Embraer (EMBR3) Q1 2025 earnings summary

Executive summary

• Achieved record first-quarter revenue of $1.1 billion (US$1,103 million), the highest since 2016, with a record order backlog of $26.4 billion, up 25% year-over-year.

• Adjusted EBITDA margin reached 9.8%, the highest in five years, and adjusted EBIT margin improved to 5.6%.

• Aircraft deliveries increased 20–30% year-over-year, with 30 jets delivered in 1Q25, reflecting operational efficiency improvements.

• Resumed regular dividend payments, with R$51.4 million (R$0.07/share) approved for 2024.

• U.S. tariffs had limited or no impact on Q1 results; 2025 guidance remains unchanged.

Financial highlights

• Revenue rose 22–44% year-over-year to $1.1 billion (R$6.4 billion), with Service & Support and Executive Aviation contributing nearly 70% of total revenue.

• Adjusted EBITDA was $109 million (9.8% margin); adjusted EBIT was $62 million (5.6% margin), both up significantly year-over-year.

• Adjusted net result was negative $74 million, mainly due to deferred taxes and Eve results; reported net income was positive $73 million.

• Consumed $386 million in adjusted free cash flow, mainly due to inventory buildup for higher deliveries in coming quarters.

• Net debt (excluding Eve) was $468 million (R$2.7 billion), with net debt/EBITDA at 0.5x, down from 1.8x a year earlier.

Outlook and guidance

• 2025 guidance reaffirmed: double-digit growth in deliveries and revenue, with 77–85 commercial jets and 145–155 executive jets to be delivered.

• Expected consolidated revenue between $7.0–7.5 billion, adjusted EBIT margin 7.5–8.3%, and free cash flow of at least $200 million.

• Production leveling initiatives are expected to yield more stable output from 2026 onward.

• U.S. tariffs expected to have limited impact, with mitigation measures in place; guidance remains unchanged.

• Eve expected to complete first flight of full-scale prototype and secure first firm orders in 2025.