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Item 7. Management’s Discussion and Analysis

2026-02-27 compared with 2025-03-03 · 249 added, 284 removed, 348 unchanged (60% of the section changed)

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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 consolidated financial statements and the accompanying notes, and with Part I, Item 1A, “Risk Factors” and “Forward-Looking Statements” included elsewhere in this Annual Report on Form 10-K.

A discussion of our cash flows for 2025 compared to 2024 is included in our Annual Report on Form 10-K for the year ended December 31, 2025 , under Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations.

We own, lease and sell aviation equipment.

We also develop and manufacture through a joint venture, and repair and sell, through our maintenance facilities and exclusivity arrangements, aftermarket components for aircraft engines.

We target assets that, on a combined basis, generate strong cash flows with potential for earnings growth and asset appreciation.

We believe that there is a large number of acquisition opportunities in our markets and that our expertise and business and financing relationships, together with our access to capital, will allow us to take advantage of these opportunities.

We are a leading independent engine maintenance platform focused on the CFM56-5B, CFM56-7B and V2500 aircraft engines which power the 737NG and A320ceo aircraft.

We repair and rebuild engines in our maintenance facilities and with our joint venture partners, and sell or lease the engines to airlines and asset owners around the world.

Our primary business model is to sell or lease engines via exchange through our proprietary Maintenance, Repair and Exchange (“MRE”) model which is reported under our Aerospace Products segment.

We also own and manage a portfolio of on- and off-lease aircraft and engines through our Aviation Leasing segment.

While historically these investment activities have been primarily held on balance sheet, at the end of 2024, we launched our Strategic Capital Initiative, which consists of an asset management business that manages third-party capital to invest in on-lease aircraft and engines.

We expect our primary investment activities to be through our Strategic Capital Initiative going forward.

As of December 31, 2025, we had total consolidated assets of $4.4 billion and total equity of $334.2 million.

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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) agreed to pay 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;

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.

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.

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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%).

The Company was required to use commercially reasonable efforts to make available to the Former Manager certain employees of the Company who were previously employees of the Former Manager to provide the Reverse Services, subject to certain exceptions.

In addition, the Former Manager is required to continue to provide the services that are reasonably required by the Company to prepare its quarterly and annual financial statements until May 31, 2025.

The Company is required to continue to provide the Reverse Services until the later to occur of the dissolution or sale of the entities receiving Reverse Services.

The Transition Services Agreement may be terminated earlier (x) by mutual agreement of the parties, (y) by either the Former Manager or the Company in the event of a material breach by the non-terminating party that is not cured within thirty (30) days following written notification thereof, or (z) by the Former Manager if the Company fails to pay any undisputed sum overdue and payable for a period of at least thirty (30) days.

Impact of Russia’s Invasion of Ukraine

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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.

Spin-Off of FTAI Infrastructure Inc.

(“FTAI Infrastructure”)

On August 1, 2022, Fortress Transportation and Infrastructure Investors LLC (“we”, “us”, “our”, “FTAI” or the “Company” pre-Merger, as defined below, and FTAI Aviation Ltd.

post-Merger) effected a spin-off of the Company’s infrastructure business held by FTAI Infrastructure (a wholly-owned subsidiary of the Company) as a distribution of all of the shares owned by the Company of common stock of FTAI Infrastructure to the holders of the Company’s ordinary shares as of July 21, 2022.

FTAI Infrastructure is a corporation for U.S.

federal income tax purposes and holds, among other things, the Company’s previously held interests in the (i) Jefferson Terminal business, (ii) Repauno business, (iii) Long Ridge investment, and (iv) Transtar business.

FTAI Infrastructure retained all related project-level debt of those entities.

In connection with the spin-off, FTAI Infrastructure paid a dividend of $730.3 million to the Company.

The Company used these proceeds to repay all outstanding borrowings under its 2021 bridge loans, $200.0 million of its 6.50% senior unsecured notes due 2025, and approximately $175.0 million of the outstanding borrowings under its revolving credit facility.

FTAI retained the aviation business and certain other assets, and FTAI’s remaining outstanding corporate indebtedness.

In connection with the spin-off, the Company and the Former Manager assigned the Company’s then-existing management agreement to FTAI Infrastructure, and FTAI Infrastructure and the Former Manager executed an amended and restated agreement.

The Company and certain of its subsidiaries executed a new management agreement with the Former Manager.

The new management agreement has an initial term of six years.

The Former Manager was entitled to a management fee and reimbursement of certain expenses on substantially similar terms as the previous arrangements with the Former Manager, which were assigned to FTAI Infrastructure.

Prior to the Merger described below, our Former Manager remained entitled to incentive allocations (comprised of income incentive allocation and capital gains incentive allocation) on the same terms as they existed prior to spin-off.

Following the Former Merger, the Company entered into a Services and Profit Sharing Agreement (the “Services and Profit Sharing Agreement”), with a subsidiary of the Company and Fortress Worldwide Transportation and Infrastructure Master GP LLC (“Master GP”), pursuant to which Master GP is entitled to incentive payments on substantially similar terms as the previous arrangements.

On November 10, 2022, the Company completed the transactions set forth in the Agreement and Plan of Merger (the “Merger”) between Fortress Transportation and Infrastructure Investors LLC (“FTAI”) and FTAI Aviation Ltd.

(“FTAI Aviation”) and certain other parties, with FTAI becoming a subsidiary of the company.

As a result of the merger, the FTAI became a Cayman Islands exempted company.

Upon merger completion, Fortress Transportation and Infrastructure Investors LLC public common shareholders’ shares of the Company were exchanged automatically for shares of FTAI Aviation Ltd.

without any further action from the shareholders.

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 Company has agreed that the 2025 Partnership, and follow-on partnerships, will be the primary buyer of on-lease 737NG and A320ceo aircraft.

The Company will provide aircraft management services to the 2025 Partnership, and the Company will receive customary, market-based compensation for providing such services.

The Company has also committed to make a minority investment in the 2025 Partnership.

The Company expects to provide aircraft management services to, and make minority investments in, future partnerships.

On December 30, 2024, we announced the launch of a Strategic Capital Initiative in collaboration with third-party institutional investors.

The Strategic Capital Initiative, and its related partnerships, allows us to maintain an asset-light business model while the partnerships actively acquire on-lease narrowbody aircraft at scale.

The first partnership under the initiative (the “2025 Partnership”) focuses on acquiring 737NG and A320ceo aircraft.

The 2025 Partnership completed its fundraise in October 2025 with $2.0 billion of equity commitments.

The 2025 Partnership, and follow-on partnerships, is the primary buyer of all future on-lease 737NG and A320ceo aircraft.

The Company, as the Servicer, provides aircraft management services to the 2025 Partnership, and the Company receives customary, market-based compensation for providing such services.

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.

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 and customers.

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 CFM56-7B, CFM56-5B and V2500 commercial aircraft engines.

Our two reportable segments are (i) Aerospace Products and (ii) Aviation Leasing.

The Aerospace Products segment, through our maintenance facilities and joint ventures, among other investments, develops and manufactures, repairs/refurbishes and sells aircraft engines and aftermarket components primarily for the CFM56-7B, CFM56-5B and V2500 commercial aircraft engines .

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.

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.

Results of Operations

Adjusted EBITDA (Non-GAAP)

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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.

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, 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, if any.

Results of Operations

The following table presents our consolidated results of operations:

Year Ended December 31, Change

(in thousands) 2024 2023 2022 '24 vs '23 '23 vs '22

(in thousands) 2025 2024 2023 '25 vs '24

Aerospace products revenue $ 1,600,456 $ 1,079,821 $ 454,970 $ 520,635 $ 624,851

MRE Contract revenue

335,788 — — 335,788 —

Lease income 235,210 255,338 207,936 (20,128) 47,402

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Asset sales revenue 106,945 192,176 303,141 (85,231) (110,965)

Aerospace products revenue 1,079,821 454,970 178,515 624,851 276,455

Other revenue (1)

10,511 6,757 13,502 3,754 (6,745)

Total revenues 2,507,409 1,734,901 1,170,896 772,508 564,005

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Other income (expense)

Equity in losses of unconsolidated entities (2,200) (1,606) (369) (594) (1,237)

Interest expense (247,751) (221,721) (161,639) (26,030) (60,082)

Loss on extinguishment of debt — (17,101) — 17,101 (17,101)

Equity in losses of unconsolidated entities (2)

(6,818) (2,200) (1,606) (4,618) (594)

Gain on sale to the 2025 Partnership

46,380 — — 46,380 —

Other income 73,586 17,364 7,590 56,222 9,774

Total other expense (134,603) (223,658) (155,655) 89,055 (68,003)

Income (loss) from continuing operations before income taxes 14,169 184,017 (105,311) (169,848) 289,328

Income before income taxes

606,684 14,169 184,017 592,515 (169,848)

Provision for (benefit from) income taxes 105,620 5,487 (59,800) 100,133 65,287

Net income (loss) from continuing operations 8,682 243,817 (110,611) (235,135) 354,428

Net loss from discontinued operations, net of income taxes — — (101,416) — 101,416

Net income (loss) 8,682 243,817 (212,027) (235,135) 455,844

Net income (loss) attributable to non-controlling interest in consolidated subsidiaries:

Discontinued operations — — (18,817) — 18,817

501,064 8,682 243,817 492,382 (235,135)

Dividends on preferred shares 17,243 32,763 31,795 (15,520) 968

Loss on redemption of preferred shares 6,327 7,998 — (1,671) 7,998

Net (loss) income attributable to shareholders $ (32,079) $ 212,022 $ (220,374) $ (244,101) $ 432,396

Net income (loss) attributable to shareholders

$ 477,494 $ (32,079) $ 212,022 $ 509,573 $ (244,101)

(1) Includes servicing fees of $10,150 for the year ended December 31, 2025 from the 2025 Partnership.

(2) Includes the profit elimination of $(22,829) for the year ended December 31, 2025 for sales to the 2025 Partnership.

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

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(in thousands) 2025 2024 2023 '25 vs '24 '24 vs '23

Net (loss) income attributable to shareholders from continuing operations $ (32,079) $ 212,022 $ (137,775) $ (244,101) $ 349,797

Net income (loss) attributable to shareholders

$ 477,494 $ (32,079) $ 212,022 $ 509,573 $ (244,101)

Provision for (benefit from) income taxes 105,620 5,487 (59,800) 100,133 65,287

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Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations 6,327 25,099 — (18,772) 25,099

Changes in fair value of non-hedge derivative instruments — — — — —

Asset impairment charges — 962 2,121 (962) (1,159)

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34,539 (1,892) 310 36,431 (2,202)

Equity in losses of unconsolidated entities 2,200 1,606 369 594 1,237

Non-controlling share of Adjusted EBITDA — — — — —

Adjusted EBITDA (non-GAAP) $ 862,050 $ 597,282 $ 428,097 $ 264,768 $ 169,185

Equity in losses (earnings) of unconsolidated entities (3)

(16,011) 2,200 1,606 (18,211) 594

Adjusted EBITDA (non-GAAP) $ 1,190,922 $ 862,050 $ 597,282 $ 328,872 $ 264,768

(1) Includes the following items for the years ended December 31, 2025, 2024 and 2023:

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(2) Includes the following items for the years ended December 31, 2025, 2024 and 2023:

(i) net loss of $2,200, $1,606 and $369, (ii) depreciation and amortization expense of $308, $1,488 and $409 and (iii) acquisition and transaction expense of $0, $428 and $0, respectively.

Presentation of aircraft and engine sales

During the third quarter of 2022, we updated our corporate strategy based on the opportunities available in the market such that the sale of aircraft and engines is now an output of our recurring, ordinary activities.

As a result of this update, the transaction price allocated to the sale of assets is included in Revenues in the Consolidated Statements of Operations beginning in the third quarter of 2022 and is accounted for in accordance with ASC 606.

The sale of CFM56-7B, CFM56-5B and V2500 engines are included in the Aerospace Products Segment and the sale of aircraft and other engines are included in the Aviation Leasing Segment.

The corresponding net book values of the assets sold are recorded in Cost of sales in the Consolidated Statements of Operations beginning in the third quarter of 2022.

Sales transactions of aircraft and engines prior to the third quarter of 2022 were accounted for in accordance with ASC 610-20, Gains and losses from the derecognition of nonfinancial assets and were included in Gain (loss) on sale of assets, net on the Consolidated Statements of Operations, as we were previously only occasionally selling these assets.

Generally, assets sold were included in Leasing equipment, net, on the Consolidated Balance Sheets.

(i) net income of $16,011, net loss of $2,200 and $1,606, (ii) interest expense of $6,899 $0 and $0, (iii) depreciation and amortization expense of $10,932, $308 and $1,488, (iv) acquisition and transaction expense of $769, $0 and $428 and (v) tax benefit of $72, $0 and $0, respectively.

(3) Excludes the profit elimination of $22,829 for the year ended December 31, 2025 for sales to the 2025 Partnership.

Comparison of the years ended December 31, 2025 and 2024

Total revenues increased by $772.5 million, driven by the following:

• Aerospace products revenue increased by $520.6 million, primarily due to a $499.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $4.8 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $335.8 million, due to engine and module sales made to the 2025 Partnership.

• Asset sales revenue decreased by $85.2 million, primarily due to change in product mix of assets sold in the current period as compared to the prior period.

Specifically, the number of engines sold in the prior period was higher than the current period.

Total expenses increased by $269.0 million, driven by the following:

• Cost of sales increased by $523.8 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 $36.7 million, primarily due to higher compensation and benefits expense incurred during the current year.

• Internalization fee to affiliate decreased by $300.0 million relating to the Internalization effective May 28, 2024.

Other expense

Total other expense increased by $89.1 million due to the following:

• Other income increased by $56.2 million, primarily due to a $54.3 million insurance settlement related to aircraft and engines located in Russia.

• Gain on sale to the 2025 Partnership increased by $46.4 million, primarily resulting from the sale of 45 aircraft to the 2025 Partnership within the Aviation Leasing Segment.

• Loss on debt extinguishment decreased by $17.1 million, driven by the 2024 redemption of Senior Notes due 2025 and Senior Notes due 2027.

• Interest expense increased by $26.0 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 $22.7 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 $22.3 million, and (ii) the 6.5% senior notes due 2025 of $13.0 million.

Provision for (benefit from) income taxes

The Provision for income taxes increased $100.1 million, primarily driven by the higher income generated in the Aerospace Products segment within taxable jurisdictions for the twelve months ended December 31, 2025, and the higher income generated in the Aviation Leasing segment within taxable jurisdictions for the twelve months ended December 31, 2025.

Net income (loss)

Net income increased by $492.4 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITD A increased by $328.9 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2024 and 2023

Total revenue s increased by $564.0 million, dr iven by the following:

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Net income (loss) from continuing operations

Net income from continuing operation s decreased by $235.1 million, primarily due to the changes noted above.

Net income from continuing operations decreased by $235.1 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITD A increased by $264.8 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2023 and 2022

Total revenues increased by $462.5 million, driven by the following:

• Aerospace products revenue increased by $276.5 million, primarily due to a $213.0 million increase in CFM56-7B, CFM56-5B and V2500 engines and module sales, a $44.7 million increase in parts inventory sales, $16.7 million increase due to engine management contracts, and other sales revenue of $2.0 million from the QuickTurn acquisition.

See above discussion regarding presentation of asset sales.

• Asset sales revenue increased by $119.6 million, primarily due to an overall increase in the number of material sales transactions of commercial aircraft and engines.

Specifically, 13 aircraft and 41 engines were sold in 2023 as compared to eight aircraft and 71 engines sold in 2022.

See above discussion regarding presentation of asset sales.

• Maintenance revenue increased $42.5 million.

Engine maintenance revenue increased by $26.5 million, driven by an increased number of engines on lease in 2023 as compared to 2022.

Aircraft maintenance revenue increased $16.0 million primarily due to $20.1 million of maintenance reserves taken into revenue due to the early redelivery of five aircraft, partially offset by less aircraft on lease.

• Lease income increased by $28.6 million, primarily due to an increase in engine lease revenue of $19.7 million, driven by an increased number of engines on lease, partially offset by an increase in the number of engines redelivered.

An increase of $7.4 million in the Offshore Energy business due to one of our vessel being on-hire longer in 2023 compared to 2022, and with a charterer at higher rates.

• Other revenue decreased by $4.7 million, primarily due to a decreas e in assets with end-of-lease redelivery compensation.

During 2023, eight aircraft and four engines had end-of-lease redelivery compensation, as compared to 18 aircraft and one engine in 2022.

Total expense s increased by $206.7 million, driven by the following:

• Cost of sales increased by $253.7 million, primarily due to an increase of $170.8 million in our Aerospace Products segment, primarily due to increases in CFM56-7B, CFM56-5B and V2500 engine and module sales, parts inventory sales, and directly corresponds to components of increases in Aerospace products revenue over the same period.

An increase of $82.9 million in the Aviation Leasing segment primarily due to an overall increase in the number of material sales transactions of commercial aircraft and engines, as well as the gross presentation of asset sales revenues and related costs of sales as described above.

• Gain on sale of assets, net decreased by $77.2 million, primarily due to the change in presentation of asset sales recorded during 2022.

See above discussion regarding presentation of asset sales and impact on Gain on sale of assets, net.

• Depreciation and amortization increased by $17.0 million, primarily driven by an increase in the number of assets owned and on lease, partially offset by an increase in the number of aircraft redelivered and parted out into our engine leasing pool.

• Management fees and incentive allocation to affiliate increased by $14.5 million, primarily due to a $13.6 million increase in incentive fee due to the Former Manager driven by an increase in net income.

• Asset impairment decreased by $135.1 million, primarily due to the 2022 write down of aircraft and engines located in Russia and Ukraine that were deemed not recoverable.

See Note 6 to the consolidated financial statements for additional information.

• Operating expenses decreased by $22.1 million, primarily due to the following:

• a decrease of $43.4 million in the Aviation Leasing segment primarily as a result of a $41.4 million decrease in provision for credit losses as a result of the sanctions imposed on Russian airlines in 2022, a $2.5 million decrease in shipping and storage fees and repairs and maintenance expenses, partially offset by a $1.2 million increase in insurance expense.

• an increase of $12.8 million in the Offshore Energy business which reflects increases in offshore crew expenses of $2.1 million, project costs of $3.9 million and other operating expenses of $1.3 million for one of our vessels driven by increased cost of operations based on the operating location of the vessel, as well as increased number of days on-hire.

Additionally, repairs and maintenance expense increased $0.6 million due to repairs on one of our vessels.

• an increase of $8.5 million in the Aerospace Products segment primarily due to a $7.2 million increase in commission expenses due to the increase in sales from the used material program as well as $1.2 million increase in shipping and storage fees as operations continued to ramp-up in 2023.

Adjusted EBITDA increased by $264.8 million, primarily due to the changes noted above.

Aerospace Products Segment

The Aerospace Products segment, through our maintenance facilities and joint ventures, among other investments, develops and manufactures, repairs/refurbishes, and sells aircraft engines and aftermarket components primarily for the CFM56-7B, CFM56-5B, 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 CFM56-7B and CFM56-5B engines.

In addition, 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 engine pool.

On December 30, 2025, the Company announced the launch of FTAI Power, a platform focused on converting CFM56 engines to power turbines.

In 2023, we acquired the remaining interest in Quick Turn Engine Center LLC (“QuickTurn”), a dedicated hospital maintenance and testing facility specializing in the CFM56-7B and CFM56-5B engines.

In 2024, we acquired Lockheed Martin Commercial Engine Solutions (“LMCES”) to establish permanent engine and module manufacturing capabilities.

In 2025, we entered into an agreement within our MRE business to supply replacement aircraft engines and modules for the life of the 2025 Partnership.

We also acquired Pacific Aerodynamic Inc.

(“Pac Aero”), a specialist in CFM56 compressor blade and vane repairs, expanding our repair capabilities, and the MRE business of AerotechOPS (“ATOPS”), expanding our MRE business in Miami.

Additionally, we maintain a (i) 25% equity interest in the Advanced Engine Repair joint venture, which focuses on developing innovative cost-saving programs for engine repairs, and a (ii) 50% equity interest in QuickTurn Europe, which operates as a dedicated maintenance, repair, and overhaul facility for CFM56 engines.

The following table presents our results of operations:

Year Ended December 31, Change

(in thousands) 2025 2024 2023 '25 vs '24 '24 vs '23

Aerospace products revenue $ 1,600,456 $ 1,079,821 $ 454,970 $ 520,635 $ 624,851

MRE Contract Revenue

335,788 — — 335,788 —

Total Revenues

1,936,244 1,079,821 454,970 856,423 624,851

Cost of sales 1,240,368 673,907 280,280 566,461 393,627

Operating expenses 34,514 23,818 20,459 10,696 3,359

Acquisition and transaction expenses 3,198 4,906 1,722 (1,708) 3,184

Depreciation and amortization 15,764 6,630 661 9,134 5,969

Total expenses 1,293,844 709,261 303,122 584,583 406,139

Other income (expense)

Total other expense decreased by $33.6 million, due to the following:

• Loss on extinguishment of debt of $19.9 million was recognized during 2022.

This loss was related to the pay-down of the 2021 Bridge Loan, issued in December 2021 and February 2022, and the partial redemption of Senior Notes due 2025.

• Interest expense decreased $7.6 million, which reflects a decrease in the average outstanding debt of approximately $183.8 million primarily due to decreases in (i) the 2021 Bridge Loans of $178.3 million and (ii) the Senior Notes due 2025 of $116.7 million, which were partially redeemed in August 2022, partially offset by increases in (iii) the Revolving Credit Facility of $28.7 million and (iv) the Senior Notes due 2030 of $82.8 million, which were issued in November 2023.

• Other income increased $7.4 million primarily driven by a $5.3 million gain on consolidation of investment in connection with the QuickTurn acquisition within our Aerospace Products Segment and $1.0 million of interest income from the Company’s investments in money market funds.

Equity in earnings (losses) of unconsolidated entities

2,896 (1,993) (1,458) 4,889 (535)

Other income 5,441 — 5,347 5,441 (5,347)

Total other income (expense)

8,337 (1,993) 3,889 10,330 (5,882)

Income before income taxes 650,737 368,567 155,737 282,170 212,830

Provision for (benefit from) income taxes 102,391 22,221 (24,440) 80,170 46,661

The benefit from income taxes increased $65.1 million primarily due to the Company establishing a deferred tax asset of $72.2 million in connection with a tax law change in Bermuda, which was recorded as a benefit from income taxes during the fourth quarter of 2023.

See Note 12 to the consolidated financial statements for additional information.

The benefit was offset by a $7.1 million increase from income taxes primarily attributable to an increase in income generated from operating activities in jurisdictions subject to taxes.

Net income attributable to shareholders $ 548,346 $ 346,346 $ 180,177 $ 202,000 $ 166,169

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

Year Ended December 31, Change

(in thousands) 2025 2024 2023 '25 vs '24 '24 vs '23

Net income attributable to shareholders $ 548,346 $ 346,346 $ 180,177 $ 202,000 $ 166,169

Provision for (benefit from) income taxes 102,391 22,221 (24,440) 80,170 46,661

Equity-based compensation expense 671 309 225 362 84

Acquisition and transaction expenses 3,198 4,906 1,722 (1,708) 3,184

Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations — — — — —

Asset impairment charges — — — — —

Incentive allocations — — — — —

Depreciation and amortization expense 15,764 6,630 661 9,134 5,969

Interest expense and dividends on preferred shares — — — — —

Pro-rata share of Adjusted EBITDA from unconsolidated entities (1)

3,778 (1,769) 206 5,547 (1,975)

Equity in (earnings) losses of unconsolidated entities

(2,896) 1,993 1,458 (4,889) 535

Adjusted EBITDA (non-GAAP) $ 671,252 $ 380,636 $ 160,009 $ 290,616 $ 220,627

(1) Includes the following items for the years ended December 31, 2025, 2024 and 2023:

(i) net income of $2,896, net loss of $1,993 and net loss of $1,458 (ii) depreciation and amortization of $954, $224 and $1,236 (iii) acquisition and transaction expense of $0, $0, and $428 and (iv) tax benefit of $72, $0 and $0, respectively.

Comparison of the years ended December 31, 2025 and 2024

Total revenues increased by $856.4 million, due to the following:

• Aerospace Products revenue increased by $520.6 million, primarily due to a $499.7 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $4.8 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $335.8 million, primarily due to an increase in engine and module sales made to the 2025 Partnership.

Total expenses increased by $584.6 million, due to the following:

• Cost of sale s increased by $566.5 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 $10.7 million, primarily due to higher compensation and benefits expense due to the acquisition of LMCES.

• Depreciation and amortization increased by $9.1 million due to the acquisition of LMCES in the third quarter of 2024.

Provision for (benefit from) income taxes

The Provision for income taxes increased by $80.2 million, primarily due to the increase in income discussed above from Aerospace Products activities in jurisdictions subject to taxes.

Net income increased by $202.0 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $290.6 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2024 and 2023

Total Aerospace products revenue increased by $624.9 million, primarily due to a $546.0 million increase in CFM56-7B, CFM56-5B and V2500 engine and module sales, a $28.5 million increase in parts inventory sales, and other revenues of $47.7 million from the QuickTurn and LMCES acquisitions.

Total expenses increased by $406.1 million, due to the following:

• Cost of sales increased by $393.6 million, primarily due to increases in CFM56-7B, CFM56-5B and V2500 engine and module sales, parts inventory sales, and directly corresponds to components of increases in Aerospace products revenue over the same period.

• Depreciation and amortization increased by $6.0 million due to the acquisitions of LMCES in Q3 2024 and QuickTurn in Q4 2023.

• Operating expenses increased by $3.4 million, primarily due to the acquisition of LMCES in Q3 2024.

• Acquisition and transaction expenses increased by $3.2 million, primarily driven by higher professional fees incurred in evaluating and completing strategic transactions

Provision for (benefit from) income taxes

The Provision for income taxes increased by $46.7 million, primarily due to the benefit from income taxes recorded in 2023 in connection with a tax law change in Bermuda as well as the increase in income from Aerospace Products activities in jurisdictions subject to taxes.

As the company’s operations in these areas grew, so did the corresponding tax obligations, resulting in a higher provision for income taxes.

Net income (loss) from continuing operations

Net income from continuing operations increased by $354.4 million, primarily due to the changes noted above.

Net loss from discontinued operations

Net loss from discontinued operations decreased by $101.4 million for the year ended December 31, 2023, compared to the prior year as these businesses have spun off and there is no corresponding activity in the current period.

Net income increased by $166.2 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

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Other revenue (1)

10,507 1,041 7,419 9,466 (6,378)

Total revenues 571,161 628,437 681,611 (57,276) (53,174)

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Asset impairment — 962 2,121 (962) (1,159)

Gain on sale of assets, net — — (59,048) — 59,048

Total expenses 361,527 399,671 427,353 (38,144) (27,682)

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Equity in (losses) earnings of unconsolidated entities 13,115 (207) (148) 13,322 (59)

Gain on sale to the 2025 Partnership

46,380 — — 46,380 —

Other income 64,455 14,669 1,300 49,786 13,369

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Net income attributable to shareholders $ 271,352 $ 210,249 $ 291,603 $ 61,103 $ (81,354)

(1) Includes servicing fees of $10,150 for the year ended December 31, 2025 from the 2025 Partnership.

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

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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 — 962 2,121 (962) (1,159)

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Equity in losses (earnings) of unconsolidated entities (13,115) 207 148 (13,322) 59

Non-controlling share of Adjusted EBITDA — — — — —

Adjusted EBITDA (non-GAAP) $ 608,912 $ 500,062 $ 467,388 $ 108,850 $ 32,674

__________________________________________________

(1) Includes the following items for the years ended December 31, 2025, 2024 and 2023:

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(2) Includes the following items for the years ended December 31, 2025, 2024 and 2023:

(i) net (loss) income of $(207), $(148) and $740 and (ii) depreciation and amortization of $84, $252 and $185, respectively.

(i) net income of $13,115, net loss of $207 and $148 (ii) interest expense of $6,899, $0 and $0 (iii) depreciation and amortization of $9,978, $84 and $252 and (iv) acquisition and transaction expenses of $769, $0 and $0, respectively.

Comparison of the years ended December 31, 2025 and 2024

Total revenues decreased by $57.3 million, driven by the following:

• Asset sales revenue decreased by $85.2 million, primarily due to change in product mix of assets sold in the current period as compared to the prior period.

Specifically, the number of engines sold in the prior period was higher than the current period.

• Maintenance revenue increased by $17.7 million, primarily due to an increase in aircraft maintenance revenue of $18.1 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.

• Other revenue increased by $9.5 million, primarily as a result of servicing fees earned in our capacity as the Servicer to the 2025 Partnership.

Total expenses decreased by $38.1 million, driven by the following:

• Cost of sales decreased by $42.6 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 $4.2 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.

Total other income increased by $109.5 million, primarily due to the following:

• Gains on sale to the 2025 Partnership of $46.4 million.

• Equity in earnings of unconsolidated entities increased by $13.3 million, driven by net income realized by the 2025 Partnership in the current period.

• $54.3 million from an insurance settlement in the current year, compared to $10.8 million from an insurance settlement in the prior year.

Provision for (benefit from) income taxes

The Provision for income taxes increased by $29.3 million, primarily due to the respective changes in income discussed above from leasing activities in jurisdictions subject to taxes.

Net income decreased by $61.1 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $108.9 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2024 and 2023

Total revenues decreased by $53.2 million, driven by the following:

• Asset sales revenue decreased by $111.0 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines.

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Adjusted EBITDA increased by $32.7 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2023 and 2022

Total revenues increased by $178.7 million, driven by the following:

• Asset sales revenue increas ed by $119.6 million, primarily d ue to an increase in the number of material sales transactions of commercial aircraft and engines.

Specifically, 13 aircraft and 41 engines were sold in 2023 as compared to eight aircraft and 71 engines sold in 2022.

See above discussion regarding presentation of asset sales.

• Maintenance revenue increased by $42.5 million.

Engine maintenance revenue increased by $26.5 million, driven by an increased number of engines on lease in 2023 as compared to 2022.

Aircraft maintenance revenue increased $16.0 million, primarily due to $20.1 million of higher maintenance reserves taken into revenue due to the early redelivery of five aircraft, partially offset by less aircraft on lease.

• Lease income increased by $20.6 million, primarily due to an increase in engine lease revenue of $19.7 million, driven by an increased number of engines on lease, partially offset by an increase in the number of engines redelivered.

• Other revenue decreased $4.1 million primarily due to a decrease in end-of-lease redelivery compensation.

During 2023, eight aircraft and four engines had end-of-lease redelivery compensation, as compared to 18 aircraft and one engine in 2022.

Total expenses decreased by $17.1 million, driven by the following:

• Asset impairment decreased by $135.1 million, primarily due to the 2022 write down of aircraft and engines located in Russia and Ukraine that were deemed not recoverable.

See Note 6 to the consolidated financial statements for additional information.

• Operating expenses decreased by $43.4 million, primarily driven by the $41.4 million decrease in provision for credit losses as a result of the sanctions imposed on Russian airlines in 2022, a $2.5 million decrease in shipping and storage fees and repairs and maintenance expenses, partially offset by a $1.2 million increase in insurance expense.

• Cost of sales increased by $82.9 million, primarily due to an overall increase in the number of material sales transactions of commercial aircraft and engines, as well as the gross presentation of asset sales revenues and related costs of sales as described above.

Specifically, 13 aircraft and 41 engines were sold in 2023 as compared to eight aircraft and 71 engines sold in 2022.

• Gain on sale of assets, net decreased by $59.0 million, due to the change in presentation of asset sales recorded during 2022.

See above discussion regarding presentation of asset sales and impact on Gain on sale of assets, net.

• Depreciation and amortization expense increased by $14.1 million, driven by an increase in the number of assets owned and on lease, partially offset by an increase in the number of aircraft redelivered and parted out into our engine leasing pool.

• Acquisition and transaction expense increased by $5.2 million, driven by higher costs associated with the acquisition of aviation leasing equipment.

Provision for (benefit from) income taxes

The benefit from income taxes increased $38.7 million primarily due to the Company establishing a deferred tax asset of $46.6 million in connection with a tax law change in Bermuda , which was recorded as a benefit from income taxes during the fourth quarter of 2023.

See Note 12 to the consoli dated financial statements for additional information.

The benefit was offset by a $7.9 million increase from income taxes primarily attributable to an increase in income generated from leasing activities in jurisdictions subject to taxes.

As the Company’s operations in these areas grew, so did the corresponding tax obligations, resulting in a higher provision for income taxes.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $87.2 million, primarily due to the changes noted above.

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 CFM56-7B, CFM56-5B 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 CFM56-7B, CFM56-5B and V2500 engines.

In September 2024, we acquired LMCES to further enhance this business and establish permanent engine and module manufacturing capabilities.

Refer to Note 4 “Acquisition of Lockheed Martin Commercial Engine Solutions”, for additional information.

In addition, other serviceable used modules and parts are sold through our ex clusive partnership, who is responsible for the teardown, repair, marketing and sales of parts from our CFM56 engine pool.

In December 2023, we acquired the remaining interest in Quick Turn Engine Center LLC or “QuickTurn” (previously iAero Thrust LLC), a hospital maintenance and testing facility dedicated to the CFM56 engine.

Refer to Note 5 “Acquisition of QuickTurn”, for additional information.

We also hold a 25% interest in the Advanced Engine Repair JV which focuses on developing new cost savings programs for engine repairs.

The following table presents our results of operations:

Year Ended December 31, Change

(in thousands) 2024 2023 2022 '24 vs '23 '23 vs '22

Aerospace products revenue $ 1,079,821 $ 454,970 $ 178,515 $ 624,851 $ 276,455

Cost of sales 673,907 280,280 109,481 393,627 170,799

Operating expenses 23,818 20,459 11,967 3,359 8,492

Acquisition and transaction expenses 4,906 1,722 243 3,184 1,479

Depreciation and amortization 6,630 661 258 5,969 403

Gain on sale of assets, net — — (18,163) — 18,163

Total expenses 709,261 303,122 103,786 406,139 199,336

Other income (expense)

Equity in losses of unconsolidated entities (1,993) (1,458) (1,109) (535) (349)

Other income — 5,347 — (5,347) 5,347

Total other (expense) income (1,993) 3,889 (1,109) (5,882) 4,998

Income before income taxes 368,567 155,737 73,620 212,830 82,117

Provision for (benefit from) income taxes 22,221 (24,440) 2,961 46,661 (27,401)

Net income attributable to shareholders $ 346,346 $ 180,177 $ 70,659 $ 166,169 $ 109,518

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

Year Ended December 31, Change

(in thousands) 2024 2023 2022 '24 vs '23 '23 vs '22

Net income attributable to shareholders $ 346,346 $ 180,177 $ 70,659 $ 166,169 $ 109,518

Provision for (benefit from) income taxes 22,221 (24,440) 2,961 46,661 (27,401)

Equity-based compensation expense 309 225 — 84 225

Acquisition and transaction expenses 4,906 1,722 243 3,184 1,479

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 6,630 661 258 5,969 403

Interest expense and dividends on preferred shares — — — — —

Pro-rata share of Adjusted EBITDA from unconsolidated entities (1)

(1,769) 206 (885) (1,975) 1,091

Equity in losses of unconsolidated entities 1,993 1,458 1,109 535 349

Non-controlling share of Adjusted EBITDA

Adjusted EBITDA (non-GAAP) $ 380,636 $ 160,009 $ 74,345 $ 220,627 $ 85,664

__________________________________________________

(1) Includes the following items for the years ended December 31, 2024, 2023 and 2022:

(i) net loss of $ 1,993 , $1,458 and $1,109 (ii) depreciation and amortization of $224 , $1,236 and $224 and (iii) acquisition and transaction expense of $0, $428, $0, respectively.

Comparison of the years ended December 31, 2024 and 2023

Total expenses increased by $406.1 million, due to the following:

• Depreciation and amortization increased by $6.0 million due to the acquisitions of LMCES in Q3 2024 and QuickTurn in Q4 2023.

• Operating expenses increased by $3.4 million, primarily due to the acquisition of LMCES in Q3 2024.

• Acquisition and transaction expenses increased by $3.2 million, primarily driven by higher professional fees incurred in evaluating and completing strategic transactions.

Provision for (benefit from) income taxes

As the company’s operations in these areas grew, so did the corresponding tax obligations, resulting in a higher provision for income taxes.

Net income increased by $166.2 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $220.6 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2023 and 2022

Total Aerospace products revenue increased by $276.5 million, primarily due to a $213.0 million increase in CFM56-7B, CFM56-5B and V2500 engine and module sales, a $44.7 million increase in parts inventory sales, $16.7 million increase in revenue from engine management contracts, and other revenues of $2.0 million from the QuickTurn acquisition.

See above discussion regarding presentation of asset sales.

Total expenses increased by $199.3 million, primarily due to the following:

• Cost of sales increased by $170.8 million, primarily due to increases in CFM56-7B, CFM56-5B and V2500 engine and module sales, parts inventory sales, and directly corresponds to components of increases in Aerospace products revenue over the same period and the gross presentation described above.

• Gain on sale of assets, net decreased by $18.2 million, primarily due to t he change in presentation of asset sales recorded during 2022.

See above discussion regarding presentation of asset sales and impact on Gain on sale of assets, net.

• Operating expenses increased by $8.5 million, primarily due to a $7.2 million increase in commission expenses due to the increase in sales from the used material program as well as a $1.2 million increase in shipping and storage fees as operations continued to ramp-up in 2023.

Other income (expense)

Total other income increased $5.0 million, which primarily reflects an increase of $5.3 million in gain on consolidation of investment in connection with the QuickTurn acquisition, offset by an increase of $0.3 million in our proportionate share of unconsolidated entities’ net loss.

Provision for (benefit from) income taxes

The benefit from income taxes increase d $27.4 million primarily due to the Company establishing a deferred tax asset of $25.6 million in connection with a tax law change in Bermuda, which was recorded as a benefit from income taxes during the fourth quarter of 2023.

See Note 12 to the consolidated financial statements for additional information.

Net income increased by $109.5 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $85.7 million, primarily due to the changes noted above.

Corporate and Other

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Loss on redemption of preferred shares 6,327 7,998 — (1,671) 7,998

Net loss attributable to shareholders from continuing operations $ (588,674) $ (259,758) $ (265,378) $ (327,948) $ 5,620

Net loss attributable to shareholders

$ (319,375) $ (588,674) $ (259,758) $ 269,299 $ (328,916)

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

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(in thousands) 2025 2024 2023 '25 vs '24 '24 vs '23

Net loss attributable to shareholders from continuing operations $ (588,674) $ (259,758) $ (265,378) $ (328,916) $ 5,620

Net loss attributable to shareholders

$ (319,375) $ (588,674) $ (259,758) $ 269,299 $ (328,916)

(Benefit from) provision for income taxes (59,003) (49,713) 833 (9,290) (50,546)

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Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations 6,327 25,099 — (18,772) 25,099

Changes in fair value of non-hedge derivative instruments — — — — —

Asset impairment charges — — — — —

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Equity in (earnings) losses of unconsolidated entities — — — — —

Non-controlling share of Adjusted EBITDA — — — — —

Adjusted EBITDA (non-GAAP) $ (66,413) $ (18,648) $ (30,115) $ (47,765) $ 11,467

Comparison of the years ended December 31, 2025 and 2024

Total revenues decreased by $26.6 million, primarily due to the sale of the two vessels within the Offshore Energy business during the fourth quarter of 2024.

Total expenses decreased by $277.4 million, primarily due to the Internalization effective May 28, 2024, which resulted in an internalization fee to affiliate of $300.0 million in 2024.

Other expense

Total other expense increased by $7.9 million, due to the following:

These were partially offset by decreases in interest expense in (i) the 9.75% senior notes due 2027 of $22.3 million, and (ii) the 6.5% senior notes due 2025 of $13.0 million.

• Loss on extinguishment of debt decreased by $17.1 million, driven by the 2024 redemption of Senior Notes due 2025 and Senior Notes due 2027.

(Benefit from) provision for income taxes

The benefit from income taxes increased by $9.3 million.

The increase was mainly driven by higher corporate overhead expenses deductible for 2025 tax purposes.

Net loss decreased by $252.1 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA decreased by $47.8 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2024 and 2023

Total revenues decreased by $7.7 million, primarily due to a $7.3 million decrease in the Lease income.

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Adjusted EBITDA (Non-GAAP)

Adjusted EBIT DA increased by $11.5 million, primarily due to the changes noted above.

Comparison of the years ended December 31, 2023 and 2022

Total revenues increased by $7.4 million, primarily due to an increase in the Offshore Energy business, as one of our vessels was on-hire longer in 2023 compared to 2022, and with a charterer at higher rates.

Total expenses increased by $24.5 million, due to the following:

• Operating expenses increased by $12.8 million, primarily due to increases in the Offshore Energy business, driven by increases in offshore crew expenses of $2.1 million, project costs of $3.9 million and other operating expenses of $1.3 million for one of our vessels.

The increase in the other operating expenses were driven by the operational location of the vessel, as well as the increased number of days on-hire.

Additionally, repairs and maintenance expense increased $0.6 million due to repairs on one of our vessels.

• Depreciation and amortization increased by $2.5 million , primarily due to new assets being placed into service in the Offshore Energy business.

• Acquisition and transaction expenses decreased $4.7 million, primarily due to lower professional fees related to strategic transactions.

Other income (expense)

Total other expense decreased by $28.4 million, due to the following:

• Loss on extinguishment of debt decreased by $19.9 million driven by the 2022 pay-down of the 2021 Bridge Loans and the partial redemption of the Senior Notes due 2025.

Net loss decreased by $10.3 million, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA decreased $3.7 million, primarily due to the changes noted above.

Adjusted EBITDA increased $11.5 million, primarily due to the changes noted above.

Transactions with Affiliates and Affiliated Entities

Former Management Agreement

Prior to May 28, 2024, FTAI Aviation Ltd.

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As a result of the Internalization, the Company ceased to be externally managed and operates as an internally managed company.

In connection with the termination of the Management Agreement, the Company (i) agreed to pay the Former Manager (for itself and on behalf of the Master GP, as applicable) $150.0 million (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;

In connection with the termination of the Management Agreement, the Company (i) paid the Former Manager (for itself and on behalf of the Master GP, as applicable) $150.0 million (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) 1,866,949 ordinary shares of the Company (the “Share Consideration”);

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The Company financed the cash payments through one or more debt financings, along with cash on hand.

Following the Internalization, the Company no longer pays management fees or incentive distributions to the Former Manager and Master GP.

Strategic Capital Initiative

Potential conflicts of interest may arise with respect to our decisions regarding how to allocate investment opportunities between us and partnerships in our Strategic Capital Initiative.

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Liquidity and Capital Resources

On October 9, 2024, we issued $500.0 million aggregate principal amount of senior unsecured notes due 2033.

Using a portion of the net proceeds, the Company redeemed the remaining $130.5 million aggregate principal amount of Senior Notes due 2027, plus accrued and unpaid interest.

The Company used the remaining net proceeds to pay down in full the Company’s Revolving Credit Facility, with any excess proceeds intended for general corporate purposes, including funding acquisitions and investments.

We believe we have sufficient liquidity to satisfy our cash needs, however, we continue to evaluate and take action, as necessary, to preserve adequate liquidity and ensure that our business can continue to operate during various environments.

This includes limiting discretionary spending across the organization and re-prioritizing our investments as necessary.

On December 30, 2024, we announced the launch of a Strategic Capital Initiative in collaboration with third-party institutional investors.

The Strategic Capital Initiative, and its related partnerships, will allow us to maintain an asset-light business model while the partnerships actively acquire on-lease narrowbody aircraft at scale.

We have agreed that the related partnerships will be the primary buyer of on-lease 737NG and A320ceo aircraft.

We expect to provide aircraft management services to the related partnerships for which the Company will receive customary, market-based compensation.

The Company also expects to make minority investment in the related partnerships.

On December 30, 2024, the Company announced the launch of a Strategic Capital Initiative in collaboration with third-party institutional investors.

The Strategic Capital Initiative, and its related partnerships, allows the Company to maintain an asset-light business model while the partnerships actively acquire on-lease narrowbody aircraft at scale.

The first partnership under the initiative, the 2025 Partnership, focuses on acquiring 737NG and A320ceo aircraft.

The 2025 Partnership completed its fundraise in October 2025 with $2.0 billion of equity commitments.

The 2025 Partnership, and follow-on partnerships, is the primary buyer of all future on-lease 737NG and A320ceo aircraft.

The Company, as the Servicer, manages the aircraft in the 2025 Partnership, and the Company receives customary, market-based compensation for providing such services.

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.

Our principal uses of liquidity have been and continue to be (i) acquisitions of aircraft and engines, (ii) dividends to our ordinary and preferred shareholders, (iii) expenses associated with our operating activities, and (iv) debt service obligations associated with our investments.

In the future, instead of acquiring on-lease aircraft directly, as part of the Strategic Capital Initiative, we will invest in the related partnerships and such partnerships will acquire on-lease aircraft.

• Cash used for the purpose of making investments was $1,130.3 million, $1,526.2 million and $861.5 million during the years ended December 31, 2025, 2024, and 2023, respectively.

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• Cash flows from operating activities, plus the principal collections on finance leases and maintenance reserve collections were $(260.1) million, $(136.5) million and $163.0 million during the years ended December 31, 2025, 2024, and 2023, respectively.

• During the year ended December 31, 2025, additional borrowings and total principal repayments in connection with the Revolving Credit Facility were $480.0 million and $480.0 million, respectively.

During the year ended December 31, 2024, additional borrowings were obtained in connection with the (i) Senior Notes due 2033 of $500.0 million, (ii) Senior Notes due 2032 of $800.0 million, (iii) Senior Notes due 2031 of $700.0 million and (iv) Revolving Credit Facility of $745.0 million.

We made total principal repayments of (i) $650.0 million related to the Senior Notes due 2025, (ii) $745.0 million relating to the Revolving Credit Facility and (iii) $400.0 million related to the Senior Notes due 2027.

During the year ended December 31, 2023 , additional borrowings were obtained in connection with the (i) Revolving Credit Facility of $455.0 million and (ii) Senior Notes Due 2030 of $500.0 million.

We made total principal repayments of $605.0 million relating to the Revolving Credit Facility.

During the year ended December 31, 2022, additional borrowings were obtained in connection with the (i) 2021 Bridge Loans of $239.5 million (ii) Revolving Credit Facility of $565.0 million and (iii) EB-5 Loan Agreement of $9.5 million.

We made total principal repayments of (i) $604.5 million relating to the Revolving Credit Facility, (ii) $340.0 million related to the 2021 Bridge Loans and (iii) $200.0 million related to the Senior Notes due 2025.

• Proceeds from the sale of assets were $1,712.5 million, $969.3 million and $477.9 million during the years ended December 31, 2025, 2024, and 2023, respectively.

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There were no issuances of preferred shares during the years ended December 31, 2025 and 2024.

In October 2024, the Company redeemed in full the outstanding Series A preferred shares at a redemption price equal to $25.00 per share in cash, plus $1.6 million of accumulated and unpaid distributions thereon to, but not including, the redemption date of October 29, 2024.

On May 28, 2024, we entered into definitive agreements with the Former Manager and Master GP to internalize our management function.

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Cash flow data:

Net cash used in operating activities $ (187,956) $ 128,982 $ (20,657)

Net cash used in investing activities (469,498) (373,349) (411,253)

Net cash provided by financing activities 681,814 282,208 44,914

Net cash (used in) provided by operating activities

$ (310,745) $ (187,956) $ 128,982

Net cash provided by (used in) investing activities

723,314 (469,498) (373,349)

Net cash (used in) provided by financing activities

(227,209) 681,814 282,208

Comparison of the years ended December 31, 2025 and 2024

Net cash used in operating activities increased $316.9 million, which primarily reflects (i) a decrease in our Net income of $235.1 million and increases in (ii) Changes in working capital of $178.5 million and (iii) Gain on sale of assets of $217.2 million, partially offset by certain adjustments to reconcile net income to cash used in operating activities including increases in (iv) Non-cash termination fee to affiliate (issuance of ordinary shares) of $150.0 million, (v) Deferred income taxes of $61.7 million, (vi) Depreciation and amortization of $48.2 million, a decrease in (vii) Security deposits and maintenance claims included in earnings of $23.8 million, an increase in (viii) Loss on extinguishment of debt of $17.1 million and a decrease in (ix) Other of $6.4 million

Net cash used in investing activities increased $96.1 million primarily due to increases in (i) Acquisition of leasing equipment of $397.6 million, (ii) Deposits for leasing equipment of $134.4 million, (iii) Acquisition of business, net of cash acquired of $118.0 million and (iv) Investments in financing receivables of $66.9 million, partially offset by higher (v) Proceeds from sale of assets of $491.4 million and (vi) Proceeds (refunds) from deposits on sale of leasing equipment of $78.4 million, and decreases in (vii) Acquisition of lease intangibles of $24.1 million, (viii) Investment in unconsolidated entities of $19.5 million and (ix) Investment in promissory notes of $11.5 million.

Net cash provided by financing activities increased $399.6 million primarily due to increases in (i) Proceeds from debt of $1,630.2 million and (ii) Receipt of maintenance deposits under operating lease agreements of $19.0 million, partially offset by increases in (iii) Repayment of debt of $1,067.3 million and (iv) Redemption of preferred shares of $105.4 million, a decrease in (v) Proceeds from issuance of preferred shares, net of underwriter's discount and issuance costs of $61.7 million, and increases in (vi) Release of maintenance deposits under operating lease agreements of $6.9 million and (vii) Payment of deferred financing costs of $5.2 million.

Cash Flows of Discontinued Operations

The cash flows related to discontinued operations have not been segregated and are included in the Consolidated Statements of Cash Flows for all periods presented.

Cash used in operating activities from discontinued operations were $63.9 million for the year ended December 31, 2022.

Cash used in investing activities from discontinued operations were $136.3 million for the year ended December 31, 2022.

The absence of cash flows from discontinued operations is not expected to adversely affect our liquidity or our ability to fund capital expenditures or working capital needs.

Net cash used in operating activities increased $122.8 million, primarily reflecting an increase in our Net income of $492.4 million and certain adjustments to reconcile net income to cash used in operating activities, including an:

• increase in Deferred income taxes of $75.8 million;

partially offset by

• decrease in Changes in net working capital of $448.1 million,

• decrease in Non-cash termination fee to affiliate of $150.0 million,

• increase in Gain on insurance recoveries of $54.3 million, and

• increase in Gain on sale of assets to the 2025 Partnership of $46.4 million.

Net cash provided by investing activities increased $1.2 billion, primarily due to an:

• increase in Proceeds from the sale of assets to the 2025 partnership of $530.0 million,

• increase in Proceeds from the sale of assets of $213.2 million,

• decrease in Acquisition of leasing equipment of $488.5 million,

• decrease in Acquisition of business, net of cash acquired of $98.5 million,

• decrease in Deposits for acquisition of leasing equipment of $92.4 million,

• decrease in Investments in financing receivables of $64.1 million, and

• increase in Proceeds from settlement of insurance claims of $54.3 million;

partially offset by

• increase in Investment in unconsolidated entities of $328.5 million.

Net cash used in financing activities increased $909.0 million, primarily due to a:

• decrease in Proceeds from debt of $2.1 billion, and

• increase in Redemption of preferred shares of $18.8 million;

partially offset by

• decrease in Repayment of debt of $1.2 billion.

Contractual Obligations

Our material cash requirements include the following contractual and other obligations:

Debt Obligations — As of December 31, 2024, we had outstanding principal and interest payment obligations of $3.5 billion and $1.4 billion through the maturity date of the debt, respectively, of which only interest payments of $229.8 million are due in the next twelve months.

See Note 9 to the consolidated financial statements for additional information about our debt obligations.

Debt Obligations — As of December 31, 2025, we had outstanding principal and interest payment obligations of $3.5 billion and $1.2 billion, respectively, of which only interest payments of $228.8 million are due in the next twelve months.

Refer to Note 8, “Debt” in our “Notes to Consolidated Financial Statements” for additional information about our debt obligations.

Lease Obligations — As of December 31, 2025, we had outstanding operating and finance lease obligations of $47.8 million, of which $8.8 million is due in the next twelve months.

Other Cash Requirements — In addition to our contractual obligations, we pay quarterly cash dividends on our ordinary shares and preferred shares, which are subject to change at the discretion of our Board of Directors.

During 2024, we declared cash dividends of $121.6 million and $32.8 million o n our ordinary shares and preferred shares, respectively.

During the year ended December 31, 2025, we declared cash dividends of $128.2 million and $17.2 million on our ordinary shares and preferred shares, respectively.

We expect to meet our future short-term liquidity requirements through cash on hand, unused borrowing capacity or future financings and net cash provided by our current operations.

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These periodic maintenance payments accumulate over the term of the lease to fund major maintenance events, and we are contractually obligated to return maintenance payments to the lessee up to the cost of maintenance 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, we are not required to return any unused or excess maintenance payments to the lessee.

Maintenance payments received for which we expect to repay to the lessee are presented as Maintenance Deposits in our Consolidated Balance Sheets.

All excess maintenance payments received that we do not expect to repay to the lessee are recorded as Maintenance revenue.

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.

In the event the total cost of maintenance events over the term of a lease is less than the cumulative maintenance payments, we are not required to return any unused maintenance payments to the lessee.

For purchase and lease back transactions, we account for the transaction as a single arrangement.

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The fair value of the lease may include a lease premium or discount, which is recorded as a favorable or unfavorable lease intangible.

Asset sales revenue —Asset sales revenue primarily consists of the transaction price related to the sale of aircraft and aircraft engines from our 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.

We routinely sell leasing equipment to customers and such transactions are considered recurring and ordinary in nature to our 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 over an asset to a customer.

Revenue is recorded with corresponding costs of sales, presented on a gross basis in the Consolidated Statements of Operations.

See Note 14 for additional information.

Maintenance Payments —Typically, under an operating lease of aircraft, the lessee is responsible for performing all maintenance and is generally required to make maintenance payments to us for heavy maintenance, overhaul or replacement of certain high-value components of the aircraft or engine.

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If a lessee is making monthly maintenance payments, we would typically be obligated to reimburse the lessee for costs they incur for heavy maintenance, overhaul or replacement of certain high-value components to the extent of maintenance payments received in respect of the specific maintenance event, usually shortly following the completion of the relevant work.

We record the portion of maintenance payments paid by the lessee that are expected to be reimbursed as maintenance deposits in the Consolidated Balance Sheets.

Maintenance payments received for which we expect to repay to the lessee are presented as current and non-current Maintenance Deposits in our Consolidated Balance Sheets.

Excess maintenance payments received that we do not expect to repay to the lessee are recorded as Maintenance revenue on our Consolidated Statements of Operations.

Estimates in recognizing revenue include mean time between removal for engines on leased aircraft, projected costs for engine maintenance, and forecasted utilization, 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.

Reimbursements made to the lessee upon the receipt of evidence of qualifying maintenance work are recorded against the maintenance deposit liability.

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Sum of engine core salvage value plus the estimated fair value of life limited parts

In accounting for leasing equipment, the Company makes estimates about the expected useful lives, residual values and the fair value of acquired in-place leases and acquired maintenance liabilities (for aviation equipment).

In making these estimates, the Company relies upon observable market data for the same or similar types of equipment and, in the case of aviation equipment, its own estimates with respect to a lessee’s anticipated utilization of the aircraft or engine.

When the Company acquires leasing equipment subject to an in-place lease, determining the fair value of the in-place lease requires the Company to make assumptions regarding the current fair values of leases for identical or similar equipment, in order to determine if the in-place lease is within a fair value range of current lease rates.

If a lease is below or above the range of current lease rates, the resulting

lease discount or premium is recognized as a lease intangible and amortized into lease income over the remaining term of the lease.

Impairment of Long-Lived Assets —We perform a recoverability assessment of each of our long-lived assets whenever events or changes in circumstances, or indicators, indicate that the carrying amount or net book value of an asset may not be recoverable.

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a significant change in market conditions;

or the introduction of newer technology and the length of time an asset is off lease related to leasing equipment or engines.

or the introduction of newer technology and the length of time an asset is off lease related to leasing equipment, engines or for manufacturing equipment;

a significant decrease in market value;

adverse changes in use or condition;

legal or regulatory changes;

or cash flow reductions.

When performing a recoverability assessment, we measure whether the estimated future undiscounted net cash flows expected to be generated by the asset exceeds its net book value.

The undiscounted cash flows consist of cash flows from currently contracted leases and contracts, future projected leases, transition costs, estimated down time and estimated residual or scrap values for leasing equipment or operating cash flows for manufacturing equipment, and maintenance and operating costs.

In the event that an asset does not meet the recoverability test, the carrying value of the asset will be adjusted to fair value resulting in an impairment charge.

Management develops the assumptions used in the recoverability analysis based on its knowledge of active contracts, current and future expectations of the global demand for a particular asset and historical experience in the leasing markets, information received from third party industry sources, usage assumptions, asset lifespan for leasing equipment, and expected operating income and costs associated with operating and maintaining the manufacturing asset.

The factors considered in estimating the undiscounted cash flows are impacted by changes in future periods due to changes in contracted lease rates, residual values, economic conditions, technology, demand for a particular asset type and other factors, expected income and operating costs, maintenance and repairs, capital expenditures, and duration of the cash flows.

Recoverability of Goodwill —Goodwill is not amortized but rather is tested at least annually during the fourth quarter for impairment, or more often if events or circumstances indicate the carrying value of an asset may not be recoverable.

We assess the recoverability of goodwill using a qualitative evaluation or a quantitative test to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill.

The determination of fair value requires management to make assumptions and to apply judgment to estimate industry and economic factors and the profitability of future business strategies.

The Company conducts impairment testing based on current business strategy in light of present industry and economic conditions, as well as future expectations.

Recent Accounting Pronouncements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis