Shares of AAR Corp (AIR) surged 5.50% in pre-market trading on Thursday following the release of the company's impressive fourth-quarter earnings report for fiscal year 2025 and optimistic guidance for the upcoming fiscal year. The aviation services provider delivered results that surpassed analyst expectations, demonstrating robust growth across its key business segments.

AAR reported adjusted earnings per share of $1.16 for the quarter, handily beating the consensus estimate of $1.01. Revenue climbed 12% year-over-year to $736 million, also exceeding Wall Street's projections. The company's parts supply segment showed particularly strong performance, with sales growing 17% and adjusted EBITDA margin expanding to 17.1%.

Looking ahead, AAR's management expressed confidence in continued growth. The company expects organic sales growth in fiscal year 2026 to approach 9%, building on the momentum from fiscal 2025. AAR also anticipates further margin improvement, supported by cost synergies from recent acquisitions and expansion of its Maintenance, Repair, and Overhaul (MRO) capacity. Investors were also encouraged by AAR's progress in its digital initiatives, particularly the Trax software business, which recently secured a major contract with Delta Airlines.

Following the earnings release, several analysts updated their outlook on AAR Corp. RBC raised its target price to $85 from $75, while KeyBanc maintained a Buy rating with a price target of $86. These positive analyst reactions further fueled investor optimism, contributing to the stock's pre-market rally.