v3.26.1
Segment Information
 6 Months Ended
Jun. 30, 2026
Segment Reporting [Abstract]  
Segment Information

NOTE 19: SEGMENT INFORMATION

The Company’s chief operating decision making officer (“CODM”) is the Company’s Chief Executive Officer. Consistent with how the Company evaluates its performance and the way the Company is organized internally; the Company reports its activities in two segments: Engine Services and Component Repair Services. The CODM regularly uses the below financial measures to allocate financial and human resources to individual segments and evaluate segment performance. The CODM also uses these measures in the annual budget and quarterly forecasting processes. The CODM considers budget-to-actual variances on a monthly basis when making decisions about allocating capital and personnel to the segments.

The Company’s CODM is regularly provided and evaluates the performance of the Company’s segments based on segment Revenue and segment Adjusted EBITDA. Management believes segment Adjusted EBITDA is indicative of operational performance and ongoing profitability and is used to evaluate the operating performance of the Company’s segments and for planning and forecasting purposes, including the allocation of resources and capital.

The Company defines Segment Adjusted EBITDA as net income (loss) before interest expense, income tax expense (benefit), depreciation and amortization directly attributable to each operating segment and adjusted for certain non-cash items that the Company may record each period, as well as items not recurring in the ordinary course of business such as acquisition costs, integration and severance costs, refinance fees, business transformation costs and other discrete expenses, when applicable. Expense information is provided to and reviewed by the CODM on a consolidated basis to evaluate cost efficiency and company level performance.

The Company’s Engine Services segment provides a full suite of aftermarket services, including maintenance, repair and overhaul, on-wing and field service support, asset management, and engineering and related solutions to customers in the commercial aerospace, military & helicopter, and business aviation end markets. Revenue in the Engine Services segment is primarily derived from the repair and overhaul of a wide variety of gas turbine engines and auxiliary power units that power fixed and rotary wing aircraft. The Company also provides complementary maintenance, repair, upgrade and other related services for airframes and avionics systems in the business aviation and helicopter end markets. Cost of revenue consists primarily of cost of materials, direct labor and overhead.

The Company’s Component Repair Services segment provides engine component and accessory repairs to the Commercial Aerospace, Military & Helicopter, and Other, including land and marine, and oil and gas end markets. Revenue in the Component Repair Services segment is derived from the engine piece part and accessory repairs that the Company performs, repair development engineering and other related services, and some engine new part manufacturing. Cost of revenue consists primarily of cost of materials, direct labor and overhead.

The Company’s segment disclosure includes intersegment revenues, which primarily consist of subcontract services between segments. The revenue and corresponding cost of revenue are eliminated upon consolidation. The elimination of such intersegment transactions is included within intersegment revenue in the table below. The revenue is eliminated with the segment receiving the subcontract services. The segment providing services retains revenue while the segment receiving the services records the elimination.

The Company does not report total assets by segment for internal or external reporting purposes as the Company’s CODM does not assess performance, make strategic decisions or allocate resources based on assets.

The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies (see 2025 Form 10-K, Part II, Item 8, Financial Statements and Supplementary Data, Note 2, Summary of Significant Accounting Policies).

Selected financial information for each segment is as follows:

 

Three months ended June 30, 2026

 

 

Engine
Services

 

 

Component
Repair Services

 

 

Total
Segments

 

 

(in thousands)

 

Revenue from external customers

 

$

1,424,678

 

 

$

175,015

 

 

$

1,599,693

 

Intersegment revenue

 

 

(19,594

)

 

 

19,594

 

 

 

—

 

Total segment revenue

 

 

1,405,084

 

 

 

194,609

 

 

 

1,599,693

 

Other segment items (1)

 

 

1,200,871

 

 

 

143,411

 

 

 

1,344,282

 

Segment Adjusted EBITDA

 

$

204,213

 

 

$

51,198

 

 

$

255,411

 

Corporate (2)

 

 

 

 

 

 

 

 

25,534

 

Depreciation and amortization

 

 

 

 

 

 

 

 

47,043

 

Interest expense

 

 

 

 

 

 

 

 

41,279

 

Business transformation costs (LEAP and CFM) (3)

 

 

 

 

 

 

 

 

3,698

 

Non-cash stock compensation expense

 

 

 

 

 

 

 

 

6,267

 

Integration costs and severance (4)

 

 

 

 

 

 

 

 

346

 

Other (5)

 

 

 

 

 

 

 

 

4,040

 

Income before income taxes

 

 

 

 

 

 

 

$

127,204

 

 

(1)
Other segment items for each reportable segment primarily includes cost of sales and other selling, general and administrative expenses.
(2)
Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Supply Chain, Engineering and Quality, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt.
(3)
Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of the Company’s CFM56 capabilities into Dallas, Texas.
(4)
Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs.
(5)
Represents professional fees related to business transformation, secondary offering costs and quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of the Company’s ordinary course of continuing operations. See Note 13, “Related Party Transactions” for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc.

 

Six months ended June 30, 2026

 

 

Engine
Services

 

 

Component
Repair Services

 

 

Total
Segments

 

 

(in thousands)

 

Revenue from external customers

 

$

2,891,257

 

 

$

335,293

 

 

$

3,226,550

 

Intersegment revenue

 

 

(39,029

)

 

 

39,029

 

 

 

—

 

Total segment revenue

 

 

2,852,228

 

 

 

374,322

 

 

 

3,226,550

 

Other segment items (1)

 

 

2,469,382

 

 

 

270,723

 

 

 

2,740,105

 

Segment Adjusted EBITDA

 

$

382,846

 

 

$

103,599

 

 

$

486,445

 

Corporate (2)

 

 

 

 

 

 

 

 

53,412

 

Depreciation and amortization

 

 

 

 

 

 

 

 

93,504

 

Interest expense

 

 

 

 

 

 

 

 

79,430

 

Business transformation costs (LEAP and CFM) (3)

 

 

 

 

 

 

 

 

10,320

 

Non-cash stock compensation expense

 

 

 

 

 

 

 

 

9,725

 

Integration costs and severance (4)

 

 

 

 

 

 

 

 

687

 

Other (5)

 

 

 

 

 

 

 

 

7,216

 

Income before income taxes

 

 

 

 

 

 

 

$

232,151

 

 

(1)
Other segment items for each reportable segment primarily includes cost of sales and other selling, general and administrative expenses.
(2)
Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Supply Chain, Engineering and Quality, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt.
(3)
Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of the Company’s CFM56 capabilities into Dallas, Texas.
(4)
Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs.
(5)
Represents professional fees related to business transformation, secondary offering costs and quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of the Company’s ordinary course of continuing operations. See Note 13, “Related Party Transactions” for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc.

 

Three months ended June 30, 2025

 

 

Engine
Services

 

 

Component
Repair Services

 

 

Total
Segments

 

 

(in thousands)

 

Revenue from external customers

 

$

1,373,701

 

 

$

155,242

 

 

$

1,528,943

 

Intersegment revenue

 

 

(23,024

)

 

 

23,024

 

 

 

—

 

Total segment revenue

 

 

1,350,677

 

 

 

178,266

 

 

 

1,528,943

 

Other segment items (1)

 

 

1,172,168

 

 

 

126,626

 

 

 

1,298,794

 

Segment Adjusted EBITDA

 

$

178,509

 

 

$

51,640

 

 

$

230,149

 

Corporate (2)

 

 

 

 

 

 

 

 

25,512

 

Depreciation and amortization

 

 

 

 

 

 

 

 

48,547

 

Interest expense

 

 

 

 

 

 

 

 

43,835

 

Business transformation costs (LEAP and CFM) (3)

 

 

 

 

 

 

 

 

5,264

 

Non-cash stock compensation expense

 

 

 

 

 

 

 

 

3,830

 

Integration costs and severance (4)

 

 

 

 

 

 

 

 

1,360

 

Other (5)

 

 

 

 

 

 

 

 

10,066

 

Profit before tax

 

 

 

 

 

 

 

$

91,735

 

 

 

(1)
Other segment items for each reportable segment primarily includes cost of sales and other selling general and administrative expenses.
(2)
Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Supply Chain, Engineering and Quality, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt.
(3)
Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of the Company’s CFM56 capabilities into Dallas, Texas.
(4)
Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs.
(5)
Represents professional fees related to business transformation, secondary offering costs and quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of the Company’s ordinary course of continuing operations. See Note 13, “Related Party Transactions” for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc.

 

Six months ended June 30, 2025

 

 

Engine
Services

 

 

Component
Repair Services

 

 

Total
Segments

 

 

(in thousands)

 

Revenue from external customers

 

$

2,659,977

 

 

$

304,554

 

 

$

2,964,531

 

Intersegment revenue

 

 

(40,987

)

 

 

40,987

 

 

 

—

 

Total segment revenue

 

 

2,618,990

 

 

 

345,541

 

 

 

2,964,531

 

Other segment items (1)

 

 

2,266,472

 

 

 

246,540

 

 

 

2,513,012

 

Segment Adjusted EBITDA

 

$

352,518

 

 

$

99,001

 

 

$

451,519

 

Corporate (2)

 

 

 

 

 

 

 

 

48,655

 

Depreciation and amortization

 

 

 

 

 

 

 

 

97,223

 

Interest expense

 

 

 

 

 

 

 

 

87,626

 

Business transformation costs (LEAP and CFM) (3)

 

 

 

 

 

 

 

 

18,181

 

Non-cash stock compensation expense

 

 

 

 

 

 

 

 

5,875

 

Integration costs and severance (4)

 

 

 

 

 

 

 

 

2,740

 

Other (5)

 

 

 

 

 

 

 

 

14,352

 

Income before income taxes

 

 

 

 

 

 

 

$

176,867

 

 

(1)
Other segment items for each reportable segment primarily includes cost of sales and other selling, general and administrative expenses.
(2)
Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Supply Chain and Engineering and Quality, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt.
(3)
Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of the Company’s CFM56 capabilities into Dallas, Texas.
(4)
Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs.
(5)
Represents professional fees related to business transformation, secondary offering costs, and quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of the Company’s ordinary course of continuing operations. See Note 13, “Related Party Transactions” for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc.

The following table presents revenues from external customers by geographic area based on location of the customer:

 

Three months ended June 30,

 

 

Six months ended June 30,

 

 

2026

 

 

2025

 

 

2026

 

 

2025

 

 

(in thousands)

 

United States

 

$

969,988

 

 

$

817,941

 

 

$

1,922,626

 

 

$

1,652,600

 

United Kingdom

 

 

69,369

 

 

 

132,872

 

 

 

155,046

 

 

 

267,449

 

Canada

 

 

179,152

 

 

 

210,560

 

 

 

384,382

 

 

 

386,614

 

Rest of Europe (1)

 

 

136,578

 

 

 

124,241

 

 

 

315,149

 

 

 

241,688

 

Asia (1)

 

 

143,062

 

 

 

130,418

 

 

 

271,030

 

 

 

212,892

 

Rest of the world (1)

 

 

101,544

 

 

 

112,911

 

 

 

178,317

 

 

 

203,288

 

Total revenue

 

$

1,599,693

 

 

$

1,528,943

 

 

$

3,226,550

 

 

$

2,964,531

 

 

(1)
Countries grouped within Rest of Europe, Asia, and Rest of world are individually immaterial as compared to total revenue with no country representing more than 3% of total revenue for the three and six months ended June 30, 2026 and 2025.