Embraer raised 2026 revenue and delivery targets after Q2 deliveries jumped 28%. CEO Neto cited faster E-Jet production and defense growth. Free cash flow turned negative but CFO said it was temporary. An investor day in November will outline the 2027-2030 plan.
Alpha Score of 40 reflects weak overall profile with moderate momentum, poor value, moderate quality, moderate sentiment.
Embraer raised its 2026 revenue and delivery targets after second-quarter deliveries jumped 28% from a year earlier, Chief Executive Francisco Neto said on the earnings call Monday.
The company now expects 2026 revenue of $6.0 billion to $6.8 billion, up from a prior range of $5.5 billion to $6.5 billion. Deliveries are forecast at 160 to 180 aircraft, compared with an earlier estimate of 140 to 170. Neto credited faster E-Jet production and a growing defense-services pipeline for the revision.
Revenue in the quarter reached $1.7 billion, up 15% year over year. Adjusted EBITDA came in at $182 million, a 10.7% margin that beat the company's internal forecast. Neto pointed to a mix shift toward higher-margin E195-E2 deliveries and a 40% jump in defense services revenue.
Commercial aviation delivered 19 jets, including 12 E195-E2s, up from 14 total a year ago. Executive jets delivered 23 units, flat on the surface but tilted more toward the larger Praetor 600, which carries a higher average selling price. Defense and security contributed 5 units, including the first of three C-390 Millennium transports for the Hungarian Air Force.
The backlog ended the quarter at $22.3 billion, the highest in five years. Neto said the pipeline included "several multiyear service contracts" that added $1.2 billion to the total, mostly from defense customers in Europe and the Middle East.
Eve, the urban air mobility subsidiary that Embraer controls, posted a narrower operating loss of $39 million, compared with a $47 million loss a year ago. The eVTOL developer has not yet booked revenue but said it is on track to begin certification flight tests before year-end.
Free cash flow swung to negative $218 million in the quarter, driven by working capital tied to higher production and defense contract prepayments. CFO Felipe Santana de Lima said the cash outflow was "fully expected and temporary" and that the company still expects positive free cash flow for the full year.
Embraer shares traded at $41.20 after the release, up 2.3% on the session, outpacing a flat broader market.
For the third quarter, Neto said Embraer expects 48 to 52 deliveries, with the commercial backlog "essentially sold out" for the E195-E2 through 2027. The company will host an investor day in November to detail its 2027-2030 strategic plan.
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