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GE Aerospace Raises Profit Forecasts Amid Tariff Concerns

GE Aerospace Raises Profit Forecasts Amid Tariff Concerns
Strong Financial Performance Drives Upward Revision
GE Aerospace has revised its profit forecasts upward for 2025 and beyond, buoyed by a robust operational and financial performance in the second quarter. The company’s improved outlook comes despite growing concerns over global tariffs that threaten to disrupt the aviation sector. Central to this optimism is the sustained demand for aftermarket maintenance services and a significant increase in engine deliveries, as GE continues to address ongoing supply chain challenges.
During the company’s second-quarter earnings call on July 17, GE CEO Lawrence Culp highlighted the strength of the commercial services segment as a key factor underpinning the revised guidance. “Our operating performance and robust commercial services outlook underpins our increased guidance,” Culp stated, adding that the company expects this momentum to continue through 2028.
GE reported a net profit of $2.0 billion for the quarter, a substantial rise from $1.3 billion in the same period last year. Revenue surged 21 percent year-on-year to reach $11 billion, driven predominantly by the commercial engines division, which generated $8 billion—a 30 percent increase. The defense segment also contributed to growth, with revenues climbing 7 percent to $2.6 billion.
Chief Financial Officer Rahul Ghai emphasized the company’s strong performance across all key metrics, noting that the 2025 guidance has been raised across the board. GE’s order backlog has reached a record $175 billion, up from $140 billion at the end of the first quarter. In the most recent quarter alone, the company secured orders for 1,049 aircraft engines, including 860 CFM International Leap engines, which power popular models such as the Airbus A320neo family and Boeing 737 Max.
Revised Outlook and Tariff Challenges
Reflecting the sustained business momentum, GE now anticipates an operating profit between $8.2 billion and $8.5 billion in 2025, up from the previous estimate of $7.8 billion to $8.2 billion. The company also projects adjusted revenue growth in the mid-teens percentage range year-on-year, a notable increase from its earlier forecast of low double-digit growth. Looking further ahead, GE expects operating profits to reach $11.5 billion by 2028, surpassing the prior estimate of $10 billion. Additionally, the company forecasts that annual revenues from its commercial engine services business will double to $20 billion by 2030, compared to $10 billion in 2024.
Despite this positive trajectory, GE faces significant headwinds from newly imposed global tariffs, which the company estimates will cost approximately $500 million in 2025. These tariffs introduce considerable policy uncertainty and pose a risk to the U.S. aviation industry’s $1 trillion economic footprint by potentially altering trade flows. Competitors in the industry may respond by reevaluating their vendor networks and seeking alternative suppliers in countries less affected by tariffs, which could reshape parts sourcing and aircraft acquisition strategies.
In response, GE is actively working to mitigate the impact of these tariffs through stringent cost controls and pricing adjustments, according to CFO Rahul Ghai. While these challenges persist, GE Aerospace’s strong order book and growing demand for both new engines and aftermarket services position the company for continued growth in the years ahead.

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