GENERAL ELECTRIC CO (GE)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (MD&A). The consolidated financial statements of GE Aerospace are prepared in conformity with U.S. generally accepted accounting principles (GAAP). Unless otherwise noted, tables are presented in U.S. dollars in millions. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages presented in this report are calculated from the underlying numbers in millions. Discussions throughout this MD&A are based on continuing operations unless otherwise noted. The MD&A should be read in conjunction with the Financial Statements and Notes to the consolidated financial statements.

In the accompanying analysis of financial information, we sometimes use information derived from consolidated financial data but not presented in our financial statements prepared in accordance with GAAP. Certain of these data are considered “non-GAAP financial measures” under SEC rules. See the Non-GAAP Financial Measures section for the reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures.

BUSINESS OVERVIEW AND ENVIRONMENT. As a global aerospace company, our worldwide operations can be affected by industrial, economic, and political factors on both a regional and global level. Demand for our equipment and services is demonstrated by our backlog of engine orders and services and growth in our installed base, and tends to follow commercial air travel and freight demand and government funding for defense budgets. We expect a significant ramp in our delivery of engine units and services for newer product platforms in the years ahead to meet this demand. Refer to the Segment Operations sections for Commercial Engines & Services (CES) and Defense & Propulsion Technologies (DPT) below for additional detail about these dynamics for our commercial and defense businesses, respectively.

Global material availability continues to cause disruptions and have impacted our production and delivery of equipment and services to our customers. We are investing in our manufacturing facilities, overhaul facilities and our supply chain to increase production and strengthen yield in order to improve delivery to our customers. We are leveraging FLIGHT DECK and partnering with suppliers to improve material input while also proactively managing the impact of inflationary pressure by driving cost productivity and adjusting the pricing of our products and services. We expect the impact of supply chain constraints and inflation will continue, and we are continuing to take action to mitigate the impacts. However, through FLIGHT DECK and the engagement with our suppliers, aftermarket output and engine deliveries have continued to improve quarter over quarter.

We support efforts to revitalize domestic manufacturing and are planning to invest $1 billion in U.S. manufacturing and hire 5,000 U.S workers in 2026, including both engineering and manufacturing roles. At the same time, we support promoting free and fair trade that ensures the continued strength of the U.S aerospace industry.

As we operate in a highly dynamic tariff environment, we are focused on continuing to deliver our products and services to our customers. Given our global business, tariffs result in additional cost for us and our suppliers. In 2025, the U.S. established a zero-for-zero tariff agreement on aerospace equipment with the EU, UK, Japan and Korea, establishing a mutual elimination of tariffs. In 2026, the Supreme Court ruled against tariffs imposed under the International Emergency Economic Powers Act (IEEPA). In the second quarter, GE Aerospace submitted refund requests and received a portion of previously paid IEEPA tariffs. We will continue to monitor recent developments on tariff policy and evaluate any changes to the applicability of tariffs to our business as they occur.

We are monitoring recent developments related to the conflict in the Middle East and the potential impact on the commercial aerospace industry, including lower utilization and increased prices, which can result in adverse effects on our airline customers. As a result, the impacts to our business may include lower volume related to shop visits, spare parts and spare engines and lower profitability of our long term contracts, as well as customer credit implications. We remain confident in our ability to navigate this with our young and diverse fleet, and we are also proactively taking action on costs. The conflict did not result in a material impact on our operations in the six months ended June 30, 2026.

On January 15, 2026, we announced that our CES segment will expand to include the entire commercial engine lifecycle, including safety and quality, product management, engineering, supply chain, manufacturing and aftermarket services. In addition, our Aeroderivative business, previously reported in CES, has moved to our DPT segment. See Note 23 for further information.

4 2026 2Q FORM 10-Q

CONSOLIDATED RESULTS

For the three months ended June 30, 2026, total revenue increased $2.3 billion, or 21%, compared to the three months ended June 30, 2025. Equipment revenue increased, driven by increased engine deliveries and improved pricing. Services revenue increased due to increased internal shop visit volume and workscopes, higher spare parts volume and pricing.

For the six months ended June 30, 2026, total revenue increased $4.8 billion, or 23%, compared to the six months ended June 30, 2025. Equipment revenue increased, driven by increased engine deliveries and improved pricing. Services revenue increased due to increased internal shop visit volume and workscopes, higher spare parts volume and pricing.

For the three months ended June 30, 2026, net income from continuing operations increased $0.4 billion compared to the three months ended June 30, 2025, driven by an increase in segment profit of $0.5 billion and an increase in gains (losses) on retained and sold ownership interests and other equity securities of $0.1 billion. The increase was partially offset by an increase in interest and other financial charges of $0.1 billion and an increase in Adjusted Corporate & Other operating costs* of $0.1 billion. Adjusted net income* was $2.1 billion, an increase of $0.3 billion, due to an increase in segment profit of $0.5 billion, partially offset by an increase in Adjusted Corporate & Other operating costs* of $0.1 billion.

Profit was $2.8 billion, an increase of $0.4 billion and profit margin was 21.0%, a decrease of 70 basis points. Operating profit* was $2.7 billion, an increase of $0.4 billion and operating profit margin* was 21.7%, a decrease of 130 basis points. Adjusted EPS* was $2.02, an increase of 22%.

For the six months ended June 30, 2026, net income from continuing operations increased $0.4 billion compared to the six months ended June 30, 2025, driven by an increase in segment profit of $1.0 billion, partially offset by a decrease in gains (losses) on retained and sold ownership interests and other equity securities of $0.3 billion, an increase in Adjusted Corporate & Other operating costs* of $0.2 billion, an increase in interest and other financial charges of $0.1 billion and a decrease in Insurance profit of $0.1 billion. Adjusted net income* was $4.1 billion, an increase of $0.7 billion, due to an increase in segment profit of $1.0 billion, partially offset by an increase in Adjusted Corporate & Other operating costs* of $0.2 billion.

Profit was $5.0 billion, an increase of $0.4 billion and profit margin was 19.4%, a decrease of 270 basis points. Operating profit* was $5.3 billion, an increase of $0.8 billion and operating profit margin* was 21.8%, a decrease of 160 basis points. Adjusted EPS* was $3.88, an increase of 24%.

Remaining performance obligation (RPO) is unfilled customer orders for products and product services (expected life of contract sales for product services) excluding any purchase order that provides the customer with the ability to cancel or terminate without incurring a substantive penalty. See Note 23 for further information.

As of June 30, 2026, RPO increased $20.2 billion, or 11%, from December 31, 2025, primarily at CES, as a result of commercial actions and increases to existing long-term service agreements, and at DPT, driven by Defense & Systems equipment orders outpacing revenue recognized.

*Non-GAAP Financial Measure

2026 2Q FORM 10-Q 5

SEGMENT OPERATIONS

COMMERCIAL ENGINES & SERVICES. We are in frequent communication with our airline, airframe and maintenance, repair and overhaul (MRO) customers about the outlook for commercial air travel, new aircraft production, fleet retirements and after-market services, including shop visit and spare parts demand. In the first six months of 2026, there was a strong demand for engines and services, while commercial air travel departures were roughly flat.

Demand continues to be strong and, in the first half of 2026, we announced significant new deals with several major customers. United Airlines and Delta Airlines selected our GENx engines to power their widebody Boeing 787 Dreamliner orders. American Airlines and Copa Airlines selected LEAP engines for their narrowbody orders. Ryanair signed a long-term material services agreement to support Ryanair's entire fleet of about 2,000 CFM56 and LEAP engines powering its Boeing 737 aircraft.

To meet the strong demand, we are investing in our manufacturing and overhaul facilities and continue to strengthen our external global MRO network to support LEAP aftermarket demand by adding Iberia as the seventh Premier MRO and expanding Delta TechOps capabilities for both LEAP 1-A and LEAP 1-B engines. We are also deploying engineering and supply chain resources to increase production, expand capacity and strengthen yield.

These investments combined with improved material availability contributed to internal shop visit revenue growth of 30% in the first half of 2026, and total engine deliveries and LEAP engine deliveries increases of 37% and 41%, respectively.

Total engineering investments, both company and partner-funded, increased compared to prior year, and we continue to improve our products and advance our future of flight priorities. We recently completed the certification for the LEAP 1-B durability kit, including the upgraded HPT blade, which is expected to deliver approximately double time-on-wing for that engine. And for future of flight - In the first half of 2026, together with the Civil Aviation Authority of Singapore and Airbus, we established the world’s first airport test bed for RISE technologies, focused on Open Fan. In addition, through the NASA Electrified Powertrain Flight Demonstration, we recently completed ground tests for the megawatt-class hybrid elec

[Excerpt truncated for page length; source filing is linked above.]

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (MD&A). The consolidated financial statements of GE Aerospace are prepared in conformity with U.S. generally accepted accounting principles (GAAP). Unless otherwise noted, tables are presented in U.S. dollars in millions. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages presented in this report are calculated from the underlying numbers in millions. Discussions throughout this MD&A are based on continuing operations unless otherwise noted. Results for the years ended December 31, 2025 versus 2024 are discussed within this report. Refer to our Annual Report on Form 10-K for the year ended December 31, 2024 for discussions of results for the years ended December 31, 2024 versus 2023. The MD&A should be read in conjunction with the Financial Statements and Notes to the consolidated financial statements.

2025 FORM 10-K 7

In the accompanying analysis of financial information, we sometimes use information derived from consolidated financial data but not presented in our financial statements prepared in accordance with GAAP. Certain of these data are considered “non-GAAP financial measures” under SEC rules. See the Non-GAAP Financial Measures section for the reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures.

Beginning in the first quarter of 2025, we changed the terminology used to report our GAAP earnings from “Earnings” to “Net income” and our non-GAAP earnings from "Adjusted earnings" to "Adjusted net income." The change in terminology does not impact the amounts reported in the financial statements.

BUSINESS OVERVIEW AND ENVIRONMENT. As a global aerospace company, our worldwide operations can be affected by industrial, economic, and political factors on both a regional and global level. Demand for our equipment and services is demonstrated by our backlog of engine orders and services and growth in our installed base, and tends to follow commercial air travel and freight demand and government funding for defense budgets. We also expect a significant ramp in our delivery of engine units and services for newer product platforms in the years ahead to meet this demand. Refer to the Segment Operations sections for Commercial Engines & Services and Defense & Propulsion Technologies below for additional detail about these dynamics for our commercial and defense businesses, respectively.

Global material availability and supplier delivery performance continue to cause disruptions and have impacted our production and delivery of equipment and services to our customers. We are investing in our manufacturing facilities, overhaul facilities and our supply chain to increase production and strengthen yield in order to improve delivery to our customers. We continue to partner with our suppliers to improve material input, and work with our customers to calibrate future production rates. We are leveraging FLIGHT DECK and partnering with suppliers to improve material input while also proactively managing the impact of inflationary pressure by driving cost productivity and adjusting the pricing of our products and services. We expect the impact of supply chain constraints and inflation will continue, and we are continuing to take action to mitigate the impacts. However, through FLIGHT DECK and the engagement with our suppliers, aftermarket output and engine deliveries have continued to improve quarter over quarter.

We support efforts to revitalize domestic manufacturing and invested $1 billion in U.S manufacturing and hired 5,000 U.S workers in 2025. At the same time, we support promoting free and fair trade that ensures the continued strength of the U.S aerospace industry.

Additionally, we are expanding capacity across our global maintenance, repair and overhaul (MRO) network to support aftermarket demand. We are investing $1 billion to increase our MRO capacity, including $500 million to increase LEAP MRO capacity by expanding several sites.

As we operate in a highly dynamic tariff environment, we are focused on continuing to deliver our products and services to our customers. Given our global business, tariffs will result in additional cost for us and our suppliers. We are optimizing operations and leveraging existing programs to reduce the impact from tariffs. In late 2025, the U.S. established a zero-for-zero tariff agreement on aerospace equipment with the EU, UK, Japan and Korea, establishing a mutual elimination of tariffs. Additionally, we are taking measures to control cost and implementing pricing actions to primarily mitigate the remaining impact. We are continuing to monitor the tariff environment, including relevant U.S. Supreme Court rulings.

On January 15, 2026, we announced that our Commercial Engines & Services (CES) segment will expand to include the entire commercial engine lifecycle, including safety and quality, product management, engineering, supply chain, manufacturing and aftermarket services. In addition, our Aeroderivative business, currently reported in CES, will move to our Defense Propulsion & Technologies segment.

CONSOLIDATED RESULTS

For the year ended December 31, 2025, total revenue increased $7.2 billion, or 18%, compared to the year ended December 31, 2024. Equipment revenue increased, driven by increased engine deliveries and price. Services revenue increased, primarily due to increased internal shop visit volume and workscopes and higher spare parts volume.

8 2025 FORM 10-K

For the year ended December 31, 2025, net income from continuing operations increased $1.9 billion compared to the year ended December 31, 2024, driven by an increase in segment profit of $2.0 billion, a decrease in in restructuring and other charges of $0.6 billion, a decrease in separation costs of $0.3 billion, a decrease in goodwill impairment losses of $0.3 billion and a decrease in interest and other financial charges of $0.1 billion. These increases were partially offset by an increase in provision for income taxes of $0.4 billion, due to higher net income before taxes, a decrease in gains on sales of business interests of $0.4 billion, a decrease in gains on retained and sold ownership interests and other equity securities of $0.2 billion, and an increase in Adjusted Corporate & Other operating costs* of $0.2 billion. Adjusted net income* was $6.8 billion, an increase of $1.8 billion, due to an increase in segment profit of $2.0 billion, partially offset by an increase in Adjusted Corporate & Other operating costs* of $0.2 billion.

Profit was $10.0 billion, an increase of $2.4 billion. Profit margin was 21.8%, an increase of 210 basis points. Operating profit* was $9.1 billion, an increase of $1.8 billion. Operating profit margin* was 21.4%, an increase of 70 basis points. Adjusted EPS* was $6.37, an increase of 38%.

Remaining performance obligation (RPO) is unfilled customer orders for products and product services (expected life of contract sales for product services) excluding any purchase order that provides the customer with the ability to cancel or terminate without incurring a substantive penalty. See Note 25 for further information.

As of December 31, 2025, RPO increased $18.9 billion, or 11%, from December 31, 2024, primarily at Commercial Engines & Services, as a result of contract modifications and engines contracted under long-term service agreements that have now been put into service and from equipment orders outpacing revenue recognized, and at Defense & Propulsion Technologies, driven by Defense & Systems equipment orders outpacing revenue recognized.

SEGMENT OPERATIONS

COMMERCIAL ENGINES & SERVICES. In 2025, demand for commercial air travel grew with departures up 3%. We are in frequent communication with our airline, airframe and MRO customers about the outlook for commercial air travel, new aircraft production, fleet retirements and after-market services, including shop visit and spare parts demand.

We secured a series of landmark engine commitments in 2025 from leading global carriers. These wins span GE9X, GEnx and LEAP programs and include major selections by Qatar Airways, Emirates International Airlines Group, ANA Holdings, Malaysia Aviation Group, Korean Air, Cathay Pacific and Pegasus. Collectively, these agreements reinforce our leadership on next-generation widebody and narrowbody platforms and provide strong multi-year visibility across equipment and services. We believe these awards underscore the competitiveness of our technology and the durability of airline demand.

Total engineering investments, both company and partner-funded, increased compared to prior year. Internal shop visit revenue grew in 2025 compared to 2024 and total engine deliveries and LEAP engine deliveries increased primarily due to improved material supply. We are investing in our manufacturing and overhaul facilities and are deploying engineering and supply chain resources to increase production, expand capacity and strengthen yield.

For the year ended December 31, 2025, revenue was up $6.4 billion, or 24%, and profit was up $1.8 billion, or 26%, compared to the year ended December 31, 2024.

Revenue increased due to increased spare parts volume, internal shop visit volume and workscopes, increased engine deliveries and pricing.

Profit increased primarily due to increased spare parts volume, internal shop visit volume and workscopes and improved pricing. These increases were partially offset by the impact of higher install engine deliveries, inflation, higher growth investment and an unfavorable change in estimated profitability of our long-term service agreements, primarily from the estimated impact from tariffs.

2025 FORM 10-K 9

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]