European Aerospace and Defence: Q2 2026 A&D preview summary

Research evidence excerpt

European Aerospace and Defence: Q2 2026 A&D preview summary

Global Research

9 July 2026ab

European Aerospace and Defence Equities

GlobalQ2 2026 A&D preview summary

Aerospace

Ian Douglas-Pennant

Expect volatility in civil aerospace Analyst

A summary of our Q2 previews published this morning on each stock under coverage ian.douglas-pennant@ubs.com

and whether we view results as a positive (+), neutral or negative catalyst (-) for the +44-20-7568 0936

shares. Yassin Moktadir

Associate Analyst

Civil Aerospace yassin.moktadir@ubs.com

+44-20-7568 4313

We anticipate elevated volatility in the space, with risks skewed to the downside across

both Airbus and Engine names.

Airbus(-): We see Commercial 2030 guidance of €10-11bn EBIT and EBIT adj

margins, against consensus 13.4% and €11.5bn, at the business update 21st July.

Melrose(-): The new CFO’s first results should support 2026 group guidance, with

upside risk in Engines & downside in Aerostructures. However, 2029 FCF guidance

could be revised lower.

MTU(-): We believe a guidance increase is largely expected. We see risk to

consensus OEM sales expectations, and therefore see Q2 risks moderately skewed

to the downside.

Rolls Royce: Due to relatively weak sentiment stemming from weak EFH data, we

are relatively more positive on Rolls than other engine peers into H1.

Safran: We believe a guidance upgrade is widely expected, although the size of

the upgrade investors have priced is unclear to us. We see risk equally balanced

into results, but see a chance of higher than usual volatility

Defence

We see risk broadly balanced across defence in Q2 results, with idiosyncratic drivers

driving risks.

BAE: We do not see meaningful upside risk to H1 estimates, but believe

management tone may be increasingly positive on longer term growth