GE Aerospace (GE) is seeing sustained strength in its Defense and Propulsion Technologies segment, with revenues climbing 16% year over year to $3.4 billion in the second quarter of 2026.
Within the segment, Defense and Systems business revenues rose 11.7% to $2.2 billion, while Propulsion and Additive Technologies revenues surged 23.4% to $1.2 billion.
That top-line growth was driven by healthy demand for GE’s propulsion and additive technologies, critical aircraft systems, and aftermarket services across the defense market.
Recent contract wins are adding further fuel to that momentum, including a deal with the Republic of Korea Navy to supply 12 LM2500+G4 marine gas turbine engines for the KDDX naval destroyer project.
GE also secured a contract with the Defense Innovation Unit to work on development of a hypersonic test bed as part of the HyCAT project.
Additionally, Turkish Aerospace Industries awarded GE a contract to continue integrating its F404 engine into Türkiye’s Hurjet jet trainer during the second quarter.
Segment orders increased 12% year over year in the second quarter, with operating profit growing 18% to $475 million on the back of that strong project pipeline.
GE exited the second quarter with a total company backlog of $210 billion, and management expects Defense and Propulsion Technologies revenues to grow in the low-double-digit range for full-year 2026.
On the acquisition front, GE recently agreed to acquire Consolidated Precision Products from private equity firms Warburg Pincus and Berkshire Partners in a deal valued at approximately $11.75 billion, using $7 billion in cash and new debt for the remaining consideration.
While the deal is expected to strengthen GE’s casting capacity and manufacturing capabilities, it will also expand the company’s debt profile, which investors are watching closely.
Among peers, Textron Inc. (TXT) is also seeing solid defense demand, with Bell segment revenues rising 6% year over year in the second quarter, driven by higher H-1 and MV-75 volume alongside increased commercial helicopter deliveries.
Textron Systems revenues grew 7% on armored vehicles and ATAC services, reflecting broad-based defense spending tailwinds across the sector.
RTX Corporation (RTX) reported a record backlog of $289 billion through the first six months of 2026, which includes $119 billion in defense projects, underscoring strong industry-wide momentum.
From a price performance standpoint, GE shares have declined 2.2% over the past three months, outperforming the broader industry, which fell 6.4% over the same period.
GE is currently trading at a forward price-to-earnings ratio of 37.63X, a premium to the industry average of 30.36X, and carries a Value Score of D, suggesting limited value appeal at current levels.
The Zacks Consensus Estimate for GE’s 2026 and 2027 earnings has moved higher over the past 60 days, and the stock currently carries a Zacks Rank of 3, or Hold.
