Breaking Down General Electric Company (GE) Financial Health: Key Insights for Investors

You've watched General Electric Company (GE) go through a massive, multi-year overhaul, and now you need to know if the financial engine of the newly focused GE Aerospace is defintely delivering. The short answer is yes: the transformation is working, and the numbers for fiscal year 2025 are compelling. The core business, now singularly focused on aviation, is forecasting full-year Earnings Per Share (EPS) guidance between $6.00 and $6.20, a strong indicator of margin expansion driven by commercial services demand. Here's the quick math on the momentum: the stock has surged roughly 68% this year alone, fueled by robust aftermarket demand for spare parts and shop visits. Plus, for the trailing twelve months ending September 2025, the company generated a formidable $6.444 billion in Free Cash Flow (FCF) on $43.95 billion in total revenue, demonstrating superior cash generation post-spin-offs of GE HealthCare and GE Vernova. This isn't just a cyclical upswing; it's a structural shift, but the concentration risk in commercial aviation is real, so let's dive into what's driving this performance and where the near-term pitfalls lie.

Revenue Analysis

You're looking for the real story in General Electric Company (GE)'s revenue, especially after the major spin-offs. The direct takeaway is this: GE is now fundamentally a high-margin aerospace services business, not a diversified industrial conglomerate anymore. Its revenue growth is accelerating, driven by the massive demand for aircraft engine maintenance.

For the trailing twelve months (TTM) ending Q3 2025, General Electric Company (GE) reported total revenue of approximately $43.95 billion, reflecting a strong year-over-year (YoY) growth of 17.68%. This growth is defintely a clear indicator that the strategic focus on GE Aerospace is paying off. The total revenue for the third quarter of 2025 alone hit $12.2 billion, a significant jump of 24.2% over the prior year's quarter. That's a serious acceleration.

Here's the quick math on where the money is coming from in 2025. The primary revenue sources are cleanly split between long-term service contracts and equipment sales, but the balance is heavily weighted toward services. This is a crucial distinction for your valuation models, as services revenue is typically higher-margin and more predictable.

• Services Revenue: Generated $8.215 billion in Q3 2025, contributing 67.2% of the total.
• Equipment Revenue: Accounted for $3.493 billion in Q3 2025, or 28.6% of the total.

The Services segment saw a YoY growth of 24.0% in Q3 2025, while Equipment sales grew even faster at 33.2%. The equipment growth is good, but the services number is the core of the business's long-term value-it's the annuity stream from the installed base of jet engines. You're buying into a maintenance monopoly, honestly.

The company's revenue is now almost entirely concentrated in the two main segments of GE Aerospace: Commercial Engines & Services (CES) and Defense & Propulsion Technologies (DPT). This is the significant change you need to map. The spin-offs of GE HealthCare and GE Vernova mean the old, sprawling business model is gone, which is why the total annual revenue number is lower than in past years-it's a smaller, but much more profitable, entity.

The 2025 guidance projects continued strength in these segments:

The CES segment, which focuses on commercial aviation, is the powerhouse, expecting high-teens revenue growth in 2025, driven by a recovering air travel market and the need for shop visits (engine overhauls) that were deferred during the pandemic. This services backlog is a massive tailwind. For a deeper dive into the strategic direction, you should review the Mission Statement, Vision, & Core Values of General Electric Company (GE).

What this estimate hides, still, is the ongoing supply chain constraints, which have been noted as a negative aspect limiting potential growth, particularly in Commercial Engines deliveries. If those constraints ease faster than expected, the equipment revenue could surprise to the upside. But for now, the services side is the reliable driver of value.

Profitability Metrics

You want to know if General Electric Company (GE) Aerospace is finally making money-real, sustainable profit-after years of restructuring. The short answer is yes, and their 2025 numbers show a decisive shift, driven by the high-margin services business. The profitability metrics for GE Aerospace are not just improving; they are now industry-leading.

For the full year 2025, GE Aerospace has raised its guidance, reflecting this operational strength. They now expect adjusted operating profit to be between $8.65 billion and $8.85 billion, up from earlier forecasts. This is a clear signal of management's confidence and a payoff from the strategic separation of GE HealthCare and GE Vernova.

Gross, Operating, and Net Margins

When we look at the trailing twelve months (TTM) as of November 2025, the margins tell a powerful story of efficiency and pricing power. The gross profit margin, which is a good indicator of core manufacturing and service pricing, stood at approximately 36.5% in the third quarter of 2025, reflecting the value of their installed base for jet engines.

Moving down the income statement, the operating margin (earnings before interest and taxes) is the real star. GE Aerospace's TTM operating margin as of November 2025 is a robust 19.68%. This is where the cost discipline and the high-volume, recurring nature of their services revenue truly shine.

Finally, the net profit margin-what you actually take home-reached 18.3% in October 2025, a significant jump from 15.8% the previous year. That's a defintely strong conversion of revenue to bottom-line profit.

• Gross Margin (Q3 2025): 36.5%
• Operating Margin (TTM Nov 2025): 19.68%
• Net Margin (TTM Oct 2025): 18.3%

Operational Efficiency and Industry Comparison

The core of GE Aerospace's margin expansion is its operational efficiency, specifically in cost management and leveraging its massive services segment. Over 67% of the company's Q3 2025 revenue came from long-term service contracts, maintenance, repair, and overhaul (MRO) for its massive global fleet of engines. This recurring revenue stream is inherently higher-margin than new equipment sales.

Here's the quick math on why this matters: while the broader aerospace and defense industry faces tightening margins due to persistent supply chain constraints and inflation, GE Aerospace is outpacing its peers.

For context, a TTM operating margin of nearly 20% for a major industrial manufacturer is excellent. When you compare GE Aerospace's TTM operating margin of 19.68% to a peer like Honeywell, which has a TTM operating margin of 18.73%, you see GE is operating at a slight premium. This performance is largely due to the company's 'FLIGHT DECK' strategy, which focuses on improving safety, quality, delivery, and cost in that order.

The trend is clear: margins are widening, not shrinking, which is a rare feat in the current inflationary environment.

What this estimate hides is the continued investment in next-generation engines like the GE9X, which creates a short-term cost drag but secures long-term services revenue for decades to come. The strong margins today are funding the margins of tomorrow. For a more complete picture of the company's financial standing, you should review the full analysis at Breaking Down General Electric Company (GE) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

You want to know if General Electric Company (GE) is leaning too heavily on debt to fuel its growth, and the quick answer is no; the company's financial structure is now conservative compared to its peers, reflecting a strong post-restructuring focus on the high-margin GE Aerospace business.

As of the September 2025 quarter, General Electric Company's total debt stood at approximately $20.838 billion. This is a manageable figure, especially when you break down the composition. The vast majority of this is long-term debt, which gives the company a longer runway for repayment and strategic planning.

• Long-Term Debt & Capital Lease Obligation: $18.772 billion
• Short-Term Debt & Capital Lease Obligation: $2.066 billion

Debt-to-Equity: A Conservative Stance

The core measure of financial leverage (how much debt is used to finance assets relative to shareholder equity) is the Debt-to-Equity (D/E) ratio. For General Electric Company, the D/E ratio for the quarter ending September 2025 was approximately 1.11. Here's the quick math: Total Debt ($20.838 billion) divided by Total Stockholders' Equity ($18.812 billion) equals 1.11.

To be fair, a 1.11 ratio means the company has slightly more debt than equity financing, but this is a significant improvement from its historical leverage and is quite healthy for a major industrial player. For context, the median D/E ratio for the Aerospace & Defense subindustry is around 1.80. General Electric Company is defintely operating with a lower financial leverage than many of its competitors, which generally decreases risk and volatility.

The company's conservative Debt-to-Capital ratio of 51% is also well below the industry average of 58.3%. This signals a deliberate strategy to maintain financial flexibility, especially after the major spin-offs of GE HealthCare and GE Vernova. You can dig deeper into the new investor base in Exploring General Electric Company (GE) Investor Profile: Who's Buying and Why?

Recent Capital Activity and Credit Strength

General Electric Company is balancing its capital structure by using debt strategically while aggressively returning capital to shareholders. In July 2025, for instance, the company completed two fixed-income offerings, issuing nearly US$2 billion in senior unsecured notes. This debt issuance supports financial flexibility and growth initiatives, especially in the core aerospace segment.

This measured approach to leverage has been recognized by credit rating agencies. In March 2025, S&P Global Ratings upgraded General Electric Company's long-term issuer credit rating to 'A-' from 'BBB+'. This upgrade reflects strong operational performance and expectations that the company will maintain debt leverage below 2x.

The balance is clear: General Electric Company is comfortable adding debt for strategic purposes, but it's also committed to equity funding and shareholder returns. Management guidance for 2025 includes dividend and share repurchase levels that may exceed free cash flow by approximately $2 billion, showing a strong commitment to returning capital to equity holders.

Liquidity and Solvency

You're looking at General Electric Company (GE) now, post-spinoffs, and asking the right question: can the core business, primarily GE Aerospace, cover its near-term obligations? The short answer is yes, but the liquidity profile is tight and relies heavily on strong cash generation, not just assets on the balance sheet.

The core liquidity ratios for General Electric Company (GE) as of September 2025 show a mixed picture. The Current Ratio, which compares current assets to current liabilities, is sitting at a tight 1.08. This means the company has just over a dollar in short-term assets for every dollar of short-term debt due within the year. While technically above the critical 1.0 mark, it's notably lower than the industry median of 1.88, which is a flag.

When you strip out inventory-which can be slow to convert to cash-to look at the Quick Ratio (or acid-test ratio), the number drops to approximately 0.76. This is the real insight: without selling inventory, General Electric Company (GE) cannot cover all its immediate obligations. This is common for heavy manufacturers, but it means managing that inventory pipeline is defintely crucial. It's a low ratio, but one that a company with strong, predictable cash flow can manage.

Working Capital and Cash Flow Trends

The working capital trend for General Electric Company (GE) shows that managing the operating cycle is a constant challenge. For the Trailing Twelve Months (TTM) ending September 2025, the change in working capital was a use of cash, specifically -$812 million. This negative change means that growth in assets like inventory or accounts receivable outpaced the growth in liabilities like accounts payable, consuming cash from operations.

But here's the key strength: the cash flow statement is robust. The company's ability to generate cash from its primary business activities-the Operating Cash Flow (OCF)-is very strong, coming in at $7,553 million for the TTM ending September 2025. This OCF is the engine that offsets the tight balance sheet ratios.

Here's the quick math on the cash flow movements (TTM Sep 2025, in millions USD):

The Investing Cash Flow is a net use of cash, primarily due to capital expenditures (CapEx) of $1,109 million, which is necessary to maintain and expand the high-tech manufacturing base. This is healthy spending. On the Financing side, General Electric Company (GE) is actively returning capital to shareholders, including a recent quarterly dividend of $0.36 per share paid in October 2025.

Near-Term Risks and Opportunities

The primary liquidity risk is the low Quick Ratio of 0.76. If a major, unexpected supply chain disruption or a sudden drop in customer demand were to hit, the company would rely heavily on its cash reserves and credit facilities to meet its short-term debt. The good news is that the company has been focused on strengthening its balance sheet and maintaining a healthy cash balance. While the core operations are sound, you should always monitor the Mission Statement, Vision, & Core Values of General Electric Company (GE). to understand the strategic direction that underpins this financial stability.

The opportunity is the sheer scale of the operating cash flow. The $7.55 billion in OCF provides a significant buffer and flexibility for debt repayment, strategic CapEx, and shareholder returns, making the low current ratios less of a solvency issue and more of a working capital management challenge. The company is generating enough cash to self-fund its growth and manage its obligations.

Next Step: Check the debt maturity schedule for the next 12-18 months to ensure the OCF is sufficient to cover any large, looming principal payments.

Valuation Analysis

You're looking at General Electric Company (GE) after a massive run-up, and the core question is simple: Is it overvalued, or is the market finally pricing in the successful business separation? The short answer is that traditional valuation metrics suggest General Electric Company is expensive, but the analyst consensus points to a strong 'Buy,' signaling that future growth and the strategic shift are the real drivers here.

The stock has had an impressive year. The stock price, sitting around $290.62 as of late November 2025, is up over 60% in the last 12 months, climbing from a 52-week low of $159.36 to a high of $316.67. That kind of momentum doesn't come cheap, and the valuation multiples reflect that optimism.

Here's the quick math on key valuation ratios for General Electric Company as of the 2025 fiscal year:

• Price-to-Earnings (P/E) Ratio: The trailing P/E is high at approximately 38.19. For context, its industry peers average around 38.9x, so General Electric Company is trading in line with its fast-growing sector, but well above the broader market.
• Price-to-Book (P/B) Ratio: This is a staggering 16.30. To be fair, this ratio is often less useful for industrial conglomerates undergoing a massive transformation, but it defintely signals that a huge premium is being paid over the company's net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA): This multiple sits at about 28.00. This is another elevated figure, suggesting the company's total value (equity plus debt, minus cash) is high relative to its operating cash flow proxy (Earnings Before Interest, Taxes, Depreciation, and Amortization).

Honestly, a discounted cash flow (DCF) analysis suggests the stock might be overvalued by as much as 54.0%, with a calculated fair value of around $200.56 per share. What this estimate hides, however, is the full, un-risked value of the newly separated entities, which is what the market is anticipating.

The dividend story is straightforward: General Electric Company is prioritizing reinvestment and balance sheet strength over a high payout. The annual dividend is modest at $1.44 per share, translating to a low dividend yield of about 0.48%. The payout ratio is very conservative at around 17.08%, meaning there is significant capacity for future increases once the restructuring is complete, but for now, it's a growth stock, not an income play.

Still, Wall Street is overwhelmingly bullish. The analyst consensus rating is a strong 'Buy'. Out of all the analysts covering the stock, a substantial majority (around 83%) recommend buying. The median price target is set at $345.00, implying a solid double-digit upside from the current price. The market is betting on the operational improvements and the clear focus of the new, streamlined Mission Statement, Vision, & Core Values of General Electric Company (GE).

So, the action is clear: If you believe in the long-term earnings power of the focused aerospace and energy businesses, the current price is simply the cost of entry for a high-growth industrial leader. If you are a value investor focused solely on trailing earnings, you'll find it too rich.

Risk Factors

You're looking at General Electric Company (GE) after its massive restructuring, and while the new GE Aerospace is flying high, the risks haven't vanished-they've just become more concentrated. The biggest near-term threat isn't a lack of demand, but the operational strain of meeting it, plus a premium valuation that leaves little room for error. Honestly, the market is pricing in perfection right now.

The core challenge is that the company is now heavily dependent on commercial aviation, with services representing approximately 70% of its revenue base, according to the Q3 2025 10-Q. This reduced diversification means any shock to global air travel demand, like a major geopolitical event or a sudden economic slowdown, will hit the bottom line much harder than when the company was a sprawling conglomerate.

External Risks: Macro and Geopolitical Headwinds

The macroeconomic environment is a constant headwind, particularly inflation and interest rates. Higher input costs continue to squeeze margins in manufacturing. For example, the former GE Vernova estimated the impact of tariffs and resulting inflation on its 2025 guidance to be approximately $300 million to $400 million, net of mitigating actions. GE Aerospace itself was estimating a potential $500 million impact from heightened tariffs earlier in 2025.

Also, don't forget the geopolitical landscape. The ongoing conflict in Russia-Ukraine, tensions in the Middle East, and the potential for escalating sanctions or tariffs between the U.S. and China all threaten global supply chains and customer demand for engines and services.

• Inflation raises borrowing and input costs.
• Geopolitical events can instantly halt key customer orders.
• Recession risk directly impacts air travel demand.

Operational and Financial Execution Risks

The most immediate risk is operational execution, specifically supply chain stability. Despite solid Q3 2025 results-with revenue of $12.18 billion and net income of $2.16 billion-persistent supply chain constraints remain the biggest short-term risk. The company is doing well, but it's still battling to get parts out the door.

Here's the quick math on the pressure: GE Aerospace's operating margin in Q3 2025 was 18.9%, a decline from 20.3% in the same quarter last year. This margin compression is driven by increased investments and higher costs to ramp up production and improve material availability, which is a necessary expense but one that eats into short-term profitability.

Another strategic risk is the long-term sustainability of the LEAP engine program's service margins through 2028, a topic that was a major focus on the Q3 earnings call. The company is investing heavily in LEAP durability to mitigate this, but it's a long-term commitment that requires defintely sustained capital.

The market has high expectations, which is reflected in the valuation. As of October 2025, GE's price-to-earnings (P/E) ratio stood at 40.4x, significantly higher than the closest peer group average of 26.5x. This premium valuation means any misstep in execution-like a delay in a major engine program or a quality issue-could lead to a sharp correction.

Mitigation Strategies: The Flight Deck Plan

General Electric Company (GE) is actively mitigating these risks through its proprietary lean operating model, FLIGHT DECK, which is focused on continuous improvement and prioritizing output. The strategy is simple: control what you can. The company has successfully increased material input from priority suppliers by more than 35% year-over-year in Q3 2025, which directly addresses the supply chain bottleneck. They are also making continued investments in next-generation products and LEAP engine durability to secure future aftermarket revenue streams.

If you want to dive deeper into the market's reaction to these factors, you can read Exploring General Electric Company (GE) Investor Profile: Who's Buying and Why?

Growth Opportunities

You need a clear map of General Electric Company (GE)'s future, not just a historical recap. The core takeaway is that the company's growth in 2025 is defintely driven by the successful execution of its strategic split, focusing on two high-margin, high-demand sectors: GE Aerospace and GE Vernova. This focus translates to strong, specific financial projections for the year.

Here's the quick math on the combined outlook: General Electric Company (GE) raised its full-year adjusted earnings per share (EPS) forecast to a range of $6.00 to $6.20, up from the prior $5.60 to $5.80 estimate. Plus, the adjusted free cash flow (FCF) is expected to land between $7.1 billion and $7.3 billion. That's a significant jump, and it's all about the strength of the two new entities.

GE Aerospace: Aftermarket Dominance and Defense

The engine business, GE Aerospace, is positioned for sustained growth because of the recovery in commercial air travel and its massive installed base. The real competitive advantage here is the aftermarket services, which is maintenance, repair, and overhaul (MRO). This is a recurring, high-margin revenue stream with a commercial services backlog already exceeding $140 billion.

The company expects 2025 adjusted revenue growth in the low double-digit range, and adjusted operating profit is projected to be between $7.8 billion and $8.2 billion. This growth is being locked in with major deals, like the November 2025 agreement with flydubai for 60 GEnx-1B engines for their new widebody fleet, and the Emirates contract for 130 next-generation GE9X engines. The proprietary 'FLIGHT DECK' lean operating model is helping them execute on this massive backlog and drive operational efficiencies.

• Engine Backlog: Over $140 billion in commercial services.
• Key Innovation: Advanced materials like ceramic matrix composites for engine durability.
• Defense Win: Up to $5 billion contract from the US Air Force for F110 engines.

GE Vernova: Powering the AI Energy Transition

GE Vernova, the energy technology spin-off, is tapping into one of the most powerful near-term trends: the unprecedented demand for power from artificial intelligence (AI) and data center infrastructure. This is a massive market expansion opportunity.

The company raised its full-year 2025 revenue guidance to a range of $36 billion to $37 billion. Their strategic focus on gas turbines and electrification is paying off. For example, the Gas Power segment's equipment backlog and slot reservation agreements grew sequentially in Q3 2025 to 62 gigawatts (GW). The Electrification segment is also seeing a surge, with its equipment backlog increasing by $6.5 billion year-to-date to approximately $26 billion. They are also committed to innovation, planning an approximately 20 percent increase in research and development (R&D) spend in 2025.

What this estimate hides is the long-term visibility provided by their large, sticky contract base. A landmark multi-decade power generation deal secured with Iraq in November 2025 reinforces this long-term revenue stream. This is a business with decades of revenue visibility. If you want to dive deeper into the full financial picture, you can check out the full analysis at Breaking Down General Electric Company (GE) Financial Health: Key Insights for Investors.

Next step: Portfolio Managers should immediately stress-test their valuation models using the high-end of the $6.20 EPS and $7.3 billion FCF guidance for General Electric Company (GE) to gauge the potential upside from the accelerated execution of the two-company strategy.