in the p and l.

So a lot of volume here, work scope, expansion in a in a number of areas, a little bit of price. That's how you get to that that double digit top line number that we're looking at between, between now and '28. Yeah. Rahul, did you wanna talk to retirements?

Yeah. I can talk retirement. So so, Miles, you're right. I mean, the the last couple of years have been really low. I mean, even this year, through the first six months of the year, retirements for CFM 56 have been running below where we were in '24.

And if I remember correctly, '24 was below '23. So the retirements have been trending extremely low. But as you would expect that, hey, as the fleet ages, this should pick up. Right? And that's been our expectation.

And now we've been, you know, proven wrong on that one before. But if you ultimately, what it comes down to is what do you expect in new aircraft deliveries and where you expect departure growth to be. So what's built into our assumptions is that both Airbus and Boeing kind of reach their stated goals over the next couple of years, you know, three to four years. And as those and if you, you know, add up what what Airbus aims to deliver and you add up what Boeing, know, aims to deliver, that leads to about a six to 7% increase in, you know, installed base growth, right, over where, you know, 19 to 20,000 narrow body aircraft that are flying today. And then you say, okay.

The departures, we expect the departures to be up, call it, 3% or so, you know, low single digits, and you can say three to 4%. So that gets us to our ratio of three to 4%, somewhere in that zone. Now we don't have a precise insight into that number, but I think we we decided, Miles, so that everybody understands our fundamental assumptions going into what we are projecting for CFM56 shop visits because that's the fundamental driver of where the shop visits are going to be and and and the number that we'll see. So that's that's making sense.

The next question comes from Sheila Kahyaoglu with Jefferies.

Good morning, guys. Thank you. Maybe if we Good could talk about LEAP aftermarket profitability. It's been a major contributor to CES performance year to date. Can you talk about you talked about profits equal in the 2030 time frame, which based on the revenue buckets you give would mean margins pretty close to CFM56 levels.

So if you could talk a bit about the margin profile across CSAs and external for LEAP and how that progresses today to 28 to twenty thirty.

Yeah. So, Shul, we have you know, overall, we are very pleased with how LEAP is progressing. Right? If you you know, we we're kind of hitting our key milestones here for for LEAP, both on financial performance and operational performance. And and the share has been higher than what we expected.

GE Aerospace (GE) Q2 2025 Earnings Call Transcript

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