CAE (CAE) Q1 2026 earnings summary

Executive summary

• Revenue grew 2% year-over-year to $1,098.6 million, with operating income up 23% to $133.8 million and net income up 18% to $57.2 million; adjusted segment operating income rose 10% to $147.8 million and adjusted EPS remained stable at $0.21.

• Leadership transition as Matthew Bromberg succeeds Marc Parent as CEO, with Calin Rovinescu as Executive Chairman and governance changes announced.

• Civil Aviation and Defense & Security divisions continue to drive growth, supported by a robust global presence and strong order backlog.

Financial highlights

• Consolidated revenue of $1.1 billion, up 2% year-over-year; adjusted segment operating income rose 10% to $147.8 million; operating income up 23% to $133.8 million.

• Net income attributable to equity holders rose 18% to $57.2 million; adjusted EPS was $0.21, flat year-over-year.

• Free cash flow was negative $36.2 million, down from negative $25.3 million a year ago, mainly due to higher investment in non-cash working capital.

• Capital expenditures totaled $106.9 million, with 75% invested in growth, mainly for defense simulators.

• Net finance expense increased to $54.6 million from $49.5 million year-over-year.

Outlook and guidance

• Targeting net debt to adjusted EBITDA of 2.5x by fiscal year-end, with further deleveraging expected.

• Civil segment expects mid-single-digit adjusted operating income growth for FY2026 at the lower end of prior outlook, with stable margin.

• Defense segment targets low double-digit annual adjusted segment operating income growth and margin of 8–8.5%.

• Free cash flow conversion rate targeted at ~150% of adjusted net income for FY2026 and beyond.

• FY26 CAPEX expected to be modestly lower than FY25, focused on organic growth and simulator capacity.