Q3 2025 RTX Corp Earnings Call Transcript
Key Points
- RTX Corp (RTX) reported a 13% organic sales increase year-over-year, with double-digit growth in commercial OE, commercial aftermarket, and defense segments.
- The company achieved a 19% increase in adjusted segment operating profit, with margin expansion across all segments.
- Free cash flow was robust at $4 billion for the quarter, keeping RTX on track for its full-year target.
- RTX's backlog grew to $251 billion, up 13% year-over-year, with a book-to-bill ratio of 1.63.
- The company raised its full-year outlook for adjusted sales and EPS, reflecting strong operational performance and market demand.
- RTX faced a $0.04 EPS headwind from recently enacted tax legislation.
- The company experienced a $90 million headwind from tariffs at Collins, impacting margins.
- Despite strong demand, RTX's Raytheon segment did not raise its full-year revenue outlook, indicating potential supply chain constraints.
- The negative engine margin headwind for Pratt & Whitney is expected to be between $150 million and $200 million for the year.
- RTX's free cash flow guidance for the year remains unchanged despite raising sales and EPS outlooks, indicating potential challenges in working capital management.
Good day, and welcome to the RTX third quarter 2025 earnings conference call. My name is Desiree, and I will be your operator for today. As a reminder, this conference is being recorded for replay purposes.
On the call today are Chris Calio, Chairman and Chief Executive Officer; Neil Mitchill, Chief Financial Officer; and Nathan Ware, Vice President of Investor Relations. This call is being webcast live on the Internet, and there is a presentation available for download for RTX website at www.rtx.com.
Please note, except where otherwise noted, the company will speak to results from continuing operations, excluding acquisition accounting adjustments and net non-recurring and, or significant items often referred to by management as other significant items.
The company also remind listeners that the earnings and cash flow expectations and any other forward-looking statements provided in this call are subject to risks and uncertainties. RTX SEC filings, including its forms 8-K, 10-Q, and 10-K, provide details on important
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