Safran Posts Record Year, but Treads Carefully Amid Airbus-Pratt Engine Standoff
Paris, France — Safran delivered a banner set of annual results on Friday, reporting a 26 percent jump in recurring operating income for 2025 and guiding toward further growth this year. But the French aerospace group’s earnings day was shadowed by an entirely different question: whether its CFM International engine venture would step in to fill the gap left by an unresolved supply dispute between Airbus and rival engine maker Pratt & Whitney.
CEO Olivier Andries struck a cautious tone on that front. Speaking to reporters after the earnings release, he said CFM — co-owned by Safran and GE Aerospace — would do its best to accommodate any additional requests from Airbus for LEAP engines this year, beyond volumes already agreed. But he made clear the joint venture’s first obligation is meeting its existing commitments to customers. The planned 15 percent increase in total LEAP deliveries for 2026, Andries noted, does not factor in any grab for additional market share on the A320neo program. That careful positioning matters because Airbus finds itself in an increasingly uncomfortable spot. The European planemaker still hasn’t secured a supply agreement with RTX-owned Pratt & Whitney for either 2026 or 2027, according to industry sources. The two sides remain locked in a dispute over how to allocate geared turbofan engines between new-build production lines and the aftermarket repair shops serving airlines already flying GTF-powered aircraft. Pratt & Whitney powers roughly 40 percent of A320neo-family jets coming off the assembly line, and the absence of a deal creates real uncertainty around Airbus’ ability to set formal delivery targets.
Airbus acknowledged last month that engines — particularly those from Pratt & Whitney — were arriving late. Christian Scherer, the departing head of Airbus’ commercial aircraft division, said in late January that he expected the uncertainty surrounding Pratt engine supplies to persist throughout the year. The planemaker delivered just 19 aircraft in January, down from 25 in the same month a year earlier. And while Pratt & Whitney’s commercial engines chief Rick Deurloo expressed confidence at the Singapore Airshow that an agreement would be reached, the clock is ticking ahead of Airbus’ own earnings report on Feb. 19. The engine supply crunch has rippled well beyond Toulouse. Roughly a third of the GTF-powered Airbus fleet — some 636 aircraft, according to industry data — sits grounded or in storage, a consequence of a rare powder-metal defect disclosed by Pratt & Whitney in 2023 that triggered inspections across 600 to 700 engines. Airlines have been forced to get creative. Swiss International Air Lines is temporarily grounding its entire fleet of nine A220-100s this year to conserve scarce engine resources for its larger A220-300 fleet. ITA Airways, the Lufthansa subsidiary, is reportedly pursuing roughly €150 million in damages from Pratt & Whitney over aircraft grounded for more than a year in Naples. Globally, some 3,000 engines still require inspection or refurbishment.
Against that backdrop, Safran’s own numbers told a much more encouraging story. Adjusted revenue rose 15 percent to €31.33 billion, driven by surging aftermarket demand for civil jet engines and a record year of LEAP production. The company delivered more than 1,800 LEAP engines in 2025, a 28 percent increase over the prior year. Civil engine services revenue climbed 30 percent in dollar terms, buoyed by record passenger traffic exceeding five billion travelers and airlines’ continued reliance on older aircraft amid new-production delays. Operating margin expanded by 150 basis points to 16.6 percent of sales, while free cash flow hit €3.92 billion — comfortably above the €3.66 billion analysts had expected. Shares surged more than seven percent in early Paris trading, putting the stock on pace for its best session since March 2022.
Safran also used the occasion to raise its medium-term financial targets. The company now expects recurring operating income of €7.0 billion to €7.5 billion by 2028, up from the €6.0 billion to €6.5 billion it projected at an investor day in 2024. Cumulative free cash flow over 2024 through 2028 is seen reaching approximately €21 billion, compared with a prior range of €15 billion to €17 billion. LEAP engine deliveries are expected to reach about 2,600 units by 2028, up from a previous target of 2,500. A dividend of €3.35 per share — a 16 percent increase — will be proposed to shareholders. Defense activities added to the momentum. Safran accelerated production of M88 engines for the Rafale fighter jet and secured a new export contract with the Indian Navy. Defense electronics order intake reached record levels, with a book-to-bill ratio of 1.6.
For 2026, Safran guided toward revenue growth in the low-to-mid teens — which translates to a 12 to 15 percent increase — and recurring operating profit of €6.1 billion to €6.2 billion. Free cash flow is projected at €4.4 billion to €4.6 billion. The results underscore an unusual dynamic playing out across the narrowbody engine market. CFM’s LEAP program is firing on all cylinders, with reliability and production metrics that stand in sharp contrast to the difficulties plaguing its competitor. Yet Safran appears disinclined to overextend, preferring steady execution over an opportunistic land grab. Whether that restraint holds as Airbus’ production ambitions — a rate of 75 A320neo-family aircraft per month by 2027 — collide with the realities of engine availability is a question the industry will be watching closely in the months ahead.
Photo Credit: Angel Sinigersky
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