Aerospace & Defense: set for record growth in 2026
The aerospace and defense sector is taking to the skies in 2026. A combination of robust demand in the civil aftermarket and rising defense budgets is putting the industry on a double-digit growth path, according to Jefferies' latest "Mid-Flight" report.
The commercial aftermarket segment continues to surprise analysts. Up 21% y-o-y, it is well ahead of Jefferies' initial estimates (+10%). This performance is being driven by the full reopening of the Chinese market and increased demand for spare parts.
In this context, GE Commercial Services leads the pack with a 31% rise in activity. WWD revenue is soaring 50%, benefiting from massive restocking in China. Honeywell is finally seeing an easing of supply-chain constraints, posting +13% in this segment.
RTX Collins revenue is up 13%, supported by maintenance (+24%) and spare parts (+11%), while modifications and upgrades increased by 7%.
Boeing and Airbus: toward historic altitudes
Despite industrial challenges, 2026 is shaping up to be a record year for aircraft deliveries. Jefferies forecasts a total of 1,741 deliveries, beating the 2018 all-time peak (1,734 units), including 659 deliveries for Boeing and 917 for Airbus.
After a 2025 that was marked by strikes, Boeing's OE (original equipment) revenue skyrocketed 139% in Q4, helped by an easy comparison basis. 737 MAX production is expected to gradually reach 44 aircraft per month in 2026, Jefferies analysts say.
At Airbus, the production ramp-up continues, notably on the A350. Hexcel, a key supplier, expects deliveries of 80 units in 2026 versus 57 in 2025.
Defense: suppliers on a war footing
The global geopolitical backdrop is fueling a real boom in the sector. Revenue at the major prime contractors (large industrial groups) rose 13%, topping the 7% forecast.
In this respect, Lockheed Martin has set its own records with the delivery of 191 F-35 aircraft in 2025 and an order book at a high, supported by major contracts with Belgium and Finland.
Meanwhile, General Dynamics is showing impressive momentum in the combat segment, with a book-to-bill ratio of 4.3 to 1 in Q4-a sign of "unprecedented" demand for munitions and armored vehicles in Europe.
Watch points: Defense IT and political uncertainty
Jefferies notes that not everything is rosy, however. The Defense IT segment is showing signs of weakness, notably at Booz Allen Hamilton (-10%), a consulting and IT services company for the US defense and government sectors, which has been hit by federal budget streamlining efforts (DOGE) and funding delays.
Against a backdrop of higher global air-traffic forecasts (+5.1% in revenue passenger-kilometers in 2026) and rising military budgets, the success of 2026 will hinge above all on the ability of the major industrial groups to deliver fast enough to meet order backlogs.
The Boeing Company is the worldwide leader in aeronautical construction. Net sales (including intragroup) break down by market as follows:
- defense, space and security (46.3%): military aircraft and mobility systems (warplanes, helicopters, and air defense missiles), support services (logistics, engineering, maintenance and training services) and space equipment (satellites, launch pads, etc.);
- commercial aviation (30.4%). In addition to commercial aircraft, the group supplies spare parts and offers technical support, maintenance and engineering services.
The remaining sales (23.3%) are from services (logistics and supply management, engineering, maintenance, modification and training services, etc.), and commercial and private aircraft financing as well as aircraft equipment leasing activities.
Net sales are distributed geographically as follows: the United States (53.8%), Asia (18.4%), Europe (12.8%), Middle East (7.8%), Canada (2%), Oceania (1.8%), Africa (1.8%) and other (1.6%).
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