AIR AAR CORP

Overview and Growth

Fiscal 2026 results for AAR CORP combined $3.31B of revenue with net income of $187.70M and an operating cash inflow of $98.70M. At $3.31B, the top line establishes the operating scale supporting the company’s profit and cash-flow profile. Revenue was 19.0% above fiscal 2025 revenue of $2.78B, marking a year-over-year increase. The company reported diluted EPS of $4.86, adding a shareholder-level measure to the absolute income figures considered below. Asset turnover was 0.99x, relating the company’s annual revenue directly to the total assets reported at the period end.

Profitability

Gross profit was $622.00M, representing the portion of revenue remaining after the reported cost of revenue and before operating expenses. Gross margin was 18.8%, so that share of each revenue unit remained after the cost of revenue reported for the period. After all reported below-operating-line items, the company recorded net income of $187.70M for the fiscal year. The final earnings result represented 5.7% of revenue, connecting the absolute net income figure with the company’s top-line scale. Pretax income was $245.90M, isolating the reported earnings outcome before the income-tax provision recognized for the fiscal year. The pretax margin was 7.4%, relating income before taxes directly to revenue. The company recognized $58.20M of income tax for the period, completing the transition from pretax income to net income. The income-tax provision equaled 23.7% of pretax income, showing the tax burden absorbed by the year’s earnings. Net income equaled 11.0% of period-end equity, showing the earnings generated on shareholders’ book capital. The net-income-to-assets relationship measured 5.6%, showing earnings relative to the full balance sheet.

Liquidity and Capital Structure

The company held $3.36B of assets against $1.65B of liabilities and $1.70B of equity, revealing how the asset base was financed. The near-term balance sheet paired $1.74B of current assets with $613.20M of current liabilities at the reporting date. The current ratio was 2.84x, with current assets exceeding current liabilities and providing a short-term liquidity cushion. Cash and equivalents totaled $84.00M, identifying the most liquid reported component available within the broader current-asset balance. Cash and equivalents represented 13.7% of current liabilities, showing the portion of near-term obligations matched by reported cash alone. Total debt was $893.90M, establishing the amount of borrowing carried within the company’s capital structure. Debt equaled 0.52x of book equity, describing the relative scale of borrowing and shareholder capital. Relative to total assets, debt measured 26.6%, showing how much of the asset base was matched by borrowing. The liabilities-to-assets relationship was 49.2%, placing reported obligations against the full positive asset balance. Cash and equivalents equaled 2.5% of total assets, showing the liquid cash component within the company’s broader resource base. Total assets were 18.0% higher than fiscal 2025 assets of $2.84B, measuring the company’s own balance-sheet change.

Cash Flow and Earnings Quality

Operating activities produced a cash inflow of $98.70M, giving the cash-flow counterpart to the accrual-based profit measures reported for the year. Operating cash flow equaled 0.53x of net income, showing how strongly accounting earnings converted into cash from operations. Capital spending was $36.60M, absorbing part of the cash generated from operations before free cash flow. Relative to operating cash flow, capital expenditures measured 37.1%, connecting investment intensity with the company’s cash-generation base. The combination of operating cash flow and capital spending produced $62.10M of positive free cash flow for the period. Free cash flow represented 1.9% of revenue, linking post-investment cash generation with the company’s operating scale. Free cash flow equaled 1.9% of total assets, relating post-investment cash generation to the company’s resource base.

Based on the annual report for the fiscal year ending May 31, 2026. Analysis generated Oct 21, 2026.