Rolls-Royce’s profits surge to record highs as AI and jet demand power turnaround

In 2020, Rolls-Royce was burning through billions in cash and cutting a fifth of its workforce as Covid battered the global aviation industry. Just five years later, the British engineering giant has posted its highest profits in company history. 

On Thursday, the company reported an underlying operating profit of 3.5 billion pounds for 2025, a 40% year-on-year increase and the fourth straight year where it’s done better than analysts expected. It also announced a share buyback of up to 9 billion pounds, sending shares to an all-time high, nearly double where they sat a year ago.

Since CEO Tufan Erginbilgiç took over in January 2023, the struggling company has seen a rapid turnaround, with underlying revenues growing nearly 60% between 2022 and 2025. Profits have grown even faster, rising more than fivefold over the same time frame, as all three of its business engines begin to purr.

In 2025, Civil Aerospace, the group’s largest division, saw revenues grow 15% to 10.4 billion pounds, with operating profits up 41% on surging demand for wide-body jets — a sharp turnaround from a few years ago, when Covid grounded fleets and dried up engine service revenues. Its Defence segment posted steady 8% revenue growth to 4.8 billion pounds, buoyed by rising military spending from European and US governments. Power Systems, meanwhile, was the standout division, with revenues up 19% to 4.9 billion pounds and profits soaring 60%, driven by the AI-fueled data center boom.

Now Erginbilgiç wants more. According to a new Financial Times report, the company has asked the UK government for up to 200 million pounds in funding to help develop a new engine for short-haul planes. That’s a lucrative segment that Rolls-Royce actually exited in 2013, but now aims to rejoin, as Airbus and Boeing are expected to pick engines for their next-generation short-haul jets by the end of the decade.