Aerospace Industrial Development (2634) Q2 2026 earnings summary

Executive summary

• Significant government funding and legislative support are driving robust growth in the unmanned vehicle and drone industry, positioning Taiwan as a regional supply chain hub.

• Major commercial aviation market growth is forecasted globally, with strong demand for new aircraft, engines, and business jets through 2045.

• Operational achievements include winning a NT$1.2 billion Coast Guard drone contract, securing NT$22 billion in new commercial orders, and expanding international collaborations.

• Revenue for the six months ended June 30, 2026, was NT$16,782,863 thousand, up 7% year-over-year, with a significant increase in net profit to NT$1,226,061 thousand from NT$13,877 thousand in 2025.

• Gross profit margin improved to 14% from 7% year-over-year, driven by higher sales and a favorable settlement reducing late-delivery penalties.

Financial highlights

• H1 2026 profit increased year-over-year, driven by defense sector growth and commercial aviation recovery.

• Sales rose from NT$156.8 billion in H1 2025 to NT$167.8 billion in H1 2026, a 7% increase.

• Net profit for H1 2026 reached NT$1,226,061 thousand, up from NT$13,877 thousand in H1 2025.

• EPS improved from NT$0.01 in H1 2025 to NT$1.30 in H1 2026.

• Operating cash flow for the six months was NT$7,279,566 thousand, a significant turnaround from negative NT$2,825,532 thousand in 2025.

Outlook and guidance

• Focus on completing AJT production, expanding military aircraft upgrades, and developing UAV and counter-UAV markets.

• Plans to secure incremental commercial orders, deepen vertical integration, and target high-margin products.

• Strategic expansion into energy storage, simulation, and space markets.

• The company is focused on maintaining adequate capital for operations, business expansion, and participation in international aircraft and engine development projects.

• Management is monitoring the impact of new IFRS standards effective in 2027 and 2028, with ongoing assessment of potential effects.