GE Aerospace's Q1 2025 Earnings: Navigating the Skies of Expectation and Risk

As GE Aerospace prepares to release its Q1 2025 earnings on April 22, investors are bracing for a report that could define the trajectory of this aerospace giant’s recovery. With consensus estimates pointing to robust growth and geopolitical crosswinds complicating the outlook, the earnings call will test whether GE’s pivot to a pure-play aerospace firm can deliver on its promises.

Key Metrics: High Hopes, High Stakes

Analysts project adjusted EPS of $1.27, a 54.9% year-over-year surge from Q1 2024’s $0.82, driven by stronger aftermarket demand and cost discipline. Revenue is expected to hit $9.05 billion, a 12% increase from the same period last year. These figures reflect upward revisions over the past month, as analysts grow more confident in GE’s ability to capitalize on its $194 billion market cap and $6.8 billion operating profit (trailing 12 months).

Analysts: Bullish on Backlog, Cautious on Tariffs

The Strong Buy consensus (16 Buy ratings) highlights two critical pillars of GE’s strategy: its commercial aircraft engine backlog, which stretches through the decade, and its aerospace aftermarket (MRO) business. Wells Fargo’s Matthew Akers, who raised his price target to $212, emphasized the latter, noting that aging aircraft fleets and high airline utilization are fueling robust demand for maintenance, repair, and overhaul services.

However, risks loom large. Citi’s Jason Gursky lowered his price target to $227, citing potential margin pressures from tariffs on North American imports and the U.S.-China trade dispute. Should China delay Boeing deliveries—a scenario analysts now consider plausible—the ripple effect could reduce demand for GE’s LEAP engines, which power many Boeing jets.

Risks: Trade Wars and Economic Headwinds

The U.S.-China trade war remains the largest wildcard. While GE’s defense exposure (23% of revenue) is less tariff-sensitive, commercial aviation could suffer if Boeing faces delays. Wells Fargo warns that even a modest global economic slowdown could cut aircraft demand by 3%, trimming aftermarket revenue by 6% and original equipment sales by 10%.

Meanwhile, Worthington Industries’ recent revenue decline and Snap-on’s missed estimates underscore sector-wide volatility, making GE’s aftermarket dominance a critical differentiator.

Historical Performance: A Track Record of Post-Earnings Gains

GE’s stock has historically reacted positively to earnings, rising 58% of the time over the past five years. The median one-day gain is 4.6%, with a peak of 8.3% in 2023. This bodes well for investors, though the 6.4% price swing anticipated post-Q1 suggests volatility. Retail sentiment, however, is tepid, with Stocktwits scoring a bearish 26/100—a contrast to the institutional optimism reflected in price targets.

Conclusion: A High-Flying Bet, Anchored by Real Risks

GE Aerospace’s Q1 earnings are a litmus test for its post-corporate-split strategy. With $5.42 billion in annual EPS guidance and a $230.67 average price target (implying a 27% upside from current levels), the case for buying hinges on execution in two areas: sustaining aftermarket growth and navigating geopolitical turbulence.

The numbers are compelling: 12% revenue growth and a $39.44 billion full-year revenue target suggest momentum, while the $6.6 billion net income (trailing 12 months) underscores profitability. Yet investors must weigh these positives against the $15.17 billion pre-split Q1 2024 revenue figure, which may skew comparisons.

In the end, GE’s story remains tied to its ability to balance growth with resilience. If the earnings call confirms strong aftermarket trends and provides clarity on China-Belgium-Boeing dynamics, the stock could soar. But should macro risks materialize, the skies might grow stormier. For now, the engines of opportunity are revving—investors must decide whether to fasten their seatbelts for takeoff or wait for clearer skies.