EMBRAER EARNINGS RESULTS 1st QUARTER 2025

Rhea-AI Summary

Embraer (NYSE: ERJ) reported strong Q1 2025 financial results with revenues of $1.103 billion, up 23% year-over-year, marking the best first quarter since 2016. The company delivered 30 aircraft (7 commercial and 23 executive jets), a 20% increase from Q1 2024. Adjusted EBIT reached $62 million with a 5.6% margin, improving from 0.8% in Q1 2024. The firm order backlog hit a record high of $26.4 billion. Defense & Security segment showed remarkable growth of 72% YoY. Embraer reaffirmed its 2025 guidance, expecting commercial aviation deliveries of 77-85 aircraft and executive aviation deliveries of 145-155 aircraft, with total revenues projected between $7.0-7.5 billion. The company improved its debt profile by issuing a $650 million 10-year bond and reduced its net debt-to-EBITDA ratio to 0.5x from 1.8x YoY.

Positive

• Revenue grew 23% YoY to $1.103 billion, best Q1 since 2016
• Defense & Security revenue increased 72% YoY
• Aircraft deliveries up 20% YoY to 30 jets
• Record firm order backlog of $26.4 billion
• Improved EBIT margin to 5.6% from 0.8% YoY
• Reduced net debt-to-EBITDA ratio to 0.5x from 1.8x YoY
• Announced dividend payment of R$51.4 million

Negative

• Negative adjusted free cash flow of $385.8 million in Q1
• Lower commercial aviation deliveries (7 jets) compared to executive aviation (23 jets)

Insights

Financial Analyst

Embraer posts robust Q1 with 23% revenue growth, improved margins, record backlog, and strengthened balance sheet despite temporary negative cash flow.

Embraer's Q1 2025 results showcase impressive financial performance with revenues reaching $1,103 million, marking a 23% year-over-year increase and the company's best first quarter since 2016. Profitability metrics show substantial improvement, with adjusted EBIT margin expanding to 5.6%, a significant jump from just 0.8% in Q1 2024.

The company executed strategic debt management by issuing a $650 million 10-year bond and retiring $522 million in 2027 bonds and $150 million in 2028 bonds. This financial restructuring extended average debt duration from 3.8 to 6.3 years and significantly reduced the net debt-to-EBITDA ratio to 0.5x from 1.8x a year ago, strengthening the balance sheet considerably.

While adjusted free cash flow excluding Eve was negative $385.8 million for the quarter, the company explicitly attributes this to inventory build-up in preparation for higher aircraft deliveries in coming quarters. This aligns with their reiterated full-year guidance projecting revenues of $7.0-7.5 billion, adjusted EBIT margins between 7.5%-8.3%, and positive adjusted free cash flow of $200 million or higher for the year.

The board's approval of R$51.4 million in dividends (R$0.07 per share) related to 2024 performance, while modest, returns capital to shareholders while maintaining financial flexibility for future growth initiatives.

Aerospace Industry Expert

Embraer demonstrates strong delivery growth, reaches record backlog, and shows exceptional defense segment performance despite seasonal cash flow pattern.

Embraer's delivery momentum accelerated in Q1 2025 with 30 aircraft deliveries, representing a 20% increase from the 25 units delivered in the same period last year. The mix included 7 commercial jets (3 E2s and 4 E1s) and 23 executive jets (14 light and 9 medium), with the company maintaining its full-year delivery guidance of 77-85 commercial aircraft and 145-155 executive jets.

The $26.4 billion backlog achieved in Q1 surpassed the previous all-time high set last quarter, indicating robust market demand across Embraer's portfolio. This record order book provides exceptional production visibility and supports the company's full-year financial projections.

The Defense & Security segment emerges as a standout performer with 72% year-over-year revenue growth, highlighting the value of Embraer's diversification beyond commercial aviation. The company explicitly notes that Q1 results were not impacted by U.S. tariffs, addressing a potential concern for aerospace investors.

The negative free cash flow in Q1 reflects inventory build-up in preparation for accelerated deliveries in subsequent quarters, a common pattern in aircraft manufacturing. If the projected delivery ramp-up materializes as guided, this should convert to the projected positive free cash flow of $200 million or higher by year-end.

SÃO PAULO, May 6, 2025 /PRNewswire/ -- EMBRAER S.A. (NYSE: ERJ; B3: EMBR3) RELEASES ITS FIRST QUARTER 2025 EARNINGS RESULTS.

HIGHLIGHTS

• 2025 Guidance reiterated: Commercial Aviation deliveries between 77 and 85 aircraft, and Executive Aviation deliveries between 145 and 155 aircraft. Total company revenues in the US$7.0 to US$7.5 billion range, adjusted EBIT margin between +7.5% and +8.3%, and adjusted free cash flow of US$200 million or higher for the year. The company highlights Q1 results were not impacted by U.S. tariffs.
• Revenues totaled US$1,103 million in 1Q25 – the best first quarter since 2016 – and +23% year over year (yoy). Highlight for Defense & Security revenues +72% yoy growth.
• Adjusted EBIT reached US$62.0 million with a +5.6% margin in 1Q25 (+0.8% in 1Q24).
• Adjusted free cash flow w/o Eve was US$(385.8) million during the quarter in preparation for a higher number of aircraft deliveries in the coming quarters.
• The company approved the payment of R$51.4 million in dividends (R$0.07 per share) related to 2024.
• Embraer issued a US$650 million 10-year bond at 158bp over U.S. Treasury in 1Q25, and purchased US$522 million in 2027 bonds (fully retired) and US$150 million in 2028 bonds.
• The company extended its debt duration to 6.3 years (3.8 years in 4Q) after the most recent liability management step, and ended the quarter with a 0.5x net debt-to-EBITDA ratio, down from 1.8x yoy.
• Embraer delivered 30 jets in 1Q25, of which 7 were commercial jets (3 E2s and 4 E1s) and 23 were executive jets (14 light and 9 medium); +20% versus the 25 aircraft delivered yoy.
• Firm order backlog of US$26.4 billion in 1Q25 – surpassed the all-time historical high set in the previous quarter. For more information please see 1Q25 Backlog and Deliveries release.
• To access the spreadsheet containing the data available in our Investor Relations website click here.

For additional information, please check the full document on our website ri.embraer.com.br

Investor Relations
Guilherme Paiva, Patrícia Mc Knight, Viviane Pinheiro, Eliane Fanis, Marilia Saback and Rodrigo Diniz.  
(+55 12)3927-6017
investor.relations@embraer.com.br
ri.embraer.com.br

CONFERENCE CALL INFORMATION
Embraer will host a conference call to present its 1Q25 results on:

Tuesday May 06, 2025
ENGLISH: 8:00 AM (NY Time) / 9:00 AM (SP Time).
Translation to Portuguese.

To access the webcast click here.

Zoom webinar: 848 4607 1530

Or alternatively to participate by phone call:
U.S.:  +1(929)205-6099, +1(253)205-0468
Brazil:  +55(11)4632-2237, +55(11)4680-6788

We recommend you join 15 minutes in advance. 

 

View original content:https://www.prnewswire.com/news-releases/embraer-earnings-results-1st-quarter-2025-302447154.html

SOURCE Embraer S.A.

FAQ

What were Embraer's (ERJ) Q1 2025 revenue and growth rate?

Embraer reported Q1 2025 revenues of $1.103 billion, representing a 23% increase year-over-year. This was their best first quarter performance since 2016.

How many aircraft did Embraer (ERJ) deliver in Q1 2025?

Embraer delivered 30 jets in Q1 2025, consisting of 7 commercial jets (3 E2s and 4 E1s) and 23 executive jets (14 light and 9 medium), representing a 20% increase from the 25 aircraft delivered in Q1 2024.

What is Embraer's (ERJ) guidance for 2025?

Embraer expects to deliver 77-85 commercial aircraft and 145-155 executive aircraft in 2025, with total company revenues between $7.0-7.5 billion, adjusted EBIT margin of 7.5-8.3%, and adjusted free cash flow of $200 million or higher.

What is Embraer's (ERJ) current order backlog as of Q1 2025?

Embraer's firm order backlog reached $26.4 billion in Q1 2025, setting a new all-time historical high for the company.

How did Embraer's (ERJ) Defense & Security segment perform in Q1 2025?

Embraer's Defense & Security segment showed strong performance with 72% year-over-year revenue growth in Q1 2025.