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RTX Q3 Earnings Surpass Estimates by 5%, Sales View Raised
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RTX Corporation’s (RTX - Free Report) third-quarter 2023 adjusted earnings per share (EPS) of $1.25 beat the Zacks Consensus Estimate of $1.19 by 5%. The bottom line also improved 3.3% from the year-ago quarter’s level of $1.21.
Including one-time items, the company reported GAAP loss of 68 cents per share against earnings of 94 cents generated in the prior-year quarter.
Operational Performance
RTX’s third-quarter adjusted sales of $18,952 million beat the Zacks Consensus Estimate of $18,709 million by 1.3%.
The company reported GAAP sales of $13,494 million compared with $16,951 million in the third quarter of 2022.
Total costs and expenses decreased 4% year over year to $14,863 million. The company incurred an operating loss of $1,396 million against an operating profit of $1,520 million in the prior-year quarter.
Collins Aerospace: Adjusted sales at this segment increased 17% year over year to $6,686 million. This improvement can be attributed to higher commercial aftermarket and commercial OEM sales, backed by strong demand across commercial aerospace end markets.
The adjusted operating income totaled $1,043 million compared with the year-ago quarter’s level of $756 million.
Pratt & Whitney: This segment’s adjusted sales rose 18% year over year to $6,327 million. The improvement was due to growth in the commercial aftermarket and commercial OEM businesses, backed by higher volume and content, favorable mix across commercial aftermarket, as well as a favorable OE volume and mix in Large Commercial Engines. Increased military sales driven by higher F135 development and sustainment volume also contributed to this unit’s sales growth.
Adjusted operating profit amounted to $413 million compared with the year-ago quarter’s level of $318 million. This improvement was driven by drop through on higher commercial aftermarket sales.
Raytheon: This segment recorded third-quarter sales of $6,472 million, up 3% year over year, driven by higher sales volume from Naval Power, including AIM-9X, and Advanced Technology classified programs.
The adjusted operating profit totaled $570 million, down 18% from $694 million recorded in the corresponding period of 2022.
Financial Update
RTX had cash and cash equivalents of $5,456 million as of Sep 30, 2023, compared with $6,220 million as of Dec 31, 2022.
Long-term debt was $32,701 million as of Sep 30, 2023, up from $30,694 million as of Dec 31, 2022.
Net cash flow from operating activities was $3,316 million as of Sep 30, 2023, compared with $778 million at the end of third-quarter 2022.
Free cash flow totaled $2,752 million at the end of the reported quarter compared with $263 million at the end of third-quarter 2022.
Guidance
RTX has updated its financial guidance for 2023.
The company currently projects adjusted EPS in the band of $4.98-$5.02 compared with the earlier guidance of $4.95-$5.05. The Zacks Consensus Estimate for RTX’s 2023 EPS is pegged at $5.01, which lies just above the midpoint of the company’s guided range.
RTX has raised its adjusted sales guidance to $74 billion, up from the earlier projected band of $73-$74 billion. The Zacks Consensus Estimate for sales is pegged at $73.75 billion, which lies below the company’s guidance.
The company now expects free cash flow of $4.8 billion, up from the previously anticipated $4.3 billion.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2023 adjusted earnings of $6.77 per share, which beat the Zacks Consensus Estimate of $6.66 by 1.7%. The bottom line, however, deteriorated 1.5% from the year-ago quarter's recorded figure.
Net sales were $16.88 billion in the reported quarter, which surpassed the Zacks Consensus Estimate of $16.66 billion by 1.3%. The top line also rose 1.8% from $16.58 billion reported in the year-ago quarter.
Upcoming Q3 Defense Earnings
Textron (TXT - Free Report) is scheduled to report third-quarter 2023 results on Oct 26, before market open. The Zacks Consensus Estimate for revenues is pegged at $3.45 billion, indicating a 12.1% increase from the year-ago quarter’s reported figure.
The consensus mark for Textron’s earnings is pinned at $1.27 per share, indicating a 19.8% year-over-year improvement.
The Boeing Company (BA - Free Report) is set to release third-quarter 2023 results on Oct 25, before the opening bell. The Zacks Consensus Estimate for total revenues is pegged at $18.25 billion, indicating a 14.4% year-over-year increase.
The bottom-line estimate for BA is pegged at a loss of $3.05 per share, indicating a significant improvement from the year-ago quarter’s reported loss of $6.18.
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RTX Q3 Earnings Surpass Estimates by 5%, Sales View Raised
RTX Corporation’s (RTX - Free Report) third-quarter 2023 adjusted earnings per share (EPS) of $1.25 beat the Zacks Consensus Estimate of $1.19 by 5%. The bottom line also improved 3.3% from the year-ago quarter’s level of $1.21.
Including one-time items, the company reported GAAP loss of 68 cents per share against earnings of 94 cents generated in the prior-year quarter.
Operational Performance
RTX’s third-quarter adjusted sales of $18,952 million beat the Zacks Consensus Estimate of $18,709 million by 1.3%.
The company reported GAAP sales of $13,494 million compared with $16,951 million in the third quarter of 2022.
Total costs and expenses decreased 4% year over year to $14,863 million. The company incurred an operating loss of $1,396 million against an operating profit of $1,520 million in the prior-year quarter.
RTX Corporation Price, Consensus and EPS Surprise
RTX Corporation price-consensus-eps-surprise-chart | RTX Corporation Quote
Segmental Performance
Collins Aerospace: Adjusted sales at this segment increased 17% year over year to $6,686 million. This improvement can be attributed to higher commercial aftermarket and commercial OEM sales, backed by strong demand across commercial aerospace end markets.
The adjusted operating income totaled $1,043 million compared with the year-ago quarter’s level of $756 million.
Pratt & Whitney: This segment’s adjusted sales rose 18% year over year to $6,327 million. The improvement was due to growth in the commercial aftermarket and commercial OEM businesses, backed by higher volume and content, favorable mix across commercial aftermarket, as well as a favorable OE volume and mix in Large Commercial Engines. Increased military sales driven by higher F135 development and sustainment volume also contributed to this unit’s sales growth.
Adjusted operating profit amounted to $413 million compared with the year-ago quarter’s level of $318 million. This improvement was driven by drop through on higher commercial aftermarket sales.
Raytheon: This segment recorded third-quarter sales of $6,472 million, up 3% year over year, driven by higher sales volume from Naval Power, including AIM-9X, and Advanced Technology classified programs.
The adjusted operating profit totaled $570 million, down 18% from $694 million recorded in the corresponding period of 2022.
Financial Update
RTX had cash and cash equivalents of $5,456 million as of Sep 30, 2023, compared with $6,220 million as of Dec 31, 2022.
Long-term debt was $32,701 million as of Sep 30, 2023, up from $30,694 million as of Dec 31, 2022.
Net cash flow from operating activities was $3,316 million as of Sep 30, 2023, compared with $778 million at the end of third-quarter 2022.
Free cash flow totaled $2,752 million at the end of the reported quarter compared with $263 million at the end of third-quarter 2022.
Guidance
RTX has updated its financial guidance for 2023.
The company currently projects adjusted EPS in the band of $4.98-$5.02 compared with the earlier guidance of $4.95-$5.05. The Zacks Consensus Estimate for RTX’s 2023 EPS is pegged at $5.01, which lies just above the midpoint of the company’s guided range.
RTX has raised its adjusted sales guidance to $74 billion, up from the earlier projected band of $73-$74 billion. The Zacks Consensus Estimate for sales is pegged at $73.75 billion, which lies below the company’s guidance.
The company now expects free cash flow of $4.8 billion, up from the previously anticipated $4.3 billion.
Zacks Rank
RTX currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Q3 Defense Earnings
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2023 adjusted earnings of $6.77 per share, which beat the Zacks Consensus Estimate of $6.66 by 1.7%. The bottom line, however, deteriorated 1.5% from the year-ago quarter's recorded figure.
Net sales were $16.88 billion in the reported quarter, which surpassed the Zacks Consensus Estimate of $16.66 billion by 1.3%. The top line also rose 1.8% from $16.58 billion reported in the year-ago quarter.
Upcoming Q3 Defense Earnings
Textron (TXT - Free Report) is scheduled to report third-quarter 2023 results on Oct 26, before market open. The Zacks Consensus Estimate for revenues is pegged at $3.45 billion, indicating a 12.1% increase from the year-ago quarter’s reported figure.
The consensus mark for Textron’s earnings is pinned at $1.27 per share, indicating a 19.8% year-over-year improvement.
The Boeing Company (BA - Free Report) is set to release third-quarter 2023 results on Oct 25, before the opening bell. The Zacks Consensus Estimate for total revenues is pegged at $18.25 billion, indicating a 14.4% year-over-year increase.
The bottom-line estimate for BA is pegged at a loss of $3.05 per share, indicating a significant improvement from the year-ago quarter’s reported loss of $6.18.