Bombardier Inc (BDRAF) Q4 2025 Earnings Call Highlights: Strong Financial Performance Amid …

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Fri, February 13, 2026 at 4:03 AM GMT+9 5 min read

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**Revenue:** Increased 10% year-over-year to approximately $9.6 billion.

**Free Cash Flow:** Reached almost $1.1 billion for the full year.

**Adjusted EBITDA:** Increased 15% year-over-year to $1.56 billion with a margin of 16.3%.

**Net Leverage:** Finished at 1.9 times, better than the target range of 2 to 2.5 times.

**Backlog:** Reached $17.5 billion, a 22% increase from the previous year.

**Aircraft Deliveries:** Delivered 157 aircraft, an increase of 11 units compared to last year.

**Service Revenue:** Reached a record $2.3 billion, representing a 13% growth year-over-year.

**Defense Revenue:** Surpassed $1 billion, with 16 deliveries.

**Adjusted Net Income:** Increased 47% to $805 million, with EPS of $7.72.

**Debt Repayment:** Over $900 million repaid or called, including $500 million to be redeemed.

**Liquidity:** Stands strong at $2.5 billion.

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Release Date: February 12, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Bombardier Inc (BDRAF) successfully completed its turnaround plan, achieving ambitious financial objectives set in 2021.

The company reported a significant increase in free cash flow, reaching over $900 million, surpassing initial targets.

Bombardier Inc (BDRAF) achieved a net leverage ratio of 1.9, better than the targeted range of 2 to 2.5.

The Global 8000 entered service, setting new benchmarks in speed and cabin altitude, with approvals from major aviation authorities.

The company reported record defense sales and expanded its role as a trusted partner to governments worldwide.

Negative Points

Bombardier Inc (BDRAF) continues to face challenges with supply chain disruptions, particularly with one engine OEM.

Despite improvements, the company anticipates further supply chain challenges in the immediate future.

The company has a wide range for its 2026 free cash flow guidance, indicating potential variability due to working capital factors.

There is no immediate plan to return cash to shareholders through dividends or share buybacks, as the focus remains on deleveraging.

The delivery profile remains skewed towards the fourth quarter, which may lead to working capital swings.

Q & A Highlights

Q: Can you provide some color on the supply chain costs embedded in your 2026 guidance and the visibility into these costs exiting your cost base in the back half of the year? A: Eric Martel, President and CEO, explained that supply chain challenges have been ongoing, but significant progress has been made in reducing shortages from 5,000 to about 500. However, critical shortages still impact production. Bart Demosky, CFO, noted that the 150 basis point headwind from supply chain issues is expected to improve in the second half of 2026, contributing to the greater than $1.65 billion EBITDA guidance.

Story Continues  

Q: Given the strong performance in the services segment, are you still guiding to high single-digit growth, or do you see near-term upside? A: Bart Demosky, CFO, indicated that near-term growth in the services segment is expected to be around or just under double digits. The company is optimistic about reaching the upper end of their $2.8 billion to $3.5 billion range, with potential for even higher growth as they continue to develop the business.

Q: Does share buyback or dividend enter the capital allocation framework this year, or is the focus still on deleveraging? A: Bart Demosky, CFO, stated that while they are not in a position to declare cash returns to shareholders this year, they are transitioning from a deleveraging phase to capital allocation. The focus remains on reducing debt and deploying capital with a return on invested capital (ROIC) framework.

Q: How do you view the potential for increasing aircraft production rates given strong demand? A: Eric Martel, President and CEO, acknowledged the strong market demand and backlog, indicating that Bombardier is preparing to increase production rates. The company is investing in capacity expansion to meet demand, particularly from fleet operators, while ensuring the supply chain can support increased production.

Q: What is the expectation for defense revenue in 2026? A: Bart Demosky, CFO, mentioned that Bombardier does not provide specific guidance on defense revenue. However, the defense business is integrated into the overall business plan, and the company remains optimistic about its growth potential.

Q: How should we think about the delivery cadence for the Global 8000 and engagement with the FAA following recent social media posts? A: Eric Martel, President and CEO, clarified that the issue with the FAA is not directly related to Bombardier but involves Transport Canada and a competitor. He expressed confidence that the situation will be resolved soon and noted that business operations continue as usual.

Q: Can you elaborate on the factors contributing to the strong free cash flow generation in Q4? A: Bart Demosky, CFO, explained that the strong free cash flow was due to robust performance across the business, strong sales, and order activity. There were no one-time items; rather, it was a combination of factors, including a strong mix of Global 8000 sales.

Q: Is there potential to smooth out working capital swings and delivery profiles during the year? A: Bart Demosky, CFO, noted that working capital variability is influenced by supply chain issues and production growth. While the company aims for more stability, the nature of the business means Q4 will typically see more deliveries due to customer preferences for year-end deliveries.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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