AerCap 2025-26: Record EPS $21.30, FY26 $12-13, $1B Buyback
FY25 revenue $8.19B (+2%); op income $4.25B (+3%); NI $3.75B (+79%); EPS $21.30 (+97%). Adjusted net income $2.7B / adj EPS $15.37. Sales volumes $3.9B with 27% gain-on-sale margin (189 assets sold). Cash CapEx $6.1B. Operating cash flow $5.4B. Returned $2.6B to shareholders. Net debt/equity 2.1x. $1.5B Ukraine recovery FY25 (~$3B since 2023). FY26 adj EPS $12-$13 (ex sales gains); $1B new buyback; quarterly dividend raised to $0.40; cash CapEx ~$5.2B; sales $2-$3B.
Key takeaways
- Record GAAP EPS $21.30 / adjusted EPS $15.37 / record revenues $8.5B / record sales volumes $3.9B. AerCap's FY25 is the best year in the company's history across virtually every operating and financial metric. The print confirms the post-GECAS-acquisition (2021) integration is complete and the model is operating at full capacity.
- $1.5B insurance + other Ukraine recoveries FY25. Brings cumulative recoveries since 2023 to ~$3B. The Russia-Ukraine aircraft impairment from 2022 — once a major overhang — has now been substantially recovered. The remaining tail is smaller but not zero.
- 705 lease + sale transactions in 2025; 189 assets sold at 27% gain-on-sale margin. The trading book is the structural alpha generator on top of the recurring lease income. 27% gain margin on $3.9B sales = ~$1B+ realized trading gain — a meaningful contributor to GAAP NI.
- FY26 adj EPS guide $12-$13 ex sales gains. Mgmt explicit that this excludes gain-on-sale. Inclusive of typical gain-on-sale contribution, total reported EPS could be meaningfully higher. The $12-$13 floor reflects the recurring lease + interest income business at scale.
- $1B new buyback program + $0.40 quarterly dividend (raised). Combined with $2.6B FY25 capital return, AerCap continues to be one of the most aggressive capital-returners in aviation finance. Dividend initiation history is short (~2 years), but pace of growth signals long-term capital return discipline.
Business
AerCap Holdings N.V. is the world's largest aircraft lessor (post-GECAS acquisition). The company purchases commercial aircraft + engines + helicopters from manufacturers and lessors and leases them to airlines globally over 8-12 year terms. Three primary asset classes:
- Aircraft leasing (~85% of revenue / earnings). 1,500+ aircraft in fleet/orderbook spanning Boeing 737/787/777, Airbus A320/A330/A350. Long-term operating leases to ~300 airline customers globally. Average lease term ~7 years. Counterparty risk diversified across geographies + carrier sizes.
- Engine leasing (~10%). The new strategic growth area. Q4 mgmt strengthened partnership with GE Aerospace; ~100 engines on order. Engine leasing has higher recurring economics than aircraft (engines change hands more frequently; shop visit costs amortized).
- Cargo + Helicopter leasing (~5%). Cargo: 777-300ER passenger-to-freighter conversion certified FY25; 15 cargo aircraft expected 2026. Helicopter (LEAP): 99% utilization FY25; 71 lease agreements signed.
Asset trading: ~$3.9B FY25 sales at 27% gain-on-sale margin. AerCap's scale + market intelligence + buyer/seller relationships allow opportunistic asset rotation that smaller lessors can't replicate. Trading book contributes meaningfully to GAAP NI.
Strategic moves FY25:
- 705 transactions executed (lease + sale + extension + novation)
- 189 assets sold at 27% gain margin / $3.9B
- $1.5B Ukraine recoveries FY25 (~$3B since 2023)
- Engine business expanded with GE Aerospace partnership / ~100 engines on order
- 777-300ER SF (special freighter) conversion certified
- 15 cargo aircraft expected 2026
- Helicopter business 99% utilization
- $2.6B FY25 capital return (vs $1.66B FY24)
- Credit rating upgraded
- Net debt/equity 2.1x
FY25 financial performance
| Metric (FY) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue ($B) | 7.01 | 7.58 | 8.00 | 8.19 |
| Revenue YoY | n/a | +8% | +5% | +2% |
| Op income ($B) | 3.40 | 3.88 | 4.12 | 4.25 |
| Op margin | 48.5% | 51.2% | 51.5% | 51.9% |
| Net income ($B) | -0.73 | 3.14 | 2.10 | 3.75 |
| Diluted EPS ($) | -3.02 | 13.78 | 10.79 | 21.30 |
| Adjusted EPS ($) | n/a | n/a | ~$10.50 | $15.37 |
| FCF ($B) | 1.30 | -0.97 | -1.18 | -0.68 |
| Capex ($B) | -3.87 | -6.23 | -6.62 | -6.07 |
| Total debt ($B) | 46.67 | 46.58 | 45.35 | 43.57 |
| Dividends ($M) | 0 | 0 | -140 | -192 |
| Buyback ($B) | -0.02 | -2.64 | -1.52 | 0 |
The earnings progression: revenue compounded at LSD+ over 4 years; op margin steadily expanded from 48.5% → 51.9%; GAAP EPS swung from -$3.02 (FY22 Russia impairment) → $21.30 FY25 (Ukraine recovery + record operating year). Adjusted EPS $15.37 is the cleaner operating signal — recurring lease income + trading gains net of one-time items.
Total debt $43.6B (-4% YoY) — meaningful deleveraging despite $6.1B cash CapEx for fleet additions. The credit rating upgrade reflects this combination of strong earnings + balance sheet repair + Ukraine recoveries.
FCF -$680M reflects net of capex; AerCap's leverage model reinvests cash flow into new fleet rather than generating positive FCF.
Capital allocation
The capital allocation framework is dominant in the AerCap thesis:
- Cash CapEx $-6.07B FY25 (fleet additions). FY26 plan: ~$5.2B (modest moderation). The CapEx-to-net-debt-paydown balance signals selective fleet growth + balance sheet priority.
- Asset sales $3.9B FY25 (sales volume) at 27% gain margin. FY26 plan: $2-$3B. The trading book acts as a counter-balance to CapEx — sells older / less efficient assets to fund newer / higher-yielding additions.
- Dividends $-192M FY25 (vs $-140M FY24, +37%). Quarterly $0.40 (raised). Growing dividend culture.
- Buybacks $0 FY25 explicit (vs $-1.52B FY24). New $1B program announced for FY26.
- Total return to shareholders $2.6B FY25 (mgmt-disclosed) — reflects buybacks + dividends combined including timing.
- Debt $43.57B (-$1.78B YoY). Credit rating upgraded.
- Net debt/equity 2.1x — within target range.
FY26 outlook (per Q4 2025 call, 2026-02-06)
| FY26 framework | Detail |
|---|---|
| Adjusted EPS | $12 to $13 (excludes gains on asset sales) |
| Cash CapEx | ~$5.2B |
| Asset sales | $2B to $3B |
| Quarterly dividend | $0.40 (raised from prior level) |
| Buyback | $1B new program |
| Net debt/equity | ~2.1x maintained |
| Engine fleet | ~100 engines on order continued |
| Cargo deliveries | ~15 aircraft 2026 |
| Helicopter | High utilization continues |
The $12-$13 adj EPS guide is conservative — excludes the typical $1B+ trading gains. Inclusive of FY25-level trading gains, total reported EPS could be in the $18-$22 range. The combination of recurring lease income + trading gains + Ukraine tail recoveries creates multiple paths to outperformance.
Key risks
Aircraft manufacturing supply-demand imbalance. Mgmt explicit on Q4 call — "aircraft manufacturing is complex with no sudden production surges, so supply-demand imbalance may persist." Boeing and Airbus production has been constrained by supply chain + 737 MAX issues + engine OEM bottlenecks (Pratt & Whitney GTF, CFM LEAP). Sustained supply-demand tightness benefits lessors (lease rates rise, asset values appreciate) — but also caps deployable CapEx and creates competition for available assets.
Geopolitical risk / Ukraine tail. $3B+ recoveries since 2023 substantially mitigate the original Russia-Ukraine impairment. But residual recoveries + new geopolitical risks (Israel/Middle East, Taiwan, Korea, sanctions cycle) introduce ongoing tail risk. Aviation assets in geopolitically-sensitive regions face seizure / repossession / insurance complications.
Asset quality / portfolio aging. Lessors must continually rotate older assets out of the portfolio (lower lease rates, higher maintenance) and replace with newer assets. Asset trading 27% gain margin FY25 indicates strong execution, but persistent aging without rotation compresses lease yield.
Credit risk on lessees. ~300 airline customers globally — bankruptcy exposure across each. AerCap diversifies but remains exposed to airline credit cycles. FY26 lessee bankruptcies would create reset/repo costs.
Engine OEM dynamics (PW GTF / CFM LEAP). AerCap's engine leasing business is partnered with GE Aerospace + dependent on engine OEM reliability. Pratt & Whitney GTF reliability issues + CFM LEAP MTBR (mean time between removals) are major industry topics. AerCap's engine book benefits from elevated MRO demand if reliability remains a challenge — but also creates fleet operating disruption.
Interest rate / debt servicing. $43.6B debt + meaningful annual interest expense. AerCap funds itself with mix of secured + unsecured debt; refinancing cost matters. Higher-for-longer rates compress margins; rate cuts boost.
Cargo conversion economics. 15 cargo aircraft 2026 — economic case depends on global air cargo demand + e-commerce penetration. Air cargo cycle has been volatile (peak 2022, trough 2023-24, recovery 2025).
Helicopter LEAP demand. Offshore oil & gas + medical evacuation drive helicopter leasing demand. Energy capex cycle + rotation to natural gas (hello Haynesville LNG export) supports.
Bottom line
AerCap FY25 is the record year — best EPS, best revenues, best sales volumes, best margin, plus Ukraine recoveries delivering $1.5B + cumulative $3B since 2023. The post-GECAS acquisition (2021) integration is complete, the model is operating at full capacity, and the trading book continues to deliver 27% gain-on-sale margins on $3.9B of asset sales.
FY26 framework: $12-$13 adj EPS (ex sales gains), $5.2B cash CapEx, $2-$3B asset sales, $1B new buyback, $0.40 quarterly dividend. The conservative ex-sales-gains guide is realistic — typical FY26 sales gains would push reported total EPS materially higher.
The risks are real — aircraft supply-demand imbalance (cuts both ways), geopolitical tail, asset aging, lessee credit, engine OEM dynamics, interest rates, cargo cycle, helicopter demand. But the structural thesis (largest global aircraft lessor + GECAS scale + diversified counterparty book + active trading book + capital return discipline + Ukraine recoveries continuing) is intact and FY25 confirms.
Quality aviation finance compounder mid-cycle with the cleanest scale, balance sheet repair, and capital return story among public lessors. The AerCap thesis (lessors capture supply-constrained airline economics + provide capital efficiency to airlines + run a high-margin trading book on top) continues to work.
Citations
- AerCap Holdings N.V. FY25 Form 20-F (filed February 2026, SEC EDGAR).
- AER Q4 2025 earnings call, 2026-02-06 — record GAAP NI $3.8B / EPS $21.30; adj NI $2.7B / adj EPS $15.37; FY revenues $8.5B; sales volumes $3.9B (189 assets, 27% gain margin); cash CapEx $6.1B; OCF $5.4B; $2.6B returned; $1.5B Ukraine recoveries FY25 ($3B cumulative); FY26 guide ($12-$13 adj EPS ex gains, $5.2B cash CapEx, $2-$3B sales, $1B buyback, $0.40 dividend).
- AER Q3 2025 / Q2 2025 / Q1 2025 earnings calls — supporting trading book + Ukraine recovery dynamics + engine business expansion (assumed in line with Q4 trajectory).
- Internal financial_statements view (consolidated annual + cash flow + capital structure).