About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

Shares of RTX Corp (NYSE:RTX) are down 9% at $114.75 at last glance, despite the firm's better-than-expected first-quarter earnings and revenue. Disappointing sales guidance is weighing on the stock, after the company warned of a potential $850 million hit due to tariffs. CEO Chris Calio acknowledge the "clearly very dynamic" environment, but said the company is well positioned. Before today's bear gap, RTX was having trouble breaking above the $130 level, a familiar line of both support and pressure this y ...

Financial Data and Key Metrics Changes - The company achieved 8% organic sales growth and 120 basis points of segment margin expansion, with strong contributions from each business segment [7][34] - Adjusted sales reached $20.3 billion, up 5% overall and 8% organically, with adjusted earnings per share of $1.47, reflecting a 10% increase from the prior year [34][35] - Free cash flow improved by over $900 million compared to the previous year, totaling $792 million in the quarter [7][35] Business Line Data and Key Metrics Changes - Commercial aftermarket sales increased by 21%, while commercial OE sales rose by 3% and defense sales grew by 4% [8] - Collins reported sales of $7.2 billion, up 8% adjusted and 9% organically, driven by commercial aftermarket and defense strength [37] - Pratt & Whitney's sales reached $7.4 billion, up 14% on both adjusted and organic bases, with commercial aftermarket sales up 28% [40] - Raytheon experienced a 5% decline in adjusted sales to $6.3 billion, but organic sales were up 2% due to higher volume in land and air defense systems [42] Market Data and Key Metrics Changes - The company exited the quarter with a backlog of $217 billion, an 8% year-over-year increase, including $125 billion in commercial orders and $92 billion in defense awards [28] - The European Union has proposed an additional $850 billion in defense spending over the next four years, which aligns with the company's core capabilities [30] Company Strategy and Development Direction - The company is focused on executing commitments, innovating for future growth, and leveraging its breadth and scale [31] - Continued investment in the U.S. industrial base is planned, with nearly $10 billion invested over the last five years and an additional $2 billion planned for this year [17][18] - The company is adapting to a dynamic operating environment, particularly regarding tariffs and supply chain management [15][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning within key end markets, citing strong product portfolios and a robust backlog [28][46] - The ongoing global trade environment is being closely monitored, with potential tariff impacts not yet included in the current outlook [21][27] - Management remains optimistic about defense spending and the demand for integrated air and missile defense systems [30][31] Other Important Information - The company is making significant progress on future franchises, including the GTF Advantage and the LTAMS program, which are expected to enhance market competitiveness [12][14] - The company has seen improvements in supply chain stability, with overdue line items down over 20% year-over-year [10][70] Q&A Session Summary Question: Opportunities from European rearmament efforts - Management sees significant opportunities for Raytheon due to increased defense spending in Europe, with expectations of a book-to-bill ratio of 1.0 or more [53][56] Question: Clarification on tariff impacts - The $850 million estimate is net of mitigations, and the company has strategies in place to manage costs and pricing in response to tariffs [61][90] Question: Supply chain disruptions and China strategy - Management is focused on maintaining supply chain stability and developing multiple sourcing strategies globally, particularly in light of tariff impacts [70][74] Question: NGAP program progress - The company received a $550 million award for the NGAP program and is pleased with the testing progress and customer feedback [78] Question: Operational impacts from SPS fire - Management is optimistic about mitigating impacts from the SPS fire through collaboration with alternative suppliers [82] Question: Procurement reform implications - The company supports efforts to streamline procurement processes, which could enhance contract award timelines and reduce risks [114]

RTX and GE Aerospace expect a more than $1 billion impact combined from President Donald Trump's tariffs on imported goods and materials, the latest sign of higher prices for major U.S. manufacturers that rely on a global supply chain.Neil Mitchill, chief financial officer of defense contractor and commercial aerospace supplier RTX, said on an earnings call on Tuesday that the company will likely take a $850 million hit this year from tariffs, including the sweeping 10% tariffs that Trump imposed earlier th ...

Forward looking statements Note: This press release contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. From time to time, oral or written forward-looking statements may also be included in other information released to the public. These forward-looking statements are intended to provide RTX Corporation ("RTX") management's current expectations or plans for our future operating and financial perfor ...

RTX Corporation (RTX) Q1 2025 Earnings Conference Call April 22, 2025 08:30 AM ET Company Participants Lateef - Conference Call OperatorChris Calio - President and Chief Executive OfficerNeal Mitchell - Chief Financial OfficerNathan Ware - Vice President of Investor Relations Conference Call Participants Peter Arment - Analyst, BairdRobert Stollard - Analyst, Vertical ResearchMiles Walton - Analyst, Wolf ResearchRonald Epstein - Analyst, Bank of AmericaScott Dishel - Analyst, Deutsche BankSheila Kahiaglu - ...

RTX Posts Better-Than-Expected Earnings. Why the Stock Is Tumbling. ...

Financial Performance - RTX reported Q1 2025 sales of $20.3 billion, a 5% increase year-over-year, with 8% organic sales growth excluding divestitures[4]. - Adjusted EPS for Q1 2025 was $1.47, up 10% compared to the prior year, while GAAP EPS was $1.14[4][9]. - Operating cash flow in Q1 2025 was $1.3 billion, resulting in free cash flow of $0.8 billion[7][8]. - Net sales for Q1 2025 reached $20,306 million, a 5.2% increase from $19,305 million in Q1 2024[24]. - Operating profit for Q1 2025 was $2,035 million, compared to $1,870 million in Q1 2024, reflecting an 8.8% increase[24]. - Total segment operating profit for Q1 2025 was $2,346 million, compared to $2,257 million in Q1 2024, an increase of 3.9%[25]. - Net income for the quarter ended March 31, 2025, was $1,625 million, a decrease of 6.8% compared to $1,743 million in the same quarter of 2024[27]. - Adjusted net income attributable to common shareowners was $1,991 million for Q1 2025, up 11.2% from $1,791 million in Q1 2024[29]. - The operating profit margin improved to 10.0% in Q1 2025, compared to 9.7% in Q1 2024[31]. Segment Performance - Collins Aerospace reported Q1 2025 sales of $7.2 billion, an 8% increase year-over-year, driven by a 13% rise in commercial aftermarket sales[11][12]. - Pratt & Whitney's Q1 2025 sales were $7.4 billion, up 14% year-over-year, with a 28% increase in commercial aftermarket sales[13][14]. - Raytheon reported Q1 2025 sales of $6.3 billion, down 5% year-over-year, but up 2% when excluding the impact of a divestiture[15][16]. - Collins Aerospace segment reported net sales of $7,217 million in Q1 2025, up from $6,673 million in Q1 2024, marking an increase of 8.2%[25]. - Pratt & Whitney segment net sales increased to $7,366 million in Q1 2025 from $6,456 million in Q1 2024, a growth of 14.1%[25]. - Raytheon segment net sales decreased to $6,340 million in Q1 2025 from $6,659 million in Q1 2024, a decline of 4.8%[25]. Guidance and Projections - RTX expects adjusted sales for the full year 2025 to be between $83.0 billion and $84.0 billion, with 4% to 6% organic growth[7]. - The company anticipates adjusted EPS for 2025 to be in the range of $6.00 to $6.15[7]. - Free cash flow guidance for 2025 is projected to be between $7.0 billion and $7.5 billion[7]. Cash Flow and Assets - Free cash flow for the quarter was not specified but is a key focus for future guidance[22]. - Total assets increased to $164,864 million as of March 31, 2025, up from $162,861 million at December 31, 2024, representing a growth of 1.3%[26]. - Total current liabilities rose to $52,624 million as of March 31, 2025, compared to $51,499 million at the end of 2024, reflecting an increase of 2.2%[26]. - Free cash flow for the quarter was $792 million, a significant improvement compared to a negative $125 million in the same quarter of the previous year[32]. Tax and Non-Operational Costs - The effective tax rate for Q1 2025 was 17.0%, compared to 5.8% in Q1 2024, indicating a significant increase in tax expense[24]. - The effective tax rate for Q1 2025 was 17.0%, up from 5.8% in Q1 2024, indicating a significant increase in tax burden[29]. - The quarter ended March 31, 2025 included a tax benefit of $26 million from the closure of multiple state tax audits[36]. - An unfavorable decision related to an international tax matter resulted in a net interest expense of $35 million for the quarter ended March 31, 2025[36]. - The company incurred significant non-operational costs related to segment transformation and divestiture activities[36]. Risks and Challenges - RTX Corporation is actively managing risks related to geopolitical factors, supply chain disruptions, and changes in defense spending, which may impact future performance[22]. Organic Sales Changes - Collins Aerospace reported an organic sales change of 9% with adjusted sales of $6,673 million[34]. - Pratt & Whitney experienced a 14% organic sales change, achieving adjusted sales of $6,456 million[34]. - Raytheon had a 2% organic sales change with adjusted sales of $6,659 million[34]. - Consolidated adjusted sales reached $19,305 million, reflecting an 8% organic change[34].

Core Insights - RTX reported strong operational and financial performance in Q1 2025, with 8% organic sales growth and 10% adjusted EPS growth, alongside a 120 basis points segment margin expansion [1][2][5] - The company achieved reported and adjusted sales of $20.3 billion, reflecting a 5% increase year-over-year, with adjusted EPS rising to $1.47, up 10% from the previous year [2][4][5] - The company’s backlog reached $217 billion, with $125 billion in commercial and $92 billion in defense [5] Financial Performance - Reported sales for Q1 2025 were $20.3 billion, a 5% increase from $19.3 billion in Q1 2024 [4][5] - Net income attributable to common shareholders was $1.5 billion, down 10% from $1.7 billion in the prior year, while adjusted net income rose 11% to $2.0 billion [3][4][27] - Operating cash flow was $1.3 billion, with capital expenditures of $0.5 billion, resulting in free cash flow of $0.8 billion [3][5] Segment Performance - Collins Aerospace reported sales of $7.2 billion, an 8% increase year-over-year, driven by a 21% rise in commercial aftermarket sales [6][7] - Pratt & Whitney's sales increased by 14% to $7.4 billion, supported by a 28% rise in commercial aftermarket sales [8][9] - Raytheon experienced a 5% decline in sales to $6.3 billion, primarily due to the divestiture of its Cybersecurity, Intelligence and Services business [10][11] Outlook - RTX anticipates adjusted sales for the full year 2025 to be between $83.0 billion and $84.0 billion, with organic growth projected at 4% to 6% [5] - Adjusted EPS for the full year is expected to be in the range of $6.00 to $6.15 [5]

Core Insights - Collins Aerospace demonstrated new technology for military applications, enhancing real-time situational awareness by integrating data from various military and commercial sensors during Project Convergence Capstone 5 [1][2][3] - The integration of data allows for faster decision-making and improved operational effectiveness for military commanders, particularly in dynamic battlefield scenarios [3][4] Company Overview - Collins Aerospace is a leader in integrated solutions for the aerospace and defense industry, employing 80,000 individuals dedicated to advancing technologies for sustainable aviation and mission success [5] - RTX, the parent company of Collins Aerospace, is the largest aerospace and defense company globally, with over 185,000 employees and projected sales exceeding $80 billion in 2024 [6]