General Electric · Earnings release

GE AEROSPACE ANNOUNCES FOURTH QUARTER 2024 RESULTS

Strong fourth quarter, expects another year of substantial growth in 2025

•Total revenue (GAAP) of $10.8B, +14%; adjusted revenue* $9.9B, +16%

•Profit (GAAP) of $2.3B, +37%; operating profit* $2.0B, +49%

•Profit margin (GAAP) of 21.2%, +350 bps; operating profit margin* 20.1%, +450 bps

•Cash from Operating Activities (GAAP) of $1.3B, +5%; free cash flow* $1.5B, +21%

•Total revenue (GAAP) of $38.7B, +9%; adjusted revenue* $35.1B, +10%

•Profit (GAAP) of $7.6B, (27)%; operating profit* $7.3B, +30%

•Profit margin (GAAP) of 19.7%, (980) bps; operating profit margin* 20.7%, +330 bps

•Cash from Operating Activities (GAAP) of $5.8B, +26%; free cash flow* $6.1B, +28%

CINCINNATI — January 23, 2025 — GE Aerospace (NYSE:GE) announced results today for the fourth quarter and full year ending December 31, 2024.

GE Aerospace Chairman and CEO H. Lawrence Culp, Jr. said, “GE Aerospace delivered a strong finish to 2024 given robust demand for our services and products with fourth quarter orders up 46%, EPS more than doubling, and free cash flow increasing over 20%. Our performance capped off a monumental first year as a standalone company with $1.7 billion of profit growth and $1.3 billion of free cash flow growth.”

Culp continued, "Looking to 2025, we expect double-digit revenue and EPS growth with greater than 100% free cash flow conversion. Guided by FLIGHT DECK, our proprietary lean operating model, I'm confident in our ability to accelerate output and deliver for our customers."

GE Aerospace's key highlights included:

•In the quarter, received certification from the FAA and EASA for the upgraded LEAP 1-A high-pressure turbine (HPT) durability kit, which combined with the three prior durability enhancements, is designed to increase time on wing to achieve parity with CFM56.

•Drove progress throughout 2024 using FLIGHT DECK to address supply chain constraints, enabling a 26% increase in material inputs across priority supplier sites from the first half to second half of 2024. This supported CES services revenue growth of 17% and total engine unit growth of 18% from the first half to the second half.

•In January 2025, integrated engineering and supply chain teams, into one organization called Technology & Operations, led by Mohamed Ali. With shared accountability across the full value chain, this cross-functional team will enable faster problem solving to increase deliveries.

•In the quarter, confirmed narrowbody commitment with EL AL Israel Airlines for 20 LEAP 1-B engines, announced widebody order from Royal Jordanian Airlines for 18 GEnx-1B engines and received orders under a contract with the U.S. Army valued up to $1.1 billion for the continued production of T700 engines through 2029.

•With a continued focus on inventing the future of flight, in November, announced plans with Boeing, NASA, and Oak Ridge National Laboratory, to model the integration of an Open Fan engine design on an aircraft wing and successfully demonstrated a hybrid electric propulsion system rated at one megawatt with the U.S. Army.

•Returned more than $6 billion to shareholders in 2024, and today, announced share repurchase plans of $7 billion in 2025, while increasing the dividend by 30%, subject to Board approval.

* Non-GAAP Financial Measure

1

Total Company Results

Three Months Ended December 31

Twelve months ended December 31

Dollars in millions; per-share amounts in dollars, diluted

Year on Year

Year on Year

GAAP Metrics

Total Revenue

%

9

%

Profit

%

%

Profit Margin

%

%

%

%

Continuing EPS

%

%

Cash from Operating Activities (CFOA)

5

%

%

Non-GAAP Metrics

Adjusted Revenue

%

%

Operating Profit

%

%

Operating Profit Margin

%

%

%

%

Adjusted EPS

%

%

Free Cash Flow (FCF)

%

%

GE Aerospace Full Year 2025 Guidance

For 2025, GE Aerospace is initiating the following total company and business specific guidance:

Adjusted Revenue* Growth

Adjusted Revenue*

LDD

Operating Profit*

Operating profit margin*

G1Adjusted EPS*

Free Cash Flow*

FCF* conversion-a)

•Commercial Engines & Services (CES): Expect revenue growth in the mid-teens, driven by services growth of low-double-digits to mid-teens, and equipment growth of high-teens. G2Expect operating profit at $7.6-$7.9 billion.

•Defense & Propulsion Technologies (DPT): Expect revenue growth in the mid- to high-single-digit range, and G3operating profit of $1.1-$1.3 billion.

•Corporate: G4Expect costs to be less than $1 billion.

* Non-GAAP Financial Measure

(a – FCF* conversion: FCF* / adjusted earnings*

2

Results by Reporting Segment

The following discussions and variance explanations are intended to reflect management’s view of the relevant comparisons of financial results.

Commercial Engines & Services

Three months ended December 31

Twelve months ended December 31

(Dollars in millions)

Year on Year

Year on Year

Orders

%

%

Revenue

%

%

Operating profit/(loss)

%

%

Operating profit/(loss) margin

%

%

bps

%

%

bps

For the quarter, orders of $12.9 billion increased 50%, with growth in both services and equipment. Revenue of $7.7 billion was up 19% with services growing 12% driven by expanded shop visit workscope, higher spare parts, and price. Equipment revenue grew 38%, as engine and customer mix, in addition to price, more than offset lower units. Profit of $2.2 billion was up 44%, from spare parts volume, increased shop visit workscope, mix, and price more than offsetting inflation and investments. Margins expanded 490 basis points.

For the year, Commercial Engines & Services orders were up 38%, revenue increased 13%, and profit grew 25%, while margins expanded 250 basis points.

Defense & Propulsion Technologies

Three months ended December 31

Twelve months ended December 31

(Dollars in millions)

Year on Year

Year on Year

Orders

%

%

Revenue

4

%

6

%

Operating profit/(loss)

2

%

%

Operating profit/(loss) margin

%

%

bps

%

%

bps

For the quarter, orders of $2.8 billion were up 22%, primarily driven by Defense & Systems. Revenue of $2.5 billion grew 4%, led by Defense & Systems, which was up 6% from higher Defense deliveries and price, partially offset by lower services. Propulsion & Additive Technologies revenue grew 2%. Profit of $241 million was up 2% as price and productivity were partially offset by next-generation engine investments and inflation. Margins were down (20) basis points.

For the year, Defense & Propulsion Technologies orders were up 10%, revenue increased 6%, and profit grew 17%, while margins expanded 110 basis points.

* Non-GAAP Financial Measure

3

STATEMENT OF EARNINGS (LOSS)

Three Months Ended December 31

Twelve months ended December 31

(In millions; per-share amounts in dollars)

Sales of equipment

$

$

$

$

Sales of services

Insurance revenue

Total revenue

Cost of equipment sold

Cost of services sold

Selling, general and administrative expenses

Separation costs

Research and development

Interest and other financial charges

Insurance losses, annuity benefits and other costs

Goodwill impairments

—

—

—

Non-operating benefit cost (income)

Total costs and expenses

Other income (loss)

Earnings (loss) from continuing operations before income taxes

Benefit (provision) for income taxes

Earnings (loss) from continuing operations

Earnings (loss) from discontinued operations, net of taxes

(6)

(3)

Net earnings (loss)

Less net earnings (loss) attributable to noncontrolling interests

(8)

—

Net earnings (loss) attributable to the Company

Preferred stock dividends and other

—

—

—

Net earnings (loss) attributable to common shareholders

$

$

$

$

Amounts attributable to common shareholders

Earnings (loss) from continuing operations

$

$

$

$

Less net earnings (loss) attributable to noncontrolling interests,

continuing operations

(8)

(9)

(1)

Earnings (loss) from continuing operations attributable to the Company

Preferred stock dividends and other

—

—

—

Earnings (loss) from continuing operations attributable

to common shareholders

Earnings (loss) from discontinued operations attributable

to common shareholders

(6)

Net earnings (loss) attributable to common shareholders

$

$

$

$

Earnings (loss) per share from continuing operations

Diluted earnings (loss) per share

$

$

$

$

Basic earnings (loss) per share

$

$

$

$

Net earnings (loss) per share

Diluted earnings (loss) per share

$

$

$

$

Basic earnings (loss) per share

$

$

$

$

Amounts may not add due to rounding

* Non-GAAP Financial Measure

4

STATEMENT OF FINANCIAL POSITION

(In millions)

Cash, cash equivalents and restricted cash

$

$

Investment securities

Current receivables

Inventories, including deferred inventory costs

Current contract assets

All other current assets

Assets of businesses held for sale

—

Current assets

Investment securities

Property, plant and equipment – net

Goodwill

Other intangible assets – net

Contract and other deferred assets

All other assets

Deferred income taxes

Assets of discontinued operations

Total assets

$

$

Short-term borrowings

$

$

Accounts payable

Progress collections

Contract liabilities and deferred income

Sales discounts and allowances

All other current liabilities

Liabilities of businesses held for sale

—

Current liabilities

Deferred income

Long-term borrowings

Insurance liabilities and annuity benefits

Non-current compensation and benefits

All other liabilities

Liabilities of discontinued operations

Total liabilities

Accumulated other comprehensive income (loss) – net attributable to the Company

Other capital

Retained earnings

Less common stock held in treasury

Total shareholders’ equity

Noncontrolling interests

Total equity

Total liabilities and equity

$

$

* Non-GAAP Financial Measure

5

Financial Measures That Supplement GAAP

We believe that presenting non-GAAP financial measures provides management and investors useful measures to evaluate performance and trends of the total company and its businesses. This includes adjustments in recent periods to GAAP financial measures to increase period-to-period comparability following actions to strengthen our overall financial position and how we manage our business.

In addition, management recognizes that certain non-GAAP terms may be interpreted differently by other companies under different circumstances. In various sections of this report we have made reference to the following non-GAAP financial measures in describing our (1) revenue, specifically Adjusted revenue, (2) profit, specifically Operating profit and Operating profit margin; Adjusted earnings (loss) and Adjusted earnings (loss) per share (EPS), (3) cash flows, specifically free cash flow (FCF), and (4) guidance, specifically 2025 Operating profit, 2025 Adjusted EPS and 2025 FCF.

The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures follow. Certain columns, rows or percentages within these reconciliations may not add or recalculate due to the use of rounded numbers. Totals and percentages presented are calculated from the underlying numbers in millions.

ADJUSTED REVENUE, OPERATING PROFIT AND PROFIT MARGIN (NON-GAAP)

Three months ended December 31

Twelve months ended December 31

(Dollars in millions)

V%

V%

Total revenue (GAAP)

$

$

%

$

$

9

%

Less: Insurance revenue

Adjusted revenue (Non-GAAP)

$

$

%

$

$

%

Total costs and expenses (GAAP)

$

$

1

%

$

$

5

%

Less: Insurance cost and expenses

Less: U.S. tax equity cost and expenses

5

—

—

Less: interest and other financial charges

Less: non-operating benefit cost (income)

Less: restructuring & other

—

Less: goodwill impairments

—

—

—

Less: separation costs

Add: noncontrolling interests

(8)

(9)

(1)

Adjusted costs (Non-GAAP)

$

$

9

%

$

$

6

%

Other income (loss) (GAAP)

$

$

%

$

$

%

Less: U.S. tax equity

Less: gains (losses) on retained and sold ownership interests and other equity securities

Less: gains (losses) on purchases and sales of business interests

4

Adjusted other income (loss) (Non-GAAP)

$

$

2

%

$

$

%

Profit (loss) (GAAP)

$

$

%

$

$

%

Profit (loss) margin (GAAP)

%

%

%

%

Operating profit (loss) (Non-GAAP)

$

$

%

$

$

Operating profit (loss) margin (Non-GAAP)

We believe that adjusting revenue provides management and investors with a more complete understanding of underlying operating results and trends of established, ongoing operations by excluding the effect of revenue from our run-off insurance operations. We believe that adjusting profit to exclude the effects of items that are not closely associated with ongoing operations provides management and investors with a meaningful measure that increases the period-to-period comparability. Gains (losses) and restructuring and other items are impacted by the timing and magnitude of gains associated with dispositions, and the timing and magnitude of costs associated with restructuring and other activities. We also use Adjusted revenue* and Operating profit* as performance metrics at the company level for our annual executive incentive plan for 2024.

*Non-GAAP Financial Measure

6

ADJUSTED EARNINGS (LOSS) (NON-GAAP)

Three months ended December 31

Twelve months ended December 31

(In millions, Per-share amounts in dollars)

Earnings

EPS

Earnings

EPS

Earnings

EPS

Earnings

EPS

Earnings (loss) from continuing operations (GAAP)

$

$

$

$

$

$

$

$

Insurance earnings (loss) (pre-tax)

Tax effect on Insurance earnings (loss)

Less: Insurance earnings (loss) (net of tax)

U.S. tax equity earnings (loss) (pre-tax)

Tax effect on U.S. tax equity earnings (loss)

Less: U.S. tax equity earnings (loss) (net of tax)

9

Non-operating benefit (cost) income (pre-tax) (GAAP)

Tax effect on non-operating benefit (cost) income

Less: Non-operating benefit (cost) income (net of tax)

Gains (losses) on purchases and sales of business interests (pre-tax)

4

—

Tax effect on gains (losses) on purchases and sales of business interests

3

—

(1)

—

(2)

—

(3)

—

Less: Gains (losses) on purchases and sales of business interests (net of tax)

3

—

Gains (losses) on retained and sold ownership interests and other equity securities (pre-tax)

Tax effect on gains (losses) on retained and sold ownership interests and other equity securities(a)(b)

(2)

—

—

—

(3)

—

—

—

Less: Gains (losses) on retained and sold ownership interests and other equity securities (net of tax)

Restructuring & other (pre-tax)

—

—

Tax effect on restructuring & other

—

—

Less: Restructuring & other (net of tax)

—

—

Goodwill impairments (pre-tax)

—

—

—

—

—

—

Tax effect on goodwill impairments

3

—

—

—

3

—

—

—

Less: goodwill impairments (net of tax)

3

—

—

—

—

—

Separation costs (pre-tax)

Tax effect on separation costs

Less: Separation costs (net of tax)

Less: Excise tax and accretion of preferred share redemption

—

—

—

—

—

—

Adjusted earnings (loss) (Non-GAAP)

$

$

$

$

$

$

$

$

(a) Includes tax benefits available to offset the tax on gains (losses) on equity securities.

(b) Includes related tax valuation allowances.

Earnings-per-share amounts are computed independently. As a result, the sum of per-share amounts may not equal the total.

We believe that Adjusted earnings* provides management and investors with useful measures to evaluate the performance of the total company and increased period-to-period comparability, as well as a more complete understanding of underlying operating results and trends of established, ongoing operations by excluding items that are not closely related with ongoing operations. We also use Adjusted EPS* as a performance metric at the company level for our performance stock units granted in 2024.

*Non-GAAP Financial Measure

7

FREE CASH FLOW (FCF) (NON-GAAP)

Three months ended December 31

Twelve months ended December 31

(In millions)

V%

V%

Cash flows from operating activities (CFOA) (GAAP)

$

$

5

%

$

$

%

Add: gross additions to property, plant and equipment and internal-use software

Less: separation cash expenditures

Less: Corporate & Other restructuring cash expenditures(a)

Free cash flow (FCF) (Non-GAAP)

$

$

%

$

$

%

(a) Included cash payment of $363 million for the settlement of the Sjunde AP-Fonden shareholder lawsuit for the year ended December 31, 2024.

We believe investors may find it useful to compare free cash flow* performance without the effects of separation cash expenditures and Corporate & Other restructuring cash expenditures (associated with the separation-related program announced in the fourth quarter of 2022). We believe this measure will better allow management and investors to evaluate the capacity of our operations to generate free cash flow. We also use FCF* as a performance metric at the company level for our annual executive incentive plan and performance stock units granted in 2024.

We cannot provide a reconciliation of the differences between the non-GAAP expectations and corresponding GAAP measure for Operating profit* in 2025 without unreasonable effort due to the uncertainty of timing of any gains or losses related to acquisitions & dispositions and the timing and magnitude of restructuring expenses. Although we have attempted to estimate the amount of gains and restructuring charges for the purpose of explaining the probable significance of these components, this calculation involves a number of unknown variables, resulting in a GAAP range that we believe is too large and variable to be meaningful.

We cannot provide a reconciliation of the differences between the non-GAAP expectations and corresponding GAAP measure for Adjusted EPS* in 2025 without unreasonable effort due to the uncertainty of timing of any gains or losses related to acquisitions & dispositions and the timing and magnitude of restructuring expenses. Although we have attempted to estimate the amount of gains and restructuring charges for the purpose of explaining the probable significance of these components, this calculation involves a number of unknown variables, resulting in a GAAP range that we believe is too large and variable to be meaningful.

We cannot provide a reconciliation of the differences between the non-GAAP expectations and corresponding GAAP measure for free cash flow* in 2025 without unreasonable effort due to the uncertainty of timing for separation and restructuring related cash expenditures.

*Non-GAAP Financial Measure

8

Caution Concerning Forward Looking Statements:

This release and certain of our public communications and filings we make with the U.S. Securities and Exchange Commission (SEC) may contain statements related to future, not past, events. These forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as "expect," "anticipate," "intend," "plan," "believe," "seek," "see," "will," "would," "estimate," "forecast," "target," "preliminary," or "range." Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the impacts of macroeconomic and market conditions and volatility on our business operations, financial results and financial position; conditions affecting the aerospace and defense industry, including our customers and suppliers; our expected financial performance, including cash flows, revenue, margins, earnings and earnings per share; planned and potential transactions; our credit ratings and outlooks; our funding and liquidity; our cost structures and plans to reduce costs; restructuring, impairment or other financial charges; or tax rates.

For us, particular areas where risks or uncertainties could cause our actual results to be materially different than those expressed in our forward-looking statements include:

•changes in macroeconomic and market conditions and market volatility (including risks related to recession, inflation, supply chain constraints or disruptions, interest rates, values of financial assets, oil, jet fuel and other commodity prices and exchange rates), and the impact of such changes and volatility on our business operations and financial results;

•global economic trends, competition and geopolitical risks, including impacts from the ongoing conflict between Russia and Ukraine and related sanctions and risks related to conflict in the Middle East; demand or supply shocks from events such as a major terrorist attack, war, natural disasters or actual or threatened public health pandemics or other emergencies; or an escalation of sanctions, tariffs or other trade tensions between the U.S. and China or other countries;

•market or other developments that may affect demand or the financial strength and performance of airframers, airlines, suppliers and other key aerospace and defense industry participants, such as demand for air travel, supply chain or other production constraints, shifts in U.S. or foreign government defense programs and other industry dynamics;

•pricing, cost, volume and the timing of sales, investment and production by us and our customers, suppliers or other industry participants;

•the impact of actual or potential safety or quality issues or failures of our products or third-party products with which our products are integrated, including design, production, performance, durability or other issues, and related costs and reputational effects;

•operational execution on our business plans, including our performance amidst market growth and ramping newer product platforms, meeting delivery and other contractual obligations, improving turnaround times in our services businesses and reducing costs over time;

•the amount and timing of our earnings and cash flows, which may be impacted by macroeconomic, customer, supplier, competitive, contractual, financial or accounting (including changes in estimates) and other dynamics and conditions;

•our capital allocation plans, including the timing and amount of dividends, share repurchases, acquisitions, organic investments and other priorities;

•our decisions about investments in research and development or new products, services and platforms, and our ability to launch new products in a cost-effective manner, as well as technology developments and other dynamics that could shift the demand or competitive landscape for our products and services;

•our success in executing planned and potential transactions, including the timing for such transactions, the ability to satisfy any applicable pre-conditions and the expected benefits;

•downgrades of our credit ratings or ratings outlooks, or changes in rating application or methodology, and the related impact on our funding profile, costs, liquidity and competitive position;

•capital or liquidity needs associated with our run-off insurance operations or mortgage portfolio in Poland (Bank BPH), the amount and timing of any required future capital contributions and any strategic options that we may consider;

•changes in law, regulation or policy that may affect our businesses, such as trade policy and tariffs; government defense priorities or budgets; regulation, incentives and emissions offsetting or trading regimes related to climate change; and the effects of tax law changes;

9

•the impact of regulation; government investigations; regulatory, commercial and legal proceedings or disputes; environmental, health and safety matters; or other legal compliance risks, including the impact of shareholder and related lawsuits, Bank BPH and other proceedings that are described in our SEC filings;

•the impact related to information technology, cybersecurity or data security breaches at GE Aerospace or third parties; and

•the other factors that are described in the "Risk Factors" section in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, as such descriptions may be updated or amended by the factors that will be included in our Annual Report on Form 10-K for the year ended December 31, 2024 and in any future reports we file with the SEC.

These or other uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements. This document includes certain forward-looking projected financial information that is based on current estimates and forecasts. Actual results could differ materially.

Additional Information

CFM International is a 50/50 JV that produces CFM56 and LEAP engine families. RISE is a program of CFM International. CFM RISE is a registered trademark. Engine Alliance is a 50/50 JV that produces the GP7200 engine.

GE Aerospace’s Investor Relations website at www.geaerospace.com/investor-relations, as well as GE Aerospace’s LinkedIn and other social media accounts, contain a significant amount of information about GE Aerospace, including financial and other information for investors. GE Aerospace encourages investors to visit these websites from time to time, as information is updated and new information is posted.

Additional financial information can be found on the Company’s website at: www.geaerospace.com/investor-relations under Events and Reports.

Conference Call and Webcast

GE Aerospace will discuss its results during its investor conference call today starting at 7:30 a.m. ET. The conference call will be broadcast live via webcast, and the webcast and accompanying slide presentation containing financial information can be accessed by visiting the Events and Reports page on GE Aerospace’s website at: www.geaerospace.com/investor-relations. An archived version of the webcast will be available on the website after the call.

About GE Aerospace

GE Aerospace is a global aerospace propulsion, services, and systems leader with an installed base of approximately 45,000 commercial and 25,000 military aircraft engines. With a global team of approximately 53,000 employees building on more than a century of innovation and learning, GE Aerospace is committed to inventing the future of flight, lifting people up, and bringing them home safely. Learn more about how GE Aerospace and its partners are defining flight for today, tomorrow and the future at www.geaerospace.com.

GE Aerospace Investor Contact:

blaire.shoor@geaerospace.com

GE Aerospace Media Contact:

nicole.sizemore@geaerospace.com