Full Breakdown
Rolls-Royce Secures Major Engine Supply Deals Across Civil and Defense Sectors
By Drooid · · How we work
Core Deal with Philippine Airlines
Rolls-Royce will supply 18 Trent XWB-97 engines for nine new Airbus A350-1000 aircraft ordered by Philippine Airlines. The contract, announced as a memorandum of understanding at the Farnborough International Airshow, is described as being worth “hundreds of millions of pounds” and includes a long-term maintenance package. The Trent XWB-97 can already operate on a 50 % sustainable-aviation-fuel blend, with plans for 100 % use in the future.
Expansion of U.S. Military Engine Support
A $1 billion investment completed in August 2026 modernised Rolls-Royce’s Indianapolis campus, adding full-engine test capability and an altitude test facility in West Lafayette. The company now supports a portfolio of U.S. defence platforms:
- B-52 J Stratofortress – replacement F-130 engines for 76 bombers, requiring roughly 650 units under the Commercial Engine Replacement Programme.
- C-130J Super Hercules – powered by more than 2,300 AE 2100 engines, with production expected to continue into the 2040s.
- V-22 Osprey – over 1,090 AE 1107C engines delivered, with the final CV-22 received in July 2025 and the Marine Corps programme concluding in July 2026.
- MQ-25 Stingray – 76 AE 3007N engines for the Navy’s carrier-based tanker drones.
- MV-75 Cheyenne II tilt-rotor – exclusive propulsion supply of the AE 1107F engine, slated for initial service around 2030, with production ramp-up planned for 2028.
Since 2001 the Indianapolis campus has delivered more than 14,000 engines and employs roughly 3,500 staff, anchoring a broader Indiana supply chain.
Financial Outlook and Shareholder Returns
Rolls-Royce paid an interim dividend of 6.0 pence per share and lifted its 2026 guidance to an adjusted operating profit of £4.7-£4.9 billion (up from £4.0-£4.2 billion) and free-cash-flow of £3.8-£4.0 billion. The first half of the year saw adjusted operating profit rise 46 % to £2.5 billion, revenue increase 24.5 % to £11.3 billion, and the operating margin reach 22.5 %. Morgan Stanley raised its price target to £20, and the market consensus remains around 1,690 pence per share.
Official Statements & Responses
- “This news shows British engineering is flying high with world-class innovation that puts our companies at the front of the pack.” — Anas Sarwar, Minister for Trade.
- “The investment — the largest the company has made in the United States — modernized advanced manufacturing across the Indianapolis campus and added full engine-test capability.” — Select Rolls-Royce.
Rolls-Royce also highlighted that flight-hour-based service contracts drive its civil-engine revenue, linking profitability to long-haul traffic trends.
Data & Statistics
| Metric | Figure |
|---|---|
| Engines for Philippine Airlines | 18 (Trent XWB-97) |
| New A350-1000 aircraft | 9 |
| Indianapolis campus employees | ~3,500 |
| Engines delivered since 2001 | >14,000 |
| F-130 engines required for B-52 J | ~650 |
| B-52 J bombers to be re-engined | 76 |
| MQ-25 aircraft planned | 76 |
| AE 2100 engines on C-130J fleet | >2,300 |
| AE 1107C engines on V-22 fleet | >1,090 |
| Interim dividend | 6.0 pence per share |
| Adjusted operating profit 2026 (guidance) | £4.7-£4.9 billion |
| Free cash flow 2026 (guidance) | £3.8-£4.0 billion |
What’s Next
- Production of the MV-75 Cheyenne II engines is scheduled to ramp up in 2028, with entry into service projected for the early 2030s.
- The upgraded Indianapolis test facilities will support ongoing CCA development and future engine programmes.
- Rolls-Royce’s next full-year results, due later in 2026, will confirm whether the upgraded guidance translates into sustained earnings growth.