AerSale Corp Q1 2026 results

I'd like to welcome everyone to AerSale's first quarter 2026 earnings call. A reconciliation of those non-GAAP metrics to the nearest GAAP metric can be found in the earnings presentation materials made available in the Investors section of AerSale's website at ir.aersale.com. This quarter, our team stayed focused on executing our strategy across Asset Management and TechOps, prioritizing, one, disciplined acquisition and monetization of flight equipment and used serviceable material, you'll hear me say USM. Three, building a recurring and more predictable revenue base through MRO services and leasing while maintaining our high standards for safety, quality, and on-time performance.

First quarter revenue was $70.6 million, an increase of 7.4% from the prior year period. Adjusted EBITDA also increased by $4.2 million or 131.9% to $7.4 million from the prior year period. Excluding flight equipment sales, which tend to be volatile quarter-to-quarter, revenue increased 2.2% year-over-year, reflecting growth in leasing and increased demand across our MRO facilities. Customer demand remains supported by high utilization levels and the ongoing need for reliable parts availability and turnaround performance.

Leasing demand remained a key driver of performance during the quarter, growing 57.9% compared to the prior year period. We continue to engage in discussions with potential customers as increased demand for cargo continues to make us bullish on deploying the remaining four 757 freighters we converted in 2026. Higher average lease rates and improved utilization contributed to stronger asset yields across both aircraft and engines and reflect our continued progress towards building a larger and more consistent recurring revenue base. Partially offsetting the increased leasing revenue was a decrease in USM sales resulting from the internal consumption of engine material for our own engine builds.