RTX (RTX) Q3 2024 earnings summary

Executive summary

• Achieved 8% organic sales growth in Q3 2024, with commercial aftermarket up 11% and a record $221B backlog driven by $36B in new awards and a 1.8 book-to-bill ratio.

• Adjusted sales reached $20.1B, with adjusted EPS up 16% to $1.45 and GAAP EPS at $1.09; net income attributable to common shareowners was $1.47B.

• Free cash flow for Q3 was $2.0B, with operating cash flow at $2.5B; backlog split between $131B commercial and $90B defense.

• Completed an accelerated share repurchase, returning $10.3B to shareholders this quarter and over $32B since the merger, on track for $36–$37B by 2025.

• Resolved significant legal matters with a $918M pre-tax charge in 2024; cash flow from operations for the first nine months was $5.6B.

Financial highlights

• Q3 2024 adjusted sales were $20.1B, up 6% reported and 8% organically year-over-year; net income was $1.54B.

• Adjusted segment operating profit rose 16% to $2.4B, with 100 bps margin expansion; adjusted EPS was $1.45.

• Free cash flow was $2.0B, supported by strong collections despite higher inventory.

• Returned $1.1B to shareholders in Q3, totaling over $32B since the merger.

• Cash and cash equivalents at September 30, 2024: $6.7B; total debt: $42.2B; total equity: $62.8B.

Outlook and guidance

• Full-year 2024 adjusted sales guidance raised to $79.25–$79.75B, with 8–9% organic growth expected.

• Adjusted EPS guidance increased to $5.50–$5.58; free cash flow guidance confirmed at ~$4.7B.

• Adjusted tax rate for 2024 expected at ~18.8%; interest expense forecast at ~$1,935M; capex at ~$2.5B.

• Commercial OE sales expected to grow ~10% for the year, at the low end of prior guidance.

• Continued strong organic sales growth, margin expansion, and significant free cash flow anticipated for next year.