GE Aerospace (GE) is minting money at a pace that would make even the U.S. Treasury jealous.

The jet engine powerhouse just posted its third consecutive quarter of blistering growth, and the cash is flowing like fuel through a LEAP engine at full throttle. 

With free cash flow conversion topping 130% and the business firing on all cylinders, dividend-hungry investors have every reason to be optimistic.

During the company’s third-quarter earnings call, CFO Rahul Ghai told analysts:

That growth is translating directly into shareholder returns. Since spinning off from General Electric in 2024, GE Aerospace stock has more than doubled.  

Moreover, it has committed to returning $24 billion to shareholders over the 2024-2026 period—a 20% increase from its initial spin-off plans.

A focus on Q4 earnings on January 22

Valued at a market cap of $331 billion, GE Aerospace stock has returned 71% in the last 12 months.

The ongoing rally can be attributed to its steady earnings growth. After adjusted earnings grew 63.7% in 2024, it is forecast to increase by another 35.6% in 2025, as per Tikr.com.

All eyes will be on GE’s upcoming Q4 results which will be a near-term driver of the stock price.

According to data from Yahoo Finance, analysts forecast:

• Revenue in Q4 to increase to $11.2 billion from $9.88 billion in the year-ago period.
• Adjusted earnings per share to expand to $1.43 from $1.32 per share.

The cash machine is just getting started

GE Aerospace’s third-quarter performance was exceptional by nearly every measure.

Revenue climbed 26% to $11.3 billion, operating profit jumped 26% to $2.3 billion, and adjusted earnings per share soared 44% to $1.66. 

The company operates the world’s most extensive installed base of commercial jet engines—78,000 engines powering three out of every four commercial aircraft globally. 

GE has a massive fleet of commercial engines

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That massive fleet generates a steady stream of high-margin services revenue that’s become increasingly predictable.

“Our 78,000-engine installed base is the largest in the industry by far,” Ghai emphasized at a recent industry conference. “Through this installed base, we power 3 out of every 4 commercial aircraft and 2 out of 3 U.S. combat and rotary craft aircraft.”

Here’s what drove the quarter’s standout performance:

• Services revenue rose 28% as material availability improved and shop visits increased.
• Internal shop visit revenue grew 33% from higher volume and wider work scopes.
• Spare parts sales climbed 25% as supply chain constraints eased.
• LEAP engine deliveries surged 40% year-over-year in Q3.

The supply chain unlock is notable. For months, GE Aerospace struggled to meet surging demand as suppliers couldn’t keep pace.

Now, material input from priority suppliers is up 35% year-over-year and climbing sequentially.

FLIGHT DECK drives the turnaround

Behind GE’s operational resurgence sits FLIGHT DECK, the company’s proprietary lean manufacturing system that’s transforming how the business operates.

CEO Larry Culp launched FLIGHT DECK in early 2024 as a branded catalyst to accelerate the company’s lean transformation. The results speak for themselves.

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“FLIGHT DECK is not only helping us improve our own operations, but also driving improvements across suppliers,” Ghai explained. “Material flow improved more than 30% year-over-year in the third quarter and up high single digits sequentially.”

The system focuses on four priorities—safety, quality, delivery, and cost—in that exact order. But it’s doing more than just improving metrics. It’s fundamentally changing the company’s culture.

Walk into any GE Aerospace factory today, and you’ll see the same dashboards tracking the same metrics. 

Green means good. Red means problems that need immediate attention. No PowerPoint presentations. No conference room discussions. Just transparent, real-time data on the factory floor.

This transparency extends deep into the supply chain, where GE has stationed 550-600 engineers at supplier sites to collaboratively solve problems. That hands-on approach recently helped one critical supplier improve first-time yields and more than double output.

Services growth has serious legs

While equipment sales grab headlines, Services are where GE Aerospace really makes its money—and the growth runway looks long.

The Services accounted for roughly 65% of revenue over the past 12 months, according to data from Fiscal.ai, and that percentage should hold steady or increase as the installed base grows. 

More importantly, Services orders jumped 31% year-to-date, setting up strong revenue growth for years ahead.

The math works because engines that flew during the pandemic are now coming due for overhauls. Despite robust air traffic recovery, total shop visits in 2025 will still run below 2019 levels. That represents massive pent-up demand.

“The engines that will need overhaul in 2026 will be up double digits over 2025,” Ghai noted, explaining why services growth should continue outpacing broader traffic trends.

Three factors are supercharging services revenue:

• Work scopes are intensifying: Second shop visits on wide-body engines like the GE90 are 50% more intensive than first visits, with 70% of the fleet yet to hit that milestone.
• LEAP external shop visits are exploding: Up 30% year-over-year, unlocking high-margin spare parts revenue.
• Pricing power remains intact: Low single-digit price increases continue across the portfolio.

GE Aerospace is bullish on dividend growth

GE Aerospace currently returns capital through a combination of dividends and share buybacks. 

Management estimates free cash flow of $7.1-$7.3 billion in 2025, up $500 million from prior estimates and representing YoY growth of almost 100%. 

Management expects “really good” cash generation to continue in 2026 as services momentum builds and equipment deliveries increase.

According to data from Tikr.com, between 2024 and 2029, GE Aerospace is forecast to increase:

• Free cash flow from $3.67 billion to $10.50 billion.
• Adjusted EPS from $4.60 to $10.56.
• Annual dividend from $1.12 per share to $2.83 per share.

It means that the company’s dividend payout ratio will narrow from 32% in 2024 to 28% in 2029. 

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Looking ahead to 2028, the company maintains its target of $11.5 billion in operating profit. With services margins expanding and LEAP profitability improving, free cash flow should track meaningfully higher.

The widening gap between profit growth and capital spending needs creates room for aggressive shareholder returns. Unlike capital-intensive businesses, jet engine services require relatively modest reinvestment once capacity is in place.

An improving dividend payout ratio will allow GE Aerospace to reinvest in organic growth as well as pursue accretive acquisitions. 

For income-focused investors, GE Aerospace stock offers a rare combination of growing dividends, which is supported by solid FCF growth. 

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