Embraer raises 2026 outlook as fourth-quarter deliveries loom

By Nathan Brooks

Embraer reported third-quarter revenue of $2.35 billion, its highest-ever third-quarter result, and raised its 2026 revenue and free-cash-flow guidance.

The figure was 17% above $2 billion a year earlier and followed two consecutive record quarters.

Adjusted EBIT reached $254.8 million on a 10.9% margin, against 8.6% a year earlier. Excluding US import tariffs, the margin was 9.4%.

Embraer recorded no US import tariffs in its Executive Aviation and Services & Support units, compared with $15 million and $2 million a year earlier. Its second-quarter results also cited an exemption from direct US import tariffs in the second half of 2026.

The figures show that lower tariff costs contributed to the year-on-year margin improvement, although other factors remain in the 10.9% result. Adjusted net income fell to $73.6 million from $84.3 million, mainly because net financial and tax expenses increased.

What changes in Embraer’s 2026 guidance?

Embraer now expects 2026 revenue of $8.4 billion to $8.6 billion, up from $8.2 billion to $8.5 billion. It expects adjusted free cash flow excluding Eve Air Mobility of at least $700 million, raised from at least $400 million.

Third-quarter adjusted free cash flow excluding Eve reached $627.7 million. Embraer said the result reflected “operating performance and pre-delivery payments,” while the nine-month total stood at $581.6 million.

Net cash excluding Eve stood at $430 million at September’s end, versus net debt of $214.5 million at June’s end. The balance-sheet swing removed the net-debt position as Embraer entered its delivery-heavy fourth quarter.

Can Embraer clear its jet delivery targets?

Embraer left its adjusted EBIT margin target at 10% to 10.6%, below the 10.7% it posted over the first nine months.

Delivery guidance also stayed unchanged at 80 to 85 commercial jets and 160 to 170 executive jets. By September, the company had handed over 52 commercial and 115 executive aircraft.

Reaching those targets requires 28 to 33 commercial jets and 45 to 55 executive jets in the fourth quarter: 73 to 88 aircraft after 167 deliveries through September. That is a heavier quarterly handover schedule than the year-to-date pace. For airline customers, a delayed commercial handover would defer planned fleet additions and any network changes attached to them; for executive operators, it would defer aircraft availability.

What is driving the KC-390 defense growth?

Defense & Security revenue rose 22% to $341 million. Embraer attributed the increase to higher KC-390 Millennium revenue recognition tied to “volumes, customer mix and product stage.”

The unit’s adjusted EBIT margin rose to 15.7% from 12.9%, while its backlog increased 56% year over year. Embraer delivered one KC-390 and two A-29 Super Tucanos during the quarter.

Those measures answer different questions. Revenue recognition captures accounting treatment across the KC-390 program; deliveries count aircraft handed over; the backlog measures future work rather than aircraft already delivered. The order announcements below do not change the quarter’s handover count.

• United Arab Emirates: contracted for 10 C-390s in May 2026, with options for 10 more.
• Colombia: ordered two KC-390s on August 4, 2026.
• Greece: signed for three KC-390s on November 2, 2026, with options for three more, after the quarter closed.

Colombia’s order fell inside the reporting period; Greece’s did not. Options add potential production volume but do not equal firm deliveries, leaving Embraer’s larger backlog a measure of visibility rather than aircraft already flying.

How broad is the revenue and backlog recovery?

The three commercial-facing divisions all posted double-digit growth:

• Services & Support: revenue increased 30% to $638 million.
• Commercial Aviation: revenue rose 13% to $696 million.
• Executive Aviation: revenue advanced 12% to $655 million.

Commercial Aviation’s adjusted EBIT margin rose to 2.4% from 1.3%, mainly because of supplier compensation, according to Embraer. The segment margin remains below the group’s 10.9% third-quarter margin.

Embraer delivered 66 aircraft in the quarter and ended September with a record $35.7 billion backlog. The backlog gives production visibility; the final handover schedule tests whether that work converts into revenue and cash without eroding the improved margin.

The next test is whether Embraer can clear 73 to 88 fourth-quarter handovers, sustain cash generation and hold adjusted EBIT margin within its unchanged 10% to 10.6% target.