L3harris Technologies (LHX) Investor update summary

Strategic partnership, investment, and business transformation

• Announced a unique partnership with the Department of War, including a $1 billion preferred convertible investment to expand solid rocket motor production and support U.S. and allied missile programs.

• Business realigned into three segments: Missile Solutions, Communications & Spectrum Dominance, and Space & Mission Systems, focusing on national security and aligning with Department of War priorities.

• Created a pure-play Missile Solutions company, consolidating missile and munition capabilities, with plans for an IPO in the second half of 2026 while retaining a majority stake.

• Capital deployment will focus on growth initiatives such as CAPEX and R&D, with no near-term dividends or share repurchases.

• L3Harris will retain controlling interest post-IPO, aiming to unlock value and drive growth.

Investment, facility expansion, and production capacity

• Planned investments will more than triple rocket motor production capacity by 2030, with over 1 million sq ft of new production space and new facilities in Arkansas, Virginia, Alabama, and California.

• Camden, AR site features 64 buildings, 1M SF of new factories, 8 automated assembly lines, and 6 casting bays.

• Expanding THAAD DACS production in Canoga Park, CA, and DACS & SRMS in Orange, VA, with production resilience achieved by duplicating capabilities.

• Production capacity expansion supports critical missile programs such as PAC-3, THAAD, Tomahawk, and Standard Missile.

• Full-rate production expected by 2030, with phased buildout and operational scale transformation to drive operating leverage.

Financial outlook, market demand, and risk management

• Missile Solutions business expected to more than double sales by 2030, with 2025 revenue projected at $3.6–$3.8B and strong margin and free cash flow growth.

• Multi-year contracts, NDAA language, and multi-year award structures provide demand visibility and reduce risk of overcapacity.

• Facilities designed for flexible, common production to adapt to changing missile program demands.

• External studies and material assumptions indicate sustained demand for missile products well into the 2040s, though subject to regulatory, funding, and geopolitical risks.

• Space Propulsion and Power Systems majority stake to be sold as previously announced.