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Does Rolls-Royce's Jet Engine Momentum Seem Built to Last?

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Key Takeaways

  • Rolls-Royce benefits from civil and defense demand, led by its Trent family of engines.
  • RYCEY's Civil Aerospace unit posted double-digit revenue growth in H1 2025.
  • The company holds a backlog of more than 2,000 widebody engines as of July 2025.

The growth in global air travel and rising defense spending are driving demand for advanced jet engines, benefiting Rolls-Royce Holdings plc (RYCEY - Free Report) . The company is a prominent supplier of power systems for civil aviation, defense aircraft and business jets, with its Trent family of engines, in particular, playing a major role in widebody aircraft programs.

In the commercial segment, RYCEY’s Trent XWB powers the Airbus A350, one of the most efficient widebody aircraft. Furthermore, as airlines invest in fuel-efficient engines to modernize their fleet and lower operating costs, amid soaring passenger traffic, RYCEY’s Trent 1000, used on the Boeing 787, and the Trent 7000, used on the Airbus A330, are experiencing strong demand.
 
This solid demand trend, getting translated into strong order value, set the momentum for RYCEY’s long-term growth from the Civil Aerospace business, which delivered double-digit revenue growth in the first half of 2025. Evidently, the company boasted a large order backlog of more than 2,000 engines in its widebody segment (as of July 2025).

On the other hand, in defense, Rolls-Royce builds the EJ200 engine for the Eurofighter Typhoon, along with the AE 2100 and AE 1107C engines that power the C-130J Super Hercules and the V-22 Osprey, respectively. Growing geopolitical tensions resulting in the need to upgrade combat and transport fleet, along with increased European defense spending, are expected to boost steady demand for these engines in the long run.

In September 2025, Rolls-Royce, along with Avio Aero and IHI, expanded their partnership to develop the next-generation fighter engine under the Global Combat Air Programme. This collaboration highlights Rolls-Royce’s role in advancing future combat air propulsion technology.

Other Stocks to Focus On

Other prominent jet engine manufacturers, like GE Aerospace (GE - Free Report) and RTX Corporation (RTX - Free Report) , are also benefiting from the aforementioned demand trend in the form of solid order flows.

In September 2025, GE Aerospace signed an extended services agreement with Silk Way West Airlines to support the GE engines that power the latter’s Boeing fleet. The deal covers five GEnx-2B-powered 747-8 aircraft, six GE90-115B-powered 777 aircraft and up to four GE9X-powered 777-8 aircraft.

In September 2025, RTX clinched a $670.2 million contract to supply initial spares for the production and delivery of the F135 propulsion system to support the F-35 Joint Strike Fighter jet program. In the same month, it also secured a $60 million contract to produce and supply F135 propulsion systems in support of the 18th lot of F-35 aircraft.

The Zacks Rundown for RYCEY

Shares of RYCEY have surged 124.5% in the past year, outperforming its industry’s 36.6% growth.

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The company’s shares are trading at a discount on a relative basis, with its forward 12-month Price/Earnings being 36.51X compared with its industry’s average of 48.05X.

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The Zacks Consensus Estimate for RYCEY’s 2025 and 2026 earnings has improved over the past 60 days.

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RYCEY stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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