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Air T Stock Slips Post Q2 Earnings Despite Strong Profitability Gains
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Shares of Air T, Inc. (AIRT - Free Report) have lost 0.3% since the company reported results for the fiscal year ended Sept. 30, 2025, modestly outperforming the S&P 500 Index’s 1.9% decline over the same period. However, over the past month, the stock has lost 8.2% against the S&P 500’s 0.1% gain.
AIRT’s Earnings Snapshot
Air T’s second-quarter fiscal 2026 performance showed mixed top-line results but notable profitability gains. Revenues for the quarter ended Sept. 30, 2025, declined 21% year over year to $64.2 million from $81.2 million, driven largely by reduced activity in the Commercial Aircraft, Engines and Parts segment. Despite the lower revenue base, operating income increased 52.2% to $5.5 million from $3.6 million a year ago, reflecting stronger margins and cost controls. Adjusted EBITDA rose 56.6% to $7.9 million from $5 million, while earnings per share climbed 76.9% to $1.61 from $0.91 a year earlier.
Segment-level results were varied. On a year-over-year basis, the Overnight Air Cargo segment posted a 4% revenue decline, Ground Support Equipment revenue fell 33.3%, and Commercial Aircraft, Engines and Parts revenue contracted 36.6%. Digital Solutions remained the company’s smallest segment, but revenue grew 20.3% year over year. Several segments, notably Commercial Aircraft and Ground Support Equipment, delivered strong year-over-year EBITDA gains despite softer sales trends.
Air T’s Other Key Business Metrics
Beyond headline profitability, management highlighted improving balance sheet dynamics in select business units. Contrail, Air T’s engine and aircraft asset management business, eliminated all bank debt and ended the quarter with $6.7 million in cash, a significant deleveraging milestone given peak pandemic-era debt of $74.9 million. The investment balance for the company's equity method investees grew to $27.9 million as of Sept. 30, 2025, from $19 million at the end of March 2025.
For the six-month period ended Sept. 30, 2025, consolidated revenues declined 8.6% to $135 million from $147.7 million a year earlier, but adjusted EBITDA grew 58.7% to $9.3 million from $5.9 million.
Segment trends echoed the quarterly picture. Commercial Aircraft engines and parts remained the largest contributor to EBITDA, while Ground Support Equipment demonstrated one of the largest year-over-year improvements, buoyed by stronger margins and backlog growth (backlog of $12.9 million compared with $6.2 million the prior year).
CEO Nick Swenson emphasized operational discipline and strategic positioning. Swenson praised the Contrail team for its multi-year effort to fully deleverage the business and noted that Contrail is well-positioned should the aftermarket for end-of-life engines soften. Management also highlighted early-stage progress toward acquiring Rex Regional Airlines in Australia, describing the transaction as the “return to classic Rex,” pending court approval and expected to close in December 2025.
Factors Influencing Air T’s Quarterly Results
The quarter’s headline revenue decline was driven largely by timing-related issues and lower component inventory availability. In Ground Support Equipment, fewer deicing trucks were sold during the quarter because more orders had been placed earlier in the fiscal year, shifting revenue recognition into the fiscal first quarter. The Commercial Aircraft segment’s revenue contraction stemmed from reduced component inventory purchases over the prior 12 months, limiting available product for resale.
Still, profitability advanced due to strong execution in higher-margin areas. The sale of two Airbus A321-111 aircraft significantly boosted earnings in the Commercial Aircraft segment. Reduced expenses within Ground Support Equipment also contributed, though operating costs as a percentage of sales did not fall as sharply as in the prior year. Meanwhile, the Overnight Air Cargo segment saw softer revenue due to lower flight administration fees, but its EBITDA decline was minimal, underscoring the segment’s stability.
AIRT’s Guidance
Air T did not provide any formal forward guidance. However, narrative comments emphasize continued investment in asset management, growth through selective acquisitions, and a focus on generating attractive long-term returns across the portfolio. Management reiterated its goal of expanding and strengthening cash flow per share while leveraging partnerships and disciplined capital allocation.
Air T’s Other Developments
Recent corporate actions include the signing of a Sale and Implementation Deed to acquire Regional Express Holdings Limited (Rex), subject to creditor and court approvals. Additionally, Air T amended its revolving credit agreement with Alerus, increasing borrowing capacity to $20 million, reducing interest costs, and extending maturity to Aug. 28, 2027. In the Commercial Aircraft segment, CASP completed the sale of two Airbus A321-111 aircraft for more than $25 million, generating net proceeds of $19.9 million — a meaningful contributor to second-quarter fiscal 2026 profitability.
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Air T Stock Slips Post Q2 Earnings Despite Strong Profitability Gains
Shares of Air T, Inc. (AIRT - Free Report) have lost 0.3% since the company reported results for the fiscal year ended Sept. 30, 2025, modestly outperforming the S&P 500 Index’s 1.9% decline over the same period. However, over the past month, the stock has lost 8.2% against the S&P 500’s 0.1% gain.
AIRT’s Earnings Snapshot
Air T’s second-quarter fiscal 2026 performance showed mixed top-line results but notable profitability gains. Revenues for the quarter ended Sept. 30, 2025, declined 21% year over year to $64.2 million from $81.2 million, driven largely by reduced activity in the Commercial Aircraft, Engines and Parts segment. Despite the lower revenue base, operating income increased 52.2% to $5.5 million from $3.6 million a year ago, reflecting stronger margins and cost controls. Adjusted EBITDA rose 56.6% to $7.9 million from $5 million, while earnings per share climbed 76.9% to $1.61 from $0.91 a year earlier.
Segment-level results were varied. On a year-over-year basis, the Overnight Air Cargo segment posted a 4% revenue decline, Ground Support Equipment revenue fell 33.3%, and Commercial Aircraft, Engines and Parts revenue contracted 36.6%. Digital Solutions remained the company’s smallest segment, but revenue grew 20.3% year over year. Several segments, notably Commercial Aircraft and Ground Support Equipment, delivered strong year-over-year EBITDA gains despite softer sales trends.
Air T’s Other Key Business Metrics
Beyond headline profitability, management highlighted improving balance sheet dynamics in select business units. Contrail, Air T’s engine and aircraft asset management business, eliminated all bank debt and ended the quarter with $6.7 million in cash, a significant deleveraging milestone given peak pandemic-era debt of $74.9 million. The investment balance for the company's equity method investees grew to $27.9 million as of Sept. 30, 2025, from $19 million at the end of March 2025.
For the six-month period ended Sept. 30, 2025, consolidated revenues declined 8.6% to $135 million from $147.7 million a year earlier, but adjusted EBITDA grew 58.7% to $9.3 million from $5.9 million.
Segment trends echoed the quarterly picture. Commercial Aircraft engines and parts remained the largest contributor to EBITDA, while Ground Support Equipment demonstrated one of the largest year-over-year improvements, buoyed by stronger margins and backlog growth (backlog of $12.9 million compared with $6.2 million the prior year).
Air T, Inc. Price, Consensus and EPS Surprise
Air T, Inc. price-consensus-eps-surprise-chart | Air T, Inc. Quote
AIRT’s Management Commentary
CEO Nick Swenson emphasized operational discipline and strategic positioning. Swenson praised the Contrail team for its multi-year effort to fully deleverage the business and noted that Contrail is well-positioned should the aftermarket for end-of-life engines soften. Management also highlighted early-stage progress toward acquiring Rex Regional Airlines in Australia, describing the transaction as the “return to classic Rex,” pending court approval and expected to close in December 2025.
Factors Influencing Air T’s Quarterly Results
The quarter’s headline revenue decline was driven largely by timing-related issues and lower component inventory availability. In Ground Support Equipment, fewer deicing trucks were sold during the quarter because more orders had been placed earlier in the fiscal year, shifting revenue recognition into the fiscal first quarter. The Commercial Aircraft segment’s revenue contraction stemmed from reduced component inventory purchases over the prior 12 months, limiting available product for resale.
Still, profitability advanced due to strong execution in higher-margin areas. The sale of two Airbus A321-111 aircraft significantly boosted earnings in the Commercial Aircraft segment. Reduced expenses within Ground Support Equipment also contributed, though operating costs as a percentage of sales did not fall as sharply as in the prior year. Meanwhile, the Overnight Air Cargo segment saw softer revenue due to lower flight administration fees, but its EBITDA decline was minimal, underscoring the segment’s stability.
AIRT’s Guidance
Air T did not provide any formal forward guidance. However, narrative comments emphasize continued investment in asset management, growth through selective acquisitions, and a focus on generating attractive long-term returns across the portfolio. Management reiterated its goal of expanding and strengthening cash flow per share while leveraging partnerships and disciplined capital allocation.
Air T’s Other Developments
Recent corporate actions include the signing of a Sale and Implementation Deed to acquire Regional Express Holdings Limited (Rex), subject to creditor and court approvals. Additionally, Air T amended its revolving credit agreement with Alerus, increasing borrowing capacity to $20 million, reducing interest costs, and extending maturity to Aug. 28, 2027. In the Commercial Aircraft segment, CASP completed the sale of two Airbus A321-111 aircraft for more than $25 million, generating net proceeds of $19.9 million — a meaningful contributor to second-quarter fiscal 2026 profitability.