RTX Corporation

What they do

RTX operates through three segments: Collins Aerospace (aerospace products and aftermarket services), Pratt & Whitney (aircraft engines, including the Geared Turbofan family), and Raytheon (defense systems). The company serves commercial airlines, aircraft manufacturers (Boeing and Airbus combined represented 16% of Collins' segment sales in 2025), U.S. and foreign governments, and defense contractors. Its business spans original equipment manufacturing and extensive aftermarket parts and services, with a global customer base.

Revenue drivers

• Collins Aerospace — Provides aerospace and defense products, including avionics, cabin interiors, landing systems, and aftermarket services such as spares, overhaul, and repair. Its largest commercial customers are Boeing and Airbus (16% of Collins sales in 2025).
• Pratt & Whitney — Manufactures aircraft engines, notably the PW1100G-JM Geared Turbofan (GTF) for the A320neo family. This segment is affected by the powder metal matter requiring accelerated fleet inspections.
• Raytheon — Defense segment serving domestic and international government customers as prime or subcontractor on a broad portfolio of defense programs. It follows a fiscal calendar and contributes to a total company backlog of $289 billion ($119 billion defense).

Recent performance

In Q2 2026, RTX reported sales of $24.7 billion, up 14% year-over-year (16% organic growth). GAAP EPS was $1.57 (including $0.27 of acquisition accounting adjustments), while adjusted EPS reached $1.89, up 21%. Operating cash flow was $3.5 billion and free cash flow $2.9 billion. For the first half of 2026, the company generated strong momentum, citing double-digit commercial aftermarket and defense growth.

Strategy

RTX is focused on executing its $289 billion backlog, increasing productivity, expanding capacity, and introducing new technologies. The company is investing in next-generation regional aircraft fuel efficiency through projects with the European Union's Clean Aviation Joint Undertaking, and pursuing satellite communications, radar, and air traffic control contracts. It also agreed to divest Raytheon's Blue Canyon Technologies business for $620 million to streamline its portfolio.

Risks

• U.S. defense spending changes — A significant portion of RTX's sales come from U.S. government contracts, and shifts in budget priorities or appropriations delays could negatively impact results.
• Pratt & Whitney powder metal defect — A rare condition in powder metal used in certain engine parts is forcing accelerated inspections of the PW1100 GTF fleet, creating operational and financial uncertainties.
• Global supply chain disruptions — RTX depends on a global supply chain and has experienced disruptions that could affect production and delivery schedules.
• Macroeconomic and geopolitical volatility — Inflation, interest rates, tariffs, sanctions, and geopolitical conflicts create uncertainties that can impact commercial aerospace demand and defense program timing.

Outlook

Management raised its full-year 2026 outlook: adjusted sales now $95.0–$96.0 billion (up from $92.5–$93.5 billion), adjusted EPS $7.10–$7.25 (up from $6.70–$6.90), and free cash flow $8.50–$8.75 billion. Backlog is up 22% year-over-year, and the company cites robust demand, positioning it for continued growth through backlog execution and new technologies.