Aerospace and defense company AerSale (NASDAQ: ASLE) fell short of the markets revenue expectations in Q3 CY2025, with sales falling 13.9% year on year to $71.19 million. Its non-GAAP profit of $0.04 per share was 77.1% below analysts’ consensus estimates.

Is now the time to buy AerSale? Find out by accessing our full research report, it’s free for active Edge members.

Company Overview

Providing a one-stop shop that integrates multiple services and product offerings, AerSale (NASDAQ: ASLE) delivers full-service support to mid-life commercial aircraft.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, AerSale’s 3.9% annualized revenue growth over the last five years was sluggish. This fell short of our benchmark for the industrials sector and is a tough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. AerSale’s recent performance shows its demand has slowed as its revenue was flat over the last two years.

AerSale also breaks out the revenue for its most important segments, Products and Services, which are 51.9% and 34.9% of revenue. Over the last two years, AerSale’s Products revenue was flat while its Services revenue averaged 10.9% year-on-year declines.

This quarter, AerSale missed Wall Street’s estimates and reported a rather uninspiring 13.9% year-on-year revenue decline, generating $71.19 million of revenue.

Looking ahead, sell-side analysts expect revenue to grow 28.9% over the next 12 months, an improvement versus the last two years. This projection is eye-popping and suggests its newer products and services will catalyze better top-line performance.

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Operating Margin

Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.

AerSale was profitable over the last five years but held back by its large cost base. Its average operating margin of 6.9% was weak for an industrials business.

Looking at the trend in its profitability, AerSale’s operating margin decreased by 9.5 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. AerSale’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.

This quarter, AerSale generated an operating margin profit margin of 4%, up 1.6 percentage points year on year. This increase was a welcome development, especially since its revenue fell, showing it was more efficient because it scaled down its expenses.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

AerSale’s full-year EPS dropped 146%, or 25.3% annually, over the last four years. We tend to steer our readers away from companies with falling revenue and EPS, where diminishing earnings could imply changing secular trends and preferences. If the tide turns unexpectedly, AerSale’s low margin of safety could leave its stock price susceptible to large downswings.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

Sadly for AerSale, its EPS declined by 7.9% annually over the last two years while its revenue was flat. This tells us the company struggled to adjust to choppy demand.

In Q3, AerSale reported adjusted EPS of $0.04, in line with the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects AerSale’s full-year EPS of $0.28 to grow 136%.

Key Takeaways from AerSale’s Q3 Results

We struggled to find many positives in these results. Its revenue missed and its EBITDA fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock remained flat at $6.99 immediately after reporting.

So should you invest in AerSale right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.