Bombardier Inc.

Bombardier reported Q2 revenue of $2 billion, down $175 million or 8% year over year. Adjusted EBITDA was $297 million, down $38 million year over year, with a 14.6% margin; adjusted EBIT was $205 million, down $11 million; adjusted net income was $117 million, up 5%; and adjusted EPS was $1.11, up about 7%. Aircraft deliveries were 36 in the quarter, versus 39 a year ago, bringing first-half deliveries to 59, flat year over year. Services revenue was $590 million, up 16% year over year. Free cash flow usage was $164 million, driven mainly by $280 million of inventory investment, $125 million of cash interest, and $36 million of CapEx. Backlog ended Q2 at $16.1 billion, and unit book-to-bill was 2.3x. Management said it is on track for full-year guidance, expects greater than 91 deliveries in the second half, and still sees more than $1 billion of EBITDA in the second half. The company also said it expects to achieve its 2.0x to 2.5x net leverage target this year, implying about $600 million of incremental debt retirement by year-end.

Eric Martel struck an upbeat but disciplined tone, saying Bombardier is in an “excellent position” and on a clear path to meet 2025 guidance. He emphasized the strategic significance of the 50-aircraft fleet order, the strength of business-jet demand and flight utilization, and the expanding role of Bombardier Defense through orders and MOUs tied to special-mission aircraft. He also highlighted services expansion, including London Biggin Hill and Abu Dhabi, and said the company will likely need to prioritize the U.S. for further service growth.

Bart Demosky focused on the financial bridge to a stronger second half. He said the quarter was in line with plan despite lower revenue from fewer aircraft deliveries and a mix skewed toward Challenger aircraft; he also noted that pricing improved year over year but was offset by supply chain disruption and tariff-related costs already included in guidance. He pointed to $500 million of debt refinancing, maturities now extended to 2033, an 11-basis-point reduction in the average coupon on total long-term debt, and liquidity of $1.2 billion. He also said the company plans about $600 million of incremental debt retirement to reach its 2.0x to 2.5x net leverage target.

Analysts focused on free cash flow, book-to-bill, margins, and how the large fleet order affects cash timing. Management said the big order will contribute some cash this year and next through progress payments, but the main free-cash-flow drivers in the back half are much higher deliveries and a more favorable mix, not just the order itself. On demand, management said the market is still strong, Q1 had some hesitation around tariff uncertainty, and bonus depreciation in the U.S. is already helping orders. On defense, management said demand is concentrated in AWACS and maritime patrol missions, with the Global 6500 well positioned, while also acknowledging interest in unmanned and other longer-term defense opportunities.