Raytheon Technologies Corporation (RTX) Q3 2026 Financial Results Summary
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RTX (RTX) Q3 2026: Strong Growth and Raised Guidance — Positive Outlook
RTX Corporation (NYSE: RTX) reported impressive results for the third quarter of 2026, showcasing robust growth in both sales and earnings. The company achieved sales of $25.0 billion, reflecting an increase of $2.5 billion or 11% compared to the prior year. This growth was complemented by a significant rise in adjusted earnings per share (EPS), which reached $2.26, up $0.56 or 33% year-over-year.
Key Financial Metrics
- Sales: $25.0 billion, up $2.5 billion or +11% YoY
- GAAP EPS: $1.89, up $0.48 or +34% YoY
- Adjusted EPS: $2.26, up $0.56 or +33% YoY
- Operating Cash Flow: $2.9 billion, down $1.7 billion or -38% YoY
- Free Cash Flow: $2.1 billion, down $1.9 billion or -47% YoY
- Net Income: $2.6 billion, up $0.7 billion or +35% YoY
Analyst View
This quarter is a strong positive for shareholders, driven by significant operational performance and a robust backlog of $340 billion. The increase in adjusted EPS and sales indicates effective management and demand for RTX's products across both commercial aerospace and defense sectors. The company’s ability to raise its full-year guidance for adjusted sales, EPS, and free cash flow further underscores its confidence in sustaining this momentum.
Guidance Update
- Adjusted Sales: Now projected between $97.0 billion and $97.5 billion, up from $95.0 billion to $96.0 billion.
- Organic Sales Growth: Expected to be between 10% and 11%, revised from 8% to 9%.
- Adjusted EPS: Now forecasted at $7.65 to $7.75, up from $7.10 to $7.25.
- Free Cash Flow: Expected to be between $9.0 billion and $9.2 billion, increased from $8.50 billion to $8.75 billion.
Operational Highlights
- The company reported a record backlog of $340 billion, with $176 billion in commercial and $164 billion in defense contracts.
- RTX secured multi-year undefinitized production contracts for the Tomahawk and AMRAAM systems during the quarter, indicating strong future revenue potential.
Segment Performance
- Collins Aerospace: Sales of $8.4 billion, up 10% YoY, with operating profit increasing 42%.
- Pratt & Whitney: Sales of $9.2 billion, up 10% YoY, but operating profit decreased 19% due to a significant charge related to a customer bankruptcy.
- Raytheon: Sales of $8.0 billion, up 14% YoY, with operating profit rising 32%.
Cash Flow and Capital Management
Operating cash flow was reported at $2.9 billion, a decrease from the previous year, while free cash flow fell to $2.1 billion. The decline in cash flow metrics is a concern, but the company’s strong earnings growth and backlog provide a buffer against potential cash flow volatility.
Conclusion and Forward Catalyst
Investors should keep an eye on RTX's continued execution in the upcoming quarters, particularly how it manages its backlog and cash flow amidst rising operational demands. The next quarter will be critical as RTX aims to maintain its growth trajectory and capitalize on its strong market position in both commercial and defense sectors. The raised guidance reflects management's confidence, and successful execution will be key to sustaining shareholder value.
Note: All amounts in the following tables are in millions.
| RTX Corporation Condensed Consolidated Statement of Operations | 2026 | 2025 | 2026 | 2025 |
|---|---|---|---|---|
| Net Sales | $ 24,965 | $ 22,478 | $ 71,749 | $ 64,349 |
| Cost of Sales | 19,158 | 17,877 | 56,176 | 51,256 |
| Research and Development Expense | 711 | 684 | 2,064 | 2,018 |
| and Administrative | 1,918 | 1,436 | 5,052 | 4,457 |
| Total Costs and Expenses | 21,785 | 20,097 | 63,292 | 57,731 |
| Other Income, Net | 161 | 63 | 287 | 107 |
| Operating Profit | 3,337 | 2,523 | 8,703 | 6,704 |
| Non-Pension Income | -345 | -364 | -1,050 | -1,038 |
| Interest Expense | 381 | 449 | 1,188 | 1,349 |
| Income Before Income Tax Expense | 3,301 | 2,438 | 8,563 | 6,436 |
| Income Tax Expense | 593 | 432 | 1,449 | 1,080 |
| Net Income | 2,708 | 2,006 | 7,114 | 5,356 |
| Less: Noncontrolling Interest in Subsidiaries | 125 | 88 | 333 | 246 |
| Net Income Attributable to Common Shareowners | $ 2,583 | $ 1,918 | $ 6,781 | $ 5,110 |
| Earnings Per Share | ||||
| Basic Earnings Per Share | $ 1.91 | $ 1.43 | $ 5.02 | $ 3.81 |
| Diluted Earnings Per Share | $ 1.89 | $ 1.41 | $ 4.96 | $ 3.77 |
| Weighted-Average Shares Used to Compute Net Income per Share, Basic | 1.35... | 1.34... | 1.35... | 1.34... |
| Weighted-Average Shares Used to Compute Net Income per Share, Diluted | 1.36... | 1.35... | 1.36... | 1.35... |
| RTX Corporation Condensed Consolidated Balance Sheet | September 30, 2026 | December 31, 2025 |
|---|---|---|
| Assets | ||
| Cash and Cash Equivalents | $ 9,173 | $ 7,435 |
| Accounts Receivable, net | 14,681 | 14,701 |
| Contract Assets, net | 18,701 | 17,092 |
| Inventory, net | 14,953 | 13,364 |
| Other Current Assets | 8,561 | 7,740 |
| Total Current Assets | 66,069 | 60,332 |
| Customer Financing Assets | 1,880 | 2,132 |
| Fixed Assets, net | 17,235 | 16,868 |
| Operating Lease Right-of-Use Assets | 1,770 | 1,887 |
| Goodwill | 52,969 | 53,343 |
| Intangible Assets, net | 30,652 | 31,845 |
| Other Assets | 6,021 | 4,672 |
| Total Assets | $ 176,596 | $ 171,079 |
| Liabilities, Redeemable Noncontrolling Interest, and Equity | ||
| Short-Term Borrowings | $ 210 | $ 204 |
| Accounts Payable | 17,803 | 15,895 |
| Accrued Employee Compensation | 3,155 | 3,308 |
| Other Accrued Liabilities | 14,801 | 14,350 |
| Contract Liabilities | 21,550 | 21,615 |
| Long-Term Debt Currently Due | 5,679 | 3,412 |
| Total Current Liabilities | 63,198 | 58,784 |
| Long-Term Debt | 31,490 | 34,288 |
| Operating Lease Liabilities, non-current | 1,495 | 1,602 |
