Rolls-Royce profit soars on strong engines performance
Rolls-Royce, which supplies engines to the world's biggest aircraft manufacturers, Airbus and Boeing, has undergone a major turnaround since Erginbilgic took the helm in 2023, leading to repeated upgrades to its outlook.
Rolls-Royce, which supplies engines to the world's biggest aircraft manufacturers Airbus and Boeing, has undergone a major turnaround. (AFP)
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LONDON - British engine-maker Rolls-Royce upgraded its guidance Thursday after net profit more than doubled last year, buoyed by strong aircraft engine performance and demand for power systems used in data centres.
Rolls-Royce upgraded its mid-term guidance and said it would repurchase shares worth £2.5 billion ($3.4 billion) this year.
"We have navigated challenges from supply chain to tariffs, and delivered a strong performance in 2025," chief executive Tufan Erginbilgic said in an earnings statement.
Rolls-Royce, which supplies engines to the world's biggest aircraft manufacturers, Airbus and Boeing, has undergone a major turnaround since Erginbilgic took the helm in 2023, leading to repeated upgrades to its outlook.
Profit after tax climbed to £5.8 billion in 2025, compared with £2.5 billion one year earlier, thanks also to a favourable currency effect linked to a weaker dollar.
Rolls-Royce shares jumped more than six percent in early on London's benchmark FTSE 100 index, which was trading lower overall.
The group's upgraded targets, corresponding to its 2028 financial year, include an underlying operating profit of £4.9 billion to £5.2 billion.
"Rolls-Royce delivered a blockbuster set of results, with full-year profits flying past expectations largely due to a much better-than-expected performance from its Power Systems division," said Aarin Chiekrie, equity analyst at Hargreaves Lansdown.
The group's power systems business has benefited from the push to build data centres to power the boom in artificial intelligence.
"As upgrades to grid infrastructure are expected to take years, Rolls-Royce's on-site power generation systems are well-positioned to benefit from sustained demand," Chiekrie added.
Rolls-Royce had benefited also from cost savings, while the group is set to profit further from government spending on defence.
Total revenue jumped 12 percent last year to £21.2 billion.
The group announced a £7 billion to £9 billion share buyback across 2026 to 2028, including £2.5 billion to be completed this year.