Rolls-Royce Skyrockets 6% on Upgraded Full-Year Profit Forecast

British engineering titan Rolls-Royce Holdings has reported a remarkable performance for the first half of 2026. The company’s underlying operating profit reached a staggering £2.5 billion ($3.3 billion), marking a 46% increase compared to the same period last year. This stellar performance has led the company to revise its full-year guidance upwards for the second time in a row.

The revenue for the six months ending on June 30 saw a 24% increase to £11.3 billion, surpassing analysts’ expectations. The company’s operating margin also expanded to 22.5%, a significant rise from 19.1% a year earlier. Rolls-Royce is now predicting a full-year underlying operating profit between £4.7 billion and £4.9 billion, a sharp increase from its previous forecast of £4 billion to £4.2 billion. The company has also revised its free cash flow forecast to between £3.8 billion and £4 billion.

These impressive results reflect Rolls-Royce’s increasing involvement in two major global spending cycles: the defense boom and the AI data center buildout. The defense unit reported a 57% increase in underlying profits, while the Power Systems division saw a 72% surge in operating profit, fueled by the rising demand from data centers. CFO Helen McCabe disclosed that the company’s data center power order book grew by more than half during the first half of the year. The company’s shares leaped as much as 6% in early London trading following the announcement.

Source: CNBC – Rolls-Royce Boosts Guidance Amid Defense Surge and AI Data Center Expansion