FTAI Aviation Ltd.

What they do

FTAI Aviation operates two reportable segments: Aerospace Products and Aviation Leasing. The Aerospace Products segment repairs, rebuilds, and sells CFM56-5B, CFM56-7B, and V2500 engines via its Maintenance, Repair and Exchange (MRE) model, with a 25% interest in the Advanced Engine Repair JV. The Aviation Leasing segment owns and manages a portfolio of commercial aircraft and engines; as of December 31, 2025, it had 290 aviation assets (47 aircraft and 243 engines, including 8 aircraft and 17 engines in Russia). In late 2025, the company launched FTAI Power to convert CFM56 engines into power turbines.

Revenue drivers

• Aerospace Products — Primary segment: engine, module, and parts sales through the MRE model; reported $875.0 million revenue in Q2 2026, up 78% year-over-year.
• Aviation Leasing — Leases and sells aircraft and engines; management updated 2026 guidance down to $475 million Adjusted EBITDA due to shift to asset-light model.
• Strategic Capital Initiative — Asset-light partnership managing third-party capital to acquire on-lease narrowbody aircraft; 2025 Partnership raised $2.0 billion equity, fully deployed; 2026 SPV launched.
• FTAI Power — New platform converting CFM56 engines to power turbines; announced a $1.465 billion customer contract expected to cover a substantial portion of 2027 delivery target.

Recent performance

Q2 2026 net income attributable to shareholders was $117.6 million, with diluted EPS of $1.13 and Adjusted EBITDA of $291.4 million. Revenue for the quarter ended June 30, 2026 was $953.1 million, up from $667.1 million a year earlier. Full-year 2025 revenue was $2.51 billion with net income of $501.1 million. Operating cash flow was negative $310.7 million in 2025, reflecting heavy investment. The company increased its quarterly dividend to $0.50 per ordinary share.

Strategy

Management emphasizes the MRE model and expanding maintenance capacity through partnerships, including GMF Indonesia and EgyptAir. The company is shifting primary investment activities to the Strategic Capital Initiative to maintain an asset-light balance sheet, with the 2025 SPV fully deployed and the 2026 SPV launched. FTAI Power is a new growth avenue, converting CFM56 engines to power turbines, with a landmark $1.465 billion contract. Management also guides to 2027 segment Adjusted EBITDA of $2.3 billion, split $1.4 billion from Aerospace Products, $450 million from FTAI Power, and $450 million from Aviation Leasing.

Risks

• Macroeconomic and industry cyclicality — Commercial aviation is cyclical, and economic downturns, geopolitical events, or pandemics could reduce demand for engines and leasing.
• Russia exposure — As of December 31, 2025, 8 aircraft and 17 engines were still located in Russia, subject to geopolitical and sanction-related risks.
• High leverage — As of June 30, 2026, total liabilities were $4.09 billion against equity of $404 million, with long-term debt of $3.45 billion.
• Negative operating cash flow — Operating cash flow was negative $310.7 million in 2025, indicating reliance on external funding for operations and investments.

Outlook

Management reaffirmed 2026 Aerospace Products Adjusted EBITDA guidance of $1,050 million but lowered Aviation Leasing guidance to $475 million due to the asset-light shift. They introduced 2027 segment Adjusted EBITDA guidance of $2.3 billion, with FTAI Power contributing $450 million. The company continues to expand maintenance capacity internationally and expects Strategic Capital's 2026 SPV to drive further aircraft acquisitions.