RRolls-Royce 2025 Full Year Results: The aerospace and engineering powerhouse didn’t just meet expectations—it shattered them, driving a sharp rally in the stock and reinforcing its position as one of the FTSE 100’s standout performers.
On that day, rolls royce share price today 26 february 2026 closed at 1,352.50 GBp, up +3.24% from the previous close, with the shares briefly touching an intraday high of 1,420.00 GBp amid heavy trading volume exceeding 42 million shares. Why the excitement? The numbers told a compelling story of recovery, profitability explosion, and bold shareholder returns. Let’s break down the highlights from the RollsRoyce 2025 full year results and explore what it means for investors moving forward.
Key Financial Highlights from Rolls-Royce 2025 Full Year Results
Rolls-Royce delivered a blockbuster performance across the board in 2025. Underlying revenue climbed to £20,059 million, up from £17,848 million in 2024—a solid 12% increase that reflected stronger demand in civil aviation and beyond.
The star metric? Underlying operating profit soared to £3,462 million (often rounded to £3.5 billion in headlines), marking a remarkable 40% jump from £2,464 million the prior year. Operating margin expanded impressively to 17.3%, compared to 13.8% in 2024. This wasn’t luck; it stemmed from disciplined cost management, better contract terms, and explosive growth in high-margin aftermarket services.
Free cash flow reached £3.3 billion, a huge leap from £2.4 billion, pushing the company into a net cash position of £1.9 billion by year-end—up dramatically from £475 million. These figures beat consensus forecasts, with operating profit coming in about 6% ahead and cash flow roughly 3% better than expected.
Civil Aerospace: The Engine Driving Rolls-Royce 2025 Full Year Results
Civil aerospace remained the crown jewel. This division posted an underlying operating margin of 20.5%—up from 16.6% in 2024—fueled by:
- Higher large engine flying hours (up 8% year-over-year)
- Increased shop visits and aftermarket revenue
- Improved profitability on spare engines
- Contractual enhancements from long-term service agreements (LTSAs)
The company delivered 483 original equipment (OE) engines in 2025, slightly below its own guidance range, but aftermarket strength more than compensated. Expansions in maintenance facilities (Derby, Dahlewitz, Singapore, and a new JV in Beijing with Air China) position Rolls-Royce to handle surging demand in the years ahead.
Think of it like this: while new engine sales provide the initial thrust, the real power comes from the recurring revenue of servicing those engines—like owning a fleet of high-performance cars where the maintenance contracts generate the steady profits.
Other Divisions Shine in Rolls-Royce 2025 Full Year Results
Defence held steady with a 14.4% margin (slight uptick from 14.2%), benefiting from strong transport and combat performance.
Power Systems impressed even more, achieving a 17.4% margin (from 13.1%), thanks to profitable growth in power generation—especially data centres—and governmental sectors. The push into reliable power for AI-driven data centres adds a fresh growth avenue beyond traditional aviation.
Across the group, efficiency gains from the transformation program delivered £0.6 billion in cost savings (beating the £0.5 billion target) and £1.2 billion in procurement improvements.
Shareholder Returns: The Big Win from Rolls-Royce 2025 Full Year Results
Perhaps the most investor-friendly part? Rolls-Royce announced a multi-year share buyback program of £7 billion to £9 billion spanning 2026-2028. For 2026 alone, up to £2.5 billion (including £200 million already completed early in the year).
Dividends returned too: a final dividend of 5.0p per share brought the total for 2025 to 9.5p, equating to a 32% payout ratio of underlying profit after tax—the first meaningful dividend in years.
This capital return strategy, combined with the strong balance sheet, signaled immense confidence. Markets rewarded it handsomely, boosting rolls royce share price today 26 february 2026 and pushing the stock to new highs.
Upgraded Guidance and Mid-Term Outlook Post Rolls-Royce 2025 Full Year Results
The company didn’t stop at celebrating 2025. It upgraded 2026 guidance to £4.0bn-£4.2bn underlying operating profit and £3.6bn-£3.8bn free cash flow.
Mid-term (2028) targets got a significant lift:
- Underlying operating profit: £4.9bn-£5.2bn (previously lower)
- Operating margin: 18%-20%
- Free cash flow: £5.0bn-£5.3bn
- Return on capital: 23%-26%
These upgrades mean Rolls-Royce expects to hit prior mid-term profit goals two years early. It’s like accelerating from cruise to afterburner.
Market Reaction and Why Rolls-Royce 2025 Full Year Results Mattered
Shares surged on announcement day, reflecting relief and optimism. The combination of profit beats, cash generation, buybacks, and ambitious targets turned skeptics into believers. The stock’s momentum carried forward from earlier recovery phases, rewarding long-term holders who stuck through tougher times.
Risks and Considerations After Rolls-Royce 2025 Full Year Results
No story is without caveats. Supply chain constraints persisted (though improving), engine deliveries lagged guidance slightly, and external factors like fuel prices, geopolitical tensions, or aviation demand cycles could influence future performance.
Currency impacts (many revenues in USD) and competition in engines remain realities. Yet the wide moat in large civil engines, recurring services revenue, and diversified segments provide strong defenses.
Conclusion: What Rolls-Royce 2025 Full Year Results Tell Us About the Future
The Rolls Royce 2025 full year results marked a pivotal chapter: record profits, margin expansion, robust cash flow, reinstated dividends, and a massive buyback commitment. Released on February 26, 2026, they propelled rolls royce share price today 26 february 2026 higher and underscored a successful transformation under leadership. With upgraded guidance pointing to sustained growth, Rolls-Royce appears well-positioned in civil aerospace recovery, defense stability, and emerging opportunities like data centre power. For investors, this isn’t just a results day—it’s evidence of a company firing on all cylinders. Keep watching; the journey ahead looks powerful.
FAQs
What were the key numbers in Rolls-Royce 2025 full year results?
Underlying operating profit reached £3.5 billion with a 17.3% margin, revenue hit £20.1 billion, and free cash flow stood at £3.3 billion—strong beats across the board in the Rolls-Royce 2025 full year results.
How did Rolls-Royce 2025 full year results impact the share price?
The impressive figures and £7-9 billion multi-year buyback announcement drove a +3.24% gain, closing rolls royce share price today 26 february 2026 at 1,352.50 GBp with high volume.
What shareholder returns came from Rolls-Royce 2025 full year results?
A total dividend of 9.5p for 2025 and a new £7-9 billion buyback program (including £2.5 billion in 2026) highlighted generous returns tied to the Rolls-Royce 2025 full year results.
What is the outlook following Rolls-Royce 2025 full year results?
2026 guidance sits at £4.0-4.2 billion operating profit, with upgraded 2028 targets of £4.9-5.2 billion profit and 18-20% margins—signaling continued momentum after the Rolls-Royce 2025 full year results.
Where can I find more details on Rolls-Royce 2025 full year results?
The official press release and presentations are available on the Rolls-Royce investor site for in-depth analysis of the Rolls-Royce 2025 full year results.
