AerSale (NASDAQ:ASLE) Announces Quarterly Earnings Results

Key Points

• AerSale reported a quarterly loss of $0.02 per share, missing the $0.11 consensus estimate, while revenue of $91.56 million slightly exceeded expectations and grew 29% year over year.
• Profitability weakened: adjusted EBITDA declined to $8.6 million from $9.5 million, and gross margin contracted to 22.5% from 30.2%. The company also reported a $15 million net loss, including a $13.4 million non-cash goodwill impairment, and ended the quarter with $23.1 million in available liquidity.
• Management expects a stronger fourth quarter, citing a planned $35 million Boeing 737 sale and other equipment transactions. It also sees growing MRO demand, with expanded operations expected to contribute profitable EBITDA in 2027.

AerSale (NASDAQ:ASLE - Get Free Report) released its earnings results on Thursday. The company reported ($0.02) EPS for the quarter, missing the consensus estimate of $0.11 by ($0.13), FiscalAI reports. AerSale had a negative net margin of 1.23% and a negative return on equity of 0.27%. The firm had revenue of $91.56 million during the quarter, compared to the consensus estimate of $91.22 million.

Here are the key takeaways from AerSale's conference call:

• Revenue grew 29% to $91.6 million, but adjusted EBITDA fell to $8.6 million from $9.5 million and gross margin contracted to 22.5% from 30.2%, primarily due to weaker TechOps margins.
• Management expects a significantly stronger fourth quarter, citing the expected close of the $35 million Boeing 737 sale and other flight-equipment transactions, which it says should recover invested capital and improve liquidity.
• MRO demand and awarded work are building, including cargo-carrier heavy-check contracts and new landing-gear agreements; management expects the expanded operations to become profitable EBITDA contributors in 2027 as throughput and cost absorption improve.
• The company reported a $15 million net loss, including a $13.4 million non-cash goodwill impairment, and ended the quarter with only $23.1 million of available liquidity after year-to-date operating cash use of $42.7 million.
• Engineered Solutions revenue rose to $8.4 million from $2.2 million, driven by AerSafe kit demand, while leasing and USM revenue also increased year over year.

AerSale Stock Down 3.0%

Shares of NASDAQ:ASLE traded down $0.15 during trading on Thursday, hitting $4.82. 471,692 shares of the company were exchanged, compared to its average volume of 409,709. AerSale has a fifty-two week low of $4.54 and a fifty-two week high of $7.93. The stock has a market cap of $230.06 million, a price-to-earnings ratio of -60.25 and a beta of 0.23. The company has a current ratio of 3.27, a quick ratio of 0.76 and a debt-to-equity ratio of 0.01. The firm has a fifty day moving average price of $5.13 and a two-hundred day moving average price of $6.21.

Analyst Upgrades and Downgrades

ASLE has been the topic of a number of recent research reports. Wall Street Zen downgraded shares of AerSale from a "hold" rating to a "sell" rating in a report on Saturday, August 15th. B. Riley Financial reduced their target price on shares of AerSale from $7.50 to $6.00 and set a "neutral" rating for the company in a report on Wednesday, October 28th. Weiss Ratings reaffirmed a "sell (d)" rating on shares of AerSale in a research report on Wednesday, August 12th. Royal Bank Of Canada decreased their target price on shares of AerSale from $8.00 to $7.00 and set a "sector perform" rating for the company in a research report on Monday, August 10th. Finally, Zacks Research upgraded shares of AerSale from a "strong sell" rating to a "hold" rating in a research note on Friday, October 9th. Four research analysts have rated the stock with a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, the company has a consensus rating of "Reduce" and an average price target of $6.33.

About AerSale

AerSale Corporation NASDAQ: ASLE is an aviation aftermarket company that provides products and services to commercial airlines, aircraft leasing companies, original equipment manufacturers, government agencies and other aviation customers. The company focuses primarily on commercial aircraft and engines, including aircraft sales and leasing support, component sourcing, and related asset management services.

AerSale also operates maintenance, repair and overhaul capabilities for aircraft, engines and components.

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