RTX Delivers Strong Q1 Earnings And Cash Flow, But Tariff Risks To Outlook Persist

RTX Corporation RTX shares are trading lower despite posting stronger-than-expected first-quarter fiscal 2025 results.

The company reported net sales of $20.31 billion, up 5% year-over-year and 8% organically, surpassing the Street estimate of $19.79 billion.

Adjusted earnings per share rose 10% to $1.47, beating the consensus of $1.35.

RTX’s operating cash flow for the quarter totaled $1.3 billion, and its free cash flow stood at $0.8 billion.

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RTX reported a robust backlog of $217 billion, comprising $125 billion in commercial and $92 billion in defense, while returning $0.9 billion to shareholders.

“The current environment is clearly very dynamic, but our company is well positioned to perform operationally and our teams remain focused on executing on our commitments and delivering our robust backlog,” commented RTX President and CEO Chris Calio.

Collins Aerospace: Sales were $7.22 billion (+8% YoY), driven by a 13% rise in commercial aftermarket sales due to continued air traffic recovery and a 10% increase in defense sales supported by higher volumes across key programs, including C5ISR and the F-35. Adjusted operating profit of $1.23 billion, up 17%, driven by higher commercial aftermarket and defense volumes.

Pratt & Whitney: Sales were $7.366 billion (+14% YY), driven by 28% commercial aftermarket growth and increased military engine deliveries, including for the Tanker program and F135 upgrade. Adjusted operating profit escalated 39% Y/Y to $590 million in the quarter.

Raytheon: Sales were $6.34 billion, down 5% year-over-year due to a business divestiture. Excluding that impact, sales rose 2%, driven by higher volume in land and air defense systems, including international Patriot and LTAMDS. Adjusted operating profit of $678 million, up 8% year-over-year, driven by favorable mix and improved productivity.

Outlook 2025: RTX reiterated its 2025 outlook. It expects adjusted sales of $83.0 billion—$84.0 billion versus the consensus of $84.151 billion and adj. EPS of $6.00-$6.15 versus the street view of $6.10.

The company expects free cash flow of $7.0 billion – $7.5 billion for the year.

The outlook excludes the impact of newly enacted U.S. and non-U.S. tariffs, and management will detail potential effects during the Q1 2025 earnings call.

Price Action: RTX shares are down 10.40% at $113.01 at the last check on Tuesday.

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