Embraer expects new US tariffs will largely hit its business aviation division and shave close to a percentage point off its 2025 earnings margin, but broadly describes the taxes as only minimally impacting its 2025 financial performance.
“Our initial analysis points towards a limited impact [from tariffs], so we remain confident and reiterate our 2025 guidance,” Embraer chief executive Francisco Gomes Neto said on 6 May during Embraer’s first-quarter earnings call. “Embraer has a substantial amount of US content in its aircraft, which mitigates partially our exposure.”
The Brazilian company’s aircraft are subject to a 10% tariff slapped on US imports by President Donald Trump on 5 April, though US-sourced components on those aircraft would likely be exempt from the taxes.
Embraer expects its 2025 earnings margin before interest and taxes will come in 90 basis points lighter due to the 10% import duty, with the impact largely reflecting duties paid on Embraer’s business jets and on aftermarket services and support, says chief financial officer Antonio Garcia.
“We do not have, at least today, a setback on commercial [aviation], but its too early to confirm 100%,” he adds.
Embraer is working to offset the tariff impact through measures including cost cutting and improving efficiency, and the company still expects to achieve its 2025 financial goals.
Those goals include delivering 77-85 commercial aircraft and 145-155 business jets, generating $7-7.5 billion in revenue and achieving an adjusted profit margin of 7.5-8.3%.
In the first quarter, Embraer turned a $79.8 million profit, up from a $32 million profit in the same period of 2024. It generated $1.1 billion in revenue during the period, up 23% year on year, and delivered 30 aircraft, including seven commercial jets and 23 business jets, up from 25 deliveries in the first quarter of 2024.
