An intuitive shape parameterization and control technique suitable for high-fidelity aerodynamic shape optimization is presented. It relies on the principles of free-form and axial deformation, enabling thorough exploration of the design space while keeping the number of design variables manageable. Surface sensitivities to the design variables are readily available; their inclusion in a highly efficient and robust adjoint-based optimization methodology involving linearly elastic volume mesh deformation and a Newton-Krylov solver for the Euler equations is described. The flexibility of the proposed approach is demonstrated through the exploratory shape optimization of a three-pronged feathered winglet, leading to a span efficiency of 1.19 under a height-to-span ratio constraint of 0.1, and an optimization of a regional jet wing at transonic speed where a winglet is allowed to develop starting from a planar wingtip extension, leading to an 18.8% reduction in drag.