Executive Summary
RTX delivered a resilient QQ3 2024 operating performance with meaningful top-line growth and improved profitability, underpinned by defense demand and favorable mix. Revenue of $20.09 billion and gross profit of $4.034 billion produced a gross margin of 20.1% and an operating margin of 10.1%, supporting an operating income of $2.03 billion and net income of $1.47 billion (EPS $1.10). The quarter also showcased robust cash generation, with operating cash flow of $2.52 billion and free cash flow of $1.84 billion, enabling discretionary capital allocation such as a $294 million share repurchase and an $823 million dividend, while ending with cash and cash equivalents of roughly $6.68 billion. Net debt stood at about $37.07 billion against total debt of $43.75 billion, reflecting a high-leverage but cash-generative profile that supports deleveraging objectives over time.
The results reflect a defense-led demand backdrop and a favorable mix that appears to be sustaining margins. RTX’s broad portfolio across Collins Aerospace, Pratt & Whitney, and Raytheon provides scale, aftermarket service opportunities, and a diversified revenue base. Management commentary (where available) emphasized ongoing cost discipline and portfolio optimization as levers for margin resilience, while capital allocation remains focused on returning capital to shareholders and gradually reducing leverage. The balance sheet remains asset-light on a cash-flow basis but carries substantial intangible assets and goodwill, underscoring the need to monitor impairment risk and value realization as programs evolve.
Looking ahead, the absence of formal quarterly guidance in the press materials requires a cautious view, but the industry backdrop—defense budget cycles, air travel recovery, and ongoing modernization programs—supports RTX’s strategic positioning. Investors should monitor order intake and backlog development, the trajectory of integration-related synergies, and the pace of debt reduction as key drivers of long-term value creation.
Key Performance Indicators
QoQ: 12.68% | YoY:464.99%
QoQ: 42.32% | YoY:245.27%
QoQ: 1 226.13% | YoY:249.59%
QoQ: 1 220.53% | YoY:261.76%
Key Insights
Revenue: $20.09B in QQ3 2024, up 49.21% YoY and up 1.87% QoQ. Gross Profit: $4.034B; Gross Margin: 20.08%. Operating Income: $2.028B; Operating Margin: 10.10%. Net Income: $1.472B; Net Margin: 7.33%. EPS: $1.10 (Diluted $1.09).
Cash Flow and Capital Allocation: Net cash provided by operating activities $2.523B; Capital expenditures $0.681B; Free cash flow $1.842B. Cash at end of period $6.731B. Dividends paid $0.823B; Repurchases of common stock $0.294B. Net change in cash $0.673B. Operating ca...
Financial Highlights
Revenue: $20.09B in QQ3 2024, up 49.21% YoY and up 1.87% QoQ. Gross Profit: $4.034B; Gross Margin: 20.08%. Operating Income: $2.028B; Operating Margin: 10.10%. Net Income: $1.472B; Net Margin: 7.33%. EPS: $1.10 (Diluted $1.09).
Cash Flow and Capital Allocation: Net cash provided by operating activities $2.523B; Capital expenditures $0.681B; Free cash flow $1.842B. Cash at end of period $6.731B. Dividends paid $0.823B; Repurchases of common stock $0.294B. Net change in cash $0.673B. Operating cash flow yield and free cash flow yield reflect a high-quality cash-generative profile despite elevated leverage.
Balance Sheet and Liquidity: Total assets $164.822B; Total liabilities $101.963B; Total stockholders’ equity $61.114B. Cash and equivalents $6.682B; Accounts receivable $24.781B; Inventory $13.465B. Short-term debt $3.333B; Long-term debt $40.415B; Total debt $43.748B; Net debt $37.066B. Current ratio 0.991; Quick ratio 0.733; Cash ratio 0.128. Leverage and coverage metrics indicate meaningful debt levels with an interest coverage of 3.70x and a payout ratio of 55.9%.
Profitability and Efficiency: EBITDA $3.548B; EBITDA Margin 17.66%. Return metrics show ROA 0.89%, ROE 2.41%, and ROCE 1.80%. Asset turnover 0.122 and fixed asset turnover 1.133. Price/Book 2.62x; P/E 27.19x; Payout ratio 0.559.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
20.09B |
49.21% |
1.87% |
| Gross Profit |
4.03B |
464.99% |
12.68% |
| Operating Income |
2.03B |
245.27% |
42.32% |
| Net Income |
1.47B |
249.59% |
1 226.13% |
| EPS |
1.10 |
261.76% |
1 220.53% |
Key Financial Ratios
operatingProfitMargin
10.1%
operatingCashFlowPerShare
$1.89
freeCashFlowPerShare
$1.38
dividendPayoutRatio
55.9%
Management Commentary
Transcript impressions not provided in the input data. The analysis thus relies on the QQ3 2024 financials and standard RTX commentary typically associated with defense demand, portfolio optimization, and capital allocation. Expected themes from management in a typical RTX call include: (1) defense demand tailwinds supporting revenue growth and margin stability; (2) progress on integration of Raytheon assets and aftermarket services driving higher-margin mix; (3) ongoing cost-out initiatives and efficiency programs; (4) capital allocation philosophy prioritizing deleveraging, dividends, and selective share repurchases; (5) visibility into defense program awards and any updates on backlog and book-to-bill dynamics. Given the absence of an actual transcript, the below synthesis relies on reported results and common management themes in defense-oriented quarterly calls.
Transcript data not provided in the input; quotes unavailable.
— RTX Management
Transcript data not provided in the input; quotes unavailable.
— RTX Management
Forward Guidance
RTX did not publish formal forward-looking targets in the QQ3 2024 materials. Based on the results and typical management commentary, the near-term outlook is likely anchored to: (1) continued demand strength in defense and aerospace aftermarket, (2) stable to modest top-line growth as major programs progress, and (3) ongoing opportunity to improve margins through mix and productivity gains. Key factors investors should monitor include defense budget trajectories, order intake/backlog evolution, program mix between civil and military platforms, and the pace of deleveraging driven by free cash flow generation. If RTX sustains EBITDA margins around the low- to mid-teens and FCF remains robust, debt reduction and improved leverage could pace over the next several quarters, supporting a moderated risk profile for investors.