Canadian business jet maker Bombardier has announced that it is raising its revenue and free cash flow targets for 2025, reflecting the strong demand for private flights. The Montreal-based company is now targeting more than $9 billion in annual revenue by 2025, up from an earlier objective for that year of about $7.5 billion. Additionally, the company is expected to generate more than $900 million in free cash flow by 2025, up from earlier estimates of greater than $500 million.
Swelling order backlogs on persistent strong demand
Corporate jet makers have reported swelling order backlogs on persistent strong demand for private flying, especially in the United States, the world’s largest market for business aviation. The Covid-19 pandemic has also led to increased demand for private flights as people try to avoid crowded airports and commercial flights. However, while demand continues to be strong, supply chain snags and fears of a recession remain headwinds.
Bombardier’s growth in defense sales and services
Bombardier also said it anticipates tripling its revenues from defense sales and services to more than $1 billion in the second half of the decade. The company’s defense business for special mission business jets could grow to a possible $1 billion in annual revenues. This move into defense sales is part of the company’s diversification strategy, which aims to reduce its reliance on the volatile business jet market.
Bombardier’s performance in 2022
In 2022, Bombardier’s full-year revenue reached $6.9 billion. This is a solid performance considering the challenges posed by the pandemic. The company’s strong financial position has allowed it to invest in new products and technology, such as the recently launched Challenger 3500 business jet. Bombardier’s focus on innovation has helped it stay ahead of its competitors and maintain its position as one of the world’s leading business jet makers.
In conclusion, Bombardier’s decision to raise its revenue and free cash flow targets reflects the strong demand for private flights and the company’s solid financial position. By diversifying into defense sales and services, Bombardier is taking steps to reduce its reliance on the volatile business jet market. The company’s focus on innovation and investment in new products and technology has helped it maintain its position as a leading business jet maker. While supply chain snags and fears of a recession remain headwinds, Bombardier’s strong performance in 2022 and its ambitious targets for 2025 suggest that the company is well-positioned for future growth.