Companies /Industrials

AAR Corp

NYSE: AIR Aerospace & Defense
$135.90
▼ $2.68 (−1.93%) today
Markets closed · 10:07pm ET

Q3 2026 Earnings

Reported Mar 24, 2026, 4:36pm ET · SEC source
$1.25
Beat +8.07%
EPS · est. $1.16
$845.1M
Beat +4.00%
Revenue · est. $812.6M
−15.9%
Trailing market
AIR vs S&P since report
6 quarters
Consecutive EPS beats

Market Reaction

% change · around the report
−5%0+5%+10%Mar 24Mar 25report 4:36pm ETearnings−0.7%+6.6%
−5%0+5%+10%Mar 24Mar 25earnings−0.7%+6.6%
AIR +6.6%S&P 500 −0.7%
−5%0+5%+10%Mar 24Mar 25report 4:36pm ETearnings−0.8%+6.6%
−5%0+5%+10%Mar 24Mar 25earnings−0.8%+6.6%
AIR +6.6%NASDAQ −0.8%
−6%0+6%+12%Mar 23Apr 1report 4:36pm ETearnings−0.3%+1.2%
−6%0+6%+12%Mar 23Apr 1earnings−0.3%+1.2%
AIR +1.2%S&P 500 −0.3%
−6%0+6%+12%Mar 23Apr 1report 4:36pm ETearnings−0.7%+1.2%
−6%0+6%+12%Mar 23Apr 1earnings−0.7%+1.2%
AIR +1.2%NASDAQ −0.7%
+9.93%
Day of report
−6.50%
Next session
−6.03%
One week
−7.02%
30 days

S&P 500 over the same 30 days: +8.88%.

Did AIR Beat Earnings? Q3 2026 Results

AAR Corp posted a standout fiscal third quarter, with adjusted diluted EPS of $1.25 clearing the $1.16 consensus by 8.07% and revenue of $845.10 million topping estimates by 4.00% on 24.6% year-over-year growth, signaling that the company's acquisition-fueled expansion strategy is delivering ahead of schedule. The headline driver was a surging Parts Supply segment, where sales jumped 45% to $392.50 million on 36% organic growth in new parts distribution and 55% organic growth in government sales, with newly acquired ADI already exceeding management expectations and lifting segment adjusted EBITDA margins 130 basis points to 14.9%. Adjusted EBITDA for the consolidated company rose 26% to $102.10 million, while cash from operations swung to a robust $74.70 million from negative $18.70 million a year ago, pushing net leverage down to a comfortable 2.17x. A freshly secured U.S. Air Force cargo pallet contract worth up to $450 million reinforced the company's government revenue outlook. Management raised full-year FY2026 guidance, now targeting approximately 19% total sales growth and 12% organic growth, with the pending A-R-T acquisition expected to close in Q4.

Key Takeaways
  • 36% organic growth in new parts Distribution activity
  • 55% organic growth in new parts Distribution sales to government customers
  • Continued volume increases in hangars and component repair facilities
  • Trax recurring software revenue expansion
  • Acquisitions of HAECO Americas and ADI contributing to top-line growth
  • ADI exceeding expectations with accretive adjusted operating margins
  • Sales mix shift toward higher-margin offerings

“AAR delivered another outstanding quarter, continuing our momentum. Total sales were up 25%, including 14% organic adjusted sales growth. We saw growth across each of our parts, repair, and software platform activities in the quarter. Our Parts Supply segment grew 45% led by 36% organic growth in our new parts Distribution activity. Within new parts Distribution we saw 55% organic growth in sales to our government customers.”

AAR CEO, on the earnings call

Forward Guidance & Outlook

AAR raised its full-year FY2026 guidance: total sales growth now expected at approximately 19% (up from approaching 17%) and organic sales growth at approximately 12% (up from approaching 11%). For Q4 FY2026, the company guides total sales growth of 19–21%, organic sales growth of 6–8%, adjusted operating margin of 10.2–10.5%, and an estimated tax rate of 28%. The company expects continued margin expansion from sales mix shift to higher-margin offerings and synergy realization from recent acquisitions. The A-R-T acquisition is expected to close in Q4 FY2026. An Investor Day is scheduled for May 12, 2026 in New York.

AIR YoY Financials

Q3 2026 vs Q3 2025 · SEC filings Q3 2025 Q3 2026
$0$300.0M$600.0M$900.0M$678.2M$845.1MRevenue$131.7M$154.7MGross Profit$71.1M$65.8MOperating Income$7.1M$68.0MNet Income
$0$300.0M$600.0M$900.0MRevenueGross ProfitOperating IncomeNet Income

AIR Revenue by Segment

Parts Supply$392.5M+45.0%
Repair, Engineering, and Software
Repair & Engineering$265.3M+23.0%
Integrated Solutions$167.8M+3.0%
Government Solutions
Legacy Commercial Programs
Expeditionary Services$19.5M−32.1%

Figures from SEC filings and company reports. Not investment advice.