I'd like to welcome everyone to AerSale's third quarter 2025 earnings call. A reconciliation of those non-GAAP metrics to the nearest GAAP metric can be found in the earnings presentation materials made available on the investor section of the AerSale website at ir.aersale.com. We reported revenue of $71.2 million for the third quarter, compared to $82.7 million in the prior year period. Turning to profitability, we delivered solid margin performance despite the absence of whole asset sales in the quarter.

Adjusted EBITDA was $9.5 million, or 13.3% of sales, compared to $8.2 million, or 10.0% of sales, in the prior year period. By segment, and starting with asset management, revenue was $39.2 million in the third quarter, compared to $50.4 million in the prior year period. Excluding whole asset transactions, segment revenue increased nearly 40.9% year-over-year to $39.2 million, driven by strong USM volume and higher leasing activity. As we've discussed in past calls, we've made a strategic decision to balance whole asset transactions with assets deployed on lease, which is more in line with our historical operating model.

During the quarter, we remained active on feedstock acquisitions to drive our future growth. We acquired a total of $13.7 million in the quarter, which brings the year-to-date total to $84.2 million. As I noted, we had one aircraft on lease during the quarter, and we placed an additional 757 freighter on lease that will begin generating revenue in the fourth quarter. Turning to tech ops, revenue was $32.0 million, down modestly from $32.3 million in the prior year period.

What went well
  • Adjusted EBITDA grew to $9.5 million (13.3% margin) from $8.2 million (10.0%) despite zero whole-asset sales, demonstrating margin expansion from leasing, USM and cost cuts.
  • Excluding lumpy whole-asset sales, the core business grew 18.5% year-over-year, with Asset Management up 40.9% on strong USM volume and higher leasing activity.
  • Gross margin improved to 30.2% from 28.6% and SG&A fell to $18.6 million from $21.7 million on twelve months of cost-reduction efforts.
  • The lease pool expanded to 15 engines and one 757 freighter, with a second 757 lease executed at quarter-end, building a more predictable recurring revenue base.
  • Completed construction of the aerostructures and pneumatics MRO expansions and reached near-full utilization at Goodyear, positioning roughly $25 million of incremental MRO revenue for 2026.
  • AerSafe deliveries rose year-over-year, with 2025 deliveries plus backlog exceeding $22 million ahead of the Q4 2026 FAA airworthiness-directive compliance deadline.
What went wrong
  • Total revenue declined to $71.2 million from $82.7 million because there were no engine or aircraft sales in the quarter, versus five engine sales a year earlier.
  • Results swung to a $0.1 million net loss from $0.5 million of net income, and adjusted net income slipped to $1.5 million from $1.8 million.
  • Feedstock supply stayed tight and pricing elevated as OEM production lagged demand, limiting attractively priced acquisitions to $13.7 million in the quarter.
  • Placing the remaining converted 757 freighters was taking time, with transaction timing still uncertain.
  • Extended engine-shop turnaround times were delaying return-to-service of the ten engines under repair.
  • Year-to-date operating cash use was $34.3 million and liquidity was modest at $58.9 million with only $5.3 million of cash, while a government shutdown caused system-wide air-traffic-control delays.

Performance Breakdown

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Reported 2025-11-06 · figures from the AerSale Corp Q3 2025 earnings call.

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