AAR Corp. (AIR) set out a fiscal 2026 organic revenue growth target of 14% and projected about 12% growth for fiscal 2027, during a presentation at the Jefferies Global Industrials Conference on September 9, 2026.
CEO John Holmes told Jefferies analysts the company aims for an EBITDA margin of 13% to 14% plus on an ex-legacy basis over three years, with a long-term target in the mid-teens. The company reached a 13% margin in the fourth quarter excluding legacy commercial programs. Leverage stood at approximately 2.0x at end of Q4, within AAR's stated target range of 2.0x to 2.5x, though Holmes said the company would exceed that range for the right acquisition.
AAR's revenue is split roughly 30% government and 70% commercial. Its parts distribution segment, which generated between $1.1 billion and $1.2 billion — about a third of total company revenue — grew 19% organically in fiscal 2026 on new parts. Over the prior five years, new parts distribution grew at a 25% to 30% clip. Contracts under the segment are predominantly five- to ten-year exclusive two-way agreements with a 100% renewal rate over the past decade. Used serviceable material now accounts for less than 15% of the business.
In repair services, AAR is the world's third-largest heavy maintenance provider and the largest in North America, focused on narrow-body aircraft including 737s and A320s. Hangar capacity is essentially sold out through the end of the decade, with an additional 15% capacity increase scheduled over the next six to twelve months. The company reported C-check turnaround times in the high 20s of days versus an industry standard of 30 to 35 days. Component repair generates approximately $400 million across five facilities — four in the U.S. and one in Thailand — currently running about 1.25 shifts with headroom to scale to three. AAR is targeting $25 million to $50 million annually in component work from major heavy maintenance customers.
Software and digital tools have been a faster-growing segment. Trax, acquired roughly three years ago as a $25 million-revenue business, now runs at $100 million and supports more than 110 airlines and approximately 6,000 aircraft. AAR noted that roughly half of the world's fleet still relies on legacy maintenance systems 30 to 40 years old. Airvoyant, an AI-driven procurement platform launched in April 2024 at MRO Americas targeting the $60 billion annual airline parts procurement market, remains in beta and has not yet contributed revenue.
On the merger and acquisition front, AAR has completed six purchases over the past three years. Its acquisition of HAECO is scheduled to close in November, and the company announced it will exit its Indianapolis facility by the end of the calendar year, ahead of schedule. AAR's market capitalization stands at approximately $4.95 billion, with the stock trading around $125.51 after pulling back 3.99% from a prior close of $130.73; the 52-week high is $154.
