second quarter 2026
Filed Aug 4, 2026Willis Lease Finance Corporation Reports Solid Second Quarter 2026 Financial Results
Lease rent revenue, income from operations, gain on sale of leased equipment, and Adjusted EBITDA increased year over year, while net income attributable to common shareholders was lower than the prior-year quarter reported in the Adjusted EBITDA reconciliation.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Income from operationsGAAP | $34.0 million | – | 20.2% |
| Lease rent revenueGAAP | $77.1 million | – | 6.7% |
| Core lease rent and maintenance reserve revenuesGAAP | $123.6 million in the aggregate | – | 0.5% |
| Long-term maintenance revenueGAAP | $7.5 million | – | – |
| Gain on sale of leased equipmentGAAP | $32.0 million | – | 16.2% |
| Net income attributable to common shareholdersGAAP | $ 28,745 (in thousands) | – | – |
| Adjusted EBITDAnon-GAAP | $ 120,737 (in thousands) | – | 4.0% |
| Income tax expenseGAAP | 7,828 (in thousands) | – | – |
| Interest expenseGAAP | 29,689 (in thousands) | – | – |
| Preferred stock dividends/costsother | 1,423 (in thousands) | – | – |
| Loss on debt extinguishmentGAAP | 5,421 (in thousands) | – | – |
| Depreciation and amortization expenseGAAP | 29,068 (in thousands) | – | – |
| Stock compensation expenseGAAP | 12,703 (in thousands) | – | – |
| Write-down of equipmentGAAP | 4,910 (in thousands) | – | – |
| Acquisition, financing and divestitures related expensesGAAP | 2,560 (in thousands) | – | – |
| Otherother | (1,610) (in thousands) | – | – |
| Net income attributable to common shareholdersGAAP | $ 52,406 (in thousands) | – | – |
| Adjusted EBITDAnon-GAAP | $ 244,585 (in thousands) | – | – |
What drove it
- Lease rent revenue increased due to an increase in the average size of the portfolio compared with the prior-year period.
- Long-term maintenance revenue is recognized at the end of a lease period as the related maintenance reserve liability is released from the balance sheet.
- The $32.0 million gain on sale of leased equipment reflected the sale of 21 engines and other parts and equipment from the lease portfolio.
- The investment fund partnership with Liberty Mutual Investments commenced operations in March 2026, followed by the investment fund partnership with Blackstone Credit & Insurance in April 2026.
Concerns
- Net income attributable to common shareholders was $ 28,745 (in thousands), compared with $ 58,955 (in thousands) in the prior-year quarter.
- The quarter included $5,421 (in thousands) of loss on debt extinguishment.
- Acquisition, financing and divestitures related expenses were 2,560 (in thousands), compared with 662 (in thousands) in the prior-year quarter.
- The prior-year Adjusted EBITDA reconciliation included $43.0 million in relation to the gain on sale of the BAML business.
- Core lease rent and maintenance reserve revenues increased 0.5%, below the 6.7% increase in lease rent revenue.
What to watch
- The contribution from the Liberty Mutual Investments and Blackstone Credit & Insurance investment fund partnerships that commenced operations in March 2026 and April 2026, respectively.
- Lease rent revenue growth and the average size of the lease portfolio.
- Long-term maintenance revenue, which is recognized when maintenance reserve liabilities are released at the end of lease periods.
- Future gains on sales of leased equipment following the sale of 21 engines and other parts and equipment in the second quarter of 2026.
- Assets under management following reported 21% year-over-year total AUM growth.
Balance sheet and cash flow
- The lease portfolio was $2,956.3 million as of June 30, 2026, consisting of $2,783.4 million of equipment held in its operating lease portfolio, $89.3 million of notes receivable, and $83.6 million of maintenance rights.
- The lease portfolio was $2,988.9 million as of December 31, 2025, consisting of $2,801.7 million of equipment held in its operating lease portfolio, $139.9 million of notes receivable, $30.6 million of maintenance rights, and $16.6 million of investments in sales-type leases.
- The book value of lease assets owned either directly or through WLFC’s joint ventures was $3,721.6 million as of June 30, 2026.
- Assets under management were $4.4 billion as of June 30, 2026.
- The June 30, 2026 lease portfolio represented 334 engines, 22 aircraft, one marine vessel, and other leased parts and equipment.
- The December 31, 2025 lease portfolio represented 363 engines, 20 aircraft, one marine vessel, and other leased parts and equipment.
Analysis
WLFC reported improved underlying operating measures in the second quarter ended June 30, 2026. Income from operations was $34.0 million, up 20.2%, while lease rent revenue increased 6.7% to $77.1 million. The company attributed lease-rent growth to a larger average portfolio. Core lease rent and maintenance reserve revenues were $123.6 million in the aggregate, up 0.5%.
Equipment sales and maintenance-reserve releases remained meaningful contributors to the period. Gain on sale of leased equipment was $32.0 million, up 16.2%, and reflected sales of 21 engines and other parts and equipment. Long-term maintenance revenue was $7.5 million, versus $0.5 million in the prior-year quarter; the company stated that this revenue is recognized when a related maintenance reserve liability is released at the end of a lease period.
Adjusted EBITDA was $ 120,737 (in thousands), compared with $ 116,061 (in thousands) a year earlier. GAAP net income attributable to common shareholders was $ 28,745 (in thousands), versus $ 58,955 (in thousands). The reconciliation identifies a $5,421 (in thousands) loss on debt extinguishment, $2,560 (in thousands) of acquisition, financing and divestitures related expenses, and $4,910 (in thousands) of equipment write-downs in the current quarter. The prior-year reconciliation also included $43.0 million related to the gain on sale of the BAML business, affecting comparability.
The company continued to develop its asset-management platform. Its Liberty Mutual Investments fund partnership commenced operations in March 2026 and its Blackstone Credit & Insurance partnership commenced in April 2026. Assets under management reached $4.4 billion as of June 30, 2026, while the book value of lease assets owned directly or through joint ventures was $3,721.6 million. The on-balance-sheet lease portfolio was $2,956.3 million, compared with $2,988.9 million at December 31, 2025, with a lower notes-receivable balance and higher maintenance rights.
No forward financial guidance, capital-return activity, cash balance, debt balance, operating cash flow, free cash flow, gross margin, total revenue, or EPS was included in the provided filing text. The central reported items to monitor are lease-rent growth, the timing of maintenance-reserve releases, gains on equipment sales, costs associated with financing and transactions, and the growth of assets under management through the new fund partnerships.
Management, verbatim
The first half of the year was focused on establishing and building Willis Aviation Capital, with total AUM growth of 21% year over year, we have delivered.
Austin C. Willis, Chief Executive Officer of WLFC
Not in the filing
stated, not guessed- Total revenue and its prior-year comparison, as the statement of income is truncated after the Lease rent heading.
- Segment revenue and segment operating results.
- Gross profit and gross margin.
- Operating expenses, except for items separately reported in the Adjusted EBITDA reconciliation.
- GAAP and non-GAAP earnings per share.
- Quarter-over-quarter comparisons for reported metrics.
- Operating cash flow and free cash flow.
- Cash and cash equivalents.
- Debt balances.
- Share repurchases, dividends, and other capital-return activity.
- Forward financial guidance.
- Prior outlook for comparison with actual results.
- A prior-year absolute value for income from operations.
- Prior-year absolute value for core lease rent and maintenance reserve revenues.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.