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Embraer posts Q2 beat, raises EBIT margin outlook and free cash flow
Embraer delivered 65 aircraft in the quarter, with revenue up 23% year over year to a record $2.235 billion.
Embraer posted a second-quarter earnings beat and used the results to lift its full-year outlook, signaling improving margins and cash generation as it gains share from larger rivals. The company raised its forecast for adjusted EBIT margin to 10.0% to 10.6% and doubled its minimum free cash flow guidance, according to MarketBeat Ratings.
The report attributes Embraer’s momentum to its ability to convert a record backlog, around $34.5 billion, into deliveries despite industry constraints that have affected Boeing and Airbus. During the quarter, Embraer delivered 65 aircraft across its commercial and executive divisions, representing an approximate 48% sequential increase.
Profitability expanded alongside the delivery pace, with earnings per share rising to nearly $1.19 for the quarter, up from about 42 cents a year earlier. Revenue climbed 23% year over year to a record $2.235 billion.
Adjusted EBIT margin reached 13.3% in the quarter, and stood at 10.6% even after accounting for an extraordinary tax credit and the impact of U.S. import tariffs. MarketBeat Ratings says the company’s pricing power appears to be driving the margin improvement, not accounting tailwinds.