Dassault Aviation SA saw its stock slip by 1% following the release of its first-half 2025 results, with weak private jet orders and supply chain challenges weighing on the company’s commercial performance.
The French aerospace manufacturer reported that orders for its Falcon business jets fell to their lowest level since 2020, even as overall backlog hit a record high, supported by strong defense demand.
Falcon orders decline amid tariff and supply chain pressures
Dassault received just eight Falcon business jet orders in the first half of the year, the lowest since 2020.
CEO Eric Trappier attributed the slowdown to the ongoing threat of tariffs and related delays in assembly, which are discouraging customers.
“There is a tariff impact, no doubt about it,” Trappier said during a press conference, adding that supply chain difficulties are also increasing delivery times and pressuring sales.
In total, Falcons accounted for €903 million ($1.1 billion), or 11%, of the company’s €8.1 billion in first-half orders.
The company continues to monitor negotiations between the US and Europe, which could further affect Falcon demand going forward.
Dassault reaffirmed its full-year target of delivering 40 Falcon jets, but the outlook for additional sales remains uncertain under the current trade conditions.
Defense business drives record backlog
Despite the dip in private jet demand, Dassault’s overall order book remains strong, largely due to its defense segment.
The company reported a record backlog of €48.3 billion at the end of the quarter, with fighter jets accounting for over three-quarters of planes on order.
A significant contributor to this was India’s agreement to acquire 26 Rafale Marine fighter jets for its navy, a major win for the Paris-based manufacturer in the highly competitive defense market.
Defense orders made up the lion’s share of Dassault’s first-half activity, cushioning the impact of weaker Falcon sales.
The increase in European and global defense spending has also provided some optimism for the company’s future revenue prospects, particularly in light of geopolitical tensions and modernization programs in various countries.
Earnings miss expectations but full-year outlook maintained
Dassault’s adjusted net sales and adjusted net income both fell short of analyst expectations, contributing to a roughly 1% decline in its shares, which traded at €286.
Still, the company reaffirmed its guidance for 2025, forecasting full-year sales of €6.5 billion and targeting deliveries of 40 Falcon private jets and 25 Rafale fighter aircraft.
While the commercial aviation side of the business faces headwinds, Dassault’s robust defense pipeline and expanding international contracts suggest a degree of stability for the group in the near term.
However, the company remains cautious, particularly as it awaits developments in US-Europe trade relations that could further impact its civil aviation performance.
As Dassault navigates a mixed environment, balancing geopolitical tailwinds with commercial aviation challenges, investors will be closely watching second-half order activity and any shifts in trade policy that could influence the Falcon jet recovery.
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