GE Aerospace sees services backlog hit $170 billion

Speaking at a Morgan Stanley conference, GE Aerospace CFO Rahul Ghai said the company anticipates commercial services revenue to grow more than 20% in 2026. The growth is backed by a $170 billion services backlog, contributing to a total company backlog of $210 billion. The company currently powers around 80,000 aircraft, including 50,000 commercial and 30,000 defense planes, along with about two-thirds of U.S. combat aircraft.

GE Aerospace secured roughly 1,800 engine orders at the Farnborough air show. These include an order from IndiGo for more than 1,000 LEAP-1A engines, which Ghai identified as the company's largest aerospace order, alongside a 100-engine order from Korean Air covering both engines and services.

Aircraft retirements fell about 10% year over year, while the count of engines removed but awaiting shop induction rose nearly 60%. Removals are expected to increase over 10% in the first half of 2027. CFM56 retirements are now estimated at 1.5% to 2% for 2026, down from an initial 3% to 4% range, with shop visits expected at 2,300 to 2,400 units this year and next. Ghai also pointed to emerging demand to convert CFM56 units for data-center power generation.

The company anticipates over $1.5 billion in profit growth in 2026 and expects free-cash-flow conversion to exceed 100% of net income for the next two to three years. For its recent acquisition of casting supplier CPP, GE Aerospace projects about $200 million in synergies by the third year after closing, doubling by year six, alongside immediate accretion to earnings per share and free cash flow.