Embraer (EMBJ) Q2 2026 Earnings Report

Overall the call was positive: Embraer reported record second-quarter revenue, stronger deliveries, a record backlog (+16% YoY), significant cash generation (adjusted FCF $401M) and improved leverage (net debt/EBITDA 0.2x). Strong growth in executive aviation (+32% revenue) and defense (+38% revenue) and notable order wins (E2 >500 orders, UAE C-390 order, new KC-390 customers) underpin confidence. Offsetting factors include low commercial aviation margins (2.9% adjusted EBIT), reliance on a material extraordinary tax credit and tariff refunds that boosted margins, residual tariff exposure (~$12M/year), and supplier delays that constrain near-term production leveling. On balance, highlights materially outweigh the lowlights.

Embraer kept 2026 delivery guidance unchanged at 80–85 commercial aircraft and 160–170 executive jets (H1 deliveries: 30 commercial, 36% of the midpoint, and 74 executive, 45% of the midpoint), left revenue guidance unchanged at $8.2–$8.5 billion (H1 revenues $3.7B, 44% of midpoint), raised adjusted EBIT margin guidance to 10.0%–10.6% (midpoint up ~130 bps, ~+$110M) and increased adjusted free cash flow guidance to $400M or higher (Q2 adjusted FCF excl. Eve was $401M); these updates reflect stronger operating performance, a $68M extraordinary tax credit, lower U.S. tariffs (≈$8M recorded in Q2) and production/efficiency gains supported by Q2 results (adj. EBITDA $356M, 15.9% margin; adj. EBIT $297M, 13.3%), with net debt/adj. EBITDA improving to 0.2x.