AAR CORP. reported significant financial growth in its latest quarterly results, with total sales reaching $918.0 million for the three months ended August 31, 2026, a 24.1% increase from $739.6 million in the same period last year. The company's net income also rose to $40.1 million, or $1.00 per diluted share, compared to $34.4 million, or $0.95 per diluted share, in the prior year. This growth was driven by strong demand in both commercial and government sectors, particularly in the Parts Supply segment, which saw sales increase by 30.5% to $414.8 million.
The company experienced notable changes in its financial metrics compared to the previous fiscal period. Gross profit increased by 31.9% to $176.3 million, with a gross profit margin improvement to 19.2% from 18.1%. However, selling, general, and administrative expenses surged by 49.0% to $107.0 million, primarily due to costs associated with recent acquisitions. AAR's operating income for the quarter was $72.1 million, up from $64.9 million a year earlier.
Strategically, AAR has been active in expanding its portfolio through acquisitions. In fiscal 2026, the company completed several acquisitions, including American Distributors Holding Co., LLC for $137.1 million and HAECO Americas for $78.0 million. These acquisitions are expected to enhance AAR's capabilities in parts distribution and aircraft maintenance, respectively. Additionally, the company announced a pending acquisition of MRO Holdings for approximately $3.0 billion, which is anticipated to close in the third quarter of fiscal 2027.
Operationally, AAR's customer base and geographic reach have expanded. The company reported a significant increase in sales to commercial customers, which rose by 28.2% to $670.8 million. The Parts Supply segment's growth was bolstered by new distribution agreements and contributions from recent acquisitions. AAR's total assets increased to $3.43 billion as of August 31, 2026, up from $3.36 billion at the end of the previous fiscal year, reflecting the impact of these strategic investments.
Looking ahead, AAR remains optimistic about its growth trajectory, citing favorable long-term trends in the aviation aftermarket and government sectors. The company plans to continue investing in its operations and capitalizing on opportunities in both commercial and government markets. However, it also acknowledges potential risks, including market fluctuations and operational challenges, which could impact future performance.
About AAR CORP
AAR Corp is a leading independent provider of aviation aftermarket solutions, offering a wide range of products and services to commercial and government aerospace customers. With operations in over 20 countries, AAR focuses on parts supply, repair and engineering, integrated solutions, and expeditionary services. The company is capitalizing on strong demand for aftermarket services, leveraging digital technologies, and expanding its facilities to enhance service delivery and profitability in a growing market.
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