London, Feb 26, 2026, 07:55 GMT — Premarket
- Rolls-Royce pointed to a £7-£9 billion share buyback planned for 2026-2028, following a notable jump in profit expected for 2025.
- Mid-term targets for profit, margins, and cash are up, with 2026 guidance also revised higher.
- The stock finished Wednesday’s session at 1,310 pence.
Shares in Rolls-Royce looked active Thursday, as the aero-engine group raised its outlook and unveiled plans for a multi-year buyback, buoyed by annual profits up 40%.
Investors have already driven a sharp rerating of the stock over the past year, so there’s not much tolerance left for any slip on cash, margins, or how quickly the turnaround plays out. With the buyback and raised guidance, those points get thrown back into focus as London’s market approaches the open.
Rolls-Royce plans to repurchase between £7 billion and £9 billion in shares from 2026 through 2028, targeting £2.5 billion of that in 2026 alone. The company also announced a final dividend of 5 pence per share.
Rolls-Royce turned in £3.46 billion in underlying operating profit for 2025, stripping out exceptional items. Free cash flow reached £3.3 billion, and the company ended the year with £1.9 billion in net cash. Looking to 2026, Rolls-Royce guided for underlying operating profit between £4.0 billion and £4.2 billion and expects free cash flow to come in at £3.6-£3.8 billion.
Tufan Erginbilgic, chief executive, said the group managed everything from supply chain bumps to tariffs as it hit its 2025 performance targets.
Rolls-Royce said its civil aerospace operations benefited from increased widebody flight hours and higher demand for engine servicing. Over in power systems, the company pointed to a lift from data centre-related orders. Defence? Still strong, and new engine projects are moving ahead, the release noted.
Rolls-Royce has laid out key dates tied to its ramped-up focus on shareholder returns. The company flagged that its final dividend hinges on a shareholder vote set for April 30 at the annual general meeting. If cleared, the payment lands on June 3 for anyone listed on the register by April 24.
LSE data showed the stock wrapped up Wednesday at 1,310 pence, having bounced from as low as 1,305 pence to as high as 1,336.5 pence during the session.
There’s a risk here: guidance relies on Rolls-Royce pushing delivery and durability gains, all while tackling supply issues and holding down costs—plus handling the tariff worries flagged by management. Shares have climbed a long way, so even a whiff of weaker free cash flow, or signs the shop-visit and spare-parts picture is getting tougher, could hurt.
Attention now turns to management’s results briefing, where investors are looking for more on the 2026 buyback speed, capital allocation, and the updated mid-term goals stretching out to 2028.
