“I am frequently asked questions about Aerospace operating margin. And when it will move into the high teens, that is above 15%. The simple answer is maybe 2026, but for sure, in 2027, with degradation again in 2028, with the delivery of a significant number of G400s.”

In context

“deliver about 13 G800s for the year, which is about 3 less than the G650s we delivered in the second half of last year. The initial G800s will not carry the operating margins of the G650. This will obviously put some pressure on operating margin in the second half, but we still expect the margins in the third quarter to be very similar to the second quarter, coupled with a stronger fourth quarter. In summary, the Aerospace team had a solid quarter. The G800 deliveries are about to commence and G700 delivery cadence and operating margin are both improving. Anecdotally, as you may recall, the G800 was designed to replace the G650. Interestingly, the first 20 of the G800s will be the G650 owners. There is significant interest in this plane from Fortune 500 companies. Before I discuss demand, I am frequently asked questions about Aerospace operating margin. And when it will move into the high teens, that is above 15%. The simple answer is maybe 2026, but for sure, in 2027, with degradation again in 2028, with the delivery of a significant number of G400s. The simple answer is made with some trepidation, nothing is more complex to forecast than the operating margin for Aerospace. So first, let me focus on what you all think about operating margin on aircraft deliveries. This is almost always driven by mix. The G700 has the highest margins, the G800 should ultimately enjoy similar margins, but it's early in its delivery cycle. The G600 enjoys the next highest margin, followed by the G500 and G280. And let's not forget the very strong margin contribution earlier in the year from the sunset G650 program. But aircraft margins, while important, because of their size are only part of the story. Aerospace also has over $3.5 billion of sales and what we generally refer to as aircraft services business. At Gulfstream, we have a large maintenance bus”