TransDigm shares fall 2% as fiscal 2026 earnings guidance disappoints

CLEVELAND - On Wednesday, TransDigm Group (NYSE:TDG) issued fiscal 2026 earnings guidance cut despite reporting strong fourth-quarter results that beat analyst expectations.

The aircraft components supplier’s shares fell 2.55% in pre-market trading after the results.

The aerospace parts manufacturer reported fourth-quarter adjusted earnings of $10.82 per share, surpassing the analyst estimate of $10.07. Revenue climbed 11.5% to $2.44 billion, slightly above the consensus estimate of $2.4 billion and up from $2.19 billion in the same quarter last year.

For fiscal 2026, TransDigm projected adjusted earnings of $36.49 to $38.53 per share, with the midpoint of $37.51 roughly in line with analyst expectations of $36.60. The company forecasts revenue between $9.75 billion and $9.95 billion, significantly higher than the consensus estimate of $8.79 billion.

"We are pleased with our team’s performance and operating results for both the fourth quarter and full fiscal year," said Mike Lisman, TransDigm’s President and CEO. "Our strong fourth quarter finish resulted in surpassing the high end of our most recently issued fiscal 2025 revenue and EBITDA As Defined guidance."

Fourth-quarter EBITDA margin reached 54.2%, up 160 basis points from the prior year, which the company attributed to "continued execution on our value drivers and effective management of our cost structure." Commercial aftermarket and defense markets both grew by double digits, while commercial OEM revenue increased in the high single digits.

TransDigm expects its commercial OEM market to see the highest growth rate in fiscal 2026 as it supports increasing build rates at aircraft manufacturers. The company also anticipates continued growth in its commercial aftermarket and defense end markets.

During fiscal 2025, TransDigm deployed approximately $6.7 billion of capital, acquiring two aerospace businesses for about $0.9 billion and returning $5.8 billion to shareholders through a $5.2 billion dividend and $0.6 billion in share repurchases.

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