Q2 2026 L3harris Technologies, Inc Earnings Call Transcript
Key Points
- Revenue grew 8% year-over-year to $5.9 billion, with broad-based growth across all three segments.
- Orders reached $7.3 billion, yielding a book-to-bill of 1.2x, and backlog increased by over $1 billion to $42 billion.
- Missile Solutions revenue grew 14% year-over-year, with deliveries up over 60% and operational efficiency improved by 22%.
- The company secured a $12 billion framework agreement for FAD and factory production over seven years, demonstrating strong demand.
- Free cash flow increased 37% to $771 million, and full-year 2026 revenue and EPS guidance were raised.
- The IPO for the missile business was delayed to mid-2027 due to unfavorable market conditions.
- Segment operating margin for Space and Mission Systems decreased 60 basis points due to a prior-year product line sale gain not repeating.
- The divestiture of the commercial space propulsion business is expected to create an approximate $0.20 EPS headwind.
- Higher research and development costs partially offset segment operating income growth.
- The company faces uncertainty from potential budget debates, continuing resolutions, and geopolitical headwinds.
Greetings. Welcome to the L3Harris Technologies second-quarter 2026 earnings conference call. (Operator Instructions) As a reminder, this call is being recorded.
It is now my pleasure to introduce your host, Tony Calderon, Vice President, Investor Relations and Corporate Development. Thank you, Tony. You may now begin.
Thank you, Jade, and good evening, everyone. Joining me today are Chairman and CEO, Chris Kubasik; and Chief Financial Officer, Ken Sharp.
After the market closed today, we published our second-quarter earnings release detailing our financial results and updated 2026 guidance and provided a supplemental earnings presentation on our website.
Before we begin, please note that our discussion will include forward-looking statements subject to risks, assumptions and uncertainties that could cause actual results to differ materially. We have discussed GAAP results alongside non-GAAP financial measures of organic revenue
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