Embraer, the Brazilian aircraft manufacturer, has reported a significant profit of R$ 434 million for the first quarter of 2025, marking a remarkable 200.1% increase compared to the same period last year. This surge in profitability comes alongside a 44% rise in revenues, which reached R$ 6.4 billion in the first three months of the year.
Despite these impressive figures, the company did face an adjusted net loss of R$ 429 million when excluding tax effects and results from its subsidiary, Eve. However, Embraer's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) soared to R$ 620.6 million, a 165.7% increase from the previous year. This growth reflects the company's strong performance in its defense and security segment, which more than doubled to R$ 811 million compared to the first quarter of 2024.
As of the end of March 2025, Embraer reported a net debt of R$ 2.688 billion, a significant 48.7% decrease from the same period last year. The company delivered a total of 30 jets during the quarter, comprising seven commercial and 23 executive aircraft. This delivery figure is 20% higher than the previous year, and Embraer is on track to meet its goal of delivering between 77 and 85 commercial jets and 145 to 155 executive jets in 2025.
In a statement to investors, Embraer emphasized that its results were not adversely affected by tariffs imposed by the United States, which were announced by President Donald Trump in early April 2025. The company has forecasted revenues between R$ 7 billion and R$ 7.5 billion for the year, indicating a positive outlook despite potential challenges.
The stock market responded favorably to Embraer's performance, with shares closing at R$ 66.46 on May 6, 2025, up 0.80% for the day. Over the past year, the stock has appreciated by an impressive 90%. Analysts at JPMorgan noted the continuous improvement in the EBIT margin of Commercial Aviation, which has risen from -14.8% to -5.1% year-on-year, and the strong performance of Executive Aviation, which achieved an EBIT margin of 11.1%, a 6.1 percentage points increase compared to the previous year.
However, some analysts raised concerns about the growth of revenue and gross margins, which fell short of expectations. The EBIT margin for the Services and Support division was reported at 10.0%, the lowest since the fourth quarter of 2022. Despite these challenges, the company’s order backlog has surged, reaching US$ 26.4 billion in the first quarter of 2025, a 25.1% increase from US$ 21.1 billion in the same period last year.
Embraer’s positive results were further supported by a strong performance in the Executive Aviation and Defense sectors, which demonstrated significant potential for growth. Analysts from BTG Pactual highlighted that although short-term delivery growth faces limitations, both the Executive Aviation and Defense sectors show great promise.
In addition to its financial performance, Embraer announced a dividend payment of US$ 51 million in May 2025, marking a return to its dividend policy after several years without distributions. The approved amount corresponds to R$ 0.07 per share for shareholders registered by May 12, 2025, with payment set for May 23, 2025. Looking ahead, the company plans to analyze potential quarterly tax benefits of interest on equity declarations and may provide additional dividends as needed to meet the minimum payout requirement established by Brazilian corporate law.
Despite the challenges posed by tariffs and supply chain risks, Embraer has reiterated its estimates for 2025, maintaining a cautious yet optimistic outlook. The company’s ability to balance its delivery capabilities with a growing order backlog suggests a healthy trajectory for growth in the coming years.
As Embraer continues to navigate the complexities of the aviation market, its recent results reflect a strong foundation for future success. With a focus on innovation and strategic growth in key sectors, the company remains well-positioned to capitalize on emerging opportunities in the aviation industry.
