AAR Corp

AAR operates globally, with sales to foreign customers representing 34.2% of consolidated sales in fiscal 2025, reflecting meaningful exposure to international airline and government demand. The company maintains offices and facilities in several foreign countries and runs repair capacity across the United States, Canada, Asia, and Europe through twelve FAA-certificated repair stations. Ten of these repair stations also hold EASA certification and three hold TCCA certification, enabling work for customers operating under different regulatory regimes. International expansion also occurs through acquisitions and investments, including an operating facility in Thailand acquired with the Product Support business. This footprint supports global parts distribution and repair turnaround but increases exposure to cross-border regulatory, currency, and operational risks.

AAR’s results are tied to commercial aviation utilization and maintenance cycles; downturns in flight activity can reduce demand for parts, MRO events, and asset values. The company operates in highly competitive markets against OEMs, airline in-house MRO operations, and other independent suppliers, which can pressure pricing and access to skilled labor. International operations are material (34.2% of FY2025 sales to foreign customers) and create exposure to regulatory compliance, geopolitical disruption, and execution risk in overseas facilities and joint ventures. Government contracting adds risks from bid protests, shifting procurement preferences (including set-asides), and potential insourcing by agencies. Cybersecurity is a persistent threat given reliance on IT systems and defense-contractor requirements, and a high concentration in specific engine/part platforms can create asset-specific demand and valuation risk.