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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 
For the quarterly period ended  September 30, 2025
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____
Commission file number 001-37386

FTAI AVIATION LTD.
(Exact name of registrant as specified in its charter )

Cayman Islands 98-1420784
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

405 West 13th Street, 3rd Floor New York NY 10014
(Address of principal executive offices) (Zip Code)

(Registrant’s telephone number, including area code)  ( 332 ) 239-7600
(Former name, former address and former fiscal year, if changed since last report) N/A
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: Trading Symbol: Name of exchange on which registered:
Ordinary shares, $0.01 par value per share FTAI The Nasdaq Global Select Market
8.25% Fixed-Rate Reset Series C Cumulative Perpetual Redeemable Preferred Shares FTAIN The Nasdaq Global Select Market
9.50% F ixed-Rate Reset Series D Cumulative Perpetual Redeemable Preferred Shares
FTAIM The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   þ No   ¨  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes   þ No   ¨  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ Accelerated filer ¨
Non-accelerated filer ¨ Smaller reporting company ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes   ☐ No   þ
There were 102,572,925 ordinary shares outstanding at October 27, 2025.

FORWARD-LOOKING STATEMENTS AND RISK FACTORS SUMMARY
This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact but instead are based on our present beliefs and assumptions and on information currently available to us. You can identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “target,” “projects,” “contemplates” or the negative version of those words or other comparable words. Any forward-looking statements contained in this report are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, that the future plans, estimates or expectations contemplated by us will be achieved.
Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. The following is a summary of the principal risk factors that make investing in our securities risky and may materially adversely affect our business, financial condition, results of operations and cash flows. This summary should be read in conjunction with the more complete discussion of the risk factors we face, which are set forth in Part II, Item 1A. “Risk Factors” of this report. We believe that these factors include, but are not limited to:
• changes in economic conditions generally and specifically in our industry sectors, and other risks relating to the global economy, including, but not limited to, the Russia-Ukraine conflict, and any related responses or actions by businesses and governments;
• reductions in cash flows received from our assets, as well as contractual limitations on the use of our aviation assets to secure debt for borrowed money;
• our ability to take advantage of acquisition opportunities at favorable prices;
• our ability to realize the anticipated benefits of our strategic initiatives;
• a lack of liquidity surrounding our assets, which could impede our ability to vary our portfolio in an appropriate manner;
• the relative spreads between the yield on the assets we acquire and the cost of financing;
• adverse changes in the financing markets we access affecting our ability to finance our acquisitions;
• customer or lessee defaults on their obligations;
• our ability to renew existing contracts and enter into new contracts with existing or potential lessees;
• the availability and cost of capital for future acquisitions;
• concentration of a particular type of asset or in a particular sector;
• competition within the aviation industry;
• the competitive market for acquisition opportunities;
• risks related to operating through joint ventures, partnerships, consortium arrangements or other collaborations with third parties;
• our ability to successfully integrate acquired businesses;
• obsolescence of our assets or our ability to sell, re-lease or re-charter our assets;
• exposure to uninsurable losses and force majeure events;
• the impact of trade disputes, including the imposition of new or increased tariffs, sanctions or other restrictions, and the legislative/regulatory environment and exposure to increased economic regulation;
• exposure to the oil and gas industry’s volatile oil and gas prices;
• difficulties in obtaining effective legal redress in jurisdictions in which we operate with less developed legal systems;
• our ability to maintain our exemption from registration under the Investment Company Act of 1940, as amended (the “Investment Company Act”) and the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”) and the fact that maintaining such exemption imposes limits on our operations;
• our ability to successfully utilize leverage in connection with our investments;
• foreign currency risk and risk management activities;
• effectiveness of our internal control over financial reporting;
• exposure to environmental risks, including natural disasters, increasing environmental legislation and the broader impacts of climate change;
• changes in interest rates and/or credit spreads, as well as the success of any hedging strategy we may undertake in relation to such changes;
• actions taken by national, state, or provincial governments, including nationalization, or the imposition of new taxes, could materially impact the financial performance or value of our assets;
• our ability to attract and retain highly skilled management and other personnel;
2

• risks relating to the Company entering into an Internalization Agreement (the “Internalization Agreement”) with FIG LLC (the “Former Manager”) and the impact on the Company’s management functions and business operations;
• volatility in the market price of our shares;
• the inability to pay dividends to our shareholders in the future;
• impacts from our past and future acquisitions, and our ability to successfully integrate acquired assets and assumed liabilities; and
• other risks described in the “Risk Factors” section of this report.
These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report. The forward-looking statements made in this report relate only to events as of the date on which the statements are made. We do not undertake any obligation to publicly update or review any forward-looking statement except as required by law, whether as a result of new information, future developments or otherwise.
If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.
3

FTAI AVIATION LTD.
INDEX TO FORM 10-Q

PART I - FINANCIAL INFORMATION
Item 1. Unaudited Consolidated Financial Statements of FTAI Aviation Ltd.
5

Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024
5

Consolidated Statements of Operations for the three and nine months ended September 30, 2025 and 2024
6

Consolidated Statements of Changes in Equity for the three and nine months ended September 30, 2025 and 2024
7

Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024
9

Notes to Consolidated Financial Statements
11

Note 1: Organization
11

Note 2: Summary of Significant Accounting Policies
11

Note 3: Acquisition of Lockheed Martin Commercial Engine Solutions
11

Note 4: Leasing Equipment, net
16

Note 5: Investments
17

Note 6: Intangible Assets and Liabilities, net
18

Note 7: Debt, net
19

Note 8: Fair Value Measurements
19

Note 9: Equity-Based Compensation
20

Note 10: Income Taxes
22

Note 11: Affiliate Transactions and Former Management Agreement
22

Note 12: Segment Information
24

Note 13: Earnings per Share and Equity
31

Note 14: Commitments and Contingencies
31

Note 15: Restructuring Charges
32

Note 16: Subsequent Events
32

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
33

Item 3. Quantitative and Qualitative Disclosures About Market Risk
50

Item 4. Controls and Procedures
50

PART II - OTHER INFORMATION
Item 1. Legal Proceedings
51

Item 1A. Risk Factors
51

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
66

Item 3. Defaults Upon Senior Securities
67

Item 4. Mine Safety Disclosures
67

Item 5. Other Information
67

Item 6. Exhibits
68

4

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements

FTAI AVIATION LTD.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share data)

(Unaudited)
Notes September 30, 2025 December 31, 2024
Assets
Current Assets
Cash and cash equivalents 2 $ 509,945   $ 115,116  
Accounts receivable, net (1)
2 214,889   150,823  
Inventory, net 2 897,216   551,156  

Other current assets (2)
2 412,779   408,923  
Total current assets 2,034,829   1,226,018  
Leasing equipment, net 4 1,669,634   2,373,730  
Property, plant, and equipment, net 2 113,951   107,451  
Investments 5 164,346   19,048  
Intangible assets, net 6 18,682   42,205  
Goodwill 3 83,012   61,070  
Other non-current assets 2 155,746   208,430  
Total assets $ 4,240,200   $ 4,037,952  

Liabilities
Current Liabilities
Accounts payable $ 147,350   $ 69,119  
Accrued liabilities 128,936   96,910  
Current maintenance deposits 2 14,650   62,552  
Current security deposits 16,012   18,100  

Other current liabilities 2 41,285   100,565  
Total current liabilities 348,233   347,246  
Long-term debt, net 7 3,446,733   3,440,478  
Non-current maintenance deposits 2 49,982   44,179  
Non-current security deposits 2 15,991   26,830  
Other non-current liabilities 126,797   97,851  
Total liabilities $ 3,987,736   $ 3,956,584  

Commitments and contingencies 14

Equity
Ordinary shares ($ 0.01 par value per share; 2,000,000,000 shares authorized; 102,572,000 and 102,550,975 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively)
$ 1,026   $ 1,026  
Preferred shares ($ 0.01 par value per share; 200,000,000 shares authorized; 6,800,000 and 11,740,000 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively)
68   117  
Additional paid in capital ( 26,549 ) 153,328  
Retained earnings (accumulated deficit) 277,919   ( 73,103 )
Shareholders' equity 252,464   81,368  
Total liabilities and equity $ 4,240,200   $ 4,037,952  

______________________________________________________
(1) Includes accounts receivable from the 2025 Partnership of $ 50,856 and $ 0 as of September 30, 2025 and December 31, 2024, respectively.
(2) Includes receivables from the 2025 Partnership of $ 17,585 and $ 0 as of September 30, 2025 and December 31, 2024, respectively.

See accompanying notes to consolidated financial statements.
5

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(Dollars in thousands, except share and per share data)

Three Months Ended September 30, Nine Months Ended September 30,
Notes 2025 2024 2025 2024
Revenues
Aerospace products revenue 2 $ 459,206   $ 303,469   $ 1,144,317   $ 737,726  
MRE Contract revenue 2, 11 58,663   —   228,886   —  
Lease income 2 55,072   65,450   185,951   189,365  
Maintenance revenue 2 52,370   59,917   175,081   156,894  
Asset sales revenue 2 38,461   34,953   105,315   145,993  
Other revenue (1)
3,292   2,005   5,831   6,104  
Total revenues 12 667,064   465,794   1,845,381   1,236,082  

Expenses
Cost of sales 362,922   219,496   980,894   568,157  
Operating expenses 2 39,092   26,858   105,858   81,274  
General and administrative 1,829   4,045   7,387   10,697  
Acquisition and transaction expenses 7,066   9,341   18,847   23,539  
Management fees and incentive allocation to affiliate 11 —   —   —   8,449  
Internalization fee to affiliate 15 —   —   —   300,000  
Depreciation and amortization 4, 6 55,278   56,775   170,076   163,386  
Asset impairment —   —   —   962  
Total expenses 466,187   316,515   1,283,062   1,156,464  

Other (expense) income
Interest expense ( 60,784 ) ( 57,937 ) ( 186,789 ) ( 160,840 )
Loss on extinguishment of debt —   —   —   ( 13,920 )
Equity in losses of unconsolidated entities (2)
5 ( 4,224 ) ( 438 ) ( 16,841 ) ( 1,799 )
Gain on sale to the 2025 Partnership 4,609   —   50,083   —  
Other income 3,570   2,909   63,797   3,045  
Total other expense ( 56,829 ) ( 55,466 ) ( 89,750 ) ( 173,514 )
Income (loss) before income taxes 144,048   93,813   472,569   ( 93,896 )
Provision for (benefit from) income taxes 10 26,330   7,331   87,067   ( 130 )
Net income (loss) 117,718   86,482   385,502   ( 93,766 )
Less: Dividends on preferred shares 3,709   8,335   13,533   25,005  
Less: Loss on redemption of preferred shares —   —   6,327   —  
Net income (loss) attributable to shareholders $ 114,009   $ 78,147   $ 365,642   $ ( 118,771 )

Earnings (loss) per share: 13
Basic $ 1.11   $ 0.76   $ 3.57   $ ( 1.17 )
Diluted $ 1.10   $ 0.76   $ 3.52   $ ( 1.17 )

Weighted average shares outstanding:
Basic 102,569,415   102,380,659   102,560,285   101,199,356  
Diluted 103,966,650   103,395,348   103,951,713   101,199,356  
______________________________________________________
(1) Includes servicing fees of $ 3,035 and $ 5,635 for the three and nine months ended September 30, 2025, respectively, from the 2025 Partnership.
(2) Includes the profit elimination of $( 3,908 ) and $( 15,793 ) for the three and nine months ended September 30, 2025, respectively, for sales to the 2025 Partnership.
See accompanying notes to consolidated financial statements.
6

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (unaudited)
(Dollars in thousands)

Three and Nine Months Ended September 30, 2025
Ordinary Shares Preferred Shares Additional Paid In Capital (Accumulated Deficit) Retained Earnings Total Equity
Equity - December 31, 2024 $ 1,026   $ 117   $ 153,328   $ ( 73,103 ) $ 81,368  
Net income 267,784   267,784  
Total comprehensive income 267,784   267,784  
Redemption of preferred shares ( 49 ) ( 117,791 ) ( 117,840 )
Loss on redemption of preferred shares ( 6,327 ) ( 6,327 )
Issuance of ordinary shares 913   913  
Dividends declared - ordinary shares ( 61,534 ) ( 61,534 )
Dividends declared - preferred shares ( 9,824 ) ( 9,824 )
Equity-based compensation 10,404   10,404  
Equity - June 30, 2025 $ 1,026   $ 68   $ ( 30,831 ) $ 194,681   $ 164,944  
Net income 117,718   117,718  
Total comprehensive income 117,718   117,718  

Issuance of ordinary shares 124   124  
Dividends declared - ordinary shares ( 30,771 ) ( 30,771 )

Dividends declared - preferred shares ( 3,709 ) ( 3,709 )
Equity-based compensation 5,655   5,655  
Net settlement on vesting of equity awards
( 1,497 ) ( 1,497 )
Equity - September 30, 2025 $ 1,026   $ 68   $ ( 26,549 ) $ 277,919   $ 252,464  

See accompanying notes to consolidated financial statements.
7

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (unaudited)
(Dollars in thousands)

Three and Nine Months Ended September 30, 2024
Ordinary Shares Preferred Shares Additional Paid In Capital Accumulated Deficit  Non-Controlling Interest in Equity of Consolidated Subsidiaries Total Equity
Equity - December 31, 2023 $ 1,002   $ 159   $ 255,973   $ ( 81,785 ) $ 534   $ 175,883  
Net loss ( 180,248 ) ( 180,248 )

Total comprehensive income ( 180,248 ) ( 180,248 )
Purchase of non-controlling interest $ ( 534 ) ( 534 )
Dividends declared - ordinary shares ( 60,148 ) ( 60,148 )
Dividends declared - preferred shares ( 16,670 ) ( 16,670 )
Issuance of ordinary shares 20   150,116   150,136  
Equity-based compensation 1,148   1,148  
Equity - June 30, 2024 $ 1,022   $ 159   $ 330,419   $ ( 262,033 ) $ —   $ 69,567  
Net income 86,482   86,482  

Total comprehensive income 86,482   86,482  

Dividends declared - ordinary shares ( 30,661 ) ( 30,661 )
Dividends declared - preferred shares ( 8,335 ) ( 8,335 )
Issuance of ordinary shares 3 46   49  
Equity-based compensation 1,430   1,430  
Equity - September 30, 2024 $ 1,025   $ 159   $ 292,899   $ ( 175,551 ) $ —   $ 118,532  

See accompanying notes to consolidated financial statements.
8

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(Dollars in thousands)

Nine Months Ended September 30,
2025 2024
Cash flows from operating activities:
Net income (loss) $ 385,502   $ ( 93,766 )
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Equity in losses of unconsolidated entities (1)
16,841   1,799  
Gain on sale of assets ( 294,761 ) ( 244,353 )
Gain on sale of assets to the 2025 Partnership ( 50,083 ) —  
Gain on insurance recoveries ( 54,325 ) —  
Security deposits and maintenance claims included in earnings ( 24,919 ) ( 13,437 )
Loss on extinguishment of debt —   13,920  
Equity-based compensation 16,059   2,578  
Non-cash termination fee to affiliate —   150,000  
Depreciation and amortization 170,076   163,386  
Asset impairment —   962  
Deferred income taxes 77,559   ( 2,470 )
Change in fair value of guarantees 2,460   1,340  
Amortization of lease intangibles and incentives 31,843   30,998  
Amortization of deferred financing costs 8,772   7,996  

Provision for credit losses 276   2,784  
Other 710   ( 158 )
Change in:
 Accounts receivable ( 38,968 ) ( 31,234 )
 Inventory ( 391,908 ) ( 163,900 )
 Other assets ( 64,011 ) ( 16,769 )
 Accounts payable and accrued liabilities 100,739   50,630  
 Management fees payable to affiliate ( 960 ) ( 3,967 )
 Other liabilities ( 22,568 ) ( 2,492 )
Net cash used in operating activities ( 131,666 ) ( 146,153 )

Cash flows from investing activities:
Investment in unconsolidated entities ( 188,698 ) —  
Return of capital from unconsolidated entities 27,113   —  
Principal collections on finance leases 1,580   1,872  
Principal collections on notes receivable 4,328   3,874  
Acquisition of business, net of cash acquired ( 37,133 ) ( 143,634 )
Acquisition of leasing equipment ( 489,781 ) ( 622,366 )
Investments in financing receivables ( 2,764 ) ( 63,857 )
Acquisition of property, plant and equipment ( 17,511 ) ( 2,968 )
Acquisition of lease intangibles 2,757   1,174  
Deposits for acquisition of leasing equipment (2)
( 58,646 ) ( 162,708 )
Proceeds from sale of assets 890,434   542,938  
Proceeds from sale of assets to the 2025 Partnership 485,108   —  
Proceeds from settlement of insurance claims 54,325   —  
Proceeds from deposits on sale of leasing equipment 6,405   2,414  
Return of deposits for acquisition of leasing equipment (2)
45,151   530  
Net cash provided by (used in) investing activities $ 722,668   $ ( 442,731 )

See accompanying notes to consolidated financial statements.
9

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(Dollars in thousands)

Nine Months Ended September 30,
2025 2024
Cash flows from financing activities:
Proceeds from debt $ 430,000   $ 2,069,250  
Repayment of debt ( 430,000 ) ( 1,367,304 )
Payment of deferred financing costs ( 524 ) ( 10,825 )
Receipt of security deposits under operating lease agreements 4,490   6,120  
Return of security deposits under operating lease agreements ( 3,469 ) —  
Receipt of maintenance deposits under operating lease agreements 40,284   35,583  
Release of maintenance deposits under operating lease agreements ( 5,452 ) ( 6,460 )
Capital contributions from non-controlling interests —   ( 534 )
Settlement of equity-based compensation ( 1,497 ) —  
Redemption of preferred shares ( 124,167 ) —  
Cash dividends - ordinary shares ( 92,305 ) ( 90,809 )
Cash dividends - preferred shares ( 13,533 ) ( 25,005 )
Net cash (used in) provided by financing activities $ ( 196,173 ) $ 610,016  

Net increase in cash and cash equivalents and restricted cash 394,829   21,132  
Cash and cash equivalents and restricted cash, beginning of period 115,266   90,906  
Cash and cash equivalents and restricted cash, end of period $ 510,095   $ 112,038  

Supplemental disclosure of non-cash investing and financing activities
(see Note 2 for additional non-cash information):
Receipt of notes receivable in connection with the sale of leasing equipment $ 32,996   $ 69,826  
Acquisition of leasing equipment in accrued liabilities ( 22,634 ) ( 11,772 )
Receipt of leasing equipment in settlement of accounts receivable ( 5,118 ) —  
Purchase deposits reclassified to leasing equipment from other assets upon acquisition ( 52,817 ) ( 19,608 )
Decrease in leasing equipment for engines provided to aircraft lessees in lieu of cash reimbursements of maintenance deposits 2,199   —  
Accounts receivable settled with security deposits ( 2,110 ) ( 4,365 )
Accounts receivable settled with maintenance deposits ( 23,883 ) ( 38,795 )
______________________________________________________
(1) Includes the profit elimination of $( 15,793 ) for the nine months ended September 30, 2025, for sales to the 2025 Partnership within the Aerospace Products segment.
(2) Includes deposits for acquisition of leasing equipment paid on behalf of the 2025 Partnership of $ 23,473 for the nine months ended September 30, 2025, and return of deposits for the acquisition of leasing equipment reimbursed from the 2025 Partnership of $ 42,813 for the nine months ended September 30, 2025.

See accompanying notes to consolidated financial statements.
10

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

1. ORGANIZATION
This report on Form 10-Q should be read in conjunction with the FTAI Aviation Ltd.(“FTAI”, “FTAI Aviation” or “the Company”) Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (“Form 10-K”).
FTAI Aviation is a Cayman Islands exempted company, which through its subsidiaries, is a leading full-service provider for CFM56-5B, CFM56-7B and V2500 aircraft engines, which power the majority of the world’s fleet of narrowbody aircraft. The Company owns and leases aircraft and engines to airlines and asset owners globally. Additionally, the Company repairs and sells refurbished engines and aftermarket components of engines as well as develops and manufactures Parts Manufacturer Approval (“PMA”) parts through a joint venture. The Company has two reportable segments, (i) Aviation Leasing and (ii) Aerospace Products (see Note 12).
The Company conducts engine maintenance at its 100% owned facilities in Montréal, Miami, and Orange, as well as through its 50 % equity ownership in QuickTurn Europe, located in Rome. Collectively, these facilities span over 950,000 square feet and are equipped with advanced tooling, engine test cells, and engineering capabilities to support a wide range of component repairs and service requirements. In addition, the Company also supports global operations through exclusive arrangements and strategic partnerships at key locations worldwide. The Company’s principal corporate location is in New York City, and has a global presence through offices in Cardiff, Dubai, Dublin and Singapore, in addition to Montréal, Miami, Orange and Rome.
The majority of FTAI’s target customers are small and medium sized airlines which have narrowbody fleets powered by CFM56-5B, CFM56-7B and V2500 engines. There are hundreds of these operators worldwide, which creates a large addressable market in which FTAI focuses and can provide significant value versus competitors.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting — The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and include the accounts of the Company and its subsidiaries.
Principles of Consolidation — The Company consolidates all entities in which it has a controlling financial interest and control over significant operating decisions. All adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The ownership interest of other investors in the Company’s consolidated subsidiaries is recorded as non-controlling interest.
The Company uses the equity method of accounting for investments in entities in which it exercises significant influence but does not meet the requirements for consolidation. Under the equity method, the Company records its proportionate share of the underlying net income (loss) of these entities.
Use of Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Reclassifications — Certain amounts from prior periods in the Company’s consolidated financial statements have been reclassified to align with the presentation in the current period.
Risks and Uncertainties — In the normal course of business, the Company encounters several significant types of economic risk including credit, market, and capital market risks. Credit risk is the risk of the inability or unwillingness of a lessee or customer to make contractually required payments or to fulfill its other contractual obligations. Market risk reflects the risk of a downturn or volatility in the underlying industry segments in which the Company operates, which could adversely impact the pricing of the services offered by the Company or a lessee’s or customer’s ability to make payments, increase the risk of unscheduled lease terminations and depress lease rates and the value of the Company’s leasing equipment or operating assets. Capital market risk is the risk that the Company is unable to obtain capital at reasonable rates to fund the growth of its business or to refinance existing debt facilities. The Company, through our subsidiaries, also conducts operations outside of the United States; such international operations are subject to the same risks as those associated with the Company’s United States operations as well as additional risks, including unexpected changes in regulatory requirements, heightened risk of political and economic instability, potentially adverse tax consequences and the burden of complying with foreign laws. The Company does not have significant exposure to foreign currency risk as all of its leasing arrangements are denominated in U.S. dollars.
Cash and Cash Equivalents — The Company considers all highly liquid short-term investments with a maturity of 90 days or less when purchased to be cash equivalents.
Inventory, net — The Company holds aircraft engines, engine modules, spare parts and used material inventory for sale. At times, inventory is transferred to leasing equipment in connection with a rebuilt engine or engine repair. Inventory is carried at the lower of cost or net realizable value on the Company’s Consolidated Balance Sheets.
11

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Revenues — Revenues are within the scope of ASC 842, Leases, and ASC 606, Revenue from contracts with customers . The Company has elected to exclude sales tax and other similar taxes from revenues.
Operating Leases — The Company leases equipment pursuant to operating leases. Operating leases with fixed rentals and step rentals are recognized on a straight-line basis over the term of the lease, assuming no renewals. Revenue is not recognized when collection is not reasonably assured. When collectability is not reasonably assured, the lessee is placed on non-accrual status and revenue is recognized when cash payments are received.
Generally, under the Company’s aircraft lease and engine agreements, the lessee is required to make periodic maintenance payments calculated based on the lessee’s utilization of the leased asset or at the end of the lease. Typically, under the Company’s aircraft lease agreements, the lessee is responsible for maintenance, repairs and other operating expenses throughout the term of the lease. These periodic maintenance payments accumulate over the term of the lease to fund major maintenance events, and the Company is contractually obligated to return maintenance payments to the lessee up to the cost of maintenance events paid by the lessee. In the event the total cost of maintenance events over the term of a lease is less than the cumulative maintenance payments, the Company is not required to return any unused maintenance payments to the lessee.
Maintenance payments received for which the Company expects to repay to the lessee are presented as current and non-current Maintenance deposits in its Consolidated Balance Sheets. All excess maintenance payments received that the Company does not expect to repay to the lessee are recorded as Maintenance revenue on its Consolidated Statements of Operations. Estimates in recognizing revenue include mean time between removal, projected costs for engine maintenance and forecasted utilization of aircraft which are affected by historical usage patterns and overall industry, market and economic conditions. Significant changes to these estimates could have a material effect on the amount of revenue recognized in the period.
Finance Leases — From time to time the Company enters into finance lease arrangements that include a lessee obligation to purchase the leased equipment at the end of the lease term, a bargain purchase option, or provides for minimum lease payments with a present value that equals or exceeds substantially all of the fair value of the leased equipment at the date of lease inception. Net investment in finance leases represents the minimum lease payments due from lessee, net of unearned income. The lease payments are segregated into principal and interest components similar to a loan. Unearned income is recognized on an effective interest method over the lease term and is recorded as lease income. The principal component of the lease payment is reflected as a reduction to the net investment in finance leases. Revenue is not recognized when collection is not reasonably assured. When collectability is not reasonably assured, the lessee is placed on non-accrual status and revenue is recognized when cash payments are received.
Asset sales revenue — Asset sales revenue primarily consists of the transaction price related to the sale of aircraft and aircraft engines from the Company’s Aviation Leasing segment. From time to time, the Company may also assign the related lease agreements to the customer as part of the sale of these assets. The Company routinely sells leasing equipment to customers, and such transactions are considered recurring and ordinary in nature to its business. As such, these sales are accounted for within the scope of ASC 606. Revenue is recognized when a performance obligation is satisfied by transferring control of an asset to the customer, along with corresponding costs of sales.
Aerospace products revenue — Aerospace products revenue primarily consists of the transaction price related to the sale of CFM56-5B, CFM56-7B and V2500 engines, engine modules, spare parts and used material inventory, and are accounted for within the scope of ASC 606. Revenue is recognized gross when a performance obligation is satisfied by transferring control over the related asset to a customer along with corresponding costs of sales. Aerospace products revenue also consists of engine management service contracts, where the Company has a stand-ready obligation to provide replacement CFM56-5B and CFM56-7B engines to customers as they become unserviceable during the contract term. The Company recognizes revenue over time using a straight-line attribution method and the costs related to fulfilling the performance obligation are expensed as incurred.
Maintenance, Repair and Exchange (“MRE”) Contract revenue — MRE Contract revenue consists of the transaction price related to the sale of CFM56-5B, CFM56-7B and V2500 commercial aircraft engines and related modules to, and subsequent exchange of unserviceable engines and modules from, the special purpose entities (the “SPVs”) of the first partnership of the strategic capital initiative (the “2025 Partnership”). MRE Contract revenue is recognized under ASC 606 when a performance obligation is satisfied by transferring control of the serviceable engine or module to the 2025 Partnership, along with corresponding costs of sales. Refer to Note 11 “Affiliate Transactions and Former Management Agreement” for additional information on the 2025 Partnership and the strategic capital initiative.
Other Income — The 2025 Partnership committed to acquire 45 on-lease narrowbody aircraft from the Company (the “Seed Assets”) and has signed an agreement through which the Company’s MRE business will provide replacement aircraft engines and modules for the life of the 2025 Partnership.
During the three and nine months ended September 30, 2025, 8 and 45 of the aircraft were sold for a gain of $ 4.6 million and $ 50.1 million, respectively, which was recognized within gain on sale to the 2025 Partnership. The aircraft sales are accounted for under ASC 610-20, Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets , as they are non-recurring in nature and not considered part of the Company’s ordinary activities.
12

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

During the three and nine months ended September 30, 2025, the Company received $ 0.0 million and $ 54.3 million, respectively, in insurance recoveries in connection with the settlement of claims related to the aircraft and engines located in Russia and recorded the gain within other income.
Concentration of Credit Risk — The Company is subject to concentrations of credit risk with respect to amounts due from customers and lessees. The Company attempts to limit its credit risk by performing ongoing credit evaluations. The Company earned 16 % and 11 % of its revenue from two customers in the Aerospace Products segment during the three months ended September 30, 2025. The Company earned 12 % of its revenue from one customer in the Aerospace Products segment during the nine months ended September 30, 2025. No single customer accounted for greater than 10% of total revenue during the three and nine months ended September 30, 2024.
As of September 30, 2025, there were two customers in the Aerospace Products segment that represented 25 % and 11 % of total accounts receivable, net. As of December 31, 2024, no single customer accounted for greater than 10% of total accounts receivable, net.
The Company maintains cash and restricted cash balances, which generally exceed federally insured limits, and subject the Company to credit risk, in high credit quality financial institutions. The Company monitors the financial condition of these institutions and has not experienced any losses associated with these accounts.
Allowance for Doubtful Accounts — The Company determines the allowance for doubtful accounts based on its assessment of the collectability of its leasing receivables, notes receivables and inventory sales. In assessing the allowance, the Company considers past collection history and specific risks identified among uncollected accounts. The assessment of collectability of its leasing receivables, notes receivables and inventory sales is done on a customer-by-customer basis. The allowance for doubtful accounts was $ 28.4 million and $ 74.9 million as of September 30, 2025 and December 31, 2024, respectively . There was a provision for credit losses of $ 0.1 million and $ 0.3 million for the three and nine months ended September 30, 2025, respectively, and $ 2.7 million and $ 2.8 million for the three and nine months ended September 30, 2024, respectively. The provision for credit losses is included in the Company's operating expenses. Receivables are written off after all reasonable means to collect the full amount have been exhausted. For the three and nine months ended September 30, 2025, the Company recorded write-offs and recoveries, net, of its allowance for doubtful accounts of $ 0.1 million and $ 46.8 million, respectively.
Other Current Assets — Other current assets are summarized as follows:

September 30, 2025 (unaudited) December 31, 2024
Notes receivable $ 269,360   $ 165,338  
Financing receivable resulting from failed sale-leaseback transactions 36,008   32,486  
Prepaid expenses including prepayments for maintenance that has not yet been incurred 40,353   87,323  
Purchase deposits 13,471   83,229  
Maintenance right assets 18,716   —  
Tax assets 7,506   31,622  
Contract asset from the 2025 Partnership 17,585   —  
Other 9,780   8,925  
Other current assets $ 412,779   $ 408,923  

Other Non-Current Assets — Other non-current assets are summarized as follows:

September 30, 2025 (unaudited) December 31, 2024
Lease incentives $ 47,320   $ 56,812  
Deferred tax assets 27,225   42,893  
Operating lease assets 30,906   28,729  
Financing receivable resulting from failed sale-leaseback transactions 22,728   28,412  
Maintenance right assets 4,624   25,907  
Engine management contract assets 10,292   7,162  
Other 12,651   18,515  
Other non-current assets $ 155,746   $ 208,430  

13

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Other Current Liabilities — Other current liabilities are summarized as follows:

September 30, 2025 (unaudited) December 31, 2024
Deposits on sales of leasing equipment 37,551   $ 87,296  
Other 3,734   13,269  
Other current liabilities $ 41,285   $ 100,565  

Dividends — Dividends are recorded if and when declared by the Board of Directors. For the three and nine months ended September 30, 2025, the Board of Directors declared cash dividends of $ 0.35 and $ 0.95 per ordinary share, respectively. For the three and nine months ended September 30, 2024, the Board of Directors declared cash dividends of $ 0.30 and $ 0.90 per ordinary share, respectively.
Additionally, in the three months ended September 30, 2025, the Board of Directors declared cash dividends on the Series C Preferred Shares and Series D Preferred Shares of $ 0.52 and $ 0.59 per share, respectively.
Cash Flow Presentation — Included in net cash (used in) provided by operating activities are inflows from the sale of engine modules and parts that were on engines originally purchased and reported as leasing equipment, net. The purchase of the original engine was reported as an outflow in net cash used in investing activities at the time of purchase through the acquisition of leasing equipment line item. As part of the aerospace products business, the Company breaks down generally unserviceable engines with the intent to manufacture modules and parts for creation and sale of new assets. To manufacture the modules and parts and bring them into a salable condition, the Company spends significant costs, often over multiple reporting periods, for new inventory and capitalizable labor (e.g., engineering) that are included in net cash (used in) provided by operating activities as components of the changes in the related working capital accounts.
Therefore, when the costs to manufacture the assets are greater than (predominant to) the estimated value transferred from leasing equipment into inventory, the related cash receipt has been reported as an inflow in net cash (used in) provided by operating activities.
Additionally, the Company buys inventory from third parties with the intent to use the parts in the manufacturing of the items discussed above, which is reported as an outflow in net cash (used in) provided by operating activities. When rebuilding whole engines for resale, for which the cash inflow upon sale is reported as a cash inflow from investing activities, the Company will transfer modules and parts needed (those purchased from third parties as well as parts from engines previously transferred to inventory from leasing equipment and rebuilt as discussed above) in the rebuild from inventory to leasing equipment.
With respect to purchases of aircraft and engines, when the expected predominant source of cash inflows from the acquired leasing equipment at the time of acquisition is from leasing activities, the related cash outflow is reported as an outflow in net cash used in investing activities. When the expected predominant source of cash inflows is from sales transactions, the related cash outflow is reported as an outflow in net cash (used in) provided by operating activities.
The cash and noncash related activities described above during the nine months ended September 30, 2025 and 2024 are detailed below (unaudited):

Nine Months Ended September 30,
(in thousands) 2025 2024

Cost of modules and parts sold sourced from engines originally within leasing equipment $ 22,429   $ 33,663  
Transfers of engines from leasing equipment to inventory for manufacturing and sale 219,732   143,678  
Transfers of inventory to leasing equipment for rebuilding and sale of engines ( 228,691 ) ( 159,876 )
Total outflows related to manufacturing modules and parts - included in net cash used in operating activities ( 478,642 ) ( 270,679 )
Cash received for assets sold sourced from leasing equipment - inflow included in net cash used in operating activities
54,853   56,670  
Cash received for sales of leasing equipment that include components sourced from inventory - inflow included in net cash provided by investing activities 635,865   276,699  
Cash paid for engine and aircraft inventory - outflow included in net cash used in operating activities ( 127,260 ) —  

Recent Accounting Pronouncements — In August 2023, the FASB issued ASU 2023‑05, Business Combinations – Joint Venture Formations , which requires that joint ventures, upon formation, apply a new basis of accounting by initially measuring assets and liabilities at fair value. The amendments in ASU 2023‑05 are effective for joint ventures that are formed on or after January 1, 2025. The adoption of ASU 2023-05 did not have a material impact on the Company’s consolidated financial statements.
14

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient in developing reasonable and supportable forecasts as apart of estimating expected credit losses, allowing entities to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. The amendments in ASU 2025-05 are effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company is currently evaluating the impact of this update on its consolidated financial statements and related disclosures.
There have been no other changes to the discussion of recently issued accounting standards included in our Annual Report on Form 10‑K for the year ended December 31, 2024. Specifically, the Company continues to monitor the future adoption of ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , and ASU 2024‑03, Income Statement—Reporting Comprehensive Income (Topic 220): Improvements to Reportable Segment Expense Disclosures , both of which have future effective dates. The Company is currently evaluating the impact these standards may have on its consolidated financial statements and related disclosures.

3. ACQUISITION OF LOCKHEED MARTIN COMMERCIAL ENGINE SOLUTIONS
On September 9, 2024, the Company, through its subsidiary FTAIC Aviation Inc. (“FTAIC”) created on April 25, 2024, acquired certain assets and assumed certain liabilities of Lockheed Martin Commercial Engine Solutions (“LMCES”) from Lockheed Martin Canada for total consideration of $ 170.0  million. LMCES is a 526,000-square-foot aircraft engine maintenance repair facility located in Montréal, Quebec. The Company acquired LMCES to further enhance its MRE business and establish permanent engine and module manufacturing capabilities in Canada. The facility operates within its Aerospace Products segment, providing extensive engine and piece-part repair capabilities for the CFM56-5B and CFM56-7B engines. The results of operations of LMCES have been included in the Company’s results since the effective date of the acquisition.
The acquisition of LMCES was accounted for as a business combination and, as such, the following fair values were assigned to assets acquired and liabilities assumed based on the Company’s estimates and assumptions. The significant assumptions used to estimate the fair values of the property, plant, and equipment and inventory included replacement cost estimates and market data for similar assets where available.
Subsequent to the acquisition, in the nine months ended September 30, 2025, measurement period adjustments as of the acquisition date were made as a result of the finalization of the net working capital adjustments which increased total consideration by $ 14.1  million. This adjustment resulted in an increase in goodwill of $ 14.1  million.
The following table summarizes the allocation of the net assets acquired:

September 9, 2024
Fair value of assets acquired:
Current Assets
Accounts receivable $ 10,758  
Inventory 25,498  
Other current assets 6,795  
Total current assets 43,051  
Property, plant, and equipment 72,151  
Leasing equipment 5,675  
Other non-current assets 10,633  
Total assets 131,510  
Fair value of liabilities assumed:
Current Liabilities
Accounts payable 7,669  
Accrued liabilities 1,692  
Other current liabilities 5,130  
Total current liabilities 14,491  
Other non-current liabilities 14,347  
Total liabilities 28,838  
Goodwill (1)
71,040  
Net assets acquired (2)
$ 173,712  
________________________________________________________
(1) Goodwill is primarily attributable to the assembled workforce of FTAIC and the synergies expected to be achieved. This goodwill is assigned to the Aerospace Products segment and is deductible for income tax purposes.
(2) Total consideration is calculated as cash paid, adjusted for the settlement of pre-existing relationships.
15

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

The following table presents fair values of the components of property, plant and equipment acquired and their estimated useful lives:

Estimated useful life in years Estimated Fair value
Buildings and improvements 25 $ 40,953  
Machinery and equipment 2 - 21
30,397  
Other N/A 801  
Total $ 72,151  

The unaudited financial information in the table below summarizes the combined results of operations of FTAI and LMCES on a pro forma basis. These pro forma results were based on estimates and assumptions which the Company believes are reasonable. The pro forma adjustments are primarily comprised of the following:
• The allocation of the purchase price and related adjustments, including adjustments to depreciation and amortization expense related to the fair value of property, plant and equipment;
• Associated tax-related impacts of adjustments.
The following unaudited pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place as of January 1, 2024.

Three Months Ended Nine Months Ended

September 30, 2024 September 30, 2024
Total revenue $ 479,277   $ 1,283,520  
Net income attributable to shareholders $ 83,727   $ ( 122,542 )

4. LEASING EQUIPMENT, NET
Leasing equipment, net is summarized as follows:

September 30, 2025 (unaudited) December 31, 2024
Leasing equipment $ 2,169,514   $ 2,963,452  
Less: Accumulated depreciation ( 499,880 ) ( 589,722 )
Leasing equipment, net $ 1,669,634   $ 2,373,730  

The Company identified certain assets in its leasing equipment portfolio with indicators of impairment. During the three and nine months ended September 30, 2025, the Company did not record any transactional impairment charges. In comparison, for the three and nine months ended September 30, 2024, the Company recognized transactional impairment charges of $ 0.0 million and $ 1.0 million, respectively, net of redelivery compensation.
Depreciation expense for leasing equipment is summarized as follows (unaudited):

Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Depreciation expense for leasing equipment $ 51,050   $ 55,376   158,185   159,936  

16

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

5. INVESTMENTS
The following table presents the ownership interests and carrying values of the Company’s investments:

Carrying Value
Investment Ownership Percentage September 30, 2025 (unaudited) December 31, 2024
Advanced Engine Repair JV Equity method 25 % $ 20,623   $ 19,048  
2025 Partnership Equity method 20 % 133,171   —  
QuickTurn Europe Equity method 50 % 10,552   —  
$ 164,346   $ 19,048  

The Company did not recognize any other-than-temporary impairments for the three and nine months ended September 30, 2025 and 2024.
The following table presents the Company’s proportionate share of equity in (losses) earnings (unaudited):

Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Advanced Engine Repair JV $ 668   $ ( 438 ) $ 1,576   $ ( 1,592 )
2025 Partnership (1)
( 4,992 ) —   ( 18,436 ) —  
Falcon MSN 177 LLC (2)
—   —   —   ( 207 )
QuickTurn Europe 100   —   19   —  
Total $ ( 4,224 ) $ ( 438 ) $ ( 16,841 ) $ ( 1,799 )
______________________________________________________
(1) Includes the profit elimination of $( 3,908 ) and $( 15,793 ) for the three and nine months ended September 30, 2025, respectively, for sales to the 2025 Partnership.
(2) On May 3, 2024, the Company purchased the remaining interest of Falcon MSN 177 LLC (“Falcon”). As a result, Falcon became a consolidated subsidiary, and is no longer accounted for as an equity method investment.
Equity Method Investments
Advanced Engine Repair JV
In December 2016, the Company invested $ 15.0  million for a 25 % interest in an advanced engine repair joint venture. This joint venture is focused on developing new cost savings programs for engine repairs.
In August 2019, the Company expanded the scope of our joint venture and invested an additional $ 13.5  million and maintained a 25 % interest. The Company exercises significant influence over this investment and accounts for this investment as an equity method investment.
Falcon MSN 177 LLC
Since November 2021, the Company owned a 50 % interest in Falcon MSN 177 LLC (“Falcon”), an entity that consists of one Dassault Falcon 2000 aircraft. Falcon leases the aircraft to charter operators on aircraft, crew maintenance, and insurance contracts. The Company accounted for its investment in Falcon as an equity method investment as it had significant influence through its interest.
On May 3, 2024, the Company purchased the remaining interest from S7 Aerospace for total cash consideration of $ 0.8  million and it is now a consolidated subsidiary.
2025 Partnership
In the nine months ended September 30, 2025, the Company invested $ 151.6  million in the 2025 Partnership, an investment focused on acquiring 737NG and A320ceo on-lease narrowbody aircraft, for which the Company is the Servicer and holds a 20 % limited partner ownership. The Company exercises significant influence over this investment and accounts for it using the equity method. As the Servicer, The Company is responsible for lessee invoicing and collections, airline relationship management, contracts management including lease extension and aircraft deliveries and redeliveries. The Company's proportionate share of equity in earnings related to this investment is based on the contractual profit-sharing arrangement, the elimination of profit on sales of engine and modules to the 2025 Partnership under ASC 606, and the servicing fees charged by us in our capacity as the Servicer to the 2025 Partnership. The profit from the MRE Contract revenue is eliminated through equity method earnings and will be recognized over time as the 2025 Partnership generates income from leasing and sales activities.
17

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

QuickTurn Europe
On June 5, 2025, the Company invested $ 10.5  million for a 50 % interest in Quick Turn Engine Center Europe S.r.l. (previously IAG Engine Center Europe S.r.l.) or “QuickTurn Europe”, a 200,000 square-foot CFM56 engine maintenance repair and overhaul facility located at the Rome Fiumicino Airport. The joint venture was established to expand the Company’s global engine maintenance capabilities and meet increasing demand for MRE services. The Company accounts for its investment in QuickTurn Europe as an equity method investment as it has significant influence through its interest.

6. INTANGIBLE ASSETS AND LIABILITIES, NET
Intangible assets and liabilities, net are summarized as follows:
September 30, 2025 (unaudited) December 31, 2024
Intangible assets
Acquired favorable lease intangibles $ 20,184   $ 70,375  
Less: Accumulated amortization ( 10,710 ) ( 29,664 )
Acquired favorable lease intangibles, net 9,474   40,711  
Acquired customer relationships 9,907   1,907  
Less: Accumulated amortization ( 699 ) ( 413 )
Acquired customer relationships, net 9,208   1,494  
Total intangible assets, net $ 18,682   $ 42,205  

Intangible liabilities
Acquired unfavorable lease intangibles $ 9,911   $ 13,767  
Less: Accumulated amortization ( 2,062 ) ( 1,259 )
Acquired unfavorable lease intangibles, net $ 7,849   $ 12,508  

The weighted average amortization period of intangible assets acquired during the nine months ended September 30, 2025 is as follows:

Weighted Average Amortization Period
Lease intangibles
3.5 years
Customer relationships
12.3 years
Total intangible assets
8.0 years

Intangible liabilities relate to unfavorable lease intangibles and are included as a component of other non-current liabilities.
Amortization of intangible assets and liabilities is recorded as follows (unaudited):
Classification in Consolidated Statements of Operations Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Lease intangibles Lease income $ 534   $ 3,720   $ 5,893   $ 11,482  
Customer relationships Depreciation and amortization 95   95   314   307  
Total $ 629   3,815   $ 6,207   11,789  

18

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

As of September 30, 2025, estimated net annual amortization of intangibles is as follows (unaudited):

Remainder of 2025 $ 1,026  
2026 1,568  
2027 1,081  
2028 1,645  
2029 683  
Thereafter 4,830  
Total $ 10,833  

7. DEBT, NET
The Company’s debt, net is summarized as follows:
September 30, 2025 (unaudited) December 31, 2024
Outstanding Borrowings Stated Interest Rate Maturity Date Outstanding Borrowings
Loans payable
Revolving Credit Facility (1)
$ —   (i) Base Rate + 1.75 %; or
(ii) Adjusted Term SOFR Rate + 2.75 %
5/22/27 $ —  
Total loans payable —   —  
Bonds payable
Senior Notes due 2028 (2)
1,001,094   5.50 % 5/1/28 1,001,382  
Senior Notes due 2030 (3)
497,367   7.88 % 12/1/30 497,071  
Senior Notes due 2031 700,000   7.00 % 5/1/31 700,000  
Senior Notes due 2032 800,000   7.00 % 6/15/32 800,000  
Senior Notes due 2033 (4)
497,724   5.88 % 4/15/33 497,551  
Total bonds payable 3,496,185   3,496,004  

Debt 3,496,185   3,496,004  
Less: Debt issuance costs ( 49,452 ) ( 55,526 )
Total debt, net $ 3,446,733   $ 3,440,478  

Total debt due within one year $ —   $ —  

________________________________________________________
(1) Requires a quarterly commitment fee at a rate of 0.50 % on the average daily unused portion, as well as customary letter of credit fees and agency fees.
(2) Includes an unamortized premium of $ 1,094 and $ 1,382 at September 30, 2025 and December 31, 2024, respectively.
(3) Includes an unamortized discount of $ 2,633 and $ 2,929 at September 30, 2025 and December 31, 2024, respectively.
(4) Includes an unamortized discount of $ 2,276 and $ 2,449 at September 30, 2025 and December 31, 2024, respectively.
We were in compliance with all debt covenants as of September 30, 2025.

8. FAIR VALUE MEASUREMENTS
Fair value measurements and disclosures require the use of valuation techniques to measure fair value that maximize the use of observable inputs and minimize use of unobservable inputs. These inputs are prioritized as follows:
• Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities.
• Level 2: Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities or market corroborated inputs.
• Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants price the asset or liability.
19

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

The valuation techniques that may be used to measure fair value are as follows:
• Market approach—Uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.
• Income approach—Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about those future amounts.
• Cost approach—Based on the amount that currently would be required to replace the service capacity of an asset (replacement cost).
The Company’s cash and cash equivalents and restricted cash consist largely of demand deposit accounts with maturities of 90 days or less when purchased that are considered to be highly liquid. These instruments are valued using inputs observable in active markets for identical instruments and are therefore classified as Level 1 within the fair value hierarchy.
Except as discussed below, the Company’s financial instruments other than cash and cash equivalents and restricted cash consist principally of accounts receivable, notes receivable, accounts payable and accrued liabilities, security deposits, maintenance deposits and management fees payable, whose fair values approximate their carrying values based on an evaluation of pricing data, vendor quotes, and historical trading activity or due to their short maturity profiles.
The fair values of the Company’s bonds payable are presented in the table below and classified as Level 2 within the fair value hierarchy:

September 30, 2025 (unaudited) December 31, 2024
Senior Notes due 2028 $ 1,001,570   $ 980,140  
Senior Notes due 2030 532,765   526,380  
Senior Notes due 2031 733,474   713,923  
Senior Notes due 2032 838,352   816,904  
Senior Notes due 2033 503,560   483,100  

The Company has contingent obligations under ASC 460, Guarantees , in connection with certain sales of aircraft on lease, which are measured at fair value. The guarantees are valued at $ 11.4  million and $ 8.9  million as of September 30, 2025 and December 31, 2024, respectively, and are reflected as a component of other non-current liabilities. The fair values of the guarantees are determined based on the estim ated condition of the engines at the end of each lease term and the estimated cost of replacement and applicable discount rates and are classified as Level 3. During the three and nine months ended September 30, 2025, the Company recorded increases related to the change in fair value of $ 0.4  million and $ 2.5  million, respectively, which are recorded in Asset sales revenue. During the three and nine months ended September 30, 2024, the Company recorded increases related to the change in fair value of $ 0.3  million and $ 1.3  million, respectively, which are recorded in Asset sales revenue.
Given variability in the condition of the engines at the end of the lease terms, which range from 3 to 7 years, the maximum potential amount of undiscounted future payments that could be required under the guarantees at September 30, 2025 was $ 43.0  million, which is not reasonably expected.
The Company measures the fair value of certain assets on a non-recurring basis when U.S. GAAP requires the application of fair value, including events or changes in circumstances that indicate that the carrying amounts of assets may not be recoverable. Assets subject to these measurements include intangible assets, property, plant and equipment and leasing equipment. The Company records such assets at fair value when it is determined the carrying value may not be recoverable. Fair value measurements for assets subject to impairment tests are based on an income approach which uses Level 3 inputs, which include the Company’s assumptions as to future cash flows from operation of the l easing and sale of assets.

9. EQUITY-BASED COMPENSATION
The Company has a FTAI Aviation Ltd. 2025 Omnibus Incentive Plan (the “Incentive Plan”) which provides for the ability to award equity compensation awards in the form of stock options to eligible employees, consultants, directors, and other individuals who provide services to the Company, each as determined by the Compensation Committee of the Board of Directors.
As of September 30, 2025, the Incentive Plan provides for the issuance of up to 5.7  million shares. Equity-based compensation expense is reported within cost of sales and operating expenses.
Unvested equity-based awards are subject to forfeiture. The Company’s accounting policy is to record the impact of forfeitures when they occur.
20

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Equity-based compensation for each type of award was as follows (unaudited):

Three Months Ended September 30, Nine Months Ended September 30, Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term
(in years)
2025 2024 2025 2024
Stock Options $ 127   $ 128   $ 381   $ 170   $ 1,397   7.9 years
Performance shares 3,502   —   10,265   —   40,260   3.1 years
Restricted Shares 2,026   1,302   5,413   2,408   15,747   1.9 years
Total $ 5,655   $ 1,430   $ 16,059   $ 2,578   $ 57,404  

Options
In 2025, the Company did not issue any options to employees.
During the nine months ended September 30, 2024, the Former Manager transferred 37,343 of its options to certain of the Former Manager’s employees. Additionally, the Company granted options to select employees related to 60,000 ordinary shares at an exercise price of $ 79.13 , which had a grant date fair value of $ 2.1  million. The assumptions used in valuing the options were: a 4.52 % risk-free rate, a 1.50 % dividend yield, a 43.00 % volatility and a 6.8 year term.
Performance Shares
During the nine months ended September 30, 2025, the Company issued performance shares to select officers and employees of the Company with a grant date fair value of $ 4.4  million, vesting over a 3 year performance period based on the achievement of relative total shareholder return ( 50 %) and cumulative diluted EPS ( 50 %).
Restricted Shares
During the nine months ended September 30, 2025, the Company issued restricted shares to select officers and employees of the Company with a grant date fair value of $ 5.5  million, vesting over 3 years.
Additionally, the Company issued restricted shares to the directors of the Company with a grant date fair value of $ 0.8  million. These awards vest on the earlier of (i) the one-year anniversary of the grant date (May 29, 2026) or (ii) the date of the Company’s next annual general meeting of shareholders occurring after the grant date.
During the nine months ended September 30, 2024, the Company issued the following restricted shares of the Company to select employees and officers of the Company:
In May 2024, the Company issued restricted shares to (i) select officers with a grant date fair value of $ 5.5  million, vesting over 3.0 years and (ii) select employees with a grant date fair value of $ 5.7  million, vesting over 4.0 years.
In September 2024, the Company issued restricted shares to select employees and officers with a grant date fair value of $ 0.8  million, vesting over 3.0 years.
All awards are subject to continued employment, with compensation expense recognized ratably over the vesting periods. The fair values of the cumulative diluted EPS performance shares and restricted shares were based on the closing price of the Company’s ordinary shares on the respective grant dates, and the fair value of the total shareholder return performance shares was determined using the Monte Carlo simulation.
21

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

10. INCOME TAXES
The current and deferred components of the provision for income taxes are as follows (unaudited):

Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Current:
Cayman Islands $ —   $ —   $ —   $ —  
Bermuda —   —   —   —  
United States:
Federal ( 7,859 ) ( 296 ) —   888  
State and local 1,518   ( 72 ) 3,063   217  
Other Non-U.S. including Pillar Two top-up tax 2,911   446   6,445   1,235  
Total current provision (benefit)
( 3,430 ) 78   9,508   2,340  
Deferred:
Cayman Islands —   —   —   —  
Bermuda 8,053   4,738   18,689   ( 3,088 )
United States:
Federal 7,092   1,422   12,524   2,733  
State and local ( 1,496 ) 317   950   584  
Other Non-U.S. 16,111   776   45,396   ( 2,699 )
Total deferred provision (benefit) 29,760   7,253   77,559   ( 2,470 )

Total provision for (benefit from) income taxes $ 26,330   $ 7,331   $ 87,067   $ ( 130 )

The Company is an exempted entity domiciled in the Cayman Islands where income taxes are not imposed. The Company has previously been classified as a “passive foreign investment company” for U.S. income tax purposes, resulting in income tax obligations for certain of its shareholders. Taxable income or loss generated by the Company’s corporate subsidiaries is subject to U.S. federal, state and foreign corporate income tax in locations where they conduct business.
The Company’s effective tax rate differs from the Cayman Islands statutory rate of 0% primarily due to a significant portion of the Company’s income being subject to tax in jurisdictions where it operates.
As of and for the nine months ended September 30, 2025, the Company had not established a liability for uncertain tax positions as no such positions existed. In general, the Company’s tax returns and the tax returns of its corporate subsidiaries are subject to U.S. federal, state, local and foreign income tax examinations by tax authorities. Generally, the Company is not subject to examination by taxing authorities for tax years prior to 2021. The Company does not believe that it is reasonably possible that the total amount of unrecognized tax benefits will significantly change within 12 months of the reporting date.

11. AFFILIATE TRANSACTIONS AND FORMER MANAGEMENT AGREEMENT
Strategic Capital Initiative – 2025 Partnership
On December 30, 2024, the Company announced the launch of its Strategic Capital Initiative in collaboration with third-party institutional investors. As part of the first partnership under the initiative, certain subsidiaries of the Company entered into an Aircraft Sale and Purchase Agreement, dated December 30, 2024, and a Beneficial Interest Sale and Purchase Agreement, dated December 30, 2024 (together, and as each may be amended from time to time, the “Aircraft Sale and Purchase Agreements”), pursuant to which the SPVs of the 2025 Partnership would acquire 45 on-lease 737NG and A320ceo aircraft for an aggregate net purchase price of approximately $ 500.0  million, subject to certain customary closing conditions. The SPVs have entered into agreements with third-party institutional investors for capital commitments to the SPVs. The Company also made a minority capital commitment and will make additional commitments to the 2025 Partnership in the same proportion relative to additional third-party institutional investors.
During 2024 and the nine months ended September 30, 2025, on behalf of the 2025 Partnership, the Company paid refundable deposits of $ 19.3 million and $ 23.5 million to unrelated, third-parties on future purchases of aircraft, respectively. As of September 30, 2025, the 2025 Partnership fully reimbursed the Company $ 42.8 million in refundable deposits.
The Company, along with certain subsidiaries of the SPVs, has entered into a MRE agreement that requires the Company to sell serviceable engines and modules and purchase unserviceable engines and modules from the SPVs when aircraft controlled by the SPVs need such serviceable engines and modules to fulfill their obligations under an aircraft lease. Under this agreement, the Company will sell CFM56-5B, CFM56-7B and V2500 commercial aircraft engines and related modules to the SPVs and purchase unserviceable engines and modules for a net cash purchase price. The net cash purchase price received by the
22

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Company is contractual and customary market-based compensation for fulfilling such performance obligations. During the three and nine months ended September 30, 2025, the Company recorded $ 58.7  million and $ 228.9  million of MRE Contract revenue, respectively, for the sale and purchase of such engines to and from the 2025 Partnership.
Former Management Agreement
On May 28, 2024, the Company entered into definitive agreements with the Former Manager and Master GP to internalize the Company’s management function. As part of the termination of the Management Agreement, the Company (i) paid the Former Manager (for itself and on behalf of the Master GP, as applicable) the Cash Consideration, the compensation accrued and payable, but not yet paid, under the Management Agreement and the expenses that were reimbursable, but not yet reimbursed, under the Management Agreement; (ii) issued to the Former Manager (for itself and on behalf of the Master GP, as applicable) the Share Consideration; and (iii) purchased from Master GP all of its partnership interests in FTAI Aviation Holdco Ltd., a subsidiary of the Company, in exchange for $ 30 thousand. Following the Internalization, the Company no longer pays management fees or incentive distributions to the Former Manager and Master GP.
In connection with the termination of the Management Agreement, the Company also entered into a Transition Services Agreement with the Former Manager. Under the Transition Services Agreement, the Former Manager was required to continue to provide the Company and its affiliates with all of the Services for a transition period through October 31, 2024, during which the Company procured replacements for the Services. In addition, the Former Manager was required to continue to provide the services that were reasonably required by the Company to prepare its quarterly and annual financial statements through May 31, 2025. The Services were provided to the Company for a fee equal to the Former Manager’s cost of providing the Services, plus a mark-up of ten percent ( 10 %).
Prior to the Internalization, the Former Manager was paid annual fees in exchange for advising the Company on various aspects of its business, formulating its investment strategies, arranging for the acquisition and disposition of assets, arranging for financing, monitoring performance, and managing its day-to-day operations, inclusive of all costs incidental thereto. In addition, the Former Manager was reimbursed for various expenses incurred by the Former Manager on the Company’s behalf, including the costs of legal, accounting and other administrative activities. Additionally, the Company entered into certain incentive allocation arrangements with Master GP, which owned approximately 0.01 % of FTAI Aviation Holdco Ltd. (a wholly owned subsidiary of the Company).
The Former Manager was entitled to a management fee and reimbursement of certain expenses. The management fee was determined by taking the average value of total equity (excluding non-controlling interests) determined on a consolidated basis in accordance with U.S. GAAP at the end of the two most recently completed months multiplied by an annual rate of 1.50 %, which was payable monthly in arrears in cash.
Prior to the Internalization and the termination of the Management Agreement on May 28, 2024, Master GP was entitled to incentive allocations (comprised of income incentive allocation and capital gains incentive allocation, defined below). The income incentive allocation was calculated and distributable quarterly in arrears based on the pre-incentive allocation net income for the immediately preceding calendar quarter (the “Income Incentive Allocation”). For this purpose, pre-incentive allocation net income means, with respect to a calendar quarter, net income attributable to shareholders during such quarter calculated in accordance with U.S. GAAP excluding the Company’s pro rata share of (1) realized or unrealized gains and losses, and (2) certain non-cash or one-time items, and (3) any other adjustments as may be approved by the Company’s independent directors. Pre-incentive allocation net income did not include any Income Incentive Allocation or Capital Gains Incentive Allocation (described below) paid to Master GP during the relevant quarter.
Prior to the Internalization, one of our subsidiaries allocated and distributed to Master GP an Income Incentive Allocation with respect to its pre-incentive allocation net income in each calendar quarter as follows: (1) no Income Incentive Allocation in any calendar quarter in which pre-incentive allocation net income, expressed as a rate of return on the average value of our net equity capital (excluding non-controlling interests) at the end of the two most recently completed calendar quarters, does not exceed 2 % for such quarter ( 8 % annualized); (2) 100 % of pre-incentive allocation net income with respect to that portion of such pre-incentive allocation net income, if any, that is equal to or exceeds 2 % but does not exceed 2.2223 % for such quarter; and (3) 10 % of the amount of pre-incentive allocation net income, if any, that exceeds 2.2223 % for such quarter. These calculations were prorated for any period of less than three months.
Prior to the Internalization, Capital Gains Incentive Allocation was calculated and distributable in arrears as of the end of each calendar year and was equal to 10 % of the Company’s pro rata share of cumulative realized gains from the date of the IPO through the end of the applicable calendar year, net of the Company’s pro rata share of cumulative realized or unrealized losses, the cumulative non-cash portion of equity-based compensation expenses and all realized gains upon which prior performance-based Capital Gains Incentive Allocation payments were made to Master GP.
23

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

The following table summarizes the management fees and income incentive allocation prior to the Internalization (unaudited):

Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024
Management fees $ —   $ 993  
Income incentive allocation —   7,456  

Total $ —   $ 8,449  

The Company paid all of its operating expenses, except those specifically required to be borne by the Former Manager under the Management Agreement. The expenses required to be paid by the Company included, but were not limited to, issuance and transaction costs incident to the acquisition, disposition and financing of its assets, legal and auditing fees and expenses, the compensation and expenses of its independent directors, the costs associated with the establishment and maintenance of any credit facilities and other indebtedness of the Company (including commitment fees, legal fees, closing costs, etc.), expenses associated with other securities offerings of the Company, costs and expenses incurred in contracting with third parties (including affiliates of the Former Manager), the costs of printing and mailing proxies and reports to its shareholders, costs incurred by the Former Manager or its affiliates for travel on the Company’s behalf, costs associated with any computer software or hardware that was used by the Company, costs to obtain liability insurance to indemnify the Company’s directors and officers and the compensation and expenses of the Company’s transfer agent.
The Company paid or reimbursed the Former Manager and its affiliates for performing certain legal, accounting, due diligence tasks and other services that outside professionals or outside consultants otherwise would perform, provided that such costs and reimbursements were no greater than those which would be paid to outside professionals or consultants. The Former Manager was responsible for all of its other costs incident to the performance of its duties under the Management Agreement, including compensation of the Former Manager’s employees, rent for facilities and other “overhead” expenses; the Company did not reimburse the Former Manager for these expenses.
The following table summarizes the Company’s reimbursements to the Former Manager (unaudited):

Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Classification in the Consolidated Statements of Operations:
General and administrative $ ( 82 ) $ 2,557   $ 247   $ 6,115  
Acquisition and transaction expenses ( 53 ) 967   122   1,654  
Total $ ( 135 ) $ 3,524   $ 369   $ 7,769  

Upon the successful completion of an offering of the Company’s ordinary shares or other equity securities (including securities issued as consideration in an acquisition), the Company granted the Former Manager options to purchase ordinary shares in an amount equal to  10 % of the number of ordinary shares being sold in the offering (or if the issuance relates to equity securities other than the Company’s ordinary shares, options to purchase a number of ordinary shares equal to  10 % of the gross capital raised in the equity issuance divided by the fair market value of a ordinary share as of the date of issuance), with an exercise price equal to the offering price per share paid by the public or other ultimate purchaser or attributed to such securities in connection with an acquisition (or the fair market value of a ordinary share as of the date of the equity issuance if it relates to equity securities other than the Company’s ordinary shares). Any ultimate purchaser of ordinary shares for which such options are granted may have been an affiliate of the Former Manager.

12. SEGMENT INFORMATION
The key factors used to identify the reportable segments are the organization and alignment of the Company’s internal operations and the nature of its products and services. The Company’s two reportable segments are (i) Aviation Leasing and (ii) Aerospace Products. The Aviation Leasing segment owns and manages aviation assets, including aircraft and aircraft engines, which it leases and sells to lessees, directly and also through its equity method investment. The Aerospace Products segment, through the Company’s maintenance facilities, equity method investment and exclusivity arrangements, develops and manufactures, repairs/refurbishes and sells aircraft engines and aftermarket components for the CFM56-5B, CFM56-7B and V2500 commercial aircraft engines.
Corporate and Other primarily consists of debt, unallocated corporate general and administrative expenses, internalization fee and management fees and incentive compensation pursuant to the Management Agreement prior to the Internalization effective May 28, 2024. Additionally, Corporate and Other also includes results from an offshore energy business, which consists of equipment that support offshore oil and gas activities and production. The Company previously owned two offshore vessels that were sold in the fourth quarter of 2024.
The accounting policies of the segments are the same as those described in the summary of significant accounting policies; however, financial information presented by segment includes the impact of intercompany eliminations. The Company’s Chief
24

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Executive Officer is its Chief Operating Decision Maker (“CODM”). Segment information is presented in the same manner that the CODM reviews the operating results in assessing performance and allocating resources. The CODM evaluates performance for each reportable segment based on net income (loss) attributable to shareholders and is used to monitor budget vs. actual results.
The CODM determined that segment asset information is not a key factor in measuring performance or allocating resources. Therefore, segment asset information is not included in the tables below as it is not provided to or reviewed by the CODM.
The following tables set forth certain information, which include all significant expenses reviewed by the CODM, for each reportable segment (unaudited):
I. For the Three Months Ended September 30, 2025

Three Months Ended September 30, 2025
Aviation Leasing Aerospace Products Corporate and Other Eliminations Total
Revenues
Aerospace products revenue $ —   $ 459,206   $ —   $ —   $ 459,206  
MRE Contract revenue —   58,663   —   —   58,663  
Lease income 55,072   —   —   —   55,072  
Maintenance revenue 52,370   —   —   —   52,370  
Asset sales revenue 38,461   —   —   —   38,461  
Other revenue (1)
3,292   —   —   —   3,292  
Total revenues 149,195   517,869   —   —   667,064  

Expenses
Cost of sales 34,769   328,153   —   —   362,922  
Operating expenses 10,146   10,545   18,401   —   39,092  
General and administrative —   —   1,829   —   1,829  
Acquisition and transaction expenses 3,571   599   2,896   —   7,066  
Depreciation and amortization 50,226   3,930   1,122   —   55,278  
Total expenses 98,712   343,227   24,248   —   466,187  

Other income (expense)
Interest expense —   —   ( 60,784 ) —   ( 60,784 )
Equity in (losses) earnings of unconsolidated entities (2)
( 1,083 ) 767   —   ( 3,908 ) ( 4,224 )
Gain on sale to the 2025 Partnership 4,609   —   —   —   4,609  
Other income 2,103   —   1,467   —   3,570  
Total other income (expense) 5,629   767   ( 59,317 ) ( 3,908 ) ( 56,829 )
Income (loss) before income taxes 56,112   175,409   ( 83,565 ) ( 3,908 ) 144,048  
Provision for (benefit from) income taxes 14,500   26,815   ( 14,985 ) —   26,330  
Net income (loss) 41,612   148,594   ( 68,580 ) ( 3,908 ) 117,718  
Less: Dividends on preferred shares —   —   3,709   —   3,709  

Net income (loss) attributable to shareholders $ 41,612   $ 148,594   $ ( 72,289 ) $ ( 3,908 ) $ 114,009  
______________________________________________________
(1) Includes servicing fees of $ 3,035 for the three months ended September 30, 2025 from the 2025 Partnership.
(2) Includes the profit elimination of $( 3,908 ) for the three months ended September 30, 2025 for sales to the 2025 Partnership within the Aerospace Products segment.

25

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Summary information with respect to the Company’s geographic sources of revenue, based on location of customer and lessee, is as follows:

Three Months Ended September 30, 2025
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Africa $ 7,919   $ 25,720   $ —   $ 33,639  
Asia 43,658   98,644   —   142,302  
Europe 48,295   97,302   —   145,597  
North America 41,803   286,006   —   327,809  
South America 7,520   10,197   —   17,717  
Total revenues (1)
$ 149,195   $ 517,869   $ —   $ 667,064  
______________________________________________________
(1) The United States, included in North America, and Ireland, included in Europe, represent 38 % and 14 % of total revenues, respectively, based on the location of the Company’s customers and lessees. No other country represents more than 10% of total revenues.

26

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

II. For the Nine Months Ended September 30, 2025

Nine Months Ended September 30, 2025
Aviation Leasing Aerospace Products Corporate and Other Eliminations Total
Revenues
Aerospace products revenue $ —   $ 1,144,317   $ —   $ —   $ 1,144,317  
MRE Contract revenue —   228,886   —   —   228,886  
Lease income 185,951   —   —   —   185,951  
Maintenance revenue 175,081   —   —   —   175,081  
Asset sales revenue 105,315   —   —   —   105,315  
Other revenue (1)
5,827   —   4   —   5,831  
Total revenues 472,174   1,373,203   4   —   1,845,381  

Expenses
Cost of sales 106,517   874,377   —   —   980,894  
Operating expenses 28,661   25,221   51,976   —   105,858  
General and administrative —   —   7,387   —   7,387  
Acquisition and transaction expenses 7,053   3,145   8,649   —   18,847  
Depreciation and amortization 155,710   11,218   3,148   —   170,076  
Total expenses 297,941   913,961   71,160   —   1,283,062  

Other income (expense)
Interest expense —   —   ( 186,789 ) —   ( 186,789 )
Equity in (losses) earnings of unconsolidated entities (2)
( 2,642 ) 1,594   —   ( 15,793 ) ( 16,841 )
Gain on sale to the 2025 Partnership 50,083   —   —   —   50,083  
Other income 61,696   —   2,101   —   63,797  
Total other income (expense) 109,137   1,594   ( 184,688 ) ( 15,793 ) ( 89,750 )
Income (loss) before income taxes 283,370   460,836   ( 255,844 ) ( 15,793 ) 472,569  
Provision for (benefit from) income taxes 58,301   72,017   ( 43,251 ) —   87,067  
Net income (loss) 225,069   388,819   ( 212,593 ) ( 15,793 ) 385,502  
Less: Dividends on preferred shares —   —   13,533   —   13,533  
Less: Loss on redemption of preferred shares —   —   6,327   —   6,327  
Net income (loss) attributable to shareholders $ 225,069   $ 388,819   $ ( 232,453 ) $ ( 15,793 ) $ 365,642  
______________________________________________________
(1) Includes servicing fees of $ 5,635 for the nine months ended September 30, 2025 from the 2025 Partnership.
(2) Includes the profit elimination of $( 15,793 ) for the nine months ended September 30, 2025 for sales to the 2025 Partnership within the Aerospace Products segment.

27

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

Summary information with respect to the Company’s geographic sources of revenue, based on location of customer and lessee, is as follows:

Nine Months Ended September 30, 2025
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Africa $ 18,713   $ 52,202   $ —   $ 70,915  
Asia 130,010   180,930   4   310,944  
Europe 205,596   320,618   —   526,214  
North America 91,668   791,477   —   883,145  
South America 26,187   27,976   —   54,163  
Total revenues (1)
$ 472,174   $ 1,373,203   $ 4   $ 1,845,381  
______________________________________________________
(1) The United States, included in North America, and Ireland, included in Europe, represent 33 % and 16 % of total revenues, respectively, based on the location of our customers and lessees. No other country represents more than 10% of total revenues.
Presented below are the contracted minimum future annual revenues to be received under existing operating leases as of September 30, 2025:
Operating Leases
Remainder of 2025 $ 49,496  
2026 156,142  
2027 132,618  
2028 111,509  
2029 81,037  
Thereafter 145,045  
Total $ 675,847  

28

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

III. For the Three Months Ended September 30, 2024

Three Months Ended September 30, 2024
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Aerospace products revenue $ —   $ 303,469   $ —   $ 303,469  
Lease income 57,322   —   8,128   65,450  
Maintenance revenue 59,917   —   —   59,917  
Asset sales revenue 34,953   —   —   34,953  
Other revenue 74   —   1,931   2,005  
Total revenues 152,266   303,469   10,059   465,794  

Expenses
Cost of sales 20,684   198,812   —   219,496  
Operating expenses 9,995   2,617   14,246   26,858  
General and administrative —   —   4,045   4,045  
Acquisition and transaction expenses 2,620   2,100   4,621   9,341  

Depreciation and amortization 52,455   1,306   3,014   56,775  
Total expenses 85,754   204,835   25,926   316,515  

Other expense
Interest expense —   —   ( 57,937 ) ( 57,937 )

Equity in losses of unconsolidated entities —   ( 438 ) —   ( 438 )
Other income 1,982   —   927   2,909  
Total other expense 1,982   ( 438 ) ( 57,010 ) ( 55,466 )
Income (loss) before income taxes 68,494   98,196   ( 72,877 ) 93,813  
Provision for (benefit from) income taxes 8,898   4,408   ( 5,975 ) 7,331  
Net income (loss) 59,596   93,788   ( 66,902 ) 86,482  
Less: Dividends on preferred shares —   —   8,335   8,335  
Net income (loss) attributable to shareholders $ 59,596   $ 93,788   $ ( 75,237 ) $ 78,147  

Summary information with respect to the Company’s geographic sources of revenue, based on location of customer and lessee, is as follows:

Three Months Ended September 30, 2024
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Africa $ 1,266   $ —   $ —   $ 1,266  
Asia 46,459   65,714   10,059   122,232  
Europe 56,750   84,136   —   140,886  
North America 34,700   149,530   —   184,230  
South America 13,091   4,089   —   17,180  
Total revenues (1)
$ 152,266   $ 303,469   $ 10,059   $ 465,794  
______________________________________________________
(1) The United States, included in North America, and Ireland, included in Europe, represent 35 % and 15 % of total revenues, respectively, based on the location of the Company’s customers and lessees. No other country represents more than 10% of total revenues.
29

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

IV. For the Nine Months Ended September 30, 2024

Nine Months Ended September 30, 2024
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Aerospace products revenue $ —   $ 737,726   $ —   $ 737,726  
Lease income 168,927   —   20,438   189,365  
Maintenance revenue 156,894   —   —   156,894  
Asset sales revenue 145,993   —   —   145,993  
Other revenue 199   —   5,905   6,104  
Total revenues 472,013   737,726   26,343   1,236,082  

Expenses
Cost of sales 111,542   456,615   —   568,157  
Operating expenses 26,984   16,510   37,780   81,274  
General and administrative —   —   10,697   10,697  
Acquisition and transaction expenses 7,350   2,871   13,318   23,539  
Management fees and incentive allocation to affiliate —   —   8,449   8,449  
Internalization fee to affiliate —   —   300,000   300,000  
Depreciation and amortization 151,211   3,177   8,998   163,386  
Asset impairment 962   —   —   962  
Total expenses 298,049   479,173   379,242   1,156,464  

Other expense
Interest expense —   —   ( 160,840 ) ( 160,840 )
Loss on extinguishment of debt —   —   ( 13,920 ) ( 13,920 )
Equity in losses of unconsolidated entities ( 207 ) ( 1,592 ) —   ( 1,799 )
Other income 1,440   —   1,605   3,045  
Total other expense 1,233   ( 1,592 ) ( 173,155 ) ( 173,514 )
Income (loss) before income taxes 175,197   256,961   ( 526,054 ) ( 93,896 )
Provision for (benefit from) income taxes 20,224   11,865   ( 32,219 ) ( 130 )
Net income (loss) 154,973   245,096   ( 493,835 ) ( 93,766 )

Less: Dividends on preferred shares —   —   25,005   25,005  
Net income (loss) attributable to shareholders $ 154,973   $ 245,096   $ ( 518,840 ) $ ( 118,771 )

Summary information with respect to the Company’s geographic sources of revenue, based on location of customer and lessee, is as follows:

Nine Months Ended September 30, 2024
Aviation Leasing Aerospace Products Corporate and Other Total
Revenues
Africa $ 3,389   $ 8,271   $ —   $ 11,660  
Asia 105,220   122,744   26,343   254,307  
Europe 235,367   256,752   —   492,119  
North America 81,709   336,672   —   418,381  
South America 46,328   13,287   —   59,615  
Total revenues (1)
$ 472,013   $ 737,726   $ 26,343   $ 1,236,082  
______________________________________________________
(1) The United States, included in North America, and Ireland, included in Europe, represent 32 % and 18 % of total revenues, respectively, based on the location of the Company’s customers and lessees. No other country represents more than 10% of total revenues.
30

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

V. Location of Long-Lived Assets
The following tables sets forth the geographic location of property, plant and equipment and leasing equipment, net:

September 30, 2025 (unaudited) December 31, 2024
Property, plant and equipment and leasing equipment, net
Africa $ 18,171   $ 37,369  
Asia 404,171   596,547  
Europe 596,938   1,038,176  
North America 544,037   592,675  
South America 220,268   216,414  
Total property, plant and equipment and leasing equipment, net (1)
$ 1,783,585   $ 2,481,181  
________________________________________________________
(1) The United States, included in North America, represents 24 % of property, plant and equipment and leasing equipment, net as of September 30, 2025. The United States, included in North America, and Italy, included in Europe, represent 17 % and 12 % of property, plant and equipment and leasing equipment, net as of December 31, 2024, respectively. No other country represents more than 10% of property, plant and equipment and leasing equipment, net.

13. EARNINGS PER SHARE AND EQUITY
Basic earnings per ordinary share (“EPS”) is calculated by dividing net income attributable to shareholders by the weighted average number of ordinary shares outstanding, plus any participating securities. Diluted EPS is calculated by dividing net income attributable to shareholders by the weighted average number of ordinary shares outstanding, plus any participating securities and potentially dilutive securities. Potentially dilutive securities are calculated using the treasury stock method.
The calculation of basic and diluted EPS is presented below (unaudited):

Three Months Ended September 30, Nine Months Ended September 30,
(in thousands, except share and per share data) 2025 2024 2025 2024
Net income (loss) $ 117,718   $ 86,482   $ 385,502   $ ( 93,766 )
Less: Dividends on preferred shares 3,709   8,335   13,533   25,005  
Less: Loss on redemption of preferred shares —   —   6,327   —  
Net income (loss) attributable to shareholders $ 114,009   $ 78,147   $ 365,642   $ ( 118,771 )
Weighted Average Ordinary Shares Outstanding - Basic 102,569,415   102,380,659   102,560,285   101,199,356  
Weighted Average Ordinary Shares Outstanding - Diluted 103,966,650   103,395,348   103,951,713   101,199,356  

Earnings (loss) per share:
Basic $ 1.11   $ 0.76   $ 3.57   $ ( 1.17 )
Diluted $ 1.10   $ 0.76   $ 3.52   $ ( 1.17 )

For the three months ended September 30, 2025 and 2024, no shares were excluded from the calculation of Diluted EPS. For the nine months ended September 30, 2025 and 2024, 0 and 859,940 shares, respectively, were excluded from the calculation of Diluted EPS due to their anti-dilutive impact.
For the three months ended September 30, 2025 and 2024, the Company issued 835 and 482 ordinary shares, respectively, and for the nine months ended September 30, 2025 and 2024, issued 1,511 and 4,852 ordinary shares, respectively, to certain directors as compensation.

14. COMMITMENTS AND CONTINGENCIES
In the normal course of business, the Company and its subsidiaries may be involved in various claims, legal proceedings, or may enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. Within the Company’s offshore energy business, a lessee did not fulfill its obligation under its charter arrangement, therefore the Company is pursuing rights afforded to it under the charter and the range of potential losses against the obligation is $ 0.0 million to $ 3.3 million. The Company believes the risk of loss in connection with such arrangements is remote.

31

FTAI AVIATION LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)

15. RESTRUCTURING CHARGES
On May 28, 2024, in connection with the Internalization and termination of the Management Agreement, the Company agreed to pay a total of $ 300.0  million to its Former Manager (for itself and on behalf of the Master GP, as applicable). At closing, the Company issued 1,866,949 ordinary shares valued at $ 150.0  million. The remaining balance was paid in cash on June 17, 2024. The restructuring charge paid in connection with the Internalization and termination of the Management Agreement is reflected in Internalization Fee to Affiliate expense in the Consolidated Statements of Operations for the three and nine months ended September 30, 2024. There were no restructuring charges recorded for the three and nine months ended September 30, 2025.

16. SUBSEQUENT EVENTS
Dividends
On October 27, 2025, the Company’s Board of Directors declared a cash dividend on its ordinary shares and eligible participating securities of $ 0.35 per share for the three months ended September 30, 2025, payable on November 19, 2025 to the holders of record on November 10, 2025.
Additionally, on October 27, 2025, the Company’s Board of Directors also declared cash dividends on the Series C Preferred Shares and Series D Preferred Shares of $ 0.52 and $ 0.59 per share, respectively, payable on December 15, 2025 to the holders of record on December 1, 2025 .
32

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help you understand FTAI Aviation Ltd. (the “Company,” “we,” “our” or “us”). Our MD&A should be read in conjunction with our unaudited consolidated financial statements and the accompanying notes, and with Part II, Item 1A, “Risk Factors” included elsewhere in this Quarterly Report on Form 10-Q.
Overview
We specialize in the acquisition, lease, repair and sale of aviation equipment, primarily CFM56-5B, CFM56-7B and V2500 aircraft engines. We repair and sell or lease, through our maintenance facilities, commercial expertise and exclusivity arrangements, refurbished aircraft engines and aftermarket components of aircraft engines, including PMA parts developed and manufactured through a joint venture.
We target assets which require maintenance repairs that can be performed through our proprietary Module Factory process of engineering. Refurbishing our own engines, modules and parts at significant scale incentivizes us to conduct repairs as efficiently as possible, which we believe creates a large opportunity to provide a low-cost, flexible, customer-driven alternative to engine maintenance for airlines and lessors worldwide.
As of September 30, 2025, we had total consolidated assets of $4.2 billion and total equity of $252.5 million.
Internalization of Management
On May 28, 2024, the Company entered into definitive agreements with the Former Manager and Master GP to internalize the Company’s management function. As part of the termination of the Management Agreement, the Company (i) paid the Former Manager (for itself and on behalf of the Master GP, as applicable) the Cash Consideration, the compensation accrued and payable, but not yet paid, under the Management Agreement and the expenses that were reimbursable, but not yet reimbursed, under the Management Agreement; (ii) issued to the Former Manager (for itself and on behalf of the Master GP, as applicable) the Share Consideration; (iii) purchased from Master GP all of its partnership interests in FTAI Aviation Holdco Ltd., a subsidiary of the Company, in exchange for $30 thousand. Following the Internalization, the Company no longer pays management fees or incentive distributions to the Former Manager and Master GP.
In connection with the termination of the Management Agreement, the Company also entered into a Transition Services Agreement with the Former Manager. Under the Transition Services Agreement, the Former Manager was required to continue to provide the Company and its affiliates with all of the Services for a transition period until October 31, 2024, during which the Company procured replacements for the Services. In addition, the Former Manager was required to continue to provide the services that were reasonably required by the Company to prepare its quarterly and annual financial statements until May 31, 2025. The Services were provided to the Company for a fee equal to the Former Manager’s cost of providing the Services, including the allocated cost of, among other things, overhead, employee wages and compensation, rent and related real estate expenses and actually incurred out-of-pocket expenses, plus a mark-up of ten percent (10%).
Impact of Russia’s Invasion of Ukraine
Economic sanctions and export controls against Russia and Russia’s aviation industry were imposed due to its invasion of Ukraine during the three months ended March 31, 2022. As a result of the sanctions imposed on Russian airlines, we terminated all lease agreements with Russian airlines. We determined that it is unlikely that we will regain possession of the aircraft and engines that had not yet been recovered from U kraine and Russia. As a result, we recognized an impairment charge totaling $120.0 million, net of maintenance deposits for the year ended December 31, 2022, to write-off the entire carrying value of leasing equipment assets that we did not expect to recover from Ukraine and Russia. As of September 30, 2025, eight aircraft and seventeen engines were still located in Russia.
Our lessees are required to provide insurance coverage with respect to leased aircraft and engines, and we are named as insureds under those policies in the event of a total loss of an aircraft or engine. We also purchase insurance which provides us with coverage when our aircraft or engines are not subject to a lease or where a lessee’s policy fails to indemnify us. The insured value of the aircraft and engines that remain in Russia is $210.7 million. We intend to pursue all of our claims under these policies. However, the timing and amount of any recoveries under these policies are uncertain.
The extent of the impact of Russia’s invasion of Ukraine and the related sanctions on our results, including the ability for us to recover our leasing equipment in the region, will depend on future developments, including the duration of the conflict, sanctions and restrictions imposed by Russian and international governments, all of which remain uncertain.
Strategic Capital Initiative
On December 30, 2024, the Company announced the launch of a Strategic Capital Initiative in collaboration with third-party institutional investors. The first partnership under the initiative, the 2025 Partnership, will focus on acquiring 737NG and A320ceo aircraft. The Strategic Capital Initiative, and its related partnerships, will allow the Company to maintain an asset-light business model while the partnerships actively acquire on-lease narrowbody aircraft at scale. The 2025 Partnership, and follow-on partnerships, will be the primary buyer of on-lease 737NG and A320ceo aircraft. The Company, as the Servicer, will manage the aircraft in the 2025 Partnership, and the Company will receive customary, market-based compensation. The Company also made a minority capital commitment and will make additional commitments to the 2025 Partnership in the same proportion relative to additional third-party institutional investors.
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Operating Segments
The key factors used to identify the reportable segments are the organization and alignment of our internal operations and the nature of our products and services. Our two reportable segments are (i) Aviation Leasing and (ii) Aerospace Products. The Aviation Leasing segment owns and manages aviation assets, including aircraft and aircraft engines, which it leases and sells to lessees, directly and also through its equity method investment. The Aerospace Products segment, through our maintenance facilities, equity method investment and exclusivity arrangements, develops and manufactures, repairs/refurbishes and sells aircraft engines and aftermarket components for the CFM56-5B, CFM56-7B and V2500 commercial aircraft engines.
Corporate and Other primarily consists of debt, unallocated corporate general and administrative expenses, internalization fee and management fees and incentive compensation pursuant to the Management Agreement prior to the Internalization effective May 28, 2024. Additionally, Corporate and Other also includes offshore energy related assets, which consist of equipment that support offshore oil and gas activities and production.
Adjusted EBITDA (Non-GAAP)
Besides net income (loss), the chief operating decision maker (“CODM”) utilizes Adjusted EBITDA as a key performance measure. Adjusted EBITDA is not a financial measure in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). This performance measure provides the CODM with the information necessary to assess operational performance and make resource and allocation decisions. We believe Adjusted EBITDA is a useful metric for investors and analysts for similar purposes of assessing our operational performance.
Adjusted EBITDA is defined as net income (loss) attributable to shareholders from continuing operations, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and preferred shares and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, dividends on preferred shares and interest expense, internalization fee to affiliate, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA, if any.

34

Results of Operations

Comparison of the three and nine months ended September 30, 2025 and 2024
The following table presents our consolidated results of operations:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Revenues
Aerospace products revenue $ 459,206   $ 303,469  $ 155,737  $ 1,144,317   $ 737,726  $ 406,591 
MRE Contract revenue 58,663   —  58,663  228,886   —  228,886 
Lease income 55,072   65,450  (10,378) 185,951   189,365  (3,414)
Maintenance revenue 52,370   59,917  (7,547) 175,081   156,894  18,187 
Asset sales revenue 38,461   34,953  3,508  105,315   145,993  (40,678)
Other revenue (1)
3,292   2,005  1,287  5,831   6,104  (273)
Total revenues 667,064   465,794  201,270  1,845,381   1,236,082  609,299 

Expenses
Cost of sales 362,922   219,496  143,426  980,894   568,157  412,737 
Operating expenses 39,092   26,858  12,234  105,858   81,274  24,584 
General and administrative 1,829   4,045  (2,216) 7,387   10,697  (3,310)
Acquisition and transaction expenses 7,066   9,341  (2,275) 18,847   23,539  (4,692)
Management fees and incentive allocation to affiliate —   —  —  —   8,449  (8,449)
Internalization fee to affiliate —   —  —  —   300,000  (300,000)
Depreciation and amortization 55,278   56,775  (1,497) 170,076   163,386  6,690 
Asset impairment —   —  —  —   962  (962)
Total expenses 466,187   316,515  149,672  1,283,062   1,156,464  126,598 

Other (expense) income
Interest expense (60,784) (57,937) (2,847) (186,789) (160,840) (25,949)
Equity in losses of unconsolidated entities (2)
(4,224) (438) (3,786) (16,841) (1,799) (15,042)
Loss on extinguishment of debt —   —  —  —   (13,920) 13,920 
Gain on sale to the 2025 Partnership 4,609   —  4,609  50,083   —  50,083 
Other income 3,570   2,909  661  63,797   3,045  60,752 
Total other expense (56,829) (55,466) (1,363) (89,750) (173,514) 83,764 
Income (loss) from before income taxes 144,048   93,813  50,235  472,569   (93,896) 566,465 
Provision for (benefit from) income taxes 26,330   7,331  18,999  87,067   (130) 87,197 
Net income (loss) 117,718   86,482  31,236  385,502   (93,766) 479,268 
Less: Dividends on preferred shares 3,709   8,335  (4,626) 13,533   25,005  (11,472)
Less: Loss on redemption of preferred shares —   —  —  6,327   —  6,327 
Net income (loss) attributable to shareholders $ 114,009   $ 78,147  $ 35,862  $ 365,642   $ (118,771) $ 484,413 
______________________________________________________
(1) Includes servicing fees of $3,035 and $5,635 for the three and nine months ended September 30, 2025, respectively, from the 2025 Partnership.
(2) Includes the profit elimination of $(3,908) and $(15,793) for the three and nine months ended September 30, 2025, respectively, for sales to the 2025 Partnership.

35

The following table sets forth a reconciliation of net income (loss) attributable to shareholders to Adjusted EBITDA:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Net income (loss) attributable to shareholders $ 114,009   $ 78,147  $ 35,862  $ 365,642   $ (118,771) $ 484,413 
Add: Provision for (benefit from) income taxes 26,330   7,331  18,999  87,067   (130) 87,197 
Add: Equity-based compensation expense 5,655   1,430  4,225  16,059   2,578  13,481 
Add: Acquisition and transaction expenses 7,066   9,341  (2,275) 18,847   23,539  (4,692)
Add: Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations —   —  —  6,327   13,920  (7,593)
Add: Changes in fair value of non-hedge derivative instruments —   —  —  —   —  — 
Add: Asset impairment charges —   —  —  —   962  (962)
Add: Incentive allocations —   —  —  —   7,456  (7,456)
Add: Depreciation and amortization expense (1)
67,855   69,453  (1,598) 201,919   194,384  7,535 
Add: Interest expense and dividends on preferred shares 64,493   66,272  (1,779) 200,322   185,845  14,477 
Add: Internalization fee to affiliate —   —  —  —   300,000  (300,000)
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2)
11,657   (382) 12,039  16,513   (1,547) 18,060 
Less: Equity in losses (earnings) of unconsolidated entities (3)
316   438  (122) 1,048   1,799  (751)
Less: Non-controlling share of Adjusted EBITDA —   —  —  —   —  — 
Adjusted EBITDA (non-GAAP) $ 297,381   $ 232,030  $ 65,351  $ 913,744   $ 610,035  $ 303,709 

________________________________________________________
(1) Includes the following items for the three months ended September 30, 2025 and 2024: (i) depreciation and amortization expense of $55,278 and $56,775, (ii) lease intangible amortization of $534 and $3,720 and (iii) amortization for lease incentives of $12,043 and $8,958, respectively. Includes the following items for the nine months ended September 30, 2025 and 2024: (i) depreciation and amortization expense of $170,076 and $163,386, (ii) lease intangible amortization of $5,893 and $11,482 and (iii) amortization for lease incentives of $25,950 and $19,516, respectively.
(2) Includes the following items for the three months ended September 30, 2025 and 2024: (i) net loss of $316 and $438, (ii) interest expense of $2,629 and $0, (iii) depreciation and amortization expense of $9,449 and $56, and (iv) tax benefit of $105 and $0, respectively. Includes the following items for the nine months ended September 30, 2025 and 2024: (i) net loss of $1,048 and $1,799, (ii) interest expense of $4,119 and $0, (iii) depreciation and amortization expense of $13,077 and $252, (iv) acquisition and transaction expenses of $470 and $0, and (v) tax benefit of $105 and $0 respectively.
(3) Excludes the profit elimination of $3,908 and $15,793 for the three and nine months ended September 30, 2025, for sales to the 2025 Partnership.
Revenues
Comparison of the three months ended September 30, 2025 and 2024
Total revenues increased by $201.3 million, driven by the following:
• Aerospace products revenue increased by $155.7 million, primarily due to a $145.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $7.4 million increase in other maintenance service revenues.
• MRE Contract revenue increased by $58.7 million, primarily due to an increase in engine and module sales made to the 2025 Partnership.
• Lease income decreased by $10.4 million, primarily due to a decrease of $8.1 million in the Offshore Energy business driven by the sale of the two vessels during Q4 2024 and a decrease in aircraft lease revenue of $9.0 million driven by the sale of Seed Assets to the 2025 Partnership. This was partially offset by an increase in engine lease revenue of $6.6 million.
Comparison of the nine months ended September 30, 2025 and 2024
Total revenues increased by $609.3 million, driven by the following:
• Aerospace products revenue increased $406.6 million, primarily due to a $382.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $19.3 million increase in other maintenance service revenues.
36

• MRE Contract revenue increased by $228.9 million, primarily due to an increase in engine and module sales made to the 2025 Partnership.
• Maintenance reve nue increased by $18.2 million, primarily due to an increase in aircraft maintenance revenue of $17.7 million driven by higher end-of-lease return compensation and an increase in the recognition of maintenance deposits due to aircraft redelivery, partially offset by a decrease in utilization and number of aircraft on lease.
• Asset sales revenue decreased by $40.7 million, primarily due to change in product mix of assets sold in the current period as compared to the prior period. Specifically, while the number of total assets sold in the current period was higher than prior period, the number of engines sold in the prior period was higher than the current period.
Expenses
Comparison of the three months ended September 30, 2025 and 2024
Total expenses increased by $149.7 million, driven by the following:
• Cost of sales increased by $143.4 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.
Comparison of the nine months ended September 30, 2025 and 2024
Total expenses increased by $126.6 million, driven by the following:
• Cost of sales increased by $412.7 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.
• Internalization fee to affiliate decreased by $300.0 million relating to the Internalization effective May 28, 2024.
Other (expense) income
Comparison of the three months ended September 30, 2025 and 2024
Total other expense increased by $1.4 million driven by the following:
• Gain on sale to the 2025 Partnership increased by $4.6 million, resulting from the sale of 8 aircraft to the 2025 Partnership within the Aviation Leasing Segment.
• Interest expense increased by $2.8 million, reflecting an increase in interest expense of $7.3 million on the 5.875% Senior Notes due 2033, which were issued in October 2024, partially offset by decreases in interest expense in (i) the 9.75% Senior Notes due 2027, which were redeemed in October 2024, of $3.2 million and (ii) the Revolving Credit Facility of $1.5 million, driven by the increase in average debt outstanding of $66.7 million.
• Equity in losses of unconsolidated entities increased by $3.8 million, primarily driven by the profit elimination of $3.9 million for sales to the 2025 Partnership.
Comparison of the nine months ended September 30, 2025 and 2024
Total other expense decreased by $83.8 million driven by the following:
• Other income increased by $60.8 million, primarily due to a $54.3 million insurance settlement and a $5.3 million increase in interest income earned on financing receivables within our Aviation Leasing Segment.
• Gain on sale to the 2025 Partnership increased by $50.1 million, resulting from the sale of 45 aircraft to the 2025 Partnership within the Aviation Leasing Segment.
• Loss on debt extinguishment decreased by $13.9 million driven by the 2024 redemption of Senior Notes due 2025 and partial redemption of Senior Notes due 2027.
• Interest expense increased by $25.9 million, reflecting increases in interest expense in (i) the 7.00% Senior Notes due 2032 of $26.0 million, (ii) the 5.875% Senior Notes due 2033 of $22.0 million, and (iii) the 7.00% Senior Notes due 2031 of $13.8 million. These were partially offset by decreases in interest expense in (i) the 9.75% senior notes due 2027 of $22.0 million, and (ii) the 6.5% senior notes due 2025 of 13.0 million.
• Equity in losses of unconsolidated entities increased by $15.0 million, primarily driven by the profit elimination of $15.8 million for sales to the 2025 Partnership.
Provision for (benefit from) income taxes
The provision for income taxes increased $19.0 million and $87.2 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily driven by the higher income generated in the Aerospace Products segment within taxable jurisdictions for both the three and nine months ended September 30, 2025, and the higher income generated in the Aviation Leasing segment within taxable jurisdictions for the nine months ended September 30, 2025.
37

Net income (loss)
Net income increased by $31.2 million and $479.3 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to the changes noted above.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA increased by $65.4 million and $303.7 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to the changes noted above.
38

Aviation Leasing Segment
As of September 30, 2025, in our Aviation Leasing segment, we own and manage 323 aviation assets, consisting of 48 commercial aircraft and 275 engines, including eight aircraft and seventeen engines that were still located in Russia.
As of September 30, 2025, 39 of our commercial aircraft and 167 of our engines were leased to operators or other third parties. Aviation assets currently off lease are either undergoing repair and/or maintenance, being prepared to go on lease or held in short term storage awaiting a future lease. Our aviation equipment was approximately 76% utilized during the three months ended September 30, 2025, based on the percent of days on-lease in the quarter weighted by the monthly average equity value of our aviation leasing equipment, excluding airframes. Our aircraft currently have a weighted average remaining lease term of 47 months, and our engines currently on-lease have an average remaining lease term of 35 months. The table below provides additional information on the assets in our Aviation Leasing segment, including transfers which involve aircraft breakdowns, engine transfers from leasing equipment to inventory for manufacturing and sales, and engine transfers from inventory to leasing equipment for rebuilding and sales:

Aviation Assets Widebody Narrowbody Total
Aircraft
Assets at January 1, 2025 5   104   109  
Purchases —  17  17 
Sales —  (45) (45)
Transfers —  (33) (33)
Assets at September 30, 2025
5   43   48  

Engines
Assets at January 1, 2025 23   289   312  
Purchases —  70  70 
Sales (5) —  (5)
Transfers —  (102) (102)
Assets at September 30, 2025 18   257   275  

39

The following table presents our results of operations for our Aviation Leasing segment:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Revenues
Lease income $ 55,072   $ 57,322  $ (2,250) $ 185,951   $ 168,927  $ 17,024 
Maintenance revenue 52,370   59,917  (7,547) 175,081   156,894  18,187 
Asset sales revenue 38,461   34,953  3,508  105,315   145,993  (40,678)
Other revenue (1)
3,292   74  3,218  5,827   199  5,628 
Total revenues 149,195   152,266  (3,071) 472,174   472,013  161 

Expenses
Cost of sales 34,769   20,684  14,085  106,517   111,542  (5,025)
Operating expenses 10,146   9,995  151  28,661   26,984  1,677 
Acquisition and transaction expenses 3,571   2,620  951  7,053   7,350  (297)
Depreciation and amortization 50,226   52,455  (2,229) 155,710   151,211  4,499 
Asset impairment —   —  —  —   962  (962)
Total expenses 98,712   85,754  12,958  297,941   298,049  (108)

Other income (expense)
Equity in losses of unconsolidated entities (1,083) —  (1,083) (2,642) (207) (2,435)
Gain on sale to the 2025 Partnership 4,609   —  4,609  50,083   —  50,083 
Other income 2,103   1,982  121  61,696   1,440  60,256 
Total other income 5,629   1,982  3,647  109,137   1,233  107,904 
Income before income taxes 56,112   68,494  (12,382) 283,370   175,197  108,173 
Provision for income taxes 14,500   8,898  5,602  58,301   20,224  38,077 

Net income attributable to shareholders $ 41,612   $ 59,596  $ (17,984) $ 225,069   $ 154,973  $ 70,096 
______________________________________________________
(1) Includes servicing fees of $3,035 and $5,635 for the three and nine months ended September 30, 2025, respectively, from the 2025 Partnership.
40

The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Net income attributable to shareholders $ 41,612   $ 59,596  $ (17,984) $ 225,069   $ 154,973  $ 70,096 
Add: Provision for income taxes 14,500   8,898  5,602  58,301   20,224  38,077 
Add: Equity-based compensation expense 264   176  88  703   409  294 
Add: Acquisition and transaction expenses 3,571   2,620  951  7,053   7,350  (297)
Add: Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations —   —  —  —   —  — 
Add: Changes in fair value of non-hedge derivative instruments —   —  —  —   —  — 
Add: Asset impairment charges —   —  —  —   962  (962)
Add: Incentive allocations —   —  —  —  —  — 
Add: Depreciation and amortization expense (1)
62,803   65,133  (2,330) 187,553   182,209  5,344 
Add: Interest expense and dividends on preferred shares —   —  —  —   —  — 
Add: Internalization fee to affiliate —   —  —  —   —  — 
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2)
10,575   —  10,575  14,379   (123) 14,502 
Less: Equity in losses of unconsolidated entities 1,083   —  1,083  2,642   207  2,435 
Less: Non-controlling share of Adjusted EBITDA —   —  —  —   —  — 
Adjusted EBITDA (non-GAAP) $ 134,408   $ 136,423  $ (2,015) $ 495,700   $ 366,211  $ 129,489 

________________________________________________________
(1) Includes the following items for the three months ended September 30, 2025 and 2024: (i) depreciation expense of $50,226 and $52,455, (ii) lease intangible amortization of $534 and $3,720 and (iii) amortization for lease incentives of $12,043 and $8,958, respectively. Includes the following items for the nine months ended September 30, 2025 and 2024: (i) depreciation expense of $155,710 and $151,211, (ii) lease intangible amortization of $5,893 and $11,482 and (iii) amortization for lease incentives of $25,950 and $19,516, respectively.
(2) Includes the following items for the three months ended September 30, 2025 and 2024: (i) net loss of $1,083 and $0, (ii) interest expense of $2,629 and $0, and (iii) depreciation and amortization of $9,029 and $0, respectively. Includes the following items for the nine months ended September 30, 2025 and 2024: (i) net loss of $2,642 and $207, (ii) interest expense of $4,119 and $0, (iii) depreciation and amortization of $12,432 and $84 and (iv) acquisition and transaction expenses of $470 and $0, respectively.
Revenues
Comparison of the three months ended September 30, 2025 and 2024
Total reven ue decreased by $3.1 million, driven by the following:
• Maintenance revenue decreased by $7.5 million, primarily due to a decrease in aircraft maintenance revenue of $7.0 million, driven by the sale of Seed Assets to the 2025 Partnership, as well as a decrease in utilization.
• Lease income decreased by $2.3 million due to a decrease in aircraft lease revenue of $9.0 million, driven by the sale of Seed Assets to the 2025 Partnership, partially offset by an increase in engine lease revenue of $6.6 million.
• Asset sales revenue increased by $3.5 million, primarily due to an overall increase in the number of sales transactions of commercial aircraft and engines in the current period as compared to the prior period.
• Other revenue increased by $3.2 million as a result of servicing fees earned in our capacity as the Servicer to the 2025 Partnership.
Comparison of the nine months ended September 30, 2025 and 2024
Total revenue increased $0.2 million, driven by the following:
• Maintenance revenue increased by $18.2 million, primarily due to an increase in aircraft maintenance revenue of $17.7 million driven by higher end-of-lease return compensation and an increase in the recognition of maintenance deposits due to aircraft redelivery, partially offset by the sale of Seed Assets to the 2025 Partnership, as well as a decrease in utilization.
• Lease income increased by $17.0 million, primarily due to an increase in engine lease revenue of $16.9 million, driven by an increased number of engines on lease in addition to higher rental rates.
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• Other revenue increased by $5.6 million as a result of servicing fees earned in our capacity as the Servicer to the 2025 Partnership.
• Asset sales revenue decreased by $40.7 million, primarily due to change in product mix of assets sold in the current period as compared to the prior period. Specifically, while the number of total assets sold in the current period was higher than prior period, the number of engines sold in the prior period was higher than the current period.
Expenses
Comparison of the three months ended September 30, 2025 and 2024
Total expenses increased by $13.0 million, driven by the following:
• Cost of sales increased by $14.1 million, primarily due to an increase in asset sales as compared to the prior period.
• Depreciation and amortization expense decreased by $2.2 million, primarily driven by the sale of Seed Assets to the 2025 Partnership.
Comparison of the nine months ended September 30, 2025 and 2024
Total expenses decreased by $0.1 million, driven by the following:
• Cost of sales decreased by $5.0 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.
• Depreciation and amortization expense increased by $4.5 million, primarily driven by a higher average book value of engines on lease, partially offset by the sale of Seed Assets to the 2025 Partnership during the period.
Other income (expense)
Total other income increased by $3.6 million and $107.9 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to (i) gains on sale to the 2025 Partnership of $4.6 million and $50.1 million, respectively, (ii) a $0.8 million and $5.3 million increase in interest income earned on financing receivables during 2025, respectively, and (iii) an insurance settlement of $54.3 million in the nine months ended September 30, 2025.
Provision for income taxes
The provision for income taxes increased by $5.6 million and $38.1 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to the respective changes in income discussed above from leasing activities in jurisdictions subject to taxes.
Net income
Net income decreased by $18.0 million and increased by $70.1 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to the changes noted above.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITD A decreased by $2.0 million and increased by $129.5 million for the three and nine months ended September 30, 2025, respectively, as compared to the prior period, primarily due to the changes noted above.

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Aerospace Products Segment
The Aerospace Products segment, through our maintenance facilities, equity method investment and exclusivity arrangements, develops and manufactures, repairs/refurbishes, and sells aircraft engines and aftermarket components primarily for the CFM56-5B, CFM56-7B, and V2500 commercial aircraft engines. Our engine, module, and parts sales are facilitated through a dedicated commercial maintenance program designed to focus on modular and parts repair and refurbishment of these engines.
To further enhance this business and establish permanent engine and module manufacturing capabilities, we acquired Lockheed Martin Commercial Engine Solutions (LMCES). Refer to Note 3, “Acquisition of Lockheed Martin Commercial Engine Solutions” in our “Notes to Consolidated Financial Statements” for additional information.
We entered into an agreement within our MRE business to supply replacement aircraft engines and modules for the life of the 2025 Partnership.
Other serviceable used modules and parts are sold through our exclusive partnership, which is responsible for the teardown, repair, marketing, and sales of parts from our CFM56-5B and CFM56-7B engine pool. We also acquired the remaining interest in Quick Turn Engine Center LLC, or “QuickTurn” (formerly iAero Thrust LLC), a hospital maintenance and testing facility specializing in the CFM56-5B and CFM56-7B engines.
We further expanded our footprint in engine services by acquiring a 50% equity interest in QuickTurn Europe, which will operate as a dedicated maintenance, repair, and overhaul facility for CFM56 engines. Additionally, we maintain a 25% ownership stake in the Advanced Engine Repair joint venture, which is focused on developing innovative cost-saving programs for engine repairs.
The following table presents our results of operations:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Revenues
Aerospace products revenue $ 459,206   $ 303,469  $ 155,737  $ 1,144,317   $ 737,726  $ 406,591 
MRE Contract revenue 58,663   —  58,663  228,886   —  228,886 
Total revenues 517,869   303,469  214,400  1,373,203   737,726  635,477 

Expenses
Cost of sales 328,153   198,812  129,341  874,377   456,615  417,762 
Operating expenses 10,545   2,617  7,928  25,221   16,510  8,711 
Acquisition and transaction expenses 599   2,100  (1,501) 3,145   2,871  274 
Depreciation and amortization 3,930   1,306  2,624  11,218   3,177  8,041 
Total expenses 343,227   204,835  138,392  913,961   479,173  434,788 

Other income (expense)
Equity in earnings (losses) of unconsolidated entities 767   (438) 1,205  1,594   (1,592) 3,186 

Total other income (expense) 767   (438) 1,205  1,594   (1,592) 3,186 
Income before income taxes 175,409   98,196  77,213  460,836   256,961  203,875 
Provision for income taxes 26,815   4,408  22,407  72,017   11,865  60,152 

Net income attributable to shareholders $ 148,594   $ 93,788  $ 54,806  $ 388,819   $ 245,096  $ 143,723 

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The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA:

Three Months Ended September 30, Change Nine Months Ended
September 30, Change
(in thousands) 2025 2024 2025 2024
Net income attributable to shareholders $ 148,594   $ 93,788  $ 54,806  $ 388,819   $ 245,096  $ 143,723 
Add: Provision for income taxes 26,815   4,408  22,407  72,017   11,865  60,152 
Add: Equity-based compensation expense 168   156  12  491   154  337 
Add: Acquisition and transaction expenses 599   2,100  (1,501) 3,145   2,871  274 
Add: Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations —   —  —  —   —  — 
Add: Changes in fair value of non-hedge derivative instruments —   —  —  —   —  — 
Add: Asset impairment charges —   —  —  —   —  — 
Add: Incentive allocations —   —  —  —   —  — 
Add: Depreciation and amortization expense 3,930   1,306  2,624  11,218   3,177  8,041 
Add: Interest expense and dividends on preferred shares —   —  —  —   —  — 
Add: Internalization fee to affiliate —   —  —  —   —  — 
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (1)
1,082   (382) 1,464  2,134   (1,424) 3,558 
Less: Equity in (earnings) losses of unconsolidated entities (767) 438  (1,205) (1,594) 1,592  (3,186)
Less: Non-controlling share of Adjusted EBITDA —   —  —  —   —  — 
Adjusted EBITDA (non-GAAP) $ 180,421   $ 101,814  $ 78,607  $ 476,230   $ 263,331  $ 212,899 
________________________________________________________
(1) Includes the following items for the three months ended September 30, 2025 and 2024: (i) net income of $767 and net loss of $438, (ii) depreciation and amortization expense of $420 and $56, and (iii) tax benefit of $105 and $0, respectively. Includes the following items for the nine months ended September 30, 2025 and 2024: (i) net income of $1,594 and net loss of $1,592, (ii) depreciation and amortization expense of $645 and $168, and (iii) tax benefit of $105 and $0, respectively.
Revenues
Comparison of the three months ended September 30, 2025 and 2024
Total revenues increased by $214.4 million, due to the following:
• Aerospace Products revenue increased by $155.7 million, primarily due to a $145.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $7.4 million increase in other maintenance service revenues.
• MRE Contract revenue increased by $58.7 million, primarily due to an increase in engine and module sales made to the 2025 Partnership.
Comparison of the nine months ended September 30, 2025 and 2024
Total revenues increased by $635.5 million, due to the following:
• Aerospace Products revenue increased by $406.6 million, primarily due to a $382.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $19.3 million increase in other maintenance service revenues.
• MRE Contract revenue increased by $228.9 million, primarily due to an increase in engine and module sales made to the 2025 Partnership.
Expenses
Comparison of the three months ended September 30, 2025 and 2024
Tota l expenses increased by $138.4 million, due to the following:
• Cost of sale s increased by $129.3 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.
• Operating expenses increased by $7.9 million, primarily due to higher compensation and benefits expense due to the acquisition of LMCES and an increase in shipping and logistics expense.
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