Rolls-Royce said Thursday it expects profits of over £4 billion ($5.42 billion) this year as the aero engine and power systems maker banks on another year of robust growth.
The aerospace giant is targeting underlying operating profit of between £4 billion and £4.2 billion in 2026, above the midpoint of £3.65 billion as expected by analysts polled by FactSet. It expects free cash flow of between £3.6 billion and £3.8 billion this year, also above expectations.
Shares rose 5.8% in morning trading Thursday.
Based on the bullish outlook, the company now expects to deliver profits within the prior mid-term guidance range two years earlier than planned, CEO Tufan Erginbilgic said.
“Our transformation continues with pace and intensity,” he said in a statement.
The British company upgraded its 2028 targets to £4.9 billion to £5.2 billion in underlying operating profit, an operating margin in the range of 18% to 20%, and free cash flow of £5 billion to £5.3 billion.
Rolls-Royce shares have more than doubled over the past 12 months as the company has thrived amid a transformation plan launched by Erginbilgic, which has boosted investor confidence.
Rolls-Royce shares are up more than 100% over the past year.
In 2025, underlying operating profits jumped over 40% to £3.46 billion, beating FactSet estimates of £3.32 billion. Underlying revenue in the year rose 12% to £20.1 billion.
It also announced that £2.5 billion of share buybacks would be completed this year as part of a multi-year buyback program of between £7 billion and £9 billion, citing a strong balance sheet.
