AerCap Holdings (AER)·Q4 2025 Earnings Summary
AerCap Delivers Record 2025 Despite Softer 2026 Outlook — Stock Slides 4%
February 6, 2026 · by Fintool AI Agent
AerCap (NYSE: AER) reported record full-year 2025 results with GAAP net income of $3.8 billion ($21.30/share) and adjusted net income of $2.7 billion ($15.37/share) . The aviation leasing giant beat Q4 expectations with adjusted EPS of $3.95 vs. consensus ~$3.08, but shares dropped ~4% in after-hours trading after 2026 guidance came in below current-year levels.
Did AerCap Beat Earnings?
Q4 2025 results exceeded expectations across the board:
The full year delivered record results:
The massive YoY jump in net income was driven by $1.5 billion in Ukraine Conflict insurance recoveries during 2025, bringing total recoveries since 2023 to approximately $3 billion .
What Did Management Guide?
FY2026 adjusted EPS guidance of $12.00-$13.00 — notably lower than 2025's $15.37, but management emphasized this excludes any gains on sale .
The guidance walk from 2025 to 2026 :
2026 Projections :
- Basic Lease Rents: $6.7B
- Total Revenue: $7.6B
- Pre-Tax Income: $1.8B
- GAAP Net Income: $1.7B
- Assumes cash capex of ~$5.2B and sales of $2.0-$3.0B
Ask Fintool AI AgentHow Did the Stock React?
AerCap shares closed at $144.00 on February 5, up 1.2% heading into results . After the earnings release, shares dropped to ~$138 in after-hours trading — a decline of approximately 4.2%.
Why the selloff despite the beat?
- 2026 guidance reset: $12-13 adjusted EPS (ex-gains) vs. 2025's $15.37 signals lower normalized earnings power
- Ukraine recoveries winding down: $1.5B collected in 2025 won't repeat
- Gains on sale excluded: Management explicitly guided without asset sale profits, a key earnings driver
The stock has performed well over the past year, up from ~$86 (52-week low) to $149 (52-week high), representing 68% appreciation from trough.
What Changed From Last Quarter?
Capital Return Acceleration:
- Quarterly dividend increased to $0.40/share (up from $0.35)
- New $1B share repurchase program announced in December
- Returned $2.6B to shareholders in 2025 (22.1M shares at $109.92 avg)
Book Value Growth:
- Book value per share: $112.59 as of December 31, 2025
- Up 19% YoY from $94.57 at year-end 2024
- 68% increase since 2022
Balance Sheet Delevering:
- Adjusted debt/equity ratio improved to 2.11x from 2.35x at year-end 2024
- Total debt reduced to $43.6B from $45.3B
What Did Analysts Ask?
The Q&A session covered supply constraints, capital deployment, and emerging opportunities:
On Order Book Strategy (Jamie Baker, JPM) :
"Last year we added 103 aircraft to our order book, including options. None of those aircraft came through direct orders from the OEMs. It was all because of our positioning in the industry."
Kelly emphasized AerCap's ability to source aircraft through bilateral deals rather than traditional OEM orders, including 281 new engines committed over the last two years.
On Supply-Demand Balance (Chris Stathoulopoulos, SIG) :
"Around 2030, Boeing and Airbus will probably pick up production to where it gets closer to meeting the demand... But the technology being used is not as durable as the previous generation."
Kelly noted newer engines (LEAP, GTF) run hotter and require more frequent overhauls than prior generation engines, structurally increasing aircraft demand.
On Engine Conversion for Data Centers (Catherine O'Brien, Goldman Sachs) :
"Of course, we're looking at this. And if it turns out that the demand... to convert them into ground-based power generation for data centers is very durable and is long-lived, then, of course, we will participate."
AerCap is the largest owner of CFM56 engines globally — a potential feedstock for data center turbine conversions.
On Spirit Airlines Aircraft (Terry Ma, Barclays) :
Pete Juhas confirmed Spirit aircraft will return to service starting in 2H 2026, with some extending into early 2027. Downtime is already baked into 2026 guidance.
On COVID-Era Leases :
"About 12% of our fleet today... will pretty much be done by 2031, 2032."
These below-market leases will roll off, providing a tailwind to lease rates as they renew at current market terms.
Ask Fintool AI AgentKey Business Highlights
Transaction Activity :
- 705 assets leased, purchased, or sold in 2025
- $3.9B in asset sales with 27% gain-on-sale margin (2.0x book equity multiple)
- Added 103 aircraft (including options) to order book
Fleet Composition :
- Total portfolio: 3,500 aircraft, engines, and helicopters (owned, managed, or on order)
- New technology assets: 76% of total fleet
- Average owned passenger aircraft age: 7.3 years
Forward Order Book :
Portfolio Strategy — "Barbell Approach" :
Kelly explained AerCap's disciplined portfolio construction:
- Old Technology: Want old variants (18+ years) that will generate returns before replacement
- Avoid Mid-Life Old Tech: Young variants of 737NG/A320ceo will struggle if the aircraft must be in service until 2042 to return cost of capital
- New Technology Focus: Investing in A321neo, A320neo, 737 MAX 8, 787-9, A330-900, A350-900 as "assets of the future"
Margins and Profitability
Operating cash flow was $1.2B in Q4 2025 and $5.4B for the full year .
CEO Commentary
CEO Aengus Kelly struck a confident tone despite the guidance step-down:
"2025 was a tremendous year for AerCap, a year that showcased the inherent strength and capabilities of our global industrial platform."
"We have over $3 billion of excess capital to deploy, which we will continue to allocate with the flexible and disciplined approach that has defined our strategy since inception."
On consistent asset sale gains over 20 years :
"At the end of the day, an aircraft is really just a piece of tin. And without records and management of those records, it is an expensive piece of tin. To generate value on a consistent basis over a 20-year period... is about how you manage that asset every single day."
On operational focus :
"Everything boils down to the day-to-day of the business... making sure that our assets are moving efficiently as quickly as we can. They're on time, on spec. They're on budget. That is what drives the business."
Risks and Concerns
Flagged by Management :
- Trade tensions and tariff uncertainty
- Hostilities in Middle East and Latin America
- Customer payment ability (lessee credit risk)
- Interest rate and capital availability changes
- Geopolitical uncertainty affecting aviation demand
Spirit Airlines Restructuring: Leasing expenses were elevated in Q4 due to costs related to Spirit Airlines' restructuring . Aircraft will return to service starting 2H 2026, with some extending into early 2027 .
Ukraine Conflict: While $1.5B was recovered in 2025, the ongoing conflict remains a source of uncertainty. Total recoveries since 2023 are approximately $3B . Ongoing litigation against operator insurance reinsurers expected to go to trial late 2026 .
Why Structural Supply Shortage Persists :
Kelly explained why engine OEMs prevent aircraft oversupply: Engine makers sell new engines at 25-30% of cost on delivery day, only profiting from shop visits at years 8, 14, and 18. Oversupply of new aircraft would mean early retirement of old aircraft — eliminating their most profitable maintenance visits. This dynamic has prevented global oversupply for 30+ years.
Ask Fintool AI AgentForward Catalysts
- Share Repurchases: $1B program active with stock trading at ~1.3x book value
- Fleet Renewal: 76% new technology assets positions well for sustainability regulations
- Asset Sales: Management guides $2-3B sales in 2026; gains could add to EPS upside
- Dividend Growth: 14% increase to $0.40/quarter signals capital return commitment
- Order Book Deliveries: 122 assets scheduled for 2026 delivery
Key Takeaways
✅ Record 2025: $3.8B GAAP net income, $21.30 EPS — both all-time highs
✅ Strong Beat: Q4 adjusted EPS $3.95 vs. ~$3.08 consensus (+28%)
✅ Capital Returns: $2.6B returned in 2025; dividend raised 14%
⚠️ Lower 2026 Guide: $12-13 adjusted EPS (ex-gains) signals normalized earnings below 2025
⚠️ Stock Reaction: -4% after-hours despite the beat
The market is recalibrating expectations from an exceptional 2025 boosted by Ukraine insurance recoveries to a more normalized 2026 run-rate. At ~1.3x book value and 12x 2026 earnings, valuation remains reasonable for the aviation leasing leader.
Ask Fintool AI AgentLast updated: February 6, 2026 (Post-Call Update)
Related: AerCap Company Page | Q4 2025 Earnings Slides