GENERAL ELECTRIC CO

FINANCIAL POLICY. GE Aerospace is committed to maintaining strong investment grade ratings with a disciplined capital allocation strategy. The Company will continue its commitment to investing and developing technologies that improve safety, durability, reliability and efficiency for our current engine products over their lifecycle and for the future of flight, and expanding our manufacturing and MRO capacity through research and development and capital expenditures. We intend to return a portion of our free cash flow* to shareholders through dividends and share repurchases. Merger and acquisition investments will be pursued in a disciplined way and focused on those that offer strategic, operational and financial synergies.

LIQUIDITY POLICY. We maintain a strong focus on liquidity and define our liquidity risk tolerance based on sources and uses to maintain a sufficient liquidity position to meet our business needs and financial obligations under both normal and stressed conditions. We believe that our consolidated liquidity and availability under our revolving credit facilities will be sufficient to meet our liquidity needs.

CONSOLIDATED LIQUIDITY. Our primary sources of liquidity consist of cash and cash equivalents, free cash flow* from our operating businesses, and access to capital markets. If needed, we can also draw from short-term borrowing facilities, including revolving credit facilities. Cash generation can be subject to variability based on many factors, including receipt of down payments on large equipment orders, timing of billings on long-term contracts, timing of customer allowances and market conditions. Total cash, cash equivalents and restricted cash was $11.0 billion at March 31, 2026, of which $8.5 billion was held in the U.S. and $2.5 billion was held outside the U.S.

Cash held outside the U.S. has generally been reinvested in active foreign business operations; however, substantially all of our unrepatriated income is subject to U.S. federal tax and, if there is a change in reinvestment, we would expect to be able to repatriate available cash (excluding amounts held in countries with currency controls) without significant tax cost.

Cash, cash equivalents and restricted cash at March 31, 2026 included $0.4 billion of cash held in countries with currency control restrictions, which may restrict the transfer of funds to the U.S. or limit our ability to transfer funds to the U.S. without incurring substantial costs. Excluded from cash, cash equivalents and restricted cash is $0.8 billion of cash in our run-off insurance operations, which is classified as All other assets in the Statement of Financial Position, and $1.0 billion of cash in our discontinued operations held by Bank BPH (see Note 2).

In March 2024, the Company announced that the Board of Directors had authorized the repurchase of up to $15.0 billion of our common stock. Under this program, shares may be repurchased on the open market, via various strategies, including plans complying with rules 10b5-1 and 10b-18 as well as accelerated share repurchases. In the first quarter of 2026, we repurchased 7.2 million shares for $2.2 billion, including repurchases of 4.2 million shares for $1.3 billion using accelerated stock repurchases as a mechanism to achieve planned repurchase volumes within a quarter during closed windows. We have repurchased $14.5 billion in total under this authorization. Repurchases under the program after the first quarter of 2026 will be pursuant to a new authorization for up to $20 billion approved by the Board of Directors in December 2025.

BORROWINGS. Consolidated total borrowings were $20.3 billion and $20.5 billion at March 31, 2026 and December 31, 2025, respectively. The decrease of $0.2 billion is due to maturities and changes in foreign currency exchange rates. The Company also holds a five-year unsecured revolving credit facility, maturing in 2029, in an aggregate committed amount of $3.0 billion, and had zero outstanding at March 31, 2026.

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CREDIT RATINGS AND CONDITIONS. We have relied, and may continue to rely, on the short- and long-term debt capital markets to fund, among other things, a significant portion of our operations. The cost and availability of debt financing is influenced by our credit ratings. Moody’s Investors Service (Moody’s) and Standard and Poor’s Global Ratings (S&P) currently issue ratings on our short- and long-term debt. On February 2, 2026, Moody's upgraded our long-term rating from A3 to A2, our short-term rating from P-2 to P-1 and maintained our positive outlook. On April 16, 2026, S&P revised our outlook from stable to positive, and affirmed our short-term rating of A-2 and our long-term rating of A-. Our credit ratings as of the date of this filing are set forth in the table below.

Our ratings may be subject to a revision or withdrawal at any time by the assigning rating organization, and each rating should be evaluated independently of any other rating.

Substantially all of the Company's debt agreements in place at March 31, 2026 do not contain material credit rating covenants. Our unused back-up revolving syndicated credit facility contains a customary net debt-to-EBITDA financial covenant, which we satisfied at March 31, 2026.

FOREIGN EXCHANGE RISK. As a result of our global operations, we generate and incur a small portion of our revenue and expenses in currencies other than the U.S. dollar. Such principal currencies include the euro, the British sterling pound and Brazilian real. The effect of foreign currency fluctuations on income was insignificant. See Note 20 for further information about our risk exposures, our use of derivatives, and the effects of this activity on our financial statements.

STATEMENT OF CASH FLOWS

CASH FLOWS FROM CONTINUING OPERATIONS. The most significant source of cash flows from operating activities (CFOA) is customer-related activities, the largest of which is collecting cash resulting from product or services sales. The most significant operating use of cash is to pay our suppliers, employees, tax authorities and postretirement plans.

Cash from operating activities was $1.9 billion for the three months ended March 31, 2026, an increase of $0.3 billion compared to 2025, primarily due to: an increase in net income (after adjusting for depreciation of property, plant, and equipment, and amortization of intangible assets) primarily driven by CES and an increase in sales discounts and allowances, partially offset by working capital growth and an increase in cash used in All other operating activities.

Cash from sales discounts and allowances was $1.0 billion for the three months ended March 31, 2026, an increase of $0.9 billion compared to 2025, primarily due to increases in allowances on new engine installs and spare parts at CES.

The cash impacts from changes in working capital was $(0.5) billion for the three months ended March 31, 2026, a decrease of $0.6 billion compared to 2025, due to: current receivables of $(0.4) billion, from higher volume partially offset by higher collections, including increased collections from CFM International, primarily in CES; current contract assets, contract liabilities and current deferred income of $(0.3) billion, driven by higher revenue recognition and a lower unfavorable change in estimated profitability on long-term service agreements, primarily driven by the absence of charges, including a $0.1 billion reversal of a majority of the tariff-related charge from the first quarter of 2025, partially offset by higher billings; progress collections of $(0.1) billion, driven by higher liquidations partially offset by higher collections. These decreases were partially offset by inventories, including deferred inventory, of $0.2 billion, driven by lower material purchases. Accounts payable was flat, driven by lower volume offset by lower disbursements.

The components of All other operating activities included:

Cash used for investing activities was $(0.9) billion for the three months ended March 31, 2026, an increase of $0.6 billion compared to 2025, primarily due to: higher net purchases of insurance investment securities of $0.4 billion and higher equity method investments $0.2 billion. Cash used for additions to property, plant and equipment and internal-use software net of dispositions, which are components of free cash flow*, was $0.3 billion and $0.2 billion for the three months ended March 31, 2026 and 2025, respectively.

Cash used for financing activities was $(2.8) billion for the three months ended March 31, 2026, an increase of $0.5 billion compared to 2025, primarily due to: an increase in treasury stock repurchases of $0.4 billion and higher dividends paid to shareholders of $0.1 billion.

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