EMBJ

This article first appeared on GuruFocus. Revenue: Net revenues increased 23% year over year to $2.2 billion in Q2 2026, with first-half revenues reaching $3.7 billion. Commercial Aviation Revenue: Increased 8% to $625 million, driven by higher volumes. Executive Aviation Revenue: Increased 32% to $725 million, supported by higher volumes and product mix. Defense & Security Revenue: Increased 38% to $304 million. Services & Support Revenue: Increased 24% to $565 million, driven by higher volumes. Adjusted EBIT: Totaled $297 million in the first half, with a positive 13.3% margin; Q2 adjusted EBIT margin was 10.6% excluding the effects of US import tariffs and an extraordinary tax credit. Adjusted EBITDA: Reached $356 million in the first half, with a positive 15.9% margin. Adjusted Net Income: Was $290 million in Q2, with a positive 9.8% margin, up 1.1 points year over year. Adjusted Free Cash Flow: Excluding Eve, was $401 million in the quarter. Deliveries: Totaled 65 aircraft in Q2 (20 commercial jets and 45 executive jets), up nearly 7% year over year; Commercial Aviation grew 5% and Executive Aviation grew 18%. Backlog: Reached $34.5 billion, an increase of 16% year over year, an all-time record. Net Debt-to-Adjusted EBITDA: Improved to 0.2 times in the quarter, down from 0.7 times a year ago. Earnings per ADS: Stands at $2.50 on a last 12-month basis. Warning! GuruFocus has detected 5 Warning Sign with EMBJ. Is EMBJ fairly valued? Test your thesis with our free DCF calculator. Release Date: August 10, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Embraer SA (NYSE:EMBJ) delivered its strongest second-quarter revenue in history, with total company deliveries up nearly 7% year-over-year. The company achieved a new all-time high backlog of $34.5 billion, marking the seventh consecutive quarter of record backlog growth. Executive Aviation posted record second-quarter revenues and deliveries, with adjusted EBIT margin reaching 23.4% (16.1% excluding one-time items). Defense & Security secured a landmark order from the UAE for 10 C-390 aircraft, the platform's first Middle East selection and largest international order to date. The company raised its 2026 adjusted EBIT margin guidance to 10%-10.6% and adjusted free cash flow guidance to $400 million or higher, reflecting strong operational performance. Commercial Aviation adjusted EBIT margin declined year-over-year to 2.9% due to unfavorable customer mix, including legacy contracts. The company recorded approximately $8 million in US import tariffs during the quarter, with an additional $12 million in annual indirect tariff costs expected, particularly impacting Services & Support. Executive Aviation margins were temporarily boosted by an extraordinary tax credit of $68 million and tariff refunds, which are non-recurring items. Supply chain issues persist, with some suppliers still delivering parts late, forcing aircraft to be moved late in the production line, though improving. The company's adjusted EBIT margin for the first half was 10.6%, which, while above the five-year average, still reflects ongoing cost pressures and the need for continued efficiency gains. Q: Can you provide more detail on what drove the operating leverage in Executive Aviation and Defense? Was there anything one-time in the quarter, and how should we think about this as a structural change versus quarter-specific?A: Gui Paiva (Director of IR, M&A): The strong Q2 performance in Executive Aviation is largely due to significant progress in our production-leveling initiatives over the last two years. We are close to where we want to be, which has definitely helped results. The quarter also included a net positive impact of around $54 million at the EBIT level from a tax credit and tariff payments. Francisco Gomes Neto (CEO) added that while some suppliers still deliver parts late, forcing aircraft to move late in the line, this is improving. We expect a much better performance in production leveling in 2027, which will lead to higher productivity and efficiency. Q: Regarding the improved adjusted EBIT margin guidance, can you comment on the $4 million improvement in business outlook? Is it related to a specific segment, and what are the upside and downside risks?A: Felipe Santana (CFO): The $4 million improvement is connected to enterprise efficiency initiatives across all business units. While it is more pronounced in Executive Aviation due to production leveling, we see this as a recurring improvement spread across all segments. Q: Can you clarify the nature of the one-off tax credit and tariff effects in the quarter? Was there a cash impact, and should we expect any other reversals in the second half?A: Felipe Santana (CFO): The impact includes both cash and EBIT effects. Most of it is a refund of tariffs that impacted the company last year and in Q1 and Q2 of this year. While some cash is still pending, everything has been recognized on the EBIT margin. Going forward, we will not have direct tariffs, but we expect around $12 million annually in indirect tariffs, impacting especially Services & Support. Q: Are we done with the tariff costs from the backlog or inventory? And can you expand on any additional pipeline opportunities for orders this year?A: Felipe Santana (CFO) confirmed that the company is done with the tariff costs from the backlog. Francisco Gomes Neto (CEO) added that they are happy with the recent announcement of 28 new orders at Farnborough. While other campaigns are still in progress and need more work to cross the finish line, they remain positive about more sales before the end of the year. Q: Executive Aviation margins were very strong. Can we consider this a different mix for the quarter, or should we expect the ~16% margin (ex-tariffs) to be the new norm? Also, are you comfortable with the long-term book-to-bill for business jets, which is below the 2030 target?A: Gui Paiva (Director of IR, M&A): We continue to see gradual improvement in Executive Aviation operations despite product and client mix headwinds, which is a testament to efficiency gains. We remain optimistic about the rest of the company, with Defense margins improving steadily and the Services backlog expanding. With a record backlog, we are able to produce at target levels for 2030, and we remain upbeat about the company's outlook. Q: Commercial Aviation margins saw a slight drop due to customer mix. What are the expectations for margins in the second half of 2026?A: Felipe Santana (CFO): The Q2 impact was driven by customer mix and legacy contracts. For the full year, Commercial Aviation should be in line with last year, with improvements expected in EBIT and customer mix going forward. Q: Services & Support margins were almost 18%. How should we think about the structural level for this division going forward?A: Felipe Santana (CFO): We believe the ~18% margin is the way forward for the next quarters, mainly due to the scale we have and new deals signed on pool agreements with customers in Commercial, Defense, and Executive. OGMA is also improving, especially on GTF engines, which should contribute to better margins in the coming years. Francisco Gomes Neto (CEO) added that the company is pushing for efficiency gains across the entire organization, and profitability should grow more than revenues in the coming years. Q: How are you thinking about your investment in Eve? Should it be 100% part of Embraer, or should it be cut loose?A: Francisco Gomes Neto (CEO): We are very confident about Eve's contribution to Embraer's growth, especially beyond 2029-2030. We have completed more than 60 vertical flights and recently completed our first partial transition to horizontal flight. We expect to certify and enter into service the eVTOL by the end of 2028. In parallel, we are working to improve current products and support new sales of the KC-390, which requires significant engineering support. Q: Have you seen any impact on sales campaigns from the geopolitical situation in the Middle East?A: Francisco Gomes Neto (CEO): In Defense, yes. The geopolitical situation has led countries to accelerate sales campaigns. After the UAE order, we announced Colombia as a new customer, and Greece has mentioned a potential deal through Portugal. We are working on other campaigns that I cannot disclose. The geopolitical situation is helping the Defense business. In Commercial, the air-transportation industry has been extremely resilient, and with the huge backlog for bigger aircraft, airlines are looking at the benefits of small narrow-bodies, creating many opportunities for our E2s. Q: Can you provide an update on India, both from Commercial and Defense perspectives? Also, when do you feel Eve will be de-risked operationally?A: Francisco Gomes Neto (CEO): In India, we have two fronts. In Defense, the MTA (Medium Transport Aircraft) opportunity is for 60-80 KC-390s. We have signed an MoU with Mahindra and are waiting for the RFP. In civil aviation, we have an opportunity to introduce E-Jets to improve connectivity, with an MoU signed with the Adani Group. Gui Paiva (Director of IR) added that Eve will be de-risked when we achieve major milestones, including a full transition flight and reversal to landing, which we expect to progress through the rest of the year and into early 2027. Q: Do you see the trend of airlines bringing engine MRO in-house affecting E-Jet operators? For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Image source: The Motley Fool. Monday, Aug. 10, 2026 at 8:00 a.m. ET President and CEO - Francisco Gomes Neto Chief Financial Officer - Felipe Santana Head of Investor Relations, M&A, and Venture Capital - Gui Paiva Corporate Communications Director - Thais Moraes Gui Paiva: Good morning, ladies and gentlemen. Thanks for standing by. As a reminder, this conference is being recorded. Its broadcast is intended exclusively for the participants of this event and may not be reproduced or retransmitted without the express authorization of Embraer. This conference call will be conducted in English, but please let me say a short announcement for Portuguese speakers. My name is Gui Paiva, and I am the head of Investor Relations, M&A, and the venture capital for Embraer. Welcome to Embraer's second quarter 2026 earnings conference call. The numbers in this presentation contain non-GAAP financial information to help investors reconcile Eve's financial information in GAAP standards to Embraer's IFRS. We remind you Eve's results were already discussed at the company's conference call last week. Before we begin, a legal notice to everyone. This presentation may contain forward-looking statements which involve risks and uncertainties, as detailed in the disclaimer available in the slides and in the documents filed with the Brazilian Securities Commission, CVM. At this time, all participants are in a listen-only mode. Instructions for the Q&A session will be provided later. Participants on today's conference call are Francisco Gomes Neto, President and CEO of Embraer, Felipe Santana, Chief Financial Officer, Thais Moraes, Corporate Communications Director, and myself. This conference call consists of three parts. First, we will present the results for the second quarter of 2026. Second, we will host a Q&A session exclusively for investors. Finally, we will hold a dedicated Q&A session for the press. It is my pleasure to now turn the conference call to our President and CEO, Francisco Gomes Neto. Please go ahead, Francisco. Francisco Gomes Neto: Thank you, Gui. Good morning and good afternoon, everyone. It is a pleasure to be with you today to discuss Embraer's second quarter 2026 results. We delivered the strongest second quarter revenue in our history. We achieved our highest second quarter deliveries in the past 16 years and reached a new all-time high backlog for the seventh consecutive quarter. We continue to see strong performance across all our business units, driven by our focus on sales execution, efficiency, operational discipline, and production ramp-up. Simply put, we continue executing the fundamentals exceptionally well. These results further strengthen our confidence in the outlook for our businesses and have led us to raise our 2026 guidance, also supported by favorable effects. Let me now turn to the key highlights of the quarter. In commercial aviation, Azorra placed an order for 15 E195-E2 aircraft while maintaining 15 purchase rights. During the quarter, the E2 program surpassed the milestones of 500 firm orders. In executive aviation, we achieved record second quarter revenues and deliveries, supported by strong market demand. We also received a triple certification for the Praetor 500E and Praetor 600E. In defense and security, the UAE ordered 10 C-390 aircraft with options for an additional 10 units. This marks the platform's first selection in the Middle East and the largest international order for the C-390 to date. In service and support, we continue to expand our recurring revenue base through new contracts, including support for Jazz Aviation's E175 fleet and a new maintenance agreement with the Brazilian Air Force covering its KC-390 fleet. During the quarter, we delivered 65 aircraft, 20 commercial jets, and 45 executive jets. Total company deliveries increased by nearly 7% year-over-year, with commercial aviation growing 5% and executive aviation growing 18%. In Commercial Aviation, we delivered 30 aircraft in the first half of the year, representing 36% of the midpoint of our full-year guidance, one percentage point above the five-year average. In Executive Aviation, we delivered 74 aircraft in the first half, representing 45% of the midpoint of our full-year guidance and an impressive 11 percentage above the five-year average. Our company-wide backlog reached $34.5 billion, an increase of 16% year-over-year and another all-time record for Embraer. Commercial Aviation backlog grew 15% year-over-year, supported by a 1.8 book-to-bill ratio over the last 12 months. Defense and Security backlog increased 42%, with a strong 2.6 book-to-bill ratio. Executive Aviation backlog grew 5% year-over-year, while Service and Support increased 12%, with both segments maintaining book-to-bill ratios above one. In addition, we hold approximately $21 billion in options, which could expand our backlog to more than $55 billion over time if exercised. I would also like to provide a brief update on Eve's continued progress. The flight testing campaign is advancing according to plan. Following the successful completion of hover flights, the team is now moving into transition flights, an important next step on the path toward certification. With that, I will now hand the call over to Felipe, who will walk you through our financial results. Felipe, the floor is yours. Felipe Santana: Thank you, Francisco. Good morning and good afternoon, everyone. Let me start with the results by business unit. All comparisons are year-over-year, unless otherwise noted. Starting with Commercial Aviation, revenues increased 8% to $625 million, driven by higher volumes. Adjusted EBIT totaled $18 million with a +2.9% of margin. The year-over-year decline was primarily due to customer mix. In Executive Aviation, revenues increased at 32% to $725 million, supported by higher volumes and product mix. Adjusted EBIT reached $170 million with a positive 23.4% of margin. These results include the strong operating performance and the effects of U.S. import tariffs and extraordinary tax credit. Excluding both effects, adjusted EBIT margin would have been 16.1%. In Defense and Security, revenues increased at 38%, reaching $304 million. Adjusted EBIT was $36 million, with a positive 11.9% of margin, supported by stronger KC-390 revenue recognition and operating leverage. In Service and Support, revenues increased at 24% to $565 million, driven by higher volumes. Adjusted EBIT totaled $106 million with a +18.7% of margin. These results include U.S. import tariffs and an extraordinary tax credit. Excluding both items, adjusted EBIT margin would have been 17.6%. At the consolidated level, net revenues increased at 23% to $2.2 billion in the second quarter. From business mix's perspective, Executive Aviation represented 32% of revenues, Commercial Aviation and service more than 25% each, and defense 14%. In the first half, revenues reached $3.7 billion, representing 44% of the midpoint of our full-year guidance. Adjusted EBITDA was $356 million, with a positive 15.9% of margin, while adjusted EBIT totaled $297 million with a +13.3% of margin. During the quarter, the company recorded approximately $8 million of U.S. import tariffs and an extraordinary tax credit of $68 million. Excluding both effects, adjusted EBIT margin would have been 10.6% of margin. In the first half, adjusted EBIT margin reached 10.6% or 5.5 points higher than the five-year average. Adjusted free cash flow, excluding Eve, was $401 million in the quarter. This reflects the stronger operating results, sales-related pre-down payments, and extraordinary tax credit. Investment totaled $121 million during the quarter, including $42 million in CapEx, $24 million in tangible additions, $18 million in the pool program, and $36 million in research. Research expenses include engineering service to current projects, as well as other developments technologies for future programs. Adjusted net income was $290 million in the last quarter. Adjusted net income margin was +9.8%, up 1.1 points, mainly due to operating performance and lower net financial expenses, which were partially offset by higher taxes. Earnings per ADS now stands at $2.50 on a last 12-month basis. Net debt to adjusted EBITDA, excluding Eve, improved to 0.2x in the quarter from 0.7x a year ago. Through our liability management initiatives, average debt maturity increased to 9.3 years and its average cost declined to 5.1%. During the quarter, we declared BRL 200 million in interest on equity. This corresponds to BRL 0.28 per share or approximately $0.22 per ADS. Based on the share price at the quarter end, this represents a dividend yield of approximately 0.34%. From an operational standpoint, we are maintaining our delivery guidance unchanged at 80 to 85 aircraft in commercial aviation and 160 to 170 aircraft in executive aviation. On the financial side, revenue guidance remains unchanged at $8.2 billion to $8.5 billion. We are increasing our adjusted EBIT margin guidance to between 10%-10.6%. At the midpoint, this represents an increase of approximately $110 million or 130 basis points, reflecting the extraordinary tax credit, lower U.S. tariffs, and a better business outlook. We are also increasing our adjusted free cash flow guidance to $400 million or higher, reflecting strong operational performance, progress in our production leveling initiatives, and a strong first-half cash generation. With that, I will hand it back to Francisco for his closing remarks. Thank you. Francisco Gomes Neto: Thank you, Felipe. The second quarter of 2026 reinforced our confidence in Embraer's strategic positioning and our ability to consistently execute. We have also started the third quarter with strong momentum, including the announcement of 28 additional E2 orders, and welcomed Colombia as the newest KC-390 customer. Colombia became the 13th country worldwide to select the KC-390, further expanding the aircraft's global footprint. We were also pleased to introduce the new EV edition of our best-selling Phenom 300. Strong demand across our businesses continues to support our growth trajectory. Our performance reflects the discipline, focus, commitment, and energy of our people across the organization. Their dedication enables us to deliver strong results today while continuing to invest in the technologies that will drive our future growth. Behind these achievements are the values that guide everything we do. Safety first and quality always. With that, we are now ready to take your questions. Operator: We'll now start the question-and-answer session. We remind you again that this conference is being recorded. Its broadcast is intended exclusively for the participants of this event. It may not be reproduced or retransmitted without the express authorization of Embraer. We also highlight that this conference call is being conducted in English with translation to Portuguese. We request participants interested in asking questions to press the Raise a Hand button on the platform. When your name is announced, please make sure your microphone is on and start your question. To give everyone a chance to participate, we request to ask just one question per time. If you need assistance, please use the Q&A button on the platform. We'll also answer questions sent via the platform chat. The first part of the Q&A session will be exclusively for equity research analysts and investors. The second part of the Q&A will be only for the press. The first question comes from Kristine Liwag with Morgan Stanley. Please go ahead. Kristine Liwag: Hey. Good morning, Francisco, Felipe, Gui, and Thais. I wanted to ask about margins. Margins were a clear standout in the quarter. Can you talk about more, and provide more detail about what drove operating leverage in executive aviation and defense? Was there anything that was one time in the quarter? Basically, how should we think about this as being structural change in your cost structure versus quarter specific? Any update regarding your Growficiency strategy would be really helpful so that we can better understand your margin trajectory from here. Gui Paiva: Hi, Kristine. Good morning, and thanks for the call. Q2 was really strong for us in executive aviation. We have done a lot of progress in our production leveling initiatives in the last two years. We're close to where we want to be. That has definitely helped the results. In the quarter, when you look at as active, obviously we have also the impact of a tax credit and the tariff payments, and that helped the results on a net basis for the division for around $54 million at the EBIT level. Kristine Liwag: Great, anything about what would be structural change in your cost structure versus, and thinking about the broader Growficiency plan in the next few years. Maybe it's a little too early to look out a few years, but it seems like you're achieving some of your margin targets much earlier than expected. I just wanted to see if there's more upside from here. Gui Paiva: Yeah. Francisco Gomes Neto: Maybe I can Yeah, go ahead, Gui. Go ahead. Gui Paiva: I was just going to highlight one of the things that you're very passionate about, Francisco, which is lean operations and the fact that we do Kaizen and we do Obeya, and we do efficiency projects on a regular basis. There's not a silver bullet, Kristine. This is an ongoing effort by thousands of thousands of people that do this on a regular basis. I'll pass it to Francisco because it's one of his most passionate topics. Francisco Gomes Neto: Okay. Thank you. You did answer the question. Kristine, it is true what Gui just said. We have seen our executive jets production progressing very well with the production leveling initiative. This year, we still have some issues to be fixed with a few suppliers that are still delivering parts late, forcing us to move the aircraft late in the line. It's improving. We expect that in 2027, we'll see a much better performance in terms of production leveling, which will help us to see a higher productivity and higher efficiency of our lines. Kristine Liwag: Great. Thank you very much. Francisco Gomes Neto: Thank you. Operator: The next question comes from Marcelo Motta with JPMorgan. Please go ahead. Marcelo Motta: Hi, everyone. Thanks for taking my question. I would like to hear more about this $4 million improvement in business outlook that you mentioned as one of the reasons to improve the adjusted EBIT margin guidance. Just wondering here, if this is related to a specific segment, if this is also a cash gain, if it's more on the accounting. Anything that you could comment about the upside and downside risks for this $4 million to be lower or higher, it would be very interesting. Thank you. Felipe Santana: Good morning, Marcelo. Felipe here. Thank you for your question. This $4 million is really connected with what Gui mentioned, and Francisco, right, on enterprise efficiency, where we focus in all business units. This $4 million is spread out among all the business unit. Of course, that we see that more on Executive Aviation, mainly because of the production leveling and all the efforts that we're doing. Here it's recurring, the way that we see this $4 million improving from all the segments that we have. Marcelo Motta: Thanks. Super clear. Operator: The next question comes from Lucas Marchiori with BTG. Please go ahead. Lucas Marquiori: Thank you. Hey, guys. Morning. Yeah, no, I just wanted to clarify this, let's say one-off effects on the Q, of course, it calls our attention, the tax credits, right? If you could just give us some color on what's the nature of it, and if this was a cash impact already in the Q, I'm assuming it is, but just to confirm the numbers, right? Then if you guys can give us at least some more color on what's the nature of it, and if there's any other kind of a reversal coming in the second back of the year as well. Thanks for the clarification. Gui Paiva: Hey, Lucas. Good morning. Felipe, start. Felipe Santana: Thank you, Lucas, for your question. Good morning. This impact, we have both, right? We have both on cash and also on EBIT. Most of it is refund of the tariffs that we impact the company last year in the first quarter and the second quarter of this year. This what we had done. We still have some pending amount to receive on cash, but everything was already recognized on the EBIT margin of the company. Going forward, we don't going to have any more direct tariffs to the company, but we also going to have indirect tariffs to the company impacting especially service support. Around $12 million annually basis. Lucas Marquiori: Great. That's clear. Thank you, Felipe. Operator: The next question comes from Louis Raffetto with Wolfe Research. Please go ahead. Felipe Santana: Yes. Louis Raffetto: Hey, good morning, guys. Felipe Santana: Morning, Louis. Louis Raffetto: I think you just actually answered the question I had, whether that $60 million was the tariff refund or not. Seems like it is. Just to be clear, the $12 million that you still have indirect, basically expect $6 million in the back half and primarily in services. Felipe Santana: Yeah. That's it. Total, Louis. Louis Raffetto: Okay. Are we done with going through the tariff cost from the backlog or from inventory, excuse me? Felipe Santana: Yes, we are. Louis Raffetto: Okay. Maybe just, I know you mentioned the 28 orders, just can you expand on any additional pipeline opportunities this year or skyline opportunities? Francisco Gomes Neto: Yeah. Louis Francisco speaking. Thanks for the question. Yes, we are happy with this last announcement we did in Farnborough with these 28 orders. Yes, we are working in other campaigns, but they are still need to do some work to cross the finish line. Yes, we are positive with more sales of our products until the end of the year. Louis Raffetto: Thank you very much. Francisco Gomes Neto: You are welcome. Operator: The next question comes from Alberto Valerio with UBS. Please go ahead. Alberto Valerio: Good morning, Francisco, Felipe, and Gui. Thank you for giving the opportunity to do my questions here. I have two on my side. The first one, really strong margins on the executive jets. You mentioned the Kaizen model of Embraer and so forth. Can we consider that it's any different mix for this quarter for looking forward? We used to have 12% margins on business jets. It's coming ex-tariff at 16%. Should we consider for the future something between, or you think it's more toward to the 16%? My second one on backlog. I think you guys are very comfortable for the guidance of long term on 2030 for the commercial with 1.6, if I'm not mistake. Times what we have the book-to-bill of this year, with more than two times, 2.6, the defense and 1.1 for the business jet. The business jet, it's one that I'm talking about to see if you guys are comfortable with the long term. It's the only one that the book-to-bill, it's a little bit below the long-term goals. Thank you very much. Gui Paiva: Hi, Alberto, good morning. Thanks for the question. On Executive Aviation, I guess we continue to see a gradual improvement in our operations Despite having a product and client mix which has provided a little bit of headwinds. That is just a testament to the efficiency gains that the company has been able to generate to offset the slight headwinds that I alluded to. When you look through the rest of the company, we continue to be really optimistic. We have seen defense margins continue to improve on a steady basis, you obviously saw the order that we were able to obtain from the UAE in Q2. We do expect the success of the KC platform to continue in the next few years. We have continued to expand the backlog in services also, which provide us with a steady stream of value for the company. We have continued to work, and we should continue to see improvements in the second half, and most importantly, in the next few years for the profitability that we have in our commercial aviation as well. Right now, with a record backlog for the company, we are able to produce at the target levels that we have for 2030, which is going to be our capacity. We remain very upbeat about the outlook for the company in the next few years. Alberto Valerio: Fantastic. Very clear, Gui. Congrats on the result. Operator: The next question is from Lucas Barbosa with Santander. Please go ahead. Lucas Barbosa: Good morning, Francisco, Felipe, and Gui. Congratulations on the results, and thanks for taking my question. My question is on commercial aviation. This quarter, the margin saw a slight drop due to client mix. I wanted to understand what are the expectations in terms of customer mix and margins for the second half 2026 or 2026 as a whole. In other words, could we see a year-over-year expansion in margins for second half or for 2026 as a whole? Should we see this drop that we saw in second quarter persisting throughout the year? Thank you very much. Felipe Santana: Thank you, Lucas, for your question. Felipe here. When we look to the results of second quarter commercial aviation, as we mentioned, we had an impact of customer mix and driven by legacy contracts. When you look for the full year of commercial aviation should be in line from what it was last year. We're going to see some improvements going forward on EBIT and also customer mix on commercial aviation. Lucas Barbosa: Perfect. Super clear. Thank you very much. Operator: The next question comes from Lucas Laghi with XP. Please go ahead. Lucas Laghi: Hi, everyone. Good morning. I have a follow-up question on profitability, but we saw this very strong performance on Executive, but also in services. Almost 18% of recurring EBIT margin services division. My question is how to think of the structurally levels for services going forward. I guess that this performance was slightly above what we saw as a reference current share conversations with market participants. When it's interesting that gross margin decline and EBIT margin increased, I'm not sure about the effects of operating leverage that you still have to capture going forward. If you could also comment on the nature and the profile of the revenues this quarter, thinking of these different components that you have in services, and how to think of this going forward. If you should see some more upside or downside considering this 18% return levels that you saw in second quarter going forward? Thank you very much. Felipe Santana: Felipe here. Thank you for your question. As we mentioned, we do not just do efficiency on the business unit aircraft, but also on certain support. When we look to the 17%, almost 18% of margin on service support on the second quarter, really believe that should be the way that we could do for the next quarters. Especially mainly because of the scale that we have and also all these new deals that we've been signing on pool agreements and everything with the customers on Commercial Aviation and also on Defense and Executive, is also helping us to see better margins going forward on service support. And- Of course, we do have OGMA as well, that is also improving, especially on the GTF engines. Also for the coming years, we're going to see better margins coming also from OGMA. Francisco Gomes Neto: Felipe, if you allow me to complement your explanation. We have been pushing for efficiency gains in the entire organization. We need to make sure that we have the right cost structure, the right expenditure to support the business, the right level of investment, and continuous productivity gains. This is for us to enjoy the growth we are planning for the future, improving more than proportional the profitability. That's why we are doing this very strongly in the entire organization. We should see the profitability growing more than the revenues in the coming years. Lucas Laghi: Perfect. Thank you very much, Francisco and Felipe. Have a great day. Francisco Gomes Neto: You too. Thank you. Operator: The next question comes from Ron Epstein with Bank of America. Please go ahead, sir. Ron Epstein: Yeah. Hey, good morning, guys. Can you speak about your investment in Eve? How are you thinking about that? Is that something that should be 100% part of Embraer, or is that something that should be cut loose? When you think about the engineering cost of that, should those engineers be deployed on something else? It seems like you are halfway in, halfway out. How are you thinking about that? Francisco Gomes Neto: Hi, Ron. Francisco here. Thank you very much for your question. We are very confident about Eve's contribution to the Embraer growth, especially now beyond the 2029, 2030, to complement our growth strategy at the beginning of the next decade. We had more than 60 flights, vertical flights. We completed recently our first partial transition to horizontal flight. We have, yes, hundreds of engineers supporting Eve, but we expect to certify an entry into service of the eVTOLs by the end of 2028. In parallel, we are working to improve current products, and also supporting new sales of our KC-390. New sales mean new configurations that requires a lot of engineering support. Also invest in new technologies to support a new cycle of products. As I had mentioned, we continue evaluating emerging technologies and product opportunities to support a longer-term growth strategy. This can be commercial aviation, executive aviation, or even defense. Ron Epstein: Got it. Have you seen any impact, and forgive me if you already answered this, I might have missed it, any impact on sales campaigns from what's been going on in the Middle East? Francisco Gomes Neto: Well, in defense, yes. Because of the geopolitical situation, we have seen countries accelerating sales campaigns. You saw the recent announcement after the UAE, we announced Colombia recently. You saw Greece also mentioning a potential deal through Portugal of KC-390. We are working on other campaigns as well that I cannot disclose at this point of time. Yes, Ron, the geopolitical situation is helping the defense business. I think not only for us, for the market. Yes, Embraer is benefiting because we have a great product that transport the military aircraft segment. Ron Epstein: How about on the commercial side, what's the impact been? Francisco Gomes Neto: Well, commercial, actually, what we see is that the air transportation industry has been extremely resilient despite the higher costs of the tickets. People are still flying, and this creates an increasing demand in the market for new planes. Ron, as there is a huge backlog for bigger aircraft, now the customers, the airlines, they have to wait many years to receive a new aircraft. Combine it with a better understanding of the benefits of the small narrow body to their fleets, we see a lot of opportunities for our E2s with the new orders in the future. Last year was great. This year also, we are doing very well, and we are still working a lot of new campaigns for the E2s as well. I think all this environment has been beneficial for Embraer. For defense, for commercial jets, we keep selling jets as well. Yeah, we are in a good momento, I would say. Ron Epstein: Got it. Great. Thank you very much. Francisco Gomes Neto: You are very welcome, Ron. Operator: The next question comes from Daniel Gasparete with Itaú BBA. Please go ahead. Daniel Gasparete: Good morning, guys. Thank you very much for the opportunity, congrats on the results. The first question, please, will be regarding if you could provide us with an update on India, both from commercial and defense aviation. That would be great. Thank you very much. The second question will be a follow-up on the previous question. When do you guys feel that Eve is going to be de-risked, I would say, operationally? Do you feel like it's going to be only after the total certification by the end of 2028? Or do you feel that when you have enough flights or you're comfortable enough with the envelope of tests, there could be a threshold of comfort, please? Just one confirmation, Francisco, you said about a new venture, you said about commercial and executive aviation, as we have discussed in the past, you mentioned defense, if I'm not mistaken. Just to clarify that, please. Thank you very much. That would be all. Francisco Gomes Neto: All right, Daniel, thanks for your question. Let's try to share this in parts. Gui, maybe you start, then you- Gui Paiva: Sure Francisco Gomes Neto: address to me. Gui Paiva: Good morning, Gasparete, and thanks for the question. Let me tackle the Eve question, and Francisco can complement on India. On Eve, I think the project will be the risk when we kind of achieve the major milestones that we have in the project. That would include at least, a full transition flight and reversal to landing. As we progress in the campaign through the rest of the year and into early 2027, we do expect this material progress to play out. Francisco? Francisco Gomes Neto: Yeah. Daniel, thanks for the question. About India. In India, we have two fronts of opportunities. By the way, good opportunities. The first one in defense with the MTA, Middle Transport Aircraft. That is an opportunity between 60-80 KC-290s. We believe we have the best product for that application, but it's a bit. We have signed an MOU with Mahindra, our partner, and we are just waiting for the customer, the Indian Air Force, to issue the RFP for us to present our proposal with the localization strategy. In parallel, we have been working in the civil aviation as well, with an opportunity to introduce our E-Jets, E1s and E2s, to help India to improve their connectivity between smaller city and taking advantage of the Make in India initiative. In that sense, we have signed an MOU with the Adani Group, and we are in close conversation with them to find the best way to explore that opportunity. Both are great opportunity for us, for Embraer, to grow and expand our production capabilities outside Brazil. Daniel Gasparete: Thank you, Francisco. Thank you, Gui. Just one follow-up on the question that I made. On the previous answer that you gave, you mentioned about looking about new ventures. You mentioned commercial and executive aviation, as we have always been discussing, but you also mentioned defense. I would just like to clarify that, if I understood that correctly, that will be something that you're going to be considering as well, or it'll be only on commercial and executive aviation, please? Francisco Gomes Neto: Well, in defense, we have two main products, right? The KC-390 and the Super Tucano. We recently announced an upgrade in the Super Tucano with the new cockpit and the new features to detect and eliminate drones, and we expect that will help us to increase sales of Super Tucano as well. Daniel Gasparete: Okay, great. Thank you very much. Francisco Gomes Neto: You are welcome, Daniel. Operator: The next question comes from Andre Mazzini with Citi. Please go ahead. Andre Mazzini: Yes. Hi Francisco, Felipe, Gui, and Thais. Thanks for the question. We see a couple of large airlines bringing engine MRO in-house this year. There was news of Ryanair announcing they would do this, bring it in-house. Do you think this may be a trend for E-Jet operators as well, or this will probably be contained to larger jets and very large fleets, right? 600, 737 in the case of this particular airline. Thank you. Thank you so much. Francisco Gomes Neto: Thank you, Andre. Good question. That's my opinion. I think this makes sense only for large volumes, right? Airlines that operate, I mean, a sizable fleet, that this maybe makes sense because the investments are huge. Also, the main purpose of the airline should be flying, right? Anyway, maybe with big fleets, this makes sense, and we don't see this as a trend for all the markets. Andre Mazzini: Great, Francisco. If I may, a quick follow-up. If you could remind us the breakdown in the service revenue between Embraer airplanes and other OEMs airplanes. We understand OGMA, for instance, they also do larger narrow bodies. I would imagine, of course, the bulk of it is Embraer, but what's the share currently between Embraer and non-Embraer in the service revenue? Thank you so much. Gui Paiva: Hi. Good morning. In terms of our service division, OGMA should be running something close to $350 million to $400 million of revenues this year. The bulk of that is going to be non-Embraer fleets, and that is the agnostic part of the business. The balance of that, which should be about $1.5 billion to $1.6 billion, will be our Embraer or fleet-related business. Andre Mazzini: Super interesting. Thank you, Francisco and Gui. Operator: Thank you, ladies and gentlemen. We will start a Q&A session dedicated to the press. We'll answer questions in English. Then we'll be answering questions in Portuguese. We will also answer questions sent via the platform chat. Please hold while we compile the questions. The first question comes from Ioannis Rekas with flight.com.gr. Please go ahead. Ioannis Rekas: Good afternoon from Greece. Can you hear me? Francisco Gomes Neto: Yes, we can. Go ahead. Ioannis Rekas: Great. I would like to congratulate you, first of all, for these exceptional results. My question has, of course, to do with the potential of Greece's requirement for C390. It is a program that was passed from the parliament. We're expecting a cost of EUR 600 million. I would like if you can share with us some more updates regarding that. Then the comment, of course, in the difference of the cost between Colombia's and Greece's program per unit. Thank you very much. Francisco Gomes Neto: Thank you for your question. This opportunity is being discussed between Greece and Portugal. That's why there is an opportunity for short deliveries to Greece. We don't know the details about commercial conditions. We can't disclose your price because every aircraft is different, every aircraft has a different specification, and this means different costs for each program. Ioannis Rekas: Great. Thank you very much. Francisco Gomes Neto: You are welcome. Operator: Once again, if you would like to ask a question, please click Raise Hand at this time. Ladies and gentlemen, please hold while we compile the questions. The next question comes from Edgardo Gimenez from Aviacionline. Please go ahead. Mr. Gimenez, your mic is Sir? Edgardo Gimenez Mazó: Hi. Can you hear me now? Yes? Operator: Yes. Francisco Gomes Neto: Yes, we can. Go ahead. Edgardo Gimenez Mazó: Sorry. My question was, with recent E2 orders from LATAM and Abra Group, do you see the E2 family as a potential good fit for low-cost carriers in the region, such as JetSMART, Volaris, or Viva? Have you actively pitched business cases to these kind of low-cost carriers in Latin America? Francisco Gomes Neto: Edgardo, thanks for the question. Absolutely. We see the E2 as a perfect fit for this kind of application. We see now Azul doing very well in Brazil, now coming LATAM. The Abra Group, we don't know yet where they will fly the E2s. The idea is the same, to improve connectivity between smaller cities. Mexico is another opportunity. Avianca, of course, in Colombia under the Abra Group. Mexico, for sure. We have, I think over 60 Embraer E1s flying Mexico with different Aeroméxico and other airlines. Now Mexicana introducing the E2s with a success operation. Yes, we hope the other airlines will look at the E2 as well as an opportunity to complement the operation for large and narrow-body in a very efficient way. Edgardo Gimenez Mazó: Thank you very much. Operator: Ladies and gentlemen, once again, if you would like to pose a question, please click Raise Hand at this time. Please hold while we compile the questions. The next question was sent from the chat, and is from Robert Wall with Aviation Week. On C-390 rates, given the recent orders and what you were seeing in potential opportunities, what is your thinking to go higher than 10 aircraft per year in 2030? Francisco Gomes Neto: Well, an opportunity we are working on is with India. This will allow us to implement a second assembling line outside Brazil and go to production levels above 10 per year. Another opportunity we are working on is with the United States. That will also allow us, if things go well, and depending on the size of the order, to implement a third assembly line that will allow us to increase even further the production of KC-390. I believe Bosco, our VP of Defense, is with us. Bosco, do you want to add anything on this? I think he's not here. Yes. Okay. That's it. Operator: Thank you very much, sir. This concludes the question-and-answer session in English for the press. This question and answer session is now being conducted in Portuguese. To switch to English, please press the interpretation button on the platform and then select English. [Non-English content] Speaker 16: Now we will initiate the Q&A session in Portuguese. Operator: [Non-English content] Speaker 16: Next question is from Marcelo Rocha with CBN Vale. You may proceed, sir Operator: [Non-English content] Speaker 16: Sir, Mr. Marcelo Rocha with CBN Vale, you may proceed. Operator: [Non-English content] Speaker 16: Ladies and gentlemen, I believe Marcelo Rocha's microphone is on mute. I'll jump to the next question from Karen Salomon with Seu Dinheiro. You may proceed, ma'am. Karen Salomon: [Non-English content] Speaker 16: Good morning. Karen Salomon: [Non-English content] [Non-English content] [Non-English content]] Speaker 16: Embraer's backlog continues to hit record numbers. Is there any ceiling to how much Embraer can invest? What are the investments to increase production going forward? Or whether the efficiency gains you mentioned are just enough to keep up with the speed of deliveries? Oi, Karen, this is a very good question. It's a combination of both things. One, we will continue to invest in efficiency, and this is something that we've been mentioning frequently with Praetors. For instance, in 2021, it used to take us 18 months to produce Praetor, and today we can produce the same plane at eight and a half months. We are doing the same thing with all the other aircrafts. With that, we can produce more aircraft with the same structure. At the same time, we're also investing to increase our production capacity. We believe that by 2030, our production capacity, we reach 120-130 commercial jets a year, plus 200 executive planes and 10 KCs in Brazil. The KC, as I said in a previous question, we still there have the opportunity to have new production lines, and this is to India is a possibility, the U.S. is another possibility, and the commercial jets. If our project with India moves forward, we might even have a second production line of commercial jets. The outlook is very good, we are doing that in a very responsible way, while at the same time we increase our backlog. Production capacity will not be a limiting factor to our future growth. Karen Salomon: [Foreign language] Speaker 16: Thank you very much. Operator: [Non-English content] Speaker 16: Next question comes from Cristian Favaro at Valor Econômico. You may proceed. Cristian Favaro: [Non-English content] Speaker 16: Hi, thank you for taking my question. Congrats for your results. My question is, I would like to hear a bit more from you about the guidance update. I thought productivity gain was an interesting aspect, especially in regards to executive jets. Just to make sure I understood, this is basically due to the fine-tuning you did on the side of vendors and whether your outlook is quite positive. My other question relates to guidance update, mainly due to U.S. tariffs. If I'm not wrong, if I'm not mistaking, the tariffs were down. You did not update your guidance. My question is, do you see any room for new updates given this current scenario? There is also the fact that you have a spare parts residual, and that's why they were subject to tariffs. Do you think this will persist going forward? I would just like to get a better understanding about that issue and if you see further possibilities of making adjustments going forward. Cristian, good morning. This is Gui. Thank you for your question. The guidance adjustment, as you mentioned, involves a combination of factors. One, tax credits or tariff credits of all of the tariffs that we received this quarter. The other issue is that we are no longer being directly taxed, giving all the most recent decisions taken by the country. The third aspect refers to the improvement of our business outlook. The performance is better than what we anticipated in previous quarters. About reviewing the business plan on a regular basis, when we publish our results every quarter, this is a moment where we can reiterate the previous guidance, or we can update it as we did it for this quarter. Cristian Favaro: [Non-English content] Speaker 16: Perfect. Thank you. Operator: [Non-English content] Speaker 16: Next question is from Marcelo Rocha with CBN Vale. You may proceed, sir Operator: [Non-English content] Speaker 16: Mr. Rocha, you are good to go. Operator: [Non-English content] Speaker 16: Your microphone is on mute. Could you please check that? Because we cannot hear you. Operator: [Non-English content] Speaker 16: Thank you. Next question. In writing, from Nelson Düring with DefesaNet. Operator: [Non-English content] Speaker 16: First question is: what is the projected share for defense in your total P&L? Now is at 14%. Well, thank you for your question, Nelson. Historically, defense has always been in the range between 14% and 15% in our total P&L. Now, since revenue is growing, there is a dollar-denominated amount, and so this grows as well. We estimate that at least by 2030, the defense sector should be around this range between 12%-14% in terms of total revenue share. With growing profitability, this is quite important. Operator: [Non-English content] Speaker 16: Thank you. Operator: [Non-English content] Speaker 16: We also have a second question on the chat from Marcelo Rocha, with CBN Vale. Question is addressed to Francisco. You mentioned that the forecast for eVTOL from Eve should start commercial operation by the end of 2028. How many units should be in the market for this period, and what would be the first anticipated commercial flight in Brazil and abroad? Thank you for your question. Well, yes, our expectation in terms of Eve starting operation by the end of 2028. Today we have about 3,000 letter of intent for purchases. Some are firm orders for eVTOL. Entry into operation should probably occur in Brazil and in the U.S., just as an entry level, probably simultaneously in Brazil for engineering possibilities, and in the U.S. for the opportunities we see in several municipalities. In terms of production, we will start our production in Taubaté, as previously announced. In Taubaté, the top capacity will be close to 480 units per year, and the reassembling of these aircraft close to where they should be operating in the future, because the range of the aircraft is small. With that, we will just get a feeling of the market, and after that, we will decide about other eVTOL plans. We don't have anything defined at the moment, but we just want to support the eVTOL entering into operation starting in 2028. Operator: [Non-English content] Speaker 16: Thank you. Operator: [Non-English content] Speaker 16: Next question. Operator: [Non-English content] Speaker 16: In writing from Nelson Düring with DefesaNet. What versions are being projected for KC-390? KC-390 MPA, or Maritime Patrol Aircraft, is that moving forward? [Foreign language] I don't have detailed information on these versions, but the versions we sell today is C-390 and KC-390. The difference between the two is the refueling is on air, and every business has its different specs. We don't have yet a version for MPA, as far as I know, until up to now. We are focusing on C-390 and KC-390 with the different specs depending on customer request. Thank you. Operator: [Non-English content] Speaker 16: Thank you. With that, we conclude the Q&A session, and also this earnings release presentation from Embraer. Thank you very much for joining us, and have a very good day Before you buy stock in Embraer, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Embraer wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $399,832!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,374,595!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 10, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Embraer. The Motley Fool has a disclosure policy. Embraer (EMBJ) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Embraer S.A. EMBJ reported second-quarter 2026 earnings of $1.19 per American Depository Share (“ADS”), beating the Zacks Consensus Estimate of 61 cents by 95.1%. The bottom line surged 177.4% from 43 cents per ADS a year ago.The company reported GAAP earnings of 30 cents per ADS compared with 11 cents in the second quarter of 2025. Revenues of $2.24 billion increased 22.9% year over year and topped the Zacks Consensus Estimate of $2.05 billion by 8.9%. The revenue increase reflected higher activity across Executive Aviation, Defense & Security, Commercial Aviation and Services & Support. Embraer-Empresa Brasileira de Aeronautica price-consensus-eps-surprise-chart | Embraer-Empresa Brasileira de Aeronautica Quote Embraer delivered 65 aircraft in the quarter, up 6.6% from 61 a year ago. Commercial Aviation deliveries rose to 20 aircraft from 19, while Executive Aviation deliveries increased to 45 from 38.The company-wide firm order backlog reached a record $34.5 billion, up 16% year over year. Commercial Aviation backlog rose 15% to $15.1 billion, Executive Aviation increased 5% to $7.8 billion, Defense & Security climbed 42% to $6.1 billion, and Services & Support advanced 12% to $5.5 billion. Executive Aviation: This segment’s revenues climbed 32% to $725 million, supported by higher volumes and product mix. Its adjusted EBIT margin expanded to 23.4% from 14.5%.Defense & Security: This segment’s revenues rose 38% to $304 million on stronger KC-390 revenue recognition tied to customer mix and product stage. Its adjusted EBIT margin improved to 11.9% from 9.2%. Commercial Aviation: Revenues increased 8% year over year to $625 million, mainly on higher volumes. Its adjusted EBIT margin declined to 2.9% from 4.3%.Services & Support: This segment’s revenues advanced 24% to $565 million, while its adjusted EBIT margin increased to 18.7% from 15.5%.Others: This segment includes ERJ’s Agricultural Aviation, cyber division Tempest, the landing gear division and other businesses. Revenues for this segment declined 6% to $15 million, primarily reflecting lower deliveries in agricultural aviation during the quarter. Embraer’s operating income amounted to $285.8 million compared with $179.5 million in the second quarter of 2025.The company posted adjusted EBITDA of $355.6 million compared with $245.5 million a year ago. As of June 30, 2026, EMBJ’s cash and cash equivalents amounted to $1.39 billion compared with $1.95 billion as of Dec. 31, 2025.Its adjusted free cash flow (without Eve) for the second quarter of 2026 totaled $401 million against the adjusted free cash outflow of $161.6 million in the prior-year period.The net cash provided by operating activities during the first six months of 2026 amounted to $204.4 million against the net cash outflow from operating activities of $134.1 million during the first six months of 2025. Embraer continues to expect 80-85 Commercial Aviation deliveries and 160-170 Executive Aviation deliveries in 2026. The company also maintained its revenue outlook of $8.2-$8.5 billion. The Zacks Consensus Estimate for revenues is pegged at $8.52 billion, which is higher than the company’s guided range.EMBJ raised its adjusted EBIT margin guidance to 10-10.6% from 8.7-9.3%. It also lifted its adjusted free cash flow outlook excluding Eve to at least $400 million from at least $200 million. Embraer currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. RTX Corporation’s RTX second-quarter 2026 adjusted earnings per share (EPS) of $1.89 beat the Zacks Consensus Estimate of $1.66 by 13.9%. The bottom line improved 21.1% from the year-ago quarter’s level of $1.56.Revenues rose 14.5% year over year to $24.71 billion and outpaced the consensus mark of $22.83 billion by 8.2%.Northrop Grumman Corporation NOC reported second-quarter 2026 adjusted earnings of $7.68 per share, which beat the Zacks Consensus Estimate of $6.84 by 12.3%. The bottom line, however, declined 5.8% from the year-ago quarter’s level of $8.15.NOC’s total sales of $10.88 billion in the second quarter outperformed the Zacks Consensus Estimate of $10.80 billion by 0.7%. The top line also improved 5.1% from $10.35 billion reported in the year-ago quarter.Textron Inc. TXT reported second-quarter 2026 adjusted earnings of $1.62 per share, which surpassed the Zacks Consensus Estimate of $1.52 by 6.6%. The bottom line also rose 4.5% from $1.55 in the year-ago quarter. The company reported total revenues of $3.83 billion, which beat the Zacks Consensus Estimate of $3.82 billion by 0.15%. The top line also increased 3% from the year-ago quarter’s level of $3.72 billion. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Embraer-Empresa Brasileira de Aeronautica (EMBJ) : Free Stock Analysis Report Northrop Grumman Corporation (NOC) : Free Stock Analysis Report Textron Inc. (TXT) : Free Stock Analysis Report RTX Corporation (RTX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). 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For the quarter ended June 2026, Embraer (EMBJ) reported revenue of $2.24 billion, up 22.9% over the same period last year. EPS came in at $1.22, compared to -$0.02 in the year-ago quarter. The reported revenue compares to the Zacks Consensus Estimate of $2.05 billion, representing a surprise of +8.94%. The company delivered an EPS surprise of +100%, with the consensus EPS estimate being $0.61. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Embraer performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Revenue- Commercial Aviation: $625 million versus $633.46 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +8.3% change. Revenue- Executive Aviation: $725 million compared to the $628.98 million average estimate based on three analysts. The reported number represents a change of +32.1% year over year. Revenue- Other: $15 million versus $22.01 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a -6.3% change. Revenue- Services & Support: $565 million compared to the $508.06 million average estimate based on three analysts. The reported number represents a change of +23.9% year over year. Revenue- Defense & Security: $304 million compared to the $259.35 million average estimate based on three analysts. The reported number represents a change of +37.6% year over year. View all Key Company Metrics for Embraer here>>> Shares of Embraer have returned +10.6% over the past month versus the Zacks S&P 500 composite's +3.4% change. The stock currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Embraer-Empresa Brasileira de Aeronautica (EMBJ) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved the strongest second-quarter revenue in company history, supported by the highest Q2 delivery volume in 16 years and a seventh consecutive record-breaking backlog of $34.5 billion. Performance in Executive Aviation was bolstered by 'production leveling' initiatives, which reduced the assembly time for Praetor aircraft from 18 months to 8.5 months over the last two years. Defense and Security growth was catalyzed by the UAE's order for 10 C-390 aircraft, marking the platform's first selection in the Middle East and its largest international order to date. Commercial Aviation results were impacted by a less favorable customer mix involving legacy contracts, though management expects full-year margins to remain in line with the previous year. Service and Support margins reached 18.7%, driven by higher volumes and the expansion of recurring revenue through new pool agreements and maintenance contracts like the Jazz Aviation E175 fleet. Management attributed broader margin expansion to the 'Growficiency' strategy, utilizing lean manufacturing tools like Kaizen and Obeya to drive productivity gains across all business units. Geopolitical tensions have accelerated defense sales campaigns globally, with management noting increased urgency from international customers for the KC-390 platform. Raised 2026 adjusted EBIT margin guidance to 10.0%-10.6%, reflecting a $68 million extraordinary tax credit, lower U.S. tariffs, and an improved operational outlook. Increased adjusted free cash flow guidance to $400 million or higher, citing strong first-half cash generation and continued progress in production leveling. Targeting a long-term production capacity by 2030 of 120-130 commercial jets and 200 executive planes annually, with potential for additional assembly lines in India and the U.S. Eve eVTOL certification and entry into service remains scheduled for late 2028, with flight testing transitioning from hover to horizontal flight phases. Management anticipates that profitability will grow 'more than proportional' to revenues in coming years as efficiency gains outpace the costs of scaling production. Recorded an extraordinary tax credit of $68 million in Q2, primarily related to the refund of U.S. import tariffs previously paid in 2023 and early 2024. Management noted that while direct U.S. tariffs have ceased, approximately $12 million in annual indirect tariff impacts will persist, primarily affecting the Service and Support segment. Supply chain constraints remain a headwind, with late deliveries from certain suppliers forcing aircraft to move late through the assembly line, though improvements are expected by 2027. The company holds $21 billion in purchase options which, if exercised, could expand the total backlog to over $55 billion. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that while Q2 margins were aided by a $54 million net benefit from tax credits and tariff refunds, structural efficiency gains are the primary long-term driver. Efficiency projects are being applied across the entire organization to ensure profitability grows faster than revenue as the company scales toward 2030 targets. Embraer is pursuing a defense contract for 60-80 KC-390s in India and has signed an MOU with Mahindra for a localization strategy. A separate MOU with the Adani Group targets the civil aviation market to introduce E-Jets for regional connectivity under the 'Make in India' initiative. Management considers the project will be significantly de-risked once it achieves a full transition flight and reversal to landing, expected between late 2026 and early 2027. The project currently has approximately 3,000 letters of intent, with initial commercial operations planned simultaneously for Brazil and the U.S. in 2028. The current geopolitical situation is actively helping the defense business, with management citing Colombia as the 13th country to select the KC-390. Management highlighted the C-390's growing global footprint, noting its first selection in the Middle East by the UAE and a new order from Colombia. as countries seek to modernize fleets amid rising global tensions.

Interested in Embraer-Empresa Brasileira de Aeronautica? Here are five stocks we like better. Record quarterly performance: Embraer’s Q2 revenue rose 23% year over year to $2.2 billion, supported by 65 aircraft deliveries and growth across all business units. Adjusted free cash flow reached $401 million, while net leverage improved to 0.2 times. Backlog reached a new high: Total backlog increased 16% year over year to $34.5 billion, bolstered by major commercial and defense orders, including 10 C-390 aircraft for the United Arab Emirates and additional E2 jet commitments. 2026 outlook improved: Embraer maintained its delivery and revenue forecasts but raised adjusted EBIT margin guidance to 10%–10.6% and free-cash-flow guidance to at least $400 million. The company also said Eve’s eVTOL remains on track to enter service by the end of 2028. Amazon Bets Big on BETA: Why Analysts See 50% Upside Embraer-Empresa Brasileira de Aeronautica (NYSE:EMBJ) said its second-quarter 2026 revenue was the highest for a second quarter in the company’s history, supported by higher aircraft deliveries, growth across its business units and continued expansion of its backlog. President and CEO Francisco Gomes Neto said Embraer delivered 65 aircraft during the quarter, including 20 commercial jets and 45 executive jets. Total deliveries rose nearly 7% from a year earlier, with commercial aviation deliveries up 5% and executive aviation deliveries up 18%. → MarketBeat Week in Review – 08/03 - 08/07 Crisis in the Caribbean: The Defense Sector Playbook “We delivered the strongest second quarter revenue in our history,” Gomes Neto said, adding that the company reached its highest second-quarter delivery total in 16 years and a record backlog for the seventh consecutive quarter. Consolidated second-quarter net revenue increased 23% year over year to $2.2 billion. Revenue for the first half reached $3.7 billion, or 44% of the midpoint of Embraer’s full-year revenue guidance. → Quantum Earnings Week: Winners and Losers Are Finally Emerging Flying Cars and Rising Bars: The 2026 eVTOL Breakout Begins Adjusted EBITDA totaled $356 million in the quarter, representing a 15.9% margin, while adjusted EBIT was $297 million, or a 13.3% margin. The company said results included approximately $8 million in U.S. import tariffs and a $68 million extraordinary tax credit. Excluding both items, adjusted EBIT margin would have been 10.6%. Adjusted net income was $290 million, with an adjusted net income margin of 9.8%. Earnings per American depositary share stood at $2.50 on a trailing 12-month basis. → Take-Two’s Q1 Results Leave GTA 6 Bulls Stuck in the Fog of War Adjusted free cash flow, excluding Eve, was $401 million in the quarter. Chief Financial Officer Felipe Santana said cash generation reflected stronger operating results, sales-related pre-delivery payments and the extraordinary tax credit. Quarterly investments totaled $121 million, including $42 million in capital expenditures and $36 million in research. Embraer’s net debt-to-adjusted EBITDA ratio, excluding Eve, improved to 0.2 times from 0.7 times a year earlier. The company said its liability-management actions extended average debt maturity to 9.3 years and lowered average debt cost to 5.1%. The company also declared 200 million Brazilian reais in interest on equity, equivalent to BRL0.28 per share, or approximately $0.22 per ADS. Commercial Aviation: Revenue rose 8% to $625 million, driven by higher volume. Adjusted EBIT was $18 million, for a 2.9% margin. Santana said the year-over-year margin decline primarily reflected customer mix and legacy contracts. Executive Aviation: Revenue increased 32% to $725 million, aided by volume and product mix. Adjusted EBIT reached $170 million, or a 23.4% margin. Excluding tariff effects and the tax credit, the segment’s adjusted EBIT margin would have been 16.1%. Defense and Security: Revenue increased 38% to $304 million, while adjusted EBIT was $36 million, for an 11.9% margin. Embraer cited stronger KC-390 revenue recognition and operating leverage. Service and Support: Revenue rose 24% to $565 million, and adjusted EBIT was $106 million, or an 18.7% margin. Excluding tariffs and the extraordinary tax credit, the margin would have been 17.6%. Management attributed gains in executive aviation partly to production-leveling initiatives. Gomes Neto said certain suppliers are still delivering parts late, requiring aircraft to be moved late in the production line, but he expects improved production leveling, productivity and efficiency in 2027. During the investor Q&A, Santana said a $4 million improvement in the company’s business outlook was spread across all business units and was recurring, with a larger benefit in executive aviation from production leveling and efficiency efforts. Gomes Neto said Embraer is pursuing continuous lean-operation initiatives across the organization rather than relying on a single cost-saving measure. Embraer’s total backlog reached $34.5 billion, up 16% from a year earlier and a new company record. Commercial Aviation backlog rose 15%, supported by a 1.8 book-to-bill ratio over the past 12 months. Defense and Security backlog grew 42%, with a 2.6 book-to-bill ratio. Executive Aviation backlog increased 5%, while Service and Support backlog rose 12%. Both segments had book-to-bill ratios above one. Embraer also held approximately $21 billion in options that could lift backlog above $55 billion if exercised. Among notable commercial wins, Azorra ordered 15 E195-E2 aircraft and retained purchase rights for another 15. The E2 program surpassed 500 firm orders during the quarter. In defense, the United Arab Emirates ordered 10 C-390 aircraft and secured options for an additional 10, marking the aircraft’s first selection in the Middle East and its largest international order to date. After the quarter closed, Embraer announced 28 additional E2 orders and said Colombia became the 13th country to select the KC-390. Embraer maintained its 2026 delivery outlook of 80 to 85 commercial aircraft and 160 to 170 executive aircraft. Revenue guidance also remained unchanged at $8.2 billion to $8.5 billion. However, the company raised adjusted EBIT margin guidance to a range of 10% to 10.6%. At the midpoint, management said the increase represents approximately $110 million, or 130 basis points, and reflects the extraordinary tax credit, lower U.S. tariffs and improved business conditions. Adjusted free cash flow guidance was raised to $400 million or more, reflecting operational performance, progress in production leveling and strong first-half cash generation. On tariffs, Santana said most of the tax-credit benefit was related to refunds of tariffs paid in the prior year and during the first half of 2026. While Embraer no longer expects direct tariffs affecting the company, it expects indirect tariffs of about $12 million on an annual basis, particularly affecting Service and Support. Gomes Neto also said Eve’s flight-test program is advancing toward certification, with more than 60 vertical flights completed and partial transition to horizontal flight recently achieved. Embraer expects Eve’s eVTOL to enter service by the end of 2028. Embraer SA (NYSE:EMBJ), legally known as Embraer – Empresa Brasileira de Aeronáutica SA, is a global aerospace company headquartered in São José dos Campos, Brazil. The company designs, develops, manufactures and sells commercial, executive, defence and agricultural aircraft. Embraer’s product portfolio includes the popular E-Jets family for regional and short-haul carriers, the advanced E2 series, a range of business jets under the Phenom, Legacy and Praetor brands, the A-29 Super Tucano military trainer and light attack aircraft, the C-390 Millennium multi-mission transport platform, and the Ipanema agricultural aircraft. Embraer’s commercial aviation segment focuses on regional airlines and air taxi operators, offering aircraft that seat between 70 and 150 passengers. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Embraer-Empresa Brasileira de Aeronautica Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Interested in LATAM Airlines Group S.A.? Here are five stocks we like better. LATAM remained profitable despite a severe fuel-cost shock: Fuel prices rose more than 80% year over year and fuel expense increased 93%, but revenue grew nearly 28% to about $4.2 billion and the adjusted operating margin reached 5.4%. The airline is expanding its Brazilian network and regional capacity: LATAM Brasil will receive its first 12 Embraer E-Jet E2 aircraft in late 2026, supporting 42 domestic routes and potentially up to 18 new bases from 2027. LATAM raised its 2026 outlook and authorized a buyback: The company now expects $4.1 billion-$4.4 billion in adjusted EBITDA, $17.3 billion-$17.7 billion in revenue and 9%-10% capacity growth, while its board approved repurchases of up to 5% of shares. Viasat: Why a Wall of Cash Has Shorts Running for Cover LATAM Airlines Group (NYSE:LTM) reported second-quarter 2026 results that remained profitable despite what management described as one of the airline industry’s sharpest recent increases in jet fuel prices. Chief Executive Officer Roberto Alvo said the all-in impact of higher fuel prices exceeded $700 million during the quarter. Even so, the company posted an adjusted operating margin of 5.4%, at the higher end of management’s prior expectation for a mid- to low-single-digit margin in the period. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling “The second quarter of 2026 was an important demonstration of the resilience of LATAM Airlines Group’s business model,” Alvo said, citing the company’s passenger, cargo and loyalty businesses, commercial initiatives, cost structure and balance sheet. Chief Financial Officer Ricardo Bottas said LATAM’s average fuel price, including hedges, rose more than 80% year over year in the second quarter. Total fuel expense increased 93%, creating a substantial cost headwind. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High LATAM responded with revenue-management actions and targeted capacity adjustments. Total revenue rose nearly 28% from a year earlier to almost $4.2 billion, led by a 28% increase in passenger revenue. Cargo revenue increased nearly 22%, supported by higher yields and growth in transported tons. The company increased consolidated capacity 8.9% year over year while maintaining an 81.8% load factor, down from 83.5% in the prior-year period. Consolidated passenger revenue per available seat kilometer, or RASK, increased 17.5%. → No Hangover: Revisiting Microsoft One Week After Earnings Adjusted costs excluding fuel increased 14%, which Bottas said was broadly consistent with the expansion of the operation. Passenger cost per available seat kilometer excluding fuel remained sequentially stable at $0.045. LATAM generated net income of $125 million and adjusted operating cash flow of $476 million. The company said it produced a positive cash change of nearly $150 million before dividend payments and ended the quarter with a positive net cash variation of $110 million. Management said premium traffic and the LATAM Pass loyalty ecosystem helped preserve revenue quality during the period of higher fares. Premium revenue represented 29% of passenger revenue and grew faster than main-cabin revenue, according to the company. More than 67% of passenger revenue was generated by LATAM Pass members, up from 60% previously. The number of elite members increased 26% year over year, while third-party sales generated by those members rose 48%. During the question-and-answer session, Alvo said international demand was solid broadly, with some improvement on South America-to-U.S. routes after prior weakness tied to potential visa restrictions and U.S. government policy announcements. He said Europe remained “very solid,” while Argentina was slower amid its economic environment. Demand in northern South America was in a good position, he added. Alvo also noted a temporary impact on travel patterns from the FIFA World Cup, particularly in June, which management said weighed on demand more than expected. LATAM Airlines Brasil expects to receive its first 12 Embraer E-Jet E2 aircraft between October and December, with commercial operations scheduled to begin Nov. 3. The initial deployment is planned to cover 42 domestic Brazilian routes, including eight new routes. The new routes include four connections from Guarulhos to Cabo Frio, Ji-Paraná, Rondonópolis and Macaé, as well as four additional routes between existing bases. LATAM said the expansion will bring its Brazilian domestic network to 67 destinations, compared with 44 in 2019. Alvo said the aircraft will enable the company to right-size capacity on existing routes, add frequencies at times with lower demand and serve airports where Airbus A320-family aircraft may be less suitable because of infrastructure limitations. The airline is evaluating as many as 18 potential new bases for the next stage of E-Jet expansion beginning in early 2027. In Brazil, management said it sees healthy domestic demand and a favorable competitive environment. Alvo pointed to LATAM’s position at Guarulhos, where he said the company’s relative frequency share is about 2.5 times that of the second-largest operator. LATAM ended the quarter with more than $4.2 billion in liquidity, equal to 26.2% of last-12-month revenue, and adjusted net leverage of 1.5 times. Management said the balance-sheet position supported a newly approved share-repurchase program authorizing purchases of up to 5% of the company’s subscribed and paid shares over no more than five years. Alvo said the board will determine the timing, price and other terms of any repurchases. He said capital allocation priorities remain profitable growth and adherence to the company’s financial policy before any excess cash is considered for dividends, buybacks or debt-related actions. The company reinstated its full-year 2026 guidance and improved its outlook. LATAM now expects capacity growth of 9% to 10% and revenue of $17.3 billion to $17.7 billion. It forecast adjusted EBITDA of $4.1 billion to $4.4 billion, raising the midpoint of its prior guidance by $250 million. Third-quarter average fuel price assumption: $147 per barrel. Fourth-quarter average fuel price assumption: $130 per barrel. Passenger CASK excluding fuel: $0.045 to $0.047. Year-end liquidity: at least $4.7 billion. Year-end adjusted net leverage: at or below 1.6 times. Management said the outlook assumes a more constructive fuel-price backdrop in the second half, while emphasizing that fuel-price volatility remains elevated. Alvo said the company expects the second quarter to have been the year’s most challenging operating environment and is entering the seasonally stronger second half with continued focus on execution, capacity discipline and revenue management. LATAM Airlines Group SA is a Chilean-based airline holding company formed in 2012 through the merger of LAN Airlines of Chile and TAM Linhas Aéreas of Brazil. The Group offers passenger and cargo air transportation services across South America and beyond, operating under a multi‐brand strategy that encompasses several nationally recognized carriers. Headquartered in Santiago, Chile, LATAM is structured to serve diverse market segments with full-service, premium and low‐cost offerings. The core business activities of LATAM Airlines Group include scheduled domestic and international passenger flights, air cargo services and maintenance, repair and overhaul (MRO) capabilities through its technical divisions. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "LATAM Airlines Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Interested in Eve Holding, Inc.? Here are five stocks we like better. Eve resumed flight testing of its eVTOL prototype and has begun partial transition flights, reaching 30 knots. It targets full transition by the end of 2026, crewed conforming-prototype flights in late 2027, and certification and entry into service in 2028. The company ended the second quarter with $403 million in cash and $531 million in total liquidity, which management believes can fund operations through 2028. Second-quarter cash burn was $49 million, while full-year cash consumption is expected at $225 million to $275 million. New letters of intent for 46 aircraft increased Eve’s stated preorder backlog to roughly 2,700 aircraft worth $13.5 billion at list prices, although only about 100 orders are currently firm. Eve also expects $100 million to $150 million in cost synergies and avoidance through its relationship with Embraer over the next three years. Amazon Bets Big on BETA: Why Analysts See 50% Upside EVE (NYSE:EVEX) said its full-scale engineering prototype has entered partial transition flight testing as the electric vertical takeoff and landing aircraft developer targets full transition by the end of 2026 and certification and entry into service in 2028. Chief Executive Officer Johann Bordais said the company resumed its flight campaign after completing a planned three-month ground-test period focused on software upgrades and system integration. The work included testing the synchronization of the aircraft’s lifter rotors and pusher propeller, as well as ground testing of avionics, actuators and flight-control systems with motors powered on. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control Flying Cars and Rising Bars: The 2026 eVTOL Breakout Begins The prototype has completed 66 flights and logged 2 hours and 46 minutes of airtime, according to Bordais. Eve has validated 150 test points during the program and accumulated more than 15,000 hours of component and systems testing across its development infrastructure. The aircraft is now conducting partial transition flights, in which it accelerates forward by engaging its pusher while the lifter rotors remain powered. Bordais said the pusher initially operated at low revolutions and was subsequently increased to about 1,200 RPM, enabling forward flight at 30 knots, or roughly 35 miles per hour. → Financials Hit Record Highs as the AI Trade Unravels—Can They Keep Leading? Don’t Miss These 3 Hidden Aerospace Gems Before They Take Off In the coming weeks, Eve plans to increase speed progressively to 60 knots and then to 80 to 90 knots. Full transition will occur when the lifter rotors are powered off and lift is generated by air flowing over the wing, allowing the aircraft to operate like a conventional airplane. Bordais said the company expects to need approximately 30 to 40 additional flights to complete the full transition, with timing still targeted for the end of the year. He said the company does not intend to “cut any corners” in the testing campaign, which is designed to expand the flight envelope while transferring findings into the certification-conforming aircraft program. → Why Rare Earth Processing Could Be the Real 2027 Opportunity Marcelo Basile, Eve’s chief flight prototype engineer, said the company expects to build six conforming prototypes next year. The first will focus on flight-envelope expansion, handling qualities and performance. Other aircraft will support testing of propulsion, electrical systems, avionics, cabin systems, and function-and-reliability requirements. The sixth prototype will be the closest to a series-production aircraft, he said. Eve plans the first crewed conforming-prototype flight for the second half of 2027. Bordais said the company expects the conforming aircraft to fly for about 12 months before certification, supporting its 2028 entry-into-service target. The company said its means-of-compliance process with Brazil’s civil aviation authority, ANAC, is nearly complete. These requirements outline the tests needed to demonstrate that aircraft components meet certification standards. Some suppliers have already begun testing components for which compliance methods have been aligned with ANAC, Bordais said. ANAC has opened an industry consultation on an updated airworthiness certification basis that Eve said reflects alignment with the Federal Aviation Administration. The consultation ends Aug. 18. ANAC also published proposed noise certification criteria for Eve’s E100 aircraft following engagement with the company, according to Bordais. Eve has applied through ANAC for type-certificate validation by the European Union Aviation Safety Agency. Bordais said EASA certification is expected 12 to 15 months after approvals from ANAC and the FAA. On the supply chain, Bordais said Eve has approximately 22 suppliers, with major contracts negotiated since 2023, beginning with the battery and propulsion systems. The company is conducting critical design reviews with suppliers and expects to freeze the aircraft design by the end of 2026, allowing only minor changes afterward. Eve also announced partnerships with Hitachi and the Florida Department of Transportation. The Hitachi relationship is intended to address vertiport electrical-grid connections, charging cycles and integration of new energy demand. The Florida partnership will focus on infrastructure, operating procedures and airspace navigation needed to integrate urban air mobility into the state’s transportation network. Chief Financial Officer Eduardo Couto said Eve ended the second quarter with $403 million in cash and total liquidity of $531 million, including $128 million of undrawn credit facilities. The company believes its liquidity is sufficient to fund operations through 2028 without additional funding. Second-quarter cash consumption was $49 million, while cash burn for the first half totaled $118 million. Eve expects full-year cash consumption to remain near the midpoint of its previously stated $225 million to $275 million range. Research and development expense was $29 million in the second quarter, down from roughly $55 million in prior quarters due to supplier agreements that were more favorable than expected and program-development updates. Couto said R&D spending is expected to return to about $50 million per quarter going forward. Selling, general and administrative expense was $8 million, and net loss was $34 million. The company identified $100 million to $150 million in potential synergies and cost avoidance over the next three years through its relationship with Embraer. Couto said slightly less than one-third of those savings is expected this year, with the remainder expected in 2027 and 2028. Cost-saving efforts include shifting certain administrative activities to Embraer, improving the master services agreement covering engineering resources, and using Embraer facilities and industrial assets to avoid duplicative investments. Eve expects approximately $20 million of capital expenditures this year, around $50 million next year, and $30 million to $40 million in 2028, for roughly $100 million of total investment in modular production capacity. At the Farnborough Airshow, Eve announced two new letters of intent covering 46 aircraft: one from Moov for operations in Cape Verde and another from Shearwater, a Bay Point Capital Company affiliate and new leasing customer. The additions brought Eve’s stated preorder backlog to about 2,700 aircraft, valued at approximately $13.5 billion at list prices. Bordais said the company has about 100 firm aircraft orders from Revo and AirX, while the broader backlog includes letters of intent. He said Eve is pursuing both direct sales to operators and sales to leasing companies, which can then lease aircraft to operators. Eve Holding, Inc (NYSE: EVEX) is the publicly traded parent of Eve Air Mobility, a company dedicated to developing sustainable urban air mobility solutions. Through its engineering and design capabilities, Eve focuses on creating electric vertical takeoff and landing (eVTOL) aircraft tailored for short-haul passenger and cargo transport in densely populated areas. The company’s flagship offering is an eVTOL aircraft designed to deliver clean, quiet and efficient point-to-point service, backed by an integrated digital platform for air traffic management. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "EVE Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Eve Holding Inc (NYSE:EVEX) successfully resumed its flight campaign and initiated partial transition flights, with the pusher engaged at up to 1,200 RPM and forward speeds of 30 knots, marking a key technical milestone. The company reported a strong liquidity position with $403 million in cash and $531 million in total liquidity, which management believes is sufficient to fund operations through 2028 without new funding. Eve Holding Inc (NYSE:EVEX) identified $100 million to $150 million in potential synergies with Embraer over the next three years, with early benefits already reflected in reduced cash burn and R&D expenses. The company expanded its pre-order backlog to approximately 2,700 aircraft valued at $13.5 billion, including two new LOIs announced at the Farnborough Air Show from MOVE and Shearwaters. Eve Holding Inc (NYSE:EVEX) made significant progress on certification, with means of compliance nearly completed with ANAC, and new partnerships with Hitachi and the Florida Department of Transportation to advance infrastructure readiness. Eve Holding Inc (NYSE:EVEX) pushed back the timeline for completing full transition flights to the end of 2026, indicating potential delays in the flight test program. The company's R&D expenses in Q2 2026 were unusually low at $29 million due to one-time supplier agreements, but management expects costs to return to around $50 million per quarter, signaling higher future cash burn. Eve Holding Inc (NYSE:EVEX) still faces significant certification hurdles, with European certification (EASA) expected only 12 to 15 months after ANAC and FAA approvals, delaying entry into key markets. The company's cash burn remains substantial, with $118 million consumed in the first half of 2026, and total consumption for the year is still projected between $225 million and $275 million. Eve Holding Inc (NYSE:EVEX) has not yet achieved full transition flight, and the conforming prototype's first crewed flight is not expected until the second half of 2027, leaving a long runway to certification and service entry in 2028. Warning! GuruFocus has detected 3 Warning Signs with EVEX. Is EVEX fairly valued? Test your thesis with our free DCF calculator. Q: Can you elaborate on the components of the $100 million to $150 million in synergies with Embraer and how much has been realized in the current run rate?A: Eduardo Coto (CFO) explained that the synergies are broken into three pockets: Eve's structure (leveraging Embraer's administrative functions), the Master Service Agreement (optimizing the pool of Embraer engineers and direct supplier payments), and industrialization (using Embraer's existing assets to avoid duplicating infrastructure investments). He noted that less than one-third of the synergies will be captured this year, with the remainder coming in 2027 and 2028. This supports the company's confidence in staying within the mid-range of its cash burn guidance. Q: How should we think about the process of revenue generation on the $1.4 billion in MRO contracts, and what kind of work might be performed on these aircraft in their first year after delivery?A: CEO Johan Borde detailed the "TechCare" suite, which is a fly-by-the-hour program. He emphasized that Eve has life-cycle contracts with its 21-22 suppliers, covering not just production but also customer support and services. The model is designed to make Eve the face to the customer, ensuring aircraft availability and managing operating costs. This includes MRO, material availability with exchange programs, training (via the ECTS joint venture with CAE and Embraer), and leveraging Embraer's "HeadPro" prognostic service to predict maintenance needs. Q: Can you provide an update on the transition flight campaign and how it impacts the timing of building the certification conforming aircraft?A: CEO Johan Borde confirmed that the full transition flight is planned by the end of this year. The prototype has resumed its flight campaign, with the pusher now engaged, and they are approximately 30-40 flights away from completing the full transition (reaching 90 knots and turning off the lifters). This milestone is directly connected to the conforming prototype timeline, as the design will be frozen by the end of the year, allowing assembly to begin and the first crewed conforming prototype flight to occur in the second half of 2027. Q: What are the major validations from the transition flights, and can you remind us where we are on the design and build-out of the six conforming aircraft?A: CEO Johan Borde highlighted that the lift-and-cruise configuration is proving efficient for certification and aftermarket operations. The building-block methodology, tested over 150 points, is being transferred to the conforming prototypes. He confirmed that the Critical Design Review (CDR) with all 21 suppliers will be completed by the end of this year, freezing the design. Six conforming prototypes will be built next year, with the first crewed flight scheduled for the second half of 2027, followed by approximately 12 months of testing before certification in 2028. Q: How significant are the new LOIs from the Farnborough Air Show, and how are you thinking about converting them to binding orders?A: CEO Johan Borde stated that the new LOIs (46 aircraft from MOVE in Cape Verde and Shearwaters, a Bay Point Capital company) are important for preparing entry into service. He emphasized that Eve signs contracts when they make sense, fitting the right mission for the aircraft. The MOVE deal aligns with ecotourism growth in Cape Verde, while the Shearwaters deal adds to the leasing community, a crucial model for the industry. These add to the total pre-order backlog of approximately 2,700 aircraft valued at about $13.5 billion. Q: Can you share how we should think about CapEx into the second half and the manufacturing strategy?A: CFO Eduardo Coto explained that Eve is studying ways to use existing Embraer facilities as much as possible to delay investments in manufacturing. He projected CapEx of around $20 million this year, increasing to roughly $50 million next year, and another $30-40 million in 2028. The total investment of around $100 million will provide a modular production capacity that can be scaled as demand grows. Q: Can you comment on the component or part-level differences between the six cert conforming prototypes?A: Marcelo Basili (Chief Flight Prototype Engineer) detailed the distinct roles of each prototype: the first is for envelope expansion and handling qualities; the second focuses on handling qualities and performance; the third deals with systems, likely propulsion and electrical; the fourth focuses on avionics; the fifth is for interior cabin systems with a full cabin; and the sixth is dedicated to function and reliability testing, being the closest to the series aircraft. Q: Can you give an update on the supply chain and whether there is room to add additional suppliers?A: CEO Johan Borde confirmed that contracts with the 22 suppliers are closed and negotiated, with the first contracts (battery and engines) signed back in 2023. He noted that the design will be frozen by the end of this year, after which only minor changes can be accepted. The contracts are life-cycle agreements, including clauses to increase production ramp-up, and Eve is embedding people at supplier locations to follow development, leveraging Embraer's 56 years of supply chain management experience. Q: This partnership with Hitachi, is this more for Eve's operational execution and infrastructure or are you targeting the general eVTOL infrastructure opportunity?A: CEO Johan Borde clarified that Eve strongly believes in an agnostic approach to scale up Urban Air Mobility (UAM). The partnership with Hitachi is aimed at standardizing electrification, battery thermal management systems (BTMS), and vertiport infrastructure. This is not just for Eve's own operations but to enable the broader eVTOL ecosystem, ensuring that different OEMs can operate at various vertiports, which is essential for scaling the industry. Q: Can you potentially find more areas of cost synergies in the future beyond the current $100-150 million range?A: CFO Eduardo Coto indicated that the current focus is on synergies related to certification through 2028. However, once Eve enters service, there is significant potential to leverage Embraer's existing MRO facilities and global network for services and support, which would provide additional cost synergies and avoid the need for new investments. For the complete transcript of the earnings call, please refer to the full earnings call transcript.