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Strong Orders Drive GE's Defense & Propulsion: Can Momentum Sustain?
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Key Takeaways
GE Aerospace's Defense & Propulsion Technologies revenues rose 16% to $3.4 billion in Q2 2026.
Segment orders climbed 12% year over year, while operating profit increased 18% to $475 million.
GE Aerospace expects 2026 Defense & Propulsion Technologies revenues to grow in the low-double digits.
GE Aerospace (GE - Free Report) is experiencing persistent strength in its Defense & Propulsion Technologies segment. Revenues from the segment increased 16% year over year to $3.4 billion in second-quarter 2026. Within the segment, revenues from the Defense & Systems business increased 11.7% to $2.2 billion, while revenues from the Propulsion & Additive Technologies business surged 23.4% to $1.2 billion. The top-line growth was supported by healthy demand for GE’s propulsion & additive technologies, critical aircraft systems and aftermarket services in the defense market.
Some of the recent contracts secured by the company include a deal from the Republic of Korea Navy to provide 12 LM2500+G4 marine gas turbine engines for its naval destroyer project, KDDX. It also clinched a deal from Defense Innovation Unit (DIU) to work on the development of a hypersonic test bed as part of the HyCAT project. In the second quarter, GE also received a contract from Turkish Aerospace Industries to continue integrating its F404 engine into Türkiye's Hurjet jet trainer.
The strong pipeline of projects boosted the Defense & Propulsion Technologies segment’s orders, which increased 12% year over year in the second quarter. The segment’s operating profit grew 18% to $475 million. The company exited the second quarter with a total backlog of $210 billion. For 2026, GE expects revenues from the Defense & Propulsion Technologies segment to increase in the low-double-digit range.
It’s worth noting that GE recently inked a contract to acquire Consolidated Precision Products (“CPP”) from private equity firms Warburg Pincus and Berkshire Partners. The deal is valued at about $11.75 billion in total, using $7 billion in cash and new debt for the remaining consideration. Although the acquisition will likely strengthen GE’s critical casting capacity and manufacturing capabilities, it is expected to expand its debt profile.
GE's Peers in the Defense Market
Among its major peers, Textron Inc. (TXT - Free Report) enjoys solid demand for its defense products as well. In the second quarter of 2026, revenues from Textron’s Bell segment increased 6% year over year, driven largely by higher H-1 and MV-75 volume and an increase in commercial helicopter deliveries. Textron Systems revenues increased 7% on armored vehicles and ATAC services.
Another peer of GE, RTX Corporation (RTX - Free Report) , is witnessing solid bookings and backlog levels. RTX’s strong backlog supports a positive outlook for revenue growth in its defense business, which is expected to strengthen profits over the long term. RTX won several notable defense contracts during the first six months of 2026, which resulted in a record backlog of $289 billion that includes $119 billion of defense projects.
GE's Price Performance, Valuation and Estimates
Image Source: Zacks Investment Research
Shares of GE Aerospace have lost 2.2% in the past three months compared with the industry’s 6.4% decline.
Image Source: Zacks Investment Research
From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 37.63X, above the industry’s average of 30.36X. GE Aerospace carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GE’s 2026 and 2027 earnings has increased over the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
Strong Orders Drive GE's Defense & Propulsion: Can Momentum Sustain?
Key Takeaways
GE Aerospace (GE - Free Report) is experiencing persistent strength in its Defense & Propulsion Technologies segment. Revenues from the segment increased 16% year over year to $3.4 billion in second-quarter 2026. Within the segment, revenues from the Defense & Systems business increased 11.7% to $2.2 billion, while revenues from the Propulsion & Additive Technologies business surged 23.4% to $1.2 billion. The top-line growth was supported by healthy demand for GE’s propulsion & additive technologies, critical aircraft systems and aftermarket services in the defense market.
Some of the recent contracts secured by the company include a deal from the Republic of Korea Navy to provide 12 LM2500+G4 marine gas turbine engines for its naval destroyer project, KDDX. It also clinched a deal from Defense Innovation Unit (DIU) to work on the development of a hypersonic test bed as part of the HyCAT project. In the second quarter, GE also received a contract from Turkish Aerospace Industries to continue integrating its F404 engine into Türkiye's Hurjet jet trainer.
The strong pipeline of projects boosted the Defense & Propulsion Technologies segment’s orders, which increased 12% year over year in the second quarter. The segment’s operating profit grew 18% to $475 million. The company exited the second quarter with a total backlog of $210 billion. For 2026, GE expects revenues from the Defense & Propulsion Technologies segment to increase in the low-double-digit range.
It’s worth noting that GE recently inked a contract to acquire Consolidated Precision Products (“CPP”) from private equity firms Warburg Pincus and Berkshire Partners. The deal is valued at about $11.75 billion in total, using $7 billion in cash and new debt for the remaining consideration. Although the acquisition will likely strengthen GE’s critical casting capacity and manufacturing capabilities, it is expected to expand its debt profile.
GE's Peers in the Defense Market
Among its major peers, Textron Inc. (TXT - Free Report) enjoys solid demand for its defense products as well. In the second quarter of 2026, revenues from Textron’s Bell segment increased 6% year over year, driven largely by higher H-1 and MV-75 volume and an increase in commercial helicopter deliveries. Textron Systems revenues increased 7% on armored vehicles and ATAC services.
Another peer of GE, RTX Corporation (RTX - Free Report) , is witnessing solid bookings and backlog levels. RTX’s strong backlog supports a positive outlook for revenue growth in its defense business, which is expected to strengthen profits over the long term. RTX won several notable defense contracts during the first six months of 2026, which resulted in a record backlog of $289 billion that includes $119 billion of defense projects.
GE's Price Performance, Valuation and Estimates
Image Source: Zacks Investment Research
Shares of GE Aerospace have lost 2.2% in the past three months compared with the industry’s 6.4% decline.
Image Source: Zacks Investment Research
From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 37.63X, above the industry’s average of 30.36X. GE Aerospace carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GE’s 2026 and 2027 earnings has increased over the past 60 days.
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.