Financial Statements 2023

2. Notes to the IFRS Consolidated Financial Statements 2.4 Airbus Performance

2.4 Airbus Performance

12.

Revenue and Gross Margin

Revenue increased by €6,683 million to €65,446 million (2022: €58,763 million). The increase is mainly driven by higher aircraft deliveries of 735 aircraft (in 2022: 661 aircraft), paired with

higher contributions from Airbus Defence and Space and strong services business in Airbus Helicopters.

Revenue by geographical areas based on the location of the customer is as follows:

2023

(In € million)

2022

Europe

25,733

24,261

Asia ‑ Pacific

18,733

15,380

North America

13,784

13,549

Middle East

3,933

2,598

Latin America

1,737

2,086

Other countries

1,526

889

Total

65,446

58,763

The gross margin decreased by €-527 million to €10,044 million compared to €10,571 million in 2022. It is mainly driven by negative foreign exchange impacts (largely related to €-1.4 billion US dollar Working Capital mismatch impact year ‑ on ‑ year which mainly reflects the phasing impact arising from the difference between transaction date and delivery date), higher costs due to hiring linked to the production ramp ‑ up and updated estimates at completion (EAC) of certain space programmes of -0.6 billion, partly offset by higher deliveries, strong services across the Company’s segments and the release of compliance ‑ related provisions. In 2022, it included a non ‑ recurring positive impact related to the re ‑ measurement of past service cost in the retirement obligations of €0.4 billion. The gross margin rate decreased from 18.0% to 15.3%. In 2023, the Company has delivered eight A400M aircraft. The Company has continued with development activities towards achieving the revised capability roadmap. Retrofit activities are progressing in close alignment with the customer. In 2022, an update of the contract estimate at completion was performed and an additional charge of €477 million recorded, mainly reflecting updated assumptions, including inflation and risks related to the remaining SOC3 contractual development milestones to be achieved. In 2023, an additional update of the contract estimate at completion has been performed and a net charge of €41 million recorded.

Risks remain on the qualification of technical capabilities and associated costs, on aircraft operational reliability, on cost reductions and on securing overall volume as per the revised baseline. In addition, the updated EACs of certain space programmes led to a charge of €-0.6 billion as of 31 December 2023. This includes an updated assessment of assumptions and estimates related to the remaining revenue and costs to completion and the progress of the contracts together with the underlying programmes status (see “– Note 5: Key Estimates and Judgements”). In a notice of termination dated 9 June 2022, the Norwegian Defence Material Agency notified NHIndustries SAS (“NHI”) of the Norwegian Ministry of Defence’s decision to terminate its contract for the supply of 14 NH90 helicopters. In a press release dated 10 June 2022, NHI noted it “is extremely disappointed by the decision taken by the Norwegian Ministry of Defence and refutes the allegations being made against the NH90 as well as against [NHI].” NHI considers the termination to be legally groundless and reserves its right to take any necessary legal action to challenge it. The parties are working towards resolving this matter, with a mediation process having been initiated during the second quarter of 2023.

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Airbus

Financial Statements 2023