StandardAero (SARO) Q4 2025 earnings summary

Executive summary

• Achieved record results in 2025, with revenue up 16% year-over-year and Adjusted EBITDA up 17%, driven by robust commercial aerospace demand and strong performance across all segments.

• Net income surged to $277 million, a 2,000% increase year-over-year, supported by operating leverage, improved mix, and productivity gains.

• Free Cash Flow reached $209 million for 2025, with over $300 million generated in the second half, despite significant growth investments.

• Strategic investments in growth platforms, including LEAP and CF34 engine programs, and successful integration of acquisitions supported results.

• Balance sheet strengthened with leverage ratio reduced to 2.4x, providing flexibility for future investments and share repurchases.

Financial highlights

• Full year 2025 revenue grew 15.8% to $6.06 billion; Q4 revenue was $1.6 billion, up 13.5% year-over-year, all organic.

• Adjusted EBITDA for 2025 was $808 million, up 17% year-over-year, with margin expanding to 13.3%.

• Net income for 2025 was $277 million, a $266 million increase year-over-year.

• Adjusted EPS for 2025 was $1.19; Free Cash Flow conversion was 75% of net income.

• Authorized a $450 million share repurchase program in December 2025.

Outlook and guidance

• 2026 revenue guidance: $6.275–$6.425 billion, reflecting 4%–6% growth including pass-through revenue elimination.

• Adjusted EBITDA guidance for 2026: $870–$905 million, up ~10% year-over-year; Adjusted EPS guidance: $1.35–$1.45, implying up to 22% growth.

• Free Cash Flow expected at $270–$300 million, or over 30% growth at the midpoint.

• Commercial aerospace revenue projected to grow low double-digit to mid-teens year-over-year; military and business aviation high single-digit growth.

• Strategic focus on organic growth, M&A, and share repurchases.