This article is based on an official press release from MTU Aero Engines and includes additional market data context.

MTU Aero Engines Reports Record 2025 Revenue Amid Supply Chain and Military Headwinds

MTU Aero Engines has concluded its 2025 fiscal year with the strongest financial performance in the company’s history, posting record revenue and earnings despite persistent supply chain constraints and costly fleet management programs. According to the company’s official figures released on February 24, 2026, adjusted revenue climbed 16% to €8.7 billion, while adjusted EBIT rose 29% to €1.35 billion.

However, the record-breaking annual figures were met with a cool reception from investors. Market data indicates that shares dipped approximately 5-6% following the announcement, driven by a fourth-quarter earnings miss and growing uncertainty surrounding the company’s military portfolio. While the commercial sector is booming, the costs associated with the Geared Turbofan (GTF) engine inspection program and stalled defense projects continue to weigh on the German engine manufacturer.

CEO Dr. Johannes Bussmann emphasized the company’s resilience in a statement accompanying the release:

“We made the most of market opportunities in 2025 and stayed on our successful course despite ongoing challenges… In 2026, we will channel our Passion for Engines into achieving further growth.”

Financial Performance Overview

The fiscal year 2025 saw MTU Aero Engines achieve new highs across nearly all key performance indicators. The company’s adjusted EBIT margin expanded from 14.0% in 2024 to 15.5% in 2025, signaling improved profitability despite inflationary pressures and supply chain disruptions.

Key Metrics vs. 2024

• Revenue (Adjusted): €8.7 billion (up from €7.5 billion)
• EBIT (Adjusted): €1.35 billion (up from €1.1 billion)
• Net Income (Adjusted): €968 million (up 27%)
• Free Cash Flow: €378 million (up 106%)
• Dividend Proposal: €3.60 per share (up from €2.20)

The company’s order backlog also grew slightly to €29.5 billion, theoretically securing more than three years of production work. Based on these results, the Executive Board has proposed a dividend increase of 64%, targeting a payout ratio of approximately 20%, with a long-term goal of returning to 40%.

Commercial Aviation: The GTF Challenge

The commercial maintenance, repair, and overhaul (MRO) sector remains a primary revenue driver, but it is heavily impacted by the ongoing “Fleet Management Plan” for the Pratt & Whitney Geared Turbofan (GTF). This program involves the recall and inspection of engines due to a rare powder metal defect in high-pressure turbine and compressor discs.

According to MTU’s report, the financial burden of this program remains significant. In 2025, MTU paid out approximately €360 million in compensation to airlines. The company projects this figure will decrease to roughly €250 million in 2026 as turnaround times improve.

Dr. Bussmann noted that fewer than 400 aircraft are currently grounded due to these inspections, although external industry estimates suggest the number could be higher. The situation has created reported friction within the supply chain, as airframers like Airbus demand engines for new deliveries while engine partners prioritize spares to keep existing fleets operational.

Military Business Stalls Amid Political Uncertainty

While the commercial side of the business grew, MTU’s military sector faced stagnation. Revenue for the military business was effectively flat at €614 million, compared to €612 million in 2024. The company attributed this lack of growth to supply chain issues that delayed the delivery of parts and modules.

The FCAS Question Mark

Beyond immediate supply chain delays, the long-term outlook for the military division is clouded by political disputes regarding the Future Combat Air System (FCAS). This next-generation fighter project, a collaboration between France, Germany, and Spain, is reportedly facing severe delays.

Recent reports indicate that disputes over workshare and design leadership between Dassault and Airbus have stalled progress. While MTU management publicly expressed confidence that partner nations would find a solution, the uncertainty poses a risk to long-term defense revenue projections. Conversely, the Eurofighter (EJ200) and CH-53K heavy-lift helicopter programs provided stability, securing strong orders despite the broader headwinds.

2026 Outlook and Guidance

Looking ahead, MTU Aero Engines forecasts continued growth for fiscal year 2026, contingent on supply chain stabilization and a reduction in GTF-related costs. The company has issued the following guidance:

• Revenue: €9.2 billion – €9.7 billion
• Adjusted EBIT: €1.35 billion – €1.45 billion
• Cash Conversion Rate: 45% – 55% (targeting an improvement from 39% in 2025)

The company reaffirmed its strategic ambition to reach revenue levels of €13–14 billion by 2030.

AirPro News Analysis

MTU’s 2025 results highlight a paradox currently gripping the aerospace supply chain. On paper, the company is in a “super-cycle” of demand; airlines are flying older aircraft longer due to delivery delays, driving unprecedented demand for MRO services. However, the same supply chain fractures causing the aircraft shortage are preventing suppliers like MTU from fully capitalizing on it.

The market’s negative reaction, despite record top-line numbers, suggests that investors are looking past the revenue growth and focusing on the “quality” of earnings. The Q4 earnings miss (EPS €4.58 vs. the forecast €4.88) indicates that operational costs are biting harder than anticipated. Furthermore, the uncertainty surrounding FCAS is not merely a political footnote; for a company like MTU, which relies on military contracts for long-term R&D stability, the potential collapse of a next-gen fighter program would be a significant strategic blow.

While the dividend increase signals management’s confidence in cash flow recovery, the immediate future will likely be defined by how quickly MTU can resolve the GTF powder metal issues and navigate the fragile geopolitical landscape of European defense procurement.

Sources: MTU Aero Engines Press Release