AerCap Holdings N.V. (NYSE: $AER) reported record financial results for full-year 2025, highlighting the earnings power of its global aircraft leasing platform even as the stock pulled back modestly following the release. Strong leasing income, robust asset sale gains, and sizeable insurance recoveries helped drive higher profitability, improved balance-sheet metrics, and expanded shareholder returns.
Record Earnings Cap a Strong 2025
For the fourth quarter of 2025, AerCap posted net income of $633 million, or $3.79 per share, while full-year net income reached $3.8 billion, or $21.30 per share. On an adjusted basis, which excludes certain recovery and accounting items, earnings totaled $660 million in Q4 and $2.7 billion for the year, underscoring the strength of the company’s core leasing and asset management operations
Total revenues and other income rose to $8.52 billion in 2025, supported by higher lease rents and continued demand for aircraft in the secondary market. AerCap sold $3.9 billion of assets during the year, generating record gains of $819 million, reflecting favorable pricing and tight supply conditions across commercial aviation.
Cash Flow and Capital Allocation Remain Key Differentiators
AerCap generated $5.39 billion in operating cash flow during 2025, comfortably funding aircraft purchases, prepayments, and debt reduction while still returning significant capital to shareholders. The company invested $3.65 billion in aircraft acquisitions and made $2.42 billion in prepayments, demonstrating confidence in long-term fleet demand.
At the same time, AerCap returned $2.6 billion to shareholders, repurchasing 22.1 million shares and paying dividends. Book value per share climbed 19% year over year to $112.59, aided by buybacks executed at prices management viewed as attractive relative to intrinsic value.
The board also increased the quarterly dividend to $0.40 per share, reinforcing the company’s commitment to consistent capital returns.
Ukraine Recoveries Bolster Results
Insurance and other recoveries related to aircraft stranded following the Ukraine conflict remained a material earnings tailwind. AerCap recognized $1.5 billion of recoveries in 2025, bringing total recoveries since 2023 to approximately $3 billion.
While these items are excluded from adjusted earnings, the cash inflows strengthened AerCap’s financial flexibility and supported both reinvestment activity and shareholder distributions.
Balance Sheet Strength Improves Further
AerCap exited 2025 with a stronger balance sheet. Total debt declined to $43.6 billion, while the adjusted debt-to-equity ratio improved to 2.11x, down from 2.35x a year earlier. Liquidity remained solid, and the company maintained broad access to funding markets.
The owned fleet remains relatively young, with an average aircraft age of 7.3 years and an average remaining lease term of 7.1 years, providing visibility into future cash flows amid ongoing aircraft supply constraints.
Market Performance
Despite the strong results, shares of AerCap closed at $140.07, down 2.73% on the day following the earnings release. The move appears more reflective of short-term profit-taking than a change in fundamentals.
Over longer timeframes, performance remains constructive. The stock is up roughly 44% year over year and nearly 29% over the past six months, even after the recent pullback. $AER is trading just below its 52-week high of $149.24, highlighting the strength of the broader uptrend.
Valuation remains relatively modest for a company delivering record profitability. AerCap currently trades at a trailing P/E of around 6.7x, with a price-to-book ratio near 1.35x. The consensus one-year price target of $153.67 implies mid-single-digit upside from current levels, with some analysts seeing further potential if capital returns remain elevated.
2026 Outlook Signals Confidence
Looking ahead, management issued 2026 adjusted EPS guidance of $12.00 to $13.00, excluding any gains on asset sales. While below record 2025 levels, the outlook reflects normalization after an exceptionally strong year and continued confidence in lease demand, funding discipline, and capital deployment.
Future performance will depend on aircraft availability, funding costs, airline health, and the pace of asset sales, but AerCap enters 2026 from a position of strength.
Is AerCap A Buy in 2026?
AerCap’s 2025 results reinforced its position as a global leader in aircraft leasing. Record earnings, strong cash flow, balance-sheet improvement, and rising shareholder returns highlight a business benefiting from favorable industry dynamics.
While $AER saw a short-term pullback following earnings, long-term fundamentals remain intact, and valuation metrics suggest the stock continues to attract investor interest as aviation demand and fleet constraints persist.
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