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GE Aerospace (GE) delivered a robust Q4 performance that exceeded analyst expectations on both the top and bottom lines, yet the stock is selling off sharply following the earnings release. The company issued FY26 adjusted EPS guidance of $7.10 to $7.40, which stands above consensus estimates at the midpoint, but shares remain under pressure as investors weigh the outlook against a significant 70% yr/yr run-up.

• Total Q4 orders surged 74% yr/yr to $27.0 bln, reflecting continued robust demand for both services and equipment.
• Revenue increased 20% yr,/yr driven by double-digit growth in both segments, while adjusted EPS rose 19% to $1.57.
• Commercial Engines & Services (CES) revenue grew 24% in Q4, fueled by a 31% jump in services revenue as improved material availability supported higher spare parts sales and internal shop visit volumes. CES segment profit rose 5% to $2.3 bln.
• Defense & Propulsion Technologies (DPT) orders increased 61% in Q4, while revenue grew 13% due to higher deliveries and favorable price/mix.
• The company’s total backlog reached a staggering $190 billion, an increase of nearly $20 bln over the prior year.
• For FY26, GE expects low-double-digit revenue growth and free cash flow between $8.0-$8.4 bln.

Briefing.com Analyst Insight:

GE delivered what would typically be considered an impressive "beat and raise" report, but the stock’s sharp decline suggests a "sell-the-news" reaction. With shares trading near record highs and up nearly 70% year-over-year heading into the print, the market appears to be taking profits. While the 2026 EPS guidance was strong, the outlook for low-double-digit revenue growth merely matched expectations, which may be providing a touch of disappointment. Furthermore, lingering concerns regarding supply chain constraints persist; the company added approximately $2 bln in inventory in 2025 to support future output, highlighting the ongoing challenge of turning its massive $190 bln backlog into revenue. It remains to be seen if GE can accelerate output fast enough to justify its premium valuation amidst these global supply hurdles.