✦ The LEAP Fleet Coming DueWide moat

GE Aerospace (GE) — the future bets

The most valuable thing in this company's future needs no invention and no competitive win. It needs aircraft to fly.

The most valuable thing in GE Aerospace's future needs no invention, no approval and no competitive win. It needs aircraft to fly.

The fleet, and the backlog behind it~5,800LEAP delivered2023-H1 2026~2,0002026 target$178.7bnServices RPO $bn12%Released per year %Almost none of the LEAP fleet has generated an overhaul yet. Every one was delivered at a gross loss.
The most valuable thing in this company’s future needs nothing invented. It needs aircraft to fly.

LEAP deliveries were 1,570 in 2023, 1,407 in 2024 and 1,802 in 20251, with roughly 2,000 targeted for 20262 and deliveries up forty-one per cent in the first half of that year3. A modern narrowbody engine runs several years before its first removal, and the LEAP-1B durability kit certified in 2026 is expected to roughly double time-on-wing from the start of 20274. So the overwhelming majority of the LEAP fleet has never generated overhaul revenue.

Every one of those engines was delivered inside an equipment package carrying a negative gross margin5. The compensation is scheduled: services remaining performance obligation was $178,705 million at June 20266, releasing twelve per cent within a year, forty-two per cent within five and eighty-six per cent within fifteen7.

This is what makes the company's current numbers look contradictory — revenue up twenty-one per cent while margins contract8. The deliveries are the cost; the shop visits are the payment; and right now the company is doing more of the first than of the second.

The near-term evidence that it is working is already strong. Internal shop visit revenue grew twenty-four per cent in 20259 and thirty per cent in the first half of 202610, with record internal shop visit output in the June quarter11 — largely because material supply improved enough to let the shops run.

Internal shop visit revenue is the single most important series GE Aerospace publishes. Sustained twenty-per-cent-plus growth through the second half of the decade converts the equipment losses of 2022 to 2026 into the margin of the 2030s. A slowdown to single digits while LEAP deliveries continue at 2,000 a year would mean the annuity is thinner than the backlog implies.

Moat trajectory: Widening

Internal shop visit revenue grew twenty-four per cent in 2025 and thirty per cent in the first half of 2026, with record shop visit output in the June quarter, against a LEAP fleet whose average age is still low. This is the most certain thing in the company's future.

The number that tests this moat
Third-party estimate
LEAP deliveries
about 2,000 targeted for 2026, from 1,802

Deliveries up 41% in the first half of 2026 into a fleet that has barely begun to generate overhauls, against a services backlog of $178,705M releasing 12% a year. Sustained twenty-per-cent-plus shop visit growth converts the equipment losses of 2022-2026 into the margin of the 2030s.

Source: Aviation coverage of the 2026 LEAP delivery target ↗
References
  1. ReportedLEAP deliveries were 1,570 in 2023, 1,407 in 2024 and 1,802 in 2025, with roughly 2,000 targeted for 2026 and deliveries up forty-one per cent in the first half of that year.
    GE Aerospace Form 10-K, FY2025 - Segment Operations — Commercial Engines & Services: segment revenue, profit and margin, commercial engine and LEAP unit deliveries, internal shop visit revenue growth, the CES remaining performance obligation, the 2025 engine commitments from Qatar Airways, Emirates, International Airlines Group, ANA Holdings, Malaysia Aviation Group, Korean Air, Cathay Pacific and Pegasus, and commercial departures growth. — FY2025 · publ. January 2026 · source ↗
  2. Third-party estimateLEAP deliveries were 1,570 in 2023, 1,407 in 2024 and 1,802 in 2025, with roughly 2,000 targeted for 2026 and deliveries up forty-one per cent in the first half of that year.
    Aviation and market coverage of GE Aerospace's narrowbody position and delivery ramp - the LEAP as the exclusive powerplant on the Boeing 737 MAX and holding more than 55% of the Airbus A320neo family through the CFM joint venture, the target of about 2,000 LEAP deliveries in 2026, first-half deliveries up 41%, and CFM RISE described as a technology demonstrator rather than a product for sale. — 2026 · publ. August 2026 · source ↗
  3. ReportedLEAP deliveries were 1,570 in 2023, 1,407 in 2024 and 1,802 in 2025, with roughly 2,000 targeted for 2026 and deliveries up forty-one per cent in the first half of that year.
    GE Aerospace second-quarter 2026 earnings release (Exhibit 99.1 to Form 8-K of July 16, 2026) — total company GAAP and non-GAAP results, segment revenue, orders and operating profit, free cash flow, the raised full-year 2026 guidance for adjusted revenue growth, operating profit, adjusted earnings per share and free cash flow, the LEAP-1B durability kit certification, the XA102 and GE426 defence programmes, the NASA hybrid-electric ground tests, and the chief executive's commentary. — Q2 2026 · publ. 16 July 2026 · source ↗
  4. ReportedA modern narrowbody engine runs several years before its first removal, and the LEAP-1B durability kit certified in 2026 is expected to roughly double time-on-wing from the start of 2027.
    GE Aerospace second-quarter 2026 earnings release (Exhibit 99.1 to Form 8-K of July 16, 2026) — total company GAAP and non-GAAP results, segment revenue, orders and operating profit, free cash flow, the raised full-year 2026 guidance for adjusted revenue growth, operating profit, adjusted earnings per share and free cash flow, the LEAP-1B durability kit certification, the XA102 and GE426 defence programmes, the NASA hybrid-electric ground tests, and the chief executive's commentary. — Q2 2026 · publ. 16 July 2026 · source ↗
  5. ReportedEvery one of those engines was delivered inside an equipment package carrying a negative gross margin.
    GE Aerospace Form 10-K, FY2025 - consolidated financial statements — statement of operations including sales of equipment, sales of services, insurance revenue and their respective costs; statement of financial position including insurance liabilities and annuity benefits, shareholders' equity, property plant and equipment and shares outstanding; and the statement of cash flows. — FY2025 · publ. January 2026 · source ↗
  6. ReportedThe compensation is scheduled: services remaining performance obligation was $178,705 million at June 2026, releasing twelve per cent within a year, forty-two per cent within five and eighty-six per cent within fifteen.
    GE Aerospace Form 10-Q for the quarter ended June 30, 2026, Management's Discussion and Analysis — consolidated revenue, profit and earnings per share, the segment results for Commercial Engines & Services and Defense & Propulsion Technologies, commercial engine and LEAP unit deliveries, internal shop visit revenue growth, the remaining performance obligation and its equipment and services split, the supply chain, tariff and Middle East discussions, and the planned $1 billion US manufacturing investment and 5,000 US hires. — Q2 2026 · publ. July 2026 · source ↗
  7. ReportedThe compensation is scheduled: services remaining performance obligation was $178,705 million at June 2026, releasing twelve per cent within a year, forty-two per cent within five and eighty-six per cent within fifteen.
    GE Aerospace Form 10-K, FY2025 - notes to the consolidated financial statements — the segment note including segment expenses, segment profit and other segment income; contract assets, contract liabilities and long-term service agreement balances; the remaining performance obligation note with its expected recognition schedule; goodwill and intangible assets; and the geographic revenue table. — FY2025 · publ. January 2026 · source ↗
  8. ReportedThis is what makes the company's current numbers look contradictory — revenue up twenty-one per cent while margins contract.
    GE Aerospace Form 10-Q for the quarter ended June 30, 2026, Management's Discussion and Analysis — consolidated revenue, profit and earnings per share, the segment results for Commercial Engines & Services and Defense & Propulsion Technologies, commercial engine and LEAP unit deliveries, internal shop visit revenue growth, the remaining performance obligation and its equipment and services split, the supply chain, tariff and Middle East discussions, and the planned $1 billion US manufacturing investment and 5,000 US hires. — Q2 2026 · publ. July 2026 · source ↗
  9. ReportedInternal shop visit revenue grew twenty-four per cent in 2025 and thirty per cent in the first half of 2026, with record internal shop visit output in the June quarter — largely because material supply improved enough to let the shops run.
    GE Aerospace Form 10-K, FY2025 - Segment Operations — Commercial Engines & Services: segment revenue, profit and margin, commercial engine and LEAP unit deliveries, internal shop visit revenue growth, the CES remaining performance obligation, the 2025 engine commitments from Qatar Airways, Emirates, International Airlines Group, ANA Holdings, Malaysia Aviation Group, Korean Air, Cathay Pacific and Pegasus, and commercial departures growth. — FY2025 · publ. January 2026 · source ↗
  10. ReportedInternal shop visit revenue grew twenty-four per cent in 2025 and thirty per cent in the first half of 2026, with record internal shop visit output in the June quarter — largely because material supply improved enough to let the shops run.
    GE Aerospace Form 10-Q for the quarter ended June 30, 2026, Management's Discussion and Analysis — consolidated revenue, profit and earnings per share, the segment results for Commercial Engines & Services and Defense & Propulsion Technologies, commercial engine and LEAP unit deliveries, internal shop visit revenue growth, the remaining performance obligation and its equipment and services split, the supply chain, tariff and Middle East discussions, and the planned $1 billion US manufacturing investment and 5,000 US hires. — Q2 2026 · publ. July 2026 · source ↗
  11. ReportedInternal shop visit revenue grew twenty-four per cent in 2025 and thirty per cent in the first half of 2026, with record internal shop visit output in the June quarter — largely because material supply improved enough to let the shops run.
    GE Aerospace second-quarter 2026 earnings release (Exhibit 99.1 to Form 8-K of July 16, 2026) — total company GAAP and non-GAAP results, segment revenue, orders and operating profit, free cash flow, the raised full-year 2026 guidance for adjusted revenue growth, operating profit, adjusted earnings per share and free cash flow, the LEAP-1B durability kit certification, the XA102 and GE426 defence programmes, the NASA hybrid-electric ground tests, and the chief executive's commentary. — Q2 2026 · publ. 16 July 2026 · source ↗
Sources
Generated September 23, 2026