GE Aerospace
General Electric Company, doing business as GE Aerospace, designs and produces commercial and defense aircraft engines, integrated engine components, electric power, and aircraft systems. The company operates through two segments, Commercial Engines & Services, and Defense & Propulsion Technologies. The Commercial Engines & Services segment designs, develops, manufactures, maintenance, repair, and overhaul (MRO) services of jet engines and sale of spare parts for commercial airframes, business aviation, and aeroderivative applications. The Defense & Propulsion Technologies designs, develops, manufactures, and services jet engines and avionics and power systems for governments, militaries, and commercial airframers, as well as MRO of engines and the sale of spare parts. This segment also offers aircraft components and systems, such as small turboprop engines, aeroengine mechanical transmissions, turbines, combustors and controls, additive manufacturing, propeller systems, ignition systems, sensors and engine accessories for fixed wing and rotorcraft applications for commercial and military end users under the Avio Aero, Unison, Dowty Propellers, and Colibrium Additive brands. The company operates in the United States, Europe, Asia, the Americas, the Middle East, and Africa. General Electric Company was incorporated in 1892 and is based in Evendale, Ohio.
What does it do?
GE Aerospace makes the jet engines that power commercial airliners and military aircraft around the world. Think of the massive engines hanging under the wings of a Boeing 737 or an Airbus A320 — there's a good chance GE or its joint venture made them. Beyond building engines, GE also services and repairs those engines over their decades-long lifespan, which is a huge and steady source of income. They also supply propulsion systems for military jets, including the F/A-18 fighter used by the US Navy.
Global air travel has fully recovered from the COVID collapse and is hitting record levels, meaning airlines are desperate for new jets and the engines that go with them — GE is one of only two Western companies capable of making them at scale. The US defense budget remains near historic highs, and next-generation fighter programs like the F-47 keep military engine demand front and center. With revenue jumping from $35.1B to $42.3B in a single year — nearly 21% growth — investors are watching GE as a direct bet on the structural boom in both commercial aviation and defense spending.
How does it make money?
GE makes money in two main ways: selling engines and then, for decades afterward, charging airlines to service and repair them. The Commercial Engines & Services segment sells jet engines to airlines and leasing companies, but the real recurring money comes from long-term service contracts — every time an engine needs an overhaul, GE gets paid again. The Defense & Propulsion Technologies segment sells engines and power systems to governments and militaries, a business with built-in demand because once a country's air force flies GE-powered jets, it needs GE to keep them running. Total revenue hit $42.3B in the latest year, with net income of $8.7B, showing this is a highly profitable operation.
Why do investors care?
The global commercial aviation industry has a backlog of aircraft orders stretching years into the future — Boeing and Airbus together have over 12,000 planes on order — and almost all of them need engines. GE's installed base of tens of thousands of engines in service creates a near-guaranteed stream of high-margin maintenance revenue for 20-30 years per engine. On the defense side, the US and its allies are investing heavily in next-generation aircraft, opening up new long-cycle contracts. For the bull case to play out, air travel demand needs to stay strong, GE needs to avoid major manufacturing or safety setbacks, and defense budgets need to hold.
Deep Dive
MemberA full investor briefing on GE Aerospace — history, leadership, risks, and outlook.