StandardAero, Inc. (SARO) · Nov 5, 2026 · Earnings
Beat — Adjusted EPS $0.39 vs ~$0.38 consensus
StandardAero’s third-quarter earnings slightly beat consensus and lifted full-year guidance, led by Engine Services, while component margins weakened.
StandardAero is a pure-play aerospace engine aftermarket provider building capacity around Engine Services, including newer LEAP work and expanded CFM56 capabilities, while benefiting from sustained aircraft-maintenance demand. Its prior quarter had already raised 2026 guidance, so this filing is an acceleration of an existing execution story—not a new strategic pivot.
The quarter was a narrow earnings beat, not a broad revenue surprise. Adjusted diluted EPS reached $0.39 versus published consensus of roughly $0.38, while revenue of $1.557 billion was effectively in line with the roughly $1.56 billion expectation. The stronger result came from profitability: adjusted EBITDA rose 15% and margin expanded 130 basis points year over year.
| Q3 2026 | Q3 2025 | Consensus | |
|---|---|---|---|
| Revenue (Financial Highlights) | $1,557.4M (+4.0%) | $1,498.0M | ~$1,560M |
| Adjusted diluted EPS (Financial Highlights) | $0.39 (+30.0%) | $0.30 | ~$0.38 |
| Adjusted EBITDA (Financial Highlights) | $224.9M (+15.0%) | $195.6M | |
| Adjusted EBITDA margin (Financial Highlights) | 14.4% (+130 bps) | 13.1% |
Engine Services is carrying the business—and the guidance raise. Engine Services EBITDA jumped 24% with a 250-basis-point margin expansion, driven by volume, mix, productivity and used serviceable material. That more than offset the weaker Component Repair Services result and pushed full-year revenue, EBITDA and adjusted EPS guidance above the ranges issued in August. The midpoint increases were about 2.3% for revenue, 1.7% for EBITDA and 3.9% for adjusted EPS.
| New FY26 guide | Prior FY26 guide | |
|---|---|---|
| Revenue (Full Year 2026 Guidance) | $6,525M–$6,645M | $6,375M–$6,500M |
| Adjusted EBITDA (Full Year 2026 Guidance) | $905M–$920M | $885M–$910M |
| Adjusted diluted EPS (Full Year 2026 Guidance) | $1.57–$1.62 | $1.50–$1.57 |
| Adjusted free cash flow (Full Year 2026 Guidance) | $270M–$300M | $270M–$300M |
The mix is less clean than the headline suggests. Component Repair Services revenue grew 7.3%, but its EBITDA fell 9.9% and margin dropped from 30.7% to 25.8%, showing that growth there is currently coming with substantial productivity and mix pressure. Cash conversion also remains a constraint: nine-month operating cash flow was only $81.7 million, despite $270.0 million of net income, and adjusted free cash flow was just $16.1 million after heavy intangible-asset spending.
The buyback is meaningful capital allocation, but it competes with deleveraging and liquidity needs. The company authorized another $560 million, taking total repurchase capacity to $1 billion, and intends to execute a $350 million accelerated share repurchase. That is a stronger shareholder-return signal, but cash declined to $191.3 million from $289.7 million at year-end while debt rose to roughly $2.5 billion; the filing therefore supports confidence in earnings durability more than it demonstrates balance-sheet flexibility.
Bottom line: This is a modestly better-than-expected quarter with a genuine guidance raise, powered by Engine Services. The story advances, but weaker Component Repair margins, limited cash conversion and continued leverage keep it from being a clean, across-the-board upgrade.
Q3 earnings call, November 5
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