AAR CORP (AIR) FY2026 10-K Annual Report
AAR CORP (AIR) 10-K annual report for fiscal year 2026, filed with SEC EDGAR on Jul 22, 2026. This page provides AI-powered analysis including business overview, management discussion & analysis (MD&A), risk factors, and key financial data such as revenue, net income, gross margin, operating margin, and return on equity (ROE) extracted from XBRL.
AAR CORP FY2026 10-K Analysis
Business Overview
- • Core business: Independent provider of global aviation aftermarket solutions including parts distribution, MRO, engineering, and software services
- • New operating segments: Government Solutions and Legacy Commercial Programs split from Integrated Solutions; Repair segment renamed Repair, Engineering, and Software
- • Strategic shift: Multi-year wind-down of Legacy Commercial Programs due to poor capital return; focus on higher-margin parts distribution and software platforms
- • Acquisitions: Four in fiscal 2026 totaling $270.1M, including ADI ($137.1M) for electronic components and HAECO Americas ($78.0M) expanding North American MRO footprint
- • Sales growth: Consolidated sales up 19.0% ($527.5M), driven by 20.6% jump in commercial parts distribution including $82.2M from ADI and $131.1M from HAECO acquisition
Management Discussion & Analysis
- • Revenue $3,308.0M, up 19.0% YoY; Commercial sales $2,384.1M (+20.6%), Government sales $923.9M (+14.9%)
- • Operating income increased 50.0% to $278.1M; consolidated gross margin stable at 18.8% vs 19.0% prior year
- • Best segment: Parts Supply sales $1,487.7M (+35.3%), operating income $186.2M (+18.8%), margin 12.5% vs 14.3%; worst: Legacy Commercial Programs sales $237.2M (-6.8%), operating income $0M vs $8.6M, margin 0% vs 3.4%
- • Cash from operations $98.7M vs $36.1M prior year; investing cash flow -$308.7M due to acquisitions; financing cash flow +$208.6M including $273.9M stock offering, $350M debt issuance; no share repurchases in 2026
- • Management plans 3-4 year Legacy Commercial Programs exit; focusing on high-margin parts distribution, repair, software growth; risks include integration and market uncertainties
Risk Factors
- • DoC Section 232 investigation on commercial aircraft and parts imports may materially impact company operations
- • Russia-Ukraine and Middle East conflicts causing jet fuel price increases impacting airline customers and demand
- • Dependence on key suppliers risks product supply disruptions and price hikes threatening margins
- • Competition from OEMs and airline-owned MRO operations with greater resources and integrated service bundles
- • $900M debt outstanding with restrictive covenants limiting financial flexibility and increasing vulnerability to economic downturns
AAR CORP FY2026 Key Financial MetricsXBRL
Revenue
$3.3B
▲ +19.0% YoY
Net Income
$188M
▲ +1401.6% YoY
Gross Margin
18.8%
▼ -18bp YoY
Net Margin
5.7%
▲ +522bp YoY
ROE
11.0%
▲ +998bp YoY
Total Assets
$3.4B
▲ +18.0% YoY
EPS (Diluted)
$4.86
▲ +1288.6% YoY
Operating Cash Flow
$99M
▲ +173.4% YoY
Source: XBRL data from AAR CORP FY2026 10-K filing on SEC EDGAR. All figures in USD.
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