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Unless the context otherwise requires, the terms “we,” “our,” “us,” “the Company,” and “RTX” mean RTX Corporation and its subsidiaries.
−Removed: References to “Raytheon Company” mean Raytheon Company, which became a wholly owned subsidiary of RTX on April 3, 2020 during an all-stock merger transaction between United Technologies Corporation and Raytheon Company (the surviving company of which is RTX Corporation).
−Removed: Raytheon follows a 4-4-5 fiscal calendar while Collins Aerospace (Collins) and Pratt & Whitney use a quarter calendar end.
−Removed: Throughout this Form 10-Q, when we refer to the quarters and nine months ended September 30, 2025 and 2024 with respect to Raytheon, we are referring to their September 28, 2025 and September 29, 2024 fiscal quarter ends, respectively.
+Added: We operate in three segments:
+Added: Collins Aerospace (Collins), Pratt & Whitney, and Raytheon.
+Added: Raytheon follows a fiscal calendar, while Collins and Pratt & Whitney use calendar quarter ends.
+Added: Throughout this Form 10-Q, references to the quarters ended March 31, 2026 and 2025 for Raytheon correspond to its fiscal quarter ends of March 29, 2026 and March 30, 2025, respectively.
The current status of significant factors affecting our business environment in 2026 is discussed below.
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Our defense operations are affected by U.S.
−Removed: Department of Defense (DoD) budget and spending levels, changes in demand, changes in policy positions or priorities, the domestic and global political and economic environment, and the evolving nature of the global and national security threat environment.
+Added: Department of War (DoW) budget and spending levels, changes in demand, changes in policy positions or priorities, the domestic and global political and economic environment, and the evolving nature of the global and national security threat environment.
In addition, our defense businesses engage in both direct commercial sales, which generally require U.S.
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Global, economic, and political conditions, changes in raw material and commodity prices and supply, labor availability and costs, inflation, interest rates, potential changes in U.S.
−Removed: government policy positions, including changes in DoD policies or priorities, geopolitical conflicts and strained intercountry relations, U.S.
−Removed: tax law changes, foreign currency exchange rates, sanctions, tariffs, energy costs and supply, levels of air travel, the financial condition of commercial airlines, and the impact from natural disasters and weather conditions create uncertainties that could impact our businesses.
+Added: government policy positions or priorities, including changes in DoW policies or priorities, geopolitical conflicts and strained intercountry relations, U.S.
+Added: tax law changes, foreign
+Added: Table of Content s
+Added: currency exchange rates, sanctions, tariffs, energy costs and supply, levels of air travel, the financial condition of commercial airlines, and the impact from natural disasters and weather conditions create uncertainties that could impact our businesses.
Legal Matters.
−Removed: As previously announced, in 2024 the Company resolved several outstanding legal matters, herein referred to as “Resolution of Certain Legal Matters.” The Company entered into a deferred prosecution agreement (DPA) (DPA-1) with
−Removed: Tabl e o f Contents
−Removed: the Department of Justice (DOJ) and the Company settled an administrative proceeding with the Securities and Exchange Commission (SEC) (the SEC Administrative Order) to resolve the previously disclosed criminal and civil government investigations into payments made by Raytheon Company and its joint venture, Thales-Raytheon Systems (TRS), in connection with certain Middle East contracts since 2012 (Thales-Raytheon Systems and Related Matters).
−Removed: The Company also entered into a DPA and a False Claims Act (FCA) settlement agreement with the DOJ to resolve previously disclosed criminal and civil government investigations into defective pricing claims for certain legacy Raytheon Company contracts entered into between 2011 and 2013 and in 2017 (DOJ Investigation and Contract Pricing Disputes).
−Removed: Under these DPAs and the SEC Administrative Order, Raytheon Company and the Company are required to retain, among other things, an independent compliance monitor satisfactory to the DOJ and the SEC (for a term ending three years from the date on which the monitor is engaged) and are required to undertake certain cooperation and disclosure obligations (for a term commencing on the effective date of DPA-1 and the SEC Administrative Order, as applicable, and ending three years from the date on which the monitor is engaged).
−Removed: The compliance monitor will oversee Raytheon Company’s and the Company’s compliance with their respective obligations under the DPAs and the SEC Administrative Order.
−Removed: The DPAs further provide that, in the event the DOJ, in its sole discretion, determines during the period of deferral of prosecution that Raytheon Company or the Company have violated any provision of either DPA, Raytheon Company or the Company may be subject to prosecution for any federal criminal violation, including the charges against Raytheon Company in the relevant DPA.
−Removed: The SEC Administrative Order further provides that, in the event of a breach of the SEC Administrative Order, the SEC may vacate the SEC Administrative Order and institute proceedings against the Company.
−Removed: In the event of any such determination or breach, the Company may face additional adverse impacts.
−Removed: In addition, the Company resolved certain voluntarily disclosed export controls violations primarily identified in connection with the integration of Rockwell Collins and, to a lesser extent, Raytheon Company, including certain violations that were resolved pursuant to a Consent Agreement (CA) with the Department of State (DOS) (Trade Compliance Matters).
−Removed: The CA, which has a three-year term, requires the Company to implement remedial compliance measures and to conduct an external audit of the Company’s International Traffic in Arms Regulations (ITAR) compliance program.
−Removed: The CA also requires appointment of an external, independent Special Compliance Officer (SCO).
−Removed: The Company appointed its SCO on September 27, 2024.
−Removed: For further discussion of DPA-1, DPA-2, the SEC Administrative Order, and the CA, see “Note 16:
−Removed: Commitments and Contingencies,” within Item 1 of this Form 10-Q.
+Added: As previously disclosed and described further in “Note 15:
+Added: Commitments and Contingencies”, within Item 1 of this Form 10-Q under the headings “Thales-Raytheon Systems and Related Matters,” “DOJ Investigation and Contract Pricing Disputes,” and “Trade Compliance Matters”, in 2024 the Company resolved several outstanding legal matters.
Pratt & Whitney Powder Metal Matter.
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In response, certain countries have announced, and in some cases imposed, tariffs, and non-tariff countermeasures on goods that are imported from the U.S.
−Removed: Our businesses and suppliers import
−Removed: Tabl e o f Contents
−Removed: goods subject to U.S.
+Added: Our businesses and suppliers import goods subject to U.S.
imposed tariffs, as well as goods subject to counter tariffs imposed by other countries.
+Added: In February 2026, the U.S.
+Added: Supreme Court ruled that U.S.
+Added: tariffs imposed under the International Emergency Economic Powers Act (IEEPA) on goods imported into the U.S.
+Added: were unauthorized.
+Added: The Company is the importer of record for certain products that were previously subject to tariffs under IEEPA and paid approximately $0.5 billion of IEEPA tariffs since their inception.
+Added: Court of International Trade (CIT) has ordered the U.S.
+Added: Customs and Border Protection (CBP) to refund the collected IEEPA tariffs.
+Added: The administrative process for seeking refunds of IEEPA tariffs previously paid remains under development and the CIT’s order may be subject to U.S.
+Added: government challenge.
+Added: Accordingly, there is uncertainty regarding our ability to obtain refunds for IEEPA tariffs previously paid, and as such we have not recorded an anticipated recovery of IEEPA tariffs paid as of March 31, 2026.
+Added: We will continue to monitor developments, including actions by the CIT and CBP to establish and execute on a refund process and take appropriate actions when or if they become available.
+Added: Further, following the Supreme Court’s ruling invalidating IEEPA tariffs, the U.S.
+Added: government imposed new and revised tariffs under various available regimes.
We continue to pursue available options to mitigate the impact of tariffs and countermeasures, including (i) utilizing available exemptions or exclusions to tariffs, such as trade agreements, treaties or other statutory relief, (ii) evaluating operational and supply chain changes, and (iii) where feasible, increasing the prices of our goods and services.
−Removed: Our results for the quarter and nine months ended September 30, 2025, reflect our best estimate of the impact of the tariffs then in effect.
−Removed: As the duration, extent and enforceability of the tariffs and counter tariffs remain uncertain, we are continuing to evaluate the potential future impacts of the imposition of the announced tariffs to our business and financial condition.
+Added: Our results for the quarter ended March 31, 2026, reflect our best estimate of the impact of the tariffs then in effect.
+Added: As the duration, extent and enforceability of the tariffs and counter tariffs in effect remain uncertain, we are continuing to evaluate the potential future impacts of the imposition of tariffs to our business and financial condition.
Based on current conditions, we do not believe that the tariffs announced by the U.S.
or counter tariffs or other actions taken by other countries will have a material adverse effect upon our results of operations, financial condition, or cash flows.
−Removed: However, the actual financial impacts of tariffs are dependent upon various factors, most notably, the scope of goods covered by tariffs, the value of our imports subject to tariffs, the rate of tariffs applied, the timing and duration of tariffs, the enforceability of tariffs and counter-tariffs, the implementation of tariff and non-tariff countermeasures by countries subject to U.S.
+Added: However, the actual financial impacts of tariffs are dependent upon various factors, most notably, the scope of goods covered by tariffs, the value of our imports subject to tariffs, the rate of tariffs
+Added: Table of Content s
+Added: applied, the timing and duration of tariffs, the enforceability of tariffs and counter-tariffs, the implementation of tariff and non-tariff countermeasures by countries subject to U.S.
tariffs, and our and our suppliers’ ability to mitigate the impacts of tariffs.
Changes in any of these factors and actual tariff costs incurred could significantly affect the estimates inherent in our financial statements, including those used in our estimates-at-completion (EACs), and estimates supporting the recoverability of our inventories, contract fulfillment costs, deferred tax assets, intangible assets and goodwill, and could have a material effect on our results of operations and cash flows in the periods recognized and paid.
−Removed: Government’s Budget & Tax Legislation.
−Removed: On September 30, 2025, the continuing resolution (CR) allowing U.S.
−Removed: government Departments and Agencies to operate through the end of the government fiscal year expired and the U.S.
−Removed: government shut down.
−Removed: As a result of the U.S.
−Removed: government shutdown, our business, program performance and results of operations may be impacted by the disruptions to federal government offices, workers, and operations, including risks relating to the funding of certain programs, stop work orders, delay in contract awards, new program starts, payments for work performed, and other actions.
−Removed: We may also experience similar impacts in the event of a series of short-term continuing resolutions rather than full-year fiscal year 2026 appropriations.
−Removed: Generally, the significance of these impacts will primarily be based on the length of the shutdown and timing of passage of a new CR or a full budget.
+Added: Government’s Budget, Tax Legislation and Executive Orders.
+Added: On February 3, 2026, Congress passed and the President signed a spending package to end a U.S.
+Added: government shutdown.
+Added: The spending package funds the majority of the government through the end of the government’s fiscal year.
On July 4, 2025, “An Act to Provide for Reconciliation Pursuant to Title II of the H.
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taxation on international earnings.
−Removed: The Act also provides a supplementary $156.2 billion to the DoD for obligations through 2029, which includes $24.4 billion for the Iron Dome for America project.
+Added: The Act also provides a supplementary $156.2 billion to the DoW for obligations through 2029, which includes $24.4 billion for the Golden Dome for America project.
The project, outlined in a January 27, 2025 Executive Order, calls for the development and deployment of a next-generation missile defense shield.
−Removed: On May 20, 2025, the DoD announced a draft architecture and implementation plan for the system.
−Removed: With next generation technologies across land, sea and space that build upon existing, proven defense capabilities, RTX’s portfolio is well-positioned to play a role to deliver reliable solutions for the Iron Dome for America initiative.
−Removed: Whether this Executive Order or corresponding funding will have a material impact on our business or results of operations will depend on a variety of factors, including award timelines, mission priorities, and future budget determinations.
−Removed: The Act also includes $25.4 billion in funding to enhance DoD resources for munitions and supply chain resiliency.
+Added: On May 20, 2025, the DoW announced a draft architecture and implementation plan for the system.
+Added: With next generation technologies across land, sea and space that build upon existing, proven defense capabilities, RTX’s portfolio is well-positioned to play a role in delivering reliable solutions for the Golden Dome for America initiative.
+Added: Whether this Executive Order or corresponding funding will have a material impact on our business or results of operations will depend on a variety of factors, including actual awards, award timelines, mission priorities, and future budget determinations.
+Added: The Act also includes $25.4 billion in funding to enhance DoW resources for munitions and supply chain resiliency.
As a leading munitions manufacturer, RTX is strategically situated to play a key role in supporting this initiative.
−Removed: Executive Order Regarding Modernizing Defense Acquisitions.
−Removed: On April 9, 2025, the U.S.
−Removed: government issued an executive order requiring, among other things, a DoD review of its Major Defense Acquisition Programs to identify those that are 15% behind schedule, 15% over budget, unable to meet key performance parameters, or unaligned with the Secretary of Defense’s mission priorities for potential cancellation.
−Removed: Although RTX does not, at this time, believe the Executive Order will have a material impact on our business or results of operations, the longer-term ramifications, if any, to RTX will depend on a variety of factors including the formulation and implementation of the review criteria in the order, the review timeline, the Secretary of Defense’s mission priorities, and future budget determinations based on the results of such review.
+Added: The President has also issued multiple executive orders, including one intended to reform the DoW’s defense acquisition processes and promote expedited and streamlined acquisitions.
+Added: Following issuance of those orders, the Secretary of War issued a memorandum and released the DoW’s Acquisition Transformation Strategy, which is aligned with the executive orders and seeks to overhaul the existing defense acquisition system through process changes that prioritize speed, flexibility, and rigorous execution.
+Added: A subsequent executive order was issued that may limit corporate distributions, share repurchases, and executive compensation incentives during periods of defense contractor underperformance, insufficient prioritization, investment or production speed under their U.S.
+Added: government contracts.
+Added: We are monitoring how these executive orders and related actions will be implemented and any potential future impacts to our business.
+Added: While those impacts are uncertain, a limitation on our ability to issue distributions or engage in share repurchases related to the defense contractor performance executive order could adversely affect the market price of our common stock.
Geopolitical Matters.
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government and the governments of various jurisdictions in which we operate, have imposed broad economic sanctions and export controls targeting specific industries, entities, and individuals in Russia.
−Removed: The Russian government has implemented similar counter-sanctions and export controls targeting specific industries, entities, and individuals in the U.S.
−Removed: and other jurisdictions in which we operate, including certain members of the Company’s management team and Board of Directors.
−Removed: These government measures, among other limitations, restrict transactions involving various Russian banks and financial institutions and impose enhanced export controls limiting transfers of various goods, software, and technologies to and from Russia, including broadened export controls specifically targeting the aerospace sector.
−Removed: These measures have adversely affected, and could continue to adversely affect, the Company and/or our supply chain, business partners, or customers;
−Removed: however, based on information available to date, we do not currently expect these issues will have a material adverse effect on our financial results.
−Removed: We will continue to monitor future
−Removed: Tabl e o f Contents
−Removed: developments, including additional sanctions and other measures, that could adversely affect the Company and/or our supply chain, business partners, or customers.
−Removed: In February 2023, China announced sanctions against Raytheon Missiles & Defense (RMD) (a former RTX business segment which became part of the Raytheon business during the third quarter of 2023), and previously announced it may take measures against RTX, in connection with certain foreign military sales to Taiwan.
−Removed: The Chinese sanctions against RMD included a fine equal to twice the value of the arms that RMD sold to Taiwan since September 2020.
+Added: The Russian government has implemented similar counter-sanctions and export controls, including targeting certain members of the Company’s management team and Board of Directors.
+Added: Similarly, in February 2023, China announced sanctions against Raytheon Missiles & Defense (RMD) (a former RTX business segment which became part of the Raytheon business during the third quarter of 2023), and previously announced it may take measures against RTX, in connection with certain foreign military sales to Taiwan.
Since that time, China has announced additional sanctions against the Raytheon business and a Collins joint venture.
−Removed: If China were to impose additional sanctions, enforce announced sanctions, or take other regulatory action against RTX, our suppliers, affiliates, or partners, it could potentially disrupt our business operations.
−Removed: Any impact of these or other potential sanctions or other actions by China, is uncertain.
+Added: We do not currently expect these measures to have a material adverse effect on our financial results, but we will continue to monitor future developments, including additional measures that could adversely affect the Company and/or our supply chain, business partners, or customers.
We have direct commercial sales contracts for products and services to certain foreign customers, for which U.S.
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If we ultimately do not receive all of the regulatory approvals, or those approvals are revoked, it could have a material effect on our financial results.
−Removed: We continue to closely monitor potential impacts to RTX’s business, customers, suppliers, employees, and operations in Israel, the Middle East, and the region at large due to continued regional instability and tensions.
−Removed: RTX’s defense programs’ ability to receive components from Israel has not been impacted in any material respect, although we could experience future delivery delays of certain products if further escalations arise.
−Removed: To date, the overall impacts to RTX from this situation have been minimal;
−Removed: however, given the volatile nature of the situation, the potential impacts to RTX are subject to change.
+Added: We continue to closely monitor impacts to RTX’s business, customers, suppliers, employees, and operations in Israel, the Middle East, and the region at large due to the conflict in Iran and increased regional instability and tensions.
+Added: RTX has employees, facilities, and operations in the Middle East and we reassess operations regularly, based upon the security situation.
+Added: Our and our suppliers’ operations in the region have not been impacted in any material respect, although we could experience
+Added: Table of Content s
+Added: future delivery delays of certain products as the conflict continues.
+Added: We also continue to monitor uncertainties related to energy costs and availability, and associated impacts to our commercial airline customers.
+Added: Given the volatile nature of the situation, the potential impacts to RTX are subject to change.
See Part I, Item 1A, “Risk Factors” in our 2025 Annual Report on Form 10-K for further discussion of these items.
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Actual results in these areas could differ from management’s estimates.
−Removed: There have been no significant changes in our critical accounting estimates during the nine months ended September 30, 2025.
+Added: There have been no significant changes in our critical accounting estimates during the quarter ended March 31, 2026.
RESULTS OF OPERATIONS
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The organic change in Net sales, Cost of sales, and Operating profit excludes acquisitions and divestitures, net, and the effect of foreign currency exchange rate translation fluctuations and other significant non-operational items and/or significant operational items that may occur at irregular intervals (Other).
−Removed: Additionally, the organic change in Cost of sales and Operating profit excludes restructuring costs, the FAS/CAS operating adjustment, and costs related to certain acquisition accounting adjustments.
+Added: Additionally, the organic change in Cost of sales and Operating profit excludes restructuring costs, the FAS/CAS operating adjustment, and acquisition accounting adjustments.
Restructuring costs generally arise from severance related to workforce reductions and facility exit costs.
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government Cost Accounting Standards (CAS), primarily related to our Raytheon segment.
−Removed: Acquisition accounting adjustments include the amortization of acquired intangible assets related to acquisitions, the amortization of the property, plant, and
−Removed: Tabl e o f Contents
−Removed: equipment fair value adjustment acquired through acquisitions, the amortization of customer contractual obligations related to loss making or below market contracts acquired, and goodwill impairment, if applicable.
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Acquisition accounting adjustments include the amortization of acquired intangible assets related to acquisitions, the amortization of the property, plant, and equipment fair value adjustment acquired through acquisitions, the amortization of customer contractual obligations related to loss making or below market contracts acquired, and goodwill impairment, if applicable.
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
Net sales $ 22,076 $ 20,306
−Removed: The factors contributing to the change year-over-year in total net sales for the quarter and nine months ended September 30, 2025 are as follows:
−Removed: (dollars in millions) Quarter Ended September 30, 2025 Nine Months Ended September 30, 2025
−Removed: $ 2,618 $ 5,922
+Added: The factors contributing to the change year-over-year in total net sales for the quarter ended March 31, 2026 are as follows:
+Added: (dollars in millions) Quarter Ended March 31, 2026
Acquisitions and divestitures, net (370)
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GAAP amounts is provided in the table above.
−Removed: Net sales increased $2.6 billion organically in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily due to higher organic net sales of $1.2 billion at Pratt & Whitney, $0.8 billion at Collins, and $0.7 billion at Raytheon.
−Removed: Net sales increased $5.9 billion organically in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily due to higher organic net sales of $2.9 billion at Pratt & Whitney, $2.0 billion at Collins, and $1.2 billion at Raytheon.
−Removed: The decrease in net sales due to Acquisitions and divestitures, net of $0.3 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 reflects the sale of the actuation and flight control business within our Collins segment completed in the third quarter of 2025 and the sale of the Goodrich Hoist & Winch business within our Collins segment in the fourth quarter of 2024.
−Removed: The decrease in net sales due to Acquisitions and divestitures, net of $0.8 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, reflects the sale of the actuation and flight control business within our Collins segment, the sale of the Cybersecurity, Intelligence and Services (CIS) business within our Raytheon segment completed in the first quarter of 2024, and the sale of the Goodrich Hoist & Winch business within our Collins segment completed in the fourth quarter of 2024.
+Added: Net sales increased $2.1 billion organically in the quarter ended March 31, 2026, primarily due to higher organic net sales of $0.8 billion at Pratt & Whitney, $0.7 billion at Collins, and $0.6 billion at Raytheon.
+Added: Table of Content s
+Added: The decrease in net sales due to Acquisitions and divestitures, net of $0.4 billion for the quarter ended March 31, 2026 was driven by divestitures within our Collins segment of the actuation and flight control business and the Simmonds Precision Products business completed in 2025.
See “Segment Review” below for further information by segment.
−Removed: Quarter Ended September 30, % of Total Net Sales
+Added: Quarter Ended March 31, % of Total Net Sales
(dollars in millions) 2026 2025 2026 2025
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Segment Financial Data” within Item 1 of this Form 10-Q for the composition of external net sales by products and services by segment.
−Removed: Net products sales increased $1.6 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily due to increases in external products sales of $0.6 billion at Pratt & Whitney, $0.5 billion at Raytheon, and $0.4 billion at Collins.
−Removed: Net services sales increased $0.8 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily due to increases in external services sales of $0.5 billion at Pratt & Whitney, $0.2 billion at Raytheon, and $0.1 billion at Collins.
−Removed: Tabl e o f Contents
−Removed: Nine Months Ended September 30, % of Total Net Sales
−Removed: (dollars in millions) 2025 2024 2025 2024
−Removed: Products $ 46,406 $ 43,573 72.1 % 73.7 %
−Removed: Services 17,959 15,542 27.9 % 26.3 %
−Removed: Total net sales $ 64,365 $ 59,115 100 % 100 %
−Removed: Net products sales increased $2.8 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily driven by increases in external products sales of $1.1 billion at Collins, $1.0 billion at Pratt & Whitney, and $0.7 billion at Raytheon.
−Removed: Net services sales increased $2.4 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily due to increases in external services sales of $1.9 billion at Pratt & Whitney, $0.4 billion at Collins, and $0.1 billion at Raytheon.
+Added: Net products sales increased $1.2 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 primarily due to increases in external products sales of $0.6 billion at Raytheon, $0.3 billion at Pratt & Whitney, and $0.3 billion at Collins.
+Added: Net services sales increased $0.6 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 primarily due to increases in external services sales of $0.6 billion at Pratt & Whitney.
Our sales to major customers were as follows:
−Removed: Quarter Ended September 30, % of Total Net Sales
−Removed: (dollars in millions) 2025 2024 2025 2024
−Removed: Sales to the U.S.
−Removed: government (1)
−Removed: $ 8,409 $ 7,996 37.4 % 39.8 %
−Removed: Foreign military sales through the U.S.
−Removed: government 1,867 1,502 8.3 % 7.5 %
−Removed: Foreign government direct commercial sales 1,477 1,218 6.6 % 6.1 %
−Removed: Commercial aerospace and other commercial sales 10,725 9,373 47.7 % 46.7 %
−Removed: Total net sales $ 22,478 $ 20,089 100 % 100 %
−Removed: (1) Excludes foreign military sales through the U.S.
−Removed: Nine Months Ended September 30, % of Total Net Sales
+Added: Quarter Ended March 31, % of Total Net Sales
(dollars in millions) 2026 2025 2026 2025
9 unchanged sentences
Cost of Sales
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
1 unchanged sentence
Percentage of net sales 79.2 % 79.7 %
−Removed: Tabl e o f Contents
−Removed: The factors contributing to the change year-over-year in total cost of sales for the quarter and nine months ended September 30, 2025 are as follows:
−Removed: (dollars in millions) Quarter Ended September 30, 2025 Nine Months Ended September 30, 2025
−Removed: $ 2,048 $ 4,627
+Added: The factors contributing to the change year-over-year in total cost of sales for the quarter ended March 31, 2026 are as follows:
+Added: (dollars in millions) Quarter Ended March 31, 2026
Acquisitions and divestitures, net (326)
1 unchanged sentence
FAS/CAS operating adjustment 12
−Removed: Acquisition accounting adjustments (27) (73)
−Removed: Other 43 (624)
Total change $ 1,292
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GAAP amounts is provided in the table above.
−Removed: The organic increase in total cost of sales of $2.0 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024, was primarily driven by the organic net sales increases at Pratt & Whitney, Collins, and Raytheon noted above.
−Removed: The organic increase in total cost of sales of $4.6 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, was primarily driven by the organic net sales increases at Pratt & Whitney, Collins, and Raytheon noted above.
−Removed: The decrease in total cost of sales due to Acquisitions and divestitures, net of $0.2 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 reflects the sale of the actuation and flight control business within our Collins segment completed in the third quarter of 2025.
−Removed: The decrease in total costs of sales due to Acquisitions and divestitures, net for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, reflects the sale of the actuation and flight control business within our Collins segment, the sale of the CIS business within our Raytheon segment completed in the first quarter of 2024, and the sale of the Goodrich Hoist & Winch business within our Collins segment in the fourth quarter of 2024.
−Removed: Other cost of sales decreased $0.6 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily driven by a $0.5 billion charge recorded in the second quarter of 2024 at Raytheon related to the termination of a fixed price development contract with a foreign customer (herein referred to as “Raytheon Contract Termination”) and $0.2 billion of charges recorded in the first quarter of 2024 at Collins related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that were no longer recoverable as a result of initiating alternative titanium sources.
−Removed: Restructuring actions relate to ongoing cost reduction efforts including workforce reductions and the consolidation of facilities.
+Added: Total cost of sales increased $1.6 billion organically for the quarter ended March 31, 2026, primarily driven by the organic net sales increases at Raytheon, Pratt & Whitney, and Collins noted above.
+Added: Table of Content s
+Added: The decrease in total cost of sales due to Acquisitions and divestitures, net of $0.3 billion for the quarter ended March 31, 2026, was driven by the divestitures within our Collins segment of the actuation and flight control business and the Simmonds Precision Products business completed in 2025.
+Added: Other cost of sales increased $0.1 billion in the quarter ended March 31, 2026, primarily driven by unfavorable foreign exchange rate impacts.
+Added: The decrease in restructuring costs in the quarter ended March 31, 2026, relates primarily to higher workforce reductions initiated in the quarter ended March 31, 2025 at Collins.
For discussion on FAS/CAS operating adjustment, see the “FAS/CAS operating adjustment” subsection under the “Segment Review” section below.
For discussion on Acquisition accounting adjustments, see the “Acquisition accounting adjustments” subsection under the “Segment Review” section below.
−Removed: Quarter Ended September 30, % of Total Net Sales
−Removed: (dollars in millions) 2025 2024 2025 2024
−Removed: Cost of sales
−Removed: Products $ 13,593 $ 12,336 60.5 % 61.4 %
−Removed: Services 4,305 3,719 19.2 % 18.5 %
−Removed: Total cost of sales $ 17,898 $ 16,055 79.6 % 79.9 %
−Removed: Net products cost of sales increased $1.3 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024, primarily driven by increases in external products cost of sales at Pratt & Whitney, Collins, and Raytheon, each driven by the products sales changes noted above.
−Removed: Net services cost of sales increased $0.6 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024, primarily due to increases in external services cost of sales at Pratt & Whitney, Raytheon, and Collins, driven by the services sales changes noted above.
−Removed: Tabl e o f Contents
−Removed: Nine Months Ended September 30, % of Total Net Sales
+Added: Quarter Ended March 31, % of Total Net Sales
(dollars in millions) 2026 2025 2026 2025
3 unchanged sentences
Total cost of sales $ 17,482 $ 16,190 79.2 % 79.7 %
−Removed: Net products cost of sales increased $1.7 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily driven by increases in external products cost of sales at Pratt & Whitney, Collins, and Raytheon, each driven by the products sales changes noted above.
−Removed: The increase was partially offset by the absence of a $0.5 billion charge recorded in the second quarter of 2024 at Raytheon related to the Raytheon Contract Termination and charges of $0.2 billion recorded in the first quarter of 2024 at Collins as a result of initiating alternative titanium sources.
−Removed: Net services cost of sales increased $1.7 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to increases in external services cost of sales at Pratt & Whitney and Collins driven by the services sales changes noted above.
+Added: Net products cost of sales increased $0.7 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, primarily driven by increases in external products cost of sales at Raytheon, Pratt & Whitney, and Collins, each driven by the products sales changes noted above.
+Added: Net services cost of sales increased $0.6 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, primarily due to increases in external services cost of sales at Pratt & Whitney, driven by the services sales changes noted above.
Research and Development
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
6 unchanged sentences
Research and development spending is subject to the variable nature of program development schedules and, therefore, year-over-year fluctuations in spending levels are expected.
−Removed: The decrease in Company-funded research and development expenses of $0.1 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily driven by lower spending on commercial programs at Collins.
−Removed: The decrease in Company-funded research and development expenses of $0.1 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily driven by lower spending on commercial and defense programs at Collins and Pratt & Whitney, partially offset by higher expenses on various development programs at Raytheon.
−Removed: The increase in Customer-funded research and development expenses of $0.1 billion for the quarter and nine months ended September 30, 2025 compared to the quarter and nine months ended September 30, 2024 was primarily driven by higher development spend on various military and commercial programs at Collins and increased spending at Pratt & Whitney on military development programs.
−Removed: These increases were partially offset by lower spending on customer-funded expenses at Raytheon on military development programs, specifically related to the Next Generation Interceptor (NGI) program in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.
Selling, General, and Administrative
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
1 unchanged sentence
Percentage of net sales 6.7 % 7.1 %
−Removed: The Selling, general, and administrative expenses in the quarter ended September 30, 2025 were relatively consistent with the quarter ended September 30, 2024.
−Removed: The increase in Selling, general, and administrative expenses of $0.2 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily driven by $0.1 billion charge at Pratt & Whitney related to a customer bankruptcy during the second quarter of 2025 and $0.1 billion of higher restructuring costs related to ongoing cost reduction efforts driven by various workforce reductions primarily initiated in the first half of 2025 at Collins.
−Removed: Tabl e o f Contents
−Removed: We are continuously evaluating our cost structure and have implemented restructuring actions in an effort to keep our cost structure competitive.
−Removed: Therefore, the amounts reflected above include the beneficial impact of previous restructuring actions on Selling, general, and administrative expenses.
−Removed: Other Income (Expense), Net
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Selling, general, and administrative expenses increased for the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, primarily driven by increased employee compensation costs, partially offset by lower restructuring costs.
+Added: Other Income, Net
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
−Removed: Other income (expense), net $ 63 $ 134 $ 107 $ (390)
−Removed: Other income (expense), net includes equity earnings in unconsolidated entities, royalty income, foreign exchange gains and losses, and other ongoing and non-recurring items.
−Removed: The decrease in Other income (expense), net of $0.1 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily due to the absence of a $0.2 billion benefit from a tax related indemnity receivable recorded in the third quarter of 2024, partially offset by a $0.1 billion gain from the sale of the actuation and flight control business in the third quarter of 2025.
−Removed: The increase in Other income (expense), net of $0.5 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to a $0.1 billion gain from the sale of the actuation and flight control business in the third quarter of 2025 and the absence of 2024 items, including a $0.9 billion charge related to the Resolution of Certain Legal Matters and the reversal of certain tax related indemnity receivables associated with the conclusion of the examination phase of certain tax audits, partially offset by the absence of prior year benefits of a $0.4 billion gain on sale of the CIS business net of transaction and other related costs, and a $0.2 billion benefit from a tax related indemnity receivable.
+Added: Other income, net $ 64 $ 4
+Added: Other income, net includes equity earnings in unconsolidated entities, royalty income, foreign exchange gains and losses, and other ongoing and non-recurring items.
+Added: Table of Content s
+Added: The increase in Other income, net of $0.1 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, was primarily due to gains related to the increase in fair value on investments in the quarter ended March 31, 2026.
Operating Profit
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
1 unchanged sentence
Operating profit margin 11.6 % 10.0 %
−Removed: The increase in Operating profit of $0.5 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily driven by an increase in the organic operating performance of our segments of approximately $0.5 billion and a $0.1 billion gain on sale of the actuation and flight control business in the third quarter of 2025, partially offset by the absence of a $0.2 billion benefit related to a tax related indemnity receivable recorded in the third quarter of 2024 .
−Removed: The increase in Operating profit of $2.3 billion for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily driven by an increase in the organic operating performance of our segments of $1.2 billion, a $0.1 billion gain on sale of the actuation and flight control business in the third quarter of 2025, and the absence of 2024 charges, including a $0.9 billion charge related to the Resolution of Certain Legal Matters, a $0.6 billion charge related to the Raytheon Contract Termination, and charges of $0.2 billion at Collins as a result of initiating alternative titanium sources.
−Removed: These increases were partially offset by higher restructuring costs of $0.1 billion, a customer bankruptcy charge of $0.1 billion at Pratt & Whitney, and the absence of prior year benefits which included a $0.4 billion gain on sale of the CIS business, net of transaction and other related costs, and a $0.2 billion benefit from a tax related indemnity receivable.
+Added: The increase in Operating profit of $0.5 billion for the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 was primarily driven by an increase in the organic operating performance of our segments of approximately $0.4 billion and a decrease in restructuring charges of $0.1 billion.
Non-service Pension Income
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
Non-service pension income $ (355) $ (366)
−Removed: The Non-service pension income in the quarter and nine months ended September 30, 2025 was relatively consistent with the quarter and nine months ended September 30, 2024.
−Removed: Tabl e o f Contents
Interest Expense, Net
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
5 unchanged sentences
(1) Primarily consists of the gains or losses on assets associated with certain of our nonqualified deferred compensation and employee benefit plans, the gains or losses on liabilities associated with certain of our nonqualified deferred compensation plans, and non-operating dividend income.
−Removed: Interest expense, net for the quarter and nine months ended September 30, 2025 was relatively consistent with the quarter and nine months ended September 30, 2024, respectively.
−Removed: The decrease in Interest expense of $0.1 billion for the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily driven by lower interest accruals.
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
−Removed: 2025 2024 2025 2024
+Added: The decrease in Interest expense of $0.1 billion for the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, was primarily driven by long-term debt repayments.
+Added: Quarter Ended March 31,
Effective income tax rate 14.4 % 17.0 %
−Removed: Our effective tax rate for the quarter and nine months ended September 30, 2025 was 17.7% and 16.8%, respectively, as compared to 19.5% and 17.5% for the quarter and nine months ended September 30, 2024, respectively.
−Removed: The lower effective tax rate for the quarter ended September 30, 2025 compared to September 30, 2024 was primarily driven by the absence of a $0.2 billion tax charge related to U.S.
−Removed: federal income taxes owed by the Company resulting from a favorable non-U.S.
−Removed: tax ruling Otis received in the quarter ending September 30, 2024 impacting pre-separation tax years.
−Removed: The lower effective tax rate also included additional tax expense in the quarter ended September 30, 2025 due to the sale of the Collins actuation and flight control business and higher taxes for 2025, principally driven by the enactment of “An Act to Provide for Reconciliation Pursuant to Title II of the H.
−Removed: 14” on July 4, 2025.
−Removed: Both periods also included tax benefits associated with certain legal entity reorganizations.
−Removed: The effective tax rates for the nine months ended September 30, 2025 and 2024 were relatively consistent.
−Removed: In addition to the items noted above, the effective tax rate for the nine months ended September 30, 2024 included a $0.3 billion benefit from the impact of the conclusion of the examination phases of the RTX and Rockwell Collins audits, that was more than offset by an unfavorable impact for the tax cost associated with the sale of the CIS business and the impact of the Resolution of Certain Legal Matters accrued during the second quarter of 2024, in which no tax benefit was recorded.
+Added: The lower effective tax rate for the quarter ended March 31, 2026 compared to quarter ended March 31, 2025 was primarily driven by a higher tax benefit from stock based compensation in the current quarter as well as a lower forecasted annualized effective tax rate for 2026 principally due to a higher Foreign Derived Deduction Eligible Income (FDDEI) benefit from the U.S.
+Added: tax legislation enacted in 2025.
Net Income Attributable to Common Shareowners
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions, except per share amounts) 2026 2025
1 unchanged sentence
Diluted earnings per share $ 1.51 $ 1.14
−Removed: Net income attributable to common shareowners for the quarter ended September 30, 2025 includes the following:
+Added: Net income attributable to common shareowners for the quarter ended March 31, 2026 includes the following:
• acquisition accounting adjustments of $0.4 billion, net of tax, which had an unfavorable impact on diluted earnings per share (EPS) of $0.27.
−Removed: Net income attributable to common shareowners for the quarter ended September 30, 2024 includes the following:
−Removed: • acquisition accounting adjustments of $0.4 billion, net of tax, which had an unfavorable impact on diluted EPS of $0.31.
−Removed: Net income attributable to common shareowners for the nine months ended September 30, 2025 includes the following:
+Added: Net income attributable to common shareowners for the quarter ended March 31, 2025 includes the following:
• acquisition accounting adjustments of $0.4 billion, net of tax, which had an unfavorable impact on diluted EPS of $0.27;
• restructuring charges of $0.1 billion, net of tax, which had an unfavorable impact on diluted EPS of $0.07.
−Removed: Net income attributable to common shareowners for the nine months ended September 30, 2024 includes the following:
−Removed: Tabl e o f Contents
−Removed: • acquisition accounting adjustments of $1.2 billion, net of tax, which had an unfavorable impact on diluted EPS of $0.89;
−Removed: • charge related to the Resolution of Certain Legal Matters of $0.9 billion, which had an unfavorable impact on diluted EPS of $0.68;
−Removed: • a charge of $0.4 billion, net of tax, related to the Raytheon Contract Termination, which had an unfavorable impact on diluted EPS of $0.33;
−Removed: • benefit recognized as a result of the conclusion of the examination phases of the RTX and Rockwell Collins tax audits of $0.3 billion, net of tax, which had a favorable impact on diluted EPS of $0.21;
−Removed: • a gain on sale of the CIS business, net of transaction and other related costs, of $0.2 billion, net of tax, which had a favorable impact on diluted EPS of $0.18;
−Removed: • charges related to initiating alternative titanium sources at our Collins segment of $0.2 billion, which had an unfavorable impact on diluted EPS of $0.13.
+Added: Table of Content s
SEGMENT REVIEW
2 unchanged sentences
Segments are generally based on the management structure of the businesses and the grouping of similar operations, based on capabilities and technologies, where each management organization has general operating autonomy over diversified products and services.
−Removed: Segment Total net sales and Operating profit include intercompany sales and profit, which are ultimately eliminated within Eliminations and other, which also includes certain smaller non-reportable segments.
+Added: Total segment net sales and segment operating profit include intercompany sales and profit, which are ultimately eliminated within Eliminations and other, which also includes certain smaller non-reportable segments.
Segment Operating Profit excludes certain acquisition accounting adjustments, the FAS/CAS operating adjustment, and certain corporate expenses, as further discussed below.
4 unchanged sentences
Total net sales by segment were as follows:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
4 unchanged sentences
Eliminations and other (1)
−Removed: (611) (611) (1,901) (1,685)
Consolidated $ 22,076 $ 20,306
(1) Includes the operating results of certain smaller operations.
−Removed: Tabl e o f Contents
Operating Profit.
Operating profit by segment was as follows:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
1 unchanged sentence
Pratt & Whitney 710 580
−Removed: 859 647 2,342 1,770
+Added: Raytheon 841 678
Total segment 2,858 2,346
Eliminations and other (1)
−Removed: (14) (14) 22 (55)
Corporate expenses and other unallocated items (42) (38)
−Removed: (25) 100 (110) (926)
FAS/CAS operating adjustment 172 185
2 unchanged sentences
(1) Includes the operating results of certain smaller operations.
−Removed: (2) Operating Profit and Margin includes a $0.6 billion charge in the second quarter of 2024 related to the Raytheon Contract Termination and a $0.4 billion gain, net of transaction and other related costs, in the first quarter of 2024 related to the sale of our CIS business.
−Removed: Changes in Contract Estimates at Completion” and “Note 2:
−Removed: Acquisitions and Dispositions,” respectively, within Item 1 of this Form 10-Q for additional information.
−Removed: (3) Includes a $0.9 billion charge in the second quarter of 2024 related to the Resolution of Certain Legal Matters.
Included in segment Operating profit are EAC adjustments, which relate to changes in Operating profit and margin due to revisions to total estimated revenues and costs at completion.
3 unchanged sentences
Given that we have thousands of individual contracts, and given the types and complexity of the assumptions and estimates we must make on an on-going basis, and the nature of the work required to be performed under our contracts, we have both favorable and unfavorable EAC adjustments in the ordinary course.
+Added: Table of Content s
We had the following net EAC adjustments for the periods presented:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
Total net EAC adjustments $ (162) $ (158)
−Removed: The change in net EAC adjustments of approximately $0.1 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily due to favorable changes in net EAC adjustments at Raytheon.
−Removed: Total net EAC adjustments in the nine months ended September 30, 2025 were relatively consistent with the nine months ended September 30, 2024.
−Removed: In addition to the amounts included in the table above, during the second quarter of 2024, Raytheon initiated the Raytheon Contract Termination and recognized a $0.6 billion charge related to its impact.
−Removed: The charge included the write-off of remaining contract assets and the estimated settlement with the customer.
−Removed: The Raytheon Contract Termination was completed, including the customer settlement, during the fourth quarter of 2024, in line with previously accrued amounts.
Significant EAC adjustments, when they occur, are discussed in each business segment’s discussion below.
Backlog and Bookings.
−Removed: Total backlog was $251 billion and $218 billion as of September 30, 2025 and December 31, 2024, respectively.
−Removed: Total backlog includes commercial backlog of $148 billion and $125 billion as of September 30, 2025 and December 31, 2024, and defense backlog of $103 billion and $93 billion as of September 30, 2025 and December 31, 2024, respectively.
+Added: Total backlog was $271 billion and $268 billion as of March 31, 2026 and December 31, 2025, respectively.
+Added: Total backlog includes commercial backlog of $162 billion and $161 billion as of March 31, 2026 and December 31, 2025, and defense backlog of $109 billion and $107 billion as of March 31, 2026 and December 31, 2025, respectively.
We believe bookings are an important measure of future performance for our defense businesses.
−Removed: Our defense operations consist primarily of our Raytheon business and operations in the defense businesses within our Collins and Pratt & Whitney segments.
−Removed: Defense bookings were approximately $23 billion and $25 billion for the quarters ended September 30, 2025 and 2024, respectively, and approximately $44 billion and $47 billion for the nine months ended September 30, 2025 and 2024.
+Added: Our defense operations consist primarily of our Raytheon segment and operations in the defense businesses within our Collins and Pratt & Whitney segments.
+Added: Defense bookings were approximately $14 billion and $9 billion for the quarters ended March 31, 2026 and 2025, respectively.
Bookings are impacted by the timing and amounts of awards in a given period, which are subject to numerous factors, including:
−Removed: the desired capability by the customer and urgency of customer needs, customer budgets and other fiscal constraints, political and economic and other environmental factors, the timing of customer negotiations, and the timing of customer and
−Removed: Tabl e o f Contents
−Removed: governmental approvals and notifications.
+Added: the desired capability by the customer and urgency of customer needs, customer budgets and other fiscal constraints, political and economic and other environmental factors, the timing of customer negotiations, and the timing of customer and governmental approvals and notifications.
In addition, due to these factors, quarterly bookings tend to fluctuate from period to period, particularly on a segment basis.
Collins Aerospace
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
−Removed: (dollars in millions) 2025 2024 Change 2025 2024 Change
+Added: Quarter Ended March 31,
+Added: (dollars in millions) 2026 2025 Change
Net sales $ 7,602 $ 7,217 5 %
1 unchanged sentence
Operating profit margins 17.2 % 15.1 %
−Removed: Quarter Ended September 30, 2025 Compared with Quarter Ended September 30, 2024
−Removed: Factors Contributing to Total Change
−Removed: (dollars in millions) Organic (1)
−Removed: Acquisitions /
−Removed: Divestitures, net Restructuring
−Removed: Costs Other Total Change
−Removed: Net sales $ 783 $ (263) $ — $ 26 $ 546
−Removed: Operating profit 123 2 (5) 78 198
−Removed: (1) See “Segment Review” above for definition of organic.
−Removed: A reconciliation of these measures to reported U.S.
−Removed: GAAP amounts is provided in the table above.
−Removed: The organic net sales increase of $0.8 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily relates to higher commercial aerospace aftermarket sales of $0.4 billion, higher commercial aerospace OEM sales of $0.3 billion and higher defense sales of $0.1 billion.
−Removed: The increase in commercial aftermarket sales was driven by higher volume across all aftermarket sales channels, and the increase in commercial OEM sales was primarily driven by higher volume on narrowbody programs.
−Removed: The increase in defense sales was primarily due to higher volume across multiple programs and platforms .
−Removed: The organic operating profit increase of $0.1 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily due to higher commercial aerospace operating profit of $0.1 billion, principally driven by the higher sales volume discussed above partially offset by unfavorable commercial OEM mix and the impact of higher tariffs.
−Removed: Defense operating profit increased slightly in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily driven by the higher sales volume discussed above.
−Removed: Operating profit also benefited from lower research and development expenses.
−Removed: The decrease in net sales due to acquisitions / divestitures, net in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 primarily relates to the sale of the actuation and flight control business completed in the third quarter of 2025.
−Removed: The increase in other operating profit of $0.1 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily driven by the gain on the sale of the actuation and flight control business completed in the third quarter of 2025.
−Removed: Tabl e o f Contents
−Removed: Nine Months Ended September 30, 2025 Compared with Nine Months Ended September 30, 2024
+Added: Quarter Ended March 31, 2026 Compared with Quarter Ended March 31, 2025
Factors Contributing to Total Change
8 unchanged sentences
GAAP amounts is provided in the table above.
−Removed: The organic net sales increase of $2.0 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily relates to higher commercial aerospace aftermarket sales of $1.1 billion, higher defense sales of $0.6 billion and higher commercial aerospace OEM sales of $0.3 billion.
−Removed: The increase in commercial aerospace sales was driven by higher volume across all sales channels.
+Added: The organic net sales increase of $0.7 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 primarily relates to higher commercial aerospace OEM sales of $0.3 billion, higher commercial aerospace aftermarket sales of $0.2 billion, and higher defense sales of $0.2 billion.
+Added: The increase in commercial OEM sales was primarily driven by higher volume on narrowbody and widebody programs and the increase in commercial aftermarket sales was driven by higher provisioning and parts and repair volume.
The increase in defense sales was primarily due to higher volume across multiple programs and platforms .
−Removed: The organic operating profit increase of $0.4 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to higher commercial aerospace operating profit of $0.2 billion, principally driven by the higher sales volume discussed above partially offset by unfavorable commercial OEM mix and the impact of tariffs.
−Removed: Defense operating profit increased $0.2 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 due to higher sales volume and favorable mix.
+Added: The organic operating profit increase of $0.1 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 was primarily due to the commercial and defense sales volume increases as discussed above, partially offset by the impact of higher tariffs and unfavorable commercial OEM mix.
Operating profit also benefited from lower research and development expenses.
−Removed: The decrease in net sales due to acquisitions / divestitures, net in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily relates to the sale of the actuation and flight control business completed in the third quarter of 2025 and the sale of the Goodrich Hoist & Winch business completed in the fourth quarter of 2024.
−Removed: The increase in other operating profit of $0.2 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to the absence of $0.2 billion of charges recorded in the first quarter of 2024, related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources and a $0.1 billion gain on the sale of our actuation and flight control business completed in the third quarter of 2025.
−Removed: The increase in restructuring costs in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 relates to ongoing cost reduction efforts driven by various workforce reductions primarily initiated in the first half of 2025.
−Removed: Defense Bookings – In addition to a number of smaller bookings, in the quarter ended September 30, 2025, Collins booked $454 million for Program D-X to deliver satellite communication systems to support survivable communications across multiple frequency bands.
−Removed: In addition to these bookings, in the nine months ended September 30, 2025, Collins booked $358 million as the primary subcontractor for the U.S.
−Removed: Navy's solution for engineering design and manufacturing of the Very Low Frequency communication subsystem, which is intended to provide secure and survivable communications to the U.S.
+Added: The decrease in net sales and operating profit due to acquisitions / divestitures, net in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 relates to the divestiture of the actuation and flight control business and the Simmonds Precision Products business completed in 2025.
+Added: The decrease in restructuring costs during the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 relates primarily to higher workforce reductions initiated in the quarter ended March 31, 2025.
+Added: Defense Bookings – In the quarter ended March 31, 2026, Collins recorded $3 billion in defense bookings, comprised of a number of smaller individual bookings under $0.5 billion.
+Added: Table of Content s
Pratt & Whitney
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
−Removed: (dollars in millions) 2025 2024 Change 2025 2024 Change
+Added: Quarter Ended March 31,
+Added: (dollars in millions) 2026 2025 Change
Net sales $ 8,173 $ 7,366 11 %
1 unchanged sentence
Operating profit margins 8.7 % 7.9 %
−Removed: Quarter Ended September 30, 2025 Compared with Quarter Ended September 30, 2024
−Removed: Factors Contributing to Total Change
−Removed: (dollars in millions) Organic (1)
−Removed: Acquisitions /
−Removed: Divestitures, net Restructuring
−Removed: Costs Other Total Change
−Removed: Net sales $ 1,180 $ — $ — $ 4 $ 1,184
−Removed: Operating profit 148 — 13 33 194
−Removed: (1) See “Segment Review” above for definition of organic.
−Removed: A reconciliation of these measures to reported U.S.
−Removed: GAAP amounts is provided in the table above.
−Removed: The organic net sales increase of $1.2 billion in the quarter ended September 30, 2025, compared to the quarter ended September 30, 2024, reflects higher commercial aftermarket sales of $0.8 billion and higher commercial OEM sales of
−Removed: Tabl e o f Contents
−Removed: $0.1 billion.
−Removed: The increase in commercial aftermarket sales of $0.8 billion was primarily driven by higher volume.
−Removed: The increase in commercial OEM sales was driven by higher volume in large commercial engines and favorable mix at Pratt & Whitney Canada.
−Removed: Military sales increased $0.3 billion primarily driven by higher volume on the F135 program, including the impact of the Lot 18 contract award in the quarter ended September 30, 2025.
−Removed: The organic operating profit increase of $0.1 billion in the quarter ended September 30, 2025, compared to the quarter ended September 30, 2024 reflects higher commercial aerospace operating profit of $0.1 billion, driven by the commercial aftermarket sales volume increase discussed above, partially offset by lower commercial OEM operating profit primarily driven by higher large commercial engines volume and the impact of higher tariffs.
−Removed: The increase in military operating profit was $0.1 billion, driven by the sales volume discussed above.
−Removed: These increases were partially offset by higher selling, general administrative expenses of $0.1 billion.
−Removed: Nine Months Ended September 30, 2025 Compared with Nine Months Ended September 30, 2024
+Added: Quarter Ended March 31, 2026 Compared with Quarter Ended March 31, 2025
Factors Contributing to Total Change
8 unchanged sentences
GAAP amounts is provided in the table above.
−Removed: The organic net sales increase of $2.9 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 reflects higher commercial aftermarket sales of $2.1 billion primarily driven by higher volume.
−Removed: Also contributing to the organic net sales increase was higher commercial OEM sales of $0.4 billion driven by higher volume and favorable mix.
−Removed: Military sales increased $0.4 billion, primarily due to higher production volume on the F135 and tanker programs.
−Removed: The organic operating profit increase of $0.4 billion in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024 reflects higher commercial aerospace operating profit of $0.4 billion primarily driven by higher commercial aftermarket volume, partially offset by lower commercial OEM operating profit, including higher tariff and production costs, driven by the higher volume discussed above.
−Removed: The increase in military operating profit of $0.1 billion was driven by the higher sales volume discussed above, as well as favorable mix.
−Removed: Increased selling, general and administrative expenses of $0.1 billion were partially offset by lower research and development expenses.
−Removed: The decrease in other operating profit of $0.1 billion in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, primarily relates to a $0.1 billion charge related to a customer bankruptcy during the second quarter of 2025.
−Removed: Defense Bookings – In the quarter ended September 30, 2025, Pratt & Whitney booked $2.9 billion for F135 production and $248 million for F135 sustainment.
−Removed: In addition to these bookings, in the nine months ended September 30, 2025, Pratt & Whitney booked $541 million for F135 sustainment and a number of smaller bookings.
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
−Removed: (dollars in millions) 2025 2024 Change 2025 2024 Change
+Added: The organic net sales increase of $0.8 billion in the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025, was driven by a $0.7 billion increase in commercial aftermarket sales, primarily reflecting higher volume.
+Added: Military sales increased $0.1 billion primarily due to higher F135 production volume.
+Added: These increases were partially offset by lower commercial OEM sales volume.
+Added: The organic operating profit increase of $0.1 billion in the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025 was primarily driven by higher commercial aerospace operating profit of $0.1 billion.
+Added: This increase resulted from higher commercial aftermarket volume as discussed above, partially offset by lower commercial OEM operating profit contribution due to higher operational costs, including tariffs.
+Added: Organic operating profit also benefited from higher military operating profit driven by the sales volume discussed above.
+Added: These increases were partially offset by higher selling, general, and administrative expenses.
+Added: Defense Bookings – In the quarter ended March 31, 2026, Pratt & Whitney recorded $4 billion in defense bookings.
+Added: In addition to a number of smaller individual bookings, Pratt & Whitney booked $3.4 billion for F135 production.
+Added: Quarter Ended March 31,
+Added: (dollars in millions) 2026 2025 Change
Net sales $ 6,945 $ 6,340 10 %
2 unchanged sentences
Defense Bookings $ 6,635 $ 4,396 51 %
−Removed: Tabl e o f Contents
−Removed: Quarter Ended September 30, 2025 Compared with Quarter Ended September 30, 2024
+Added: Quarter Ended March 31, 2026 Compared with Quarter Ended March 31, 2025
Factors Contributing to Total Change
8 unchanged sentences
GAAP amounts is provided in the table above.
−Removed: The organic net sales increase of $0.7 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was primarily due to higher net sales of $0.4 billion from land and air defense systems programs primarily driven by higher net sales on international Patriot programs.
−Removed: The increase in the quarter was also driven by higher net sales of $0.2 billion from naval power programs primarily due to higher net sales on certain classified programs, Standard Missile-6 (SM-6) programs, and Evolved SeaSparrow Missile (ESSM) programs.
−Removed: The organic operating profit increase of $0.2 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 was driven by a favorable change in mix and other performance of approximately $0.1 billion, a favorable change in net EAC adjustments of approximately $0.1 billion, and higher volume of approximately $0.1 billion.
−Removed: The favorable change in mix and other performance was primarily due to increased production on international Patriot programs.
−Removed: The favorable change in net EAC adjustments was spread across numerous programs and benefited from the absence of a $53 million unfavorable adjustment in the third quarter of 2024 related to cost increases on a classified program.
−Removed: The increase in volume was primarily driven by the higher net sales discussed above.
−Removed: Nine Months Ended September 30, 2025 Compared with Nine Months Ended September 30, 2024
−Removed: Factors Contributing to Total Change
−Removed: (dollars in millions) Organic (1)
−Removed: Acquisitions /
−Removed: Divestitures, net Restructuring
−Removed: Costs Other Total Change
−Removed: Net sales $ 1,220 $ (460) $ — $ 70 $ 830
−Removed: Operating Profit 384 (34) 26 196 572
−Removed: (1) See “Segment Review” above for definition of organic.
−Removed: A reconciliation of this measure to the reported U.S.
−Removed: GAAP amount is provided in the table above.
−Removed: The organic net sales increase of $1.2 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to higher net sales of $1.1 billion from land and air defense systems programs primarily driven by higher net sales on international Patriot programs, international National Advanced Surface-to-Air Missile System (NASAMS) programs, and Lower Tier Air and Missile Defense Sensor (LTAMDS) programs, and higher net sales of $0.4 billion from naval power programs primarily due to higher net sales on ESSM programs, SPY-6 radar programs, and certain classified programs.
−Removed: These increases were partially offset by lower net sales of $0.3 billion driven by lower development program volume within air and space defense systems.
−Removed: The organic operating profit increase of $0.4 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to a favorable change in mix and other performance of $0.2 billion, higher volume of approximately $0.1 billion and a favorable change in net EAC adjustments of $0.1 billion.
−Removed: The favorable change in mix and other performance was primarily driven by increased production on international Patriot programs.
−Removed: The increase in volume was principally driven by the higher net sales discussed above.
−Removed: The favorable change in net EAC adjustments was spread across numerous programs and benefited from the absence of a $53 million unfavorable adjustment in the third quarter of 2024 related to cost increases on a classified program.
−Removed: The decrease in net sales and operating profit due to acquisitions / divestitures, net in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily relates to the sale of the CIS business completed in the first quarter of 2024.
−Removed: The increase in other net sales and operating profit of $0.1 billion and $0.2 billion, respectively, in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 were primarily due to a charge related to the Raytheon Contract Termination initiated in the second quarter of 2024, with the operating profit decrease partially offset by a gain on sale of the CIS business, net of transaction and other related costs, in the first quarter of 2024.
−Removed: Defense Backlog and Bookings – Backlog was $72 billion as of September 30, 2025 and $63 billion as of December 31, 2024.
−Removed: In addition to a number of smaller bookings, in the quarter ended September 30, 2025, Raytheon booked $2.5 billion on several contracts to provide Guidance Enhanced Missiles (GEM-T) and Patriot launchers for international customers and the U.S.
−Removed: Army, $2.1 billion to provide advanced medium-range air-to-air missile (AMRAAM) to the U.S.
−Removed: Air Force, U.S.
−Removed: Tabl e o f Contents
−Removed: international customers, $1.5 billion for low-rate initial production (LRIP) of LTAMDS for the U.S.
−Removed: Army and Poland, $517 million to provide Stinger missiles to the U.S.
−Removed: Army and international customers, $484 million to provide precision munitions systems to the U.S.
−Removed: Navy, $327 million to provide Javelin to the U.S.
−Removed: Army, $263 million to provide the Low, slow, small, unmanned aircraft Integrated Defeat System (LIDS), a Counter-Unmanned Aircraft System (C-UAS), to the U.S.
−Removed: Army, $259 million to provide Standard Missile-2 (SM-2) for the U.S.
−Removed: Navy, and $2.5 billion on a number of classified contracts.
−Removed: In addition to these bookings, in the nine months ended September 30, 2025, Raytheon booked $1.1 billion for AIM-9X Sidewinder Block II short-range air-to-air missiles for the U.S.
−Removed: Navy and international customers, $901 million to provide Standard Missile-3 (SM-3) for the Missile Defense Agency (MDA), $647 million for a SPY-6 Hardware Production and Sustainment contract for the U.S.
−Removed: Navy, $581 million for Next Generation Jammer Mid-Band (NGJ-MB) for the U.S.
−Removed: Navy and the Royal Australian Air Force, $529 million to provide Patriot systems for the Netherlands, $326 million for an advanced development program for the U.S.
−Removed: government, $325 million for an Advanced Tactical Electro-Optical Infrared (EO/IR) system for the U.S.
−Removed: Air Force, $322 million for SM-3 to the MDA and international customers, $314 million for various Multi-Spectral Targeting System-A (MTS-A) for the U.S.
−Removed: Navy and international customers, $300 million to provide ESSM to the U.S.
−Removed: Navy, $251 million to provide ESSM for Japan, and $2.5 billion on a number of classified contracts.
+Added: The organic net sales increase of $0.6 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 was primarily due to higher net sales of $0.5 billion from land and air defense systems programs driven by higher net sales on Patriot programs.
+Added: Also contributing to the increase was higher net sales of $0.3 billion from naval power programs primarily driven by higher volume on Standard Missile programs.
+Added: The organic operating profit increase of $0.2 billion in the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025 was primarily due to a favorable change in mix and other performance of approximately $0.1 billion, and higher volume of approximately $0.1 billion.
+Added: The favorable change in mix and other performance was primarily driven by increased production on Patriot programs.
+Added: The increase in volume was principally driven by higher net sales described above.
+Added: Operating profit also benefited from a favorable change in net EAC adjustments spread across numerous programs.
+Added: Table of Content s
+Added: Defense Backlog and Bookings – Backlog was $74 billion as of March 31, 2026 and $75 billion as of December 31, 2025.
+Added: In the quarter ended March 31, 2026, Raytheon recorded $7 billion in defense bookings.
+Added: In addition to a number of smaller individual bookings, Raytheon booked $628 million to provide Patriot systems for the Netherlands and $1.6 billion on a number of classified contracts.
Corporate and Eliminations and other
Eliminations and other reflects the elimination of sales, other income, and operating profit transacted between segments, as well as the operating results of certain smaller operations.
−Removed: Corporate expenses and other unallocated items consists of costs not considered part of management’s evaluation of reportable segment operating performance, including certain unallowable costs and reserves.
−Removed: Net Sales Operating Profit
−Removed: Quarter Ended September 30, Quarter Ended September 30,
−Removed: (dollars in millions) 2025 2024 2025 2024
−Removed: Eliminations and other $ (611) $ (611) $ (14) $ (14)
−Removed: Corporate expenses and other unallocated items — — (25) 100
−Removed: The change in corporate expenses and other unallocated items of $0.1 billion in the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024, was primarily due to the absence of a $0.2 billion benefit from a tax related indemnity receivable recorded in the third quarter of 2024.
+Added: Corporate expenses and other unallocated items consist of costs not considered part of management’s evaluation of reportable segment operating performance, including certain unallowable costs and reserves.
Net Sales Operating Profit
−Removed: Nine months ended September 30, Nine months ended September 30,
+Added: Quarter Ended March 31, Quarter Ended March 31,
(dollars in millions) 2026 2025 2026 2025
1 unchanged sentence
Corporate expenses and other unallocated items — — (42) (38)
−Removed: The increase in eliminations and other sales of $0.2 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to an increase in intersegment eliminations, principally driven by Collins.
−Removed: The change in eliminations and other operating profit of $0.1 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, was primarily due to a gain related to the increase in fair value on an investment recognized in the second quarter of 2025.
−Removed: The change in Corporate expenses and other unallocated items of $0.8 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, was primarily due to the absence of a $0.9 billion charge recorded in the second quarter of 2024 related to the Resolution of Certain Legal Matters, partially offset by the absence of a $0.2 billion benefit from a tax related indemnity receivable recorded in the third quarter of 2024.
FAS/CAS operating adjustment
5 unchanged sentences
Collins and Pratt & Whitney generally record pension and PRB expense on a FAS basis .
−Removed: Tabl e o f Contents
The components of the FAS/CAS operating adjustment were as follows:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
2 unchanged sentences
FAS/CAS operating adjustment $ 172 $ 185
−Removed: The FAS/CAS operating adjustments in the quarter and nine months ended September 30, 2025 were relatively consistent with the quarter and nine months ended September 30, 2024.
Acquisition accounting adjustments
2 unchanged sentences
The components of Acquisition accounting adjustments were as follows:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
3 unchanged sentences
Acquisition accounting adjustments $ (471) $ (470)
+Added: Table of Content s
Acquisition accounting adjustments related to acquisitions in each segment were as follows:
−Removed: Quarter Ended September 30, Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
5 unchanged sentences
Acquisition accounting adjustments $ (471) $ (470)
−Removed: Acquisition accounting adjustments in the quarter ended September 30, 2025 were relatively consistent with the quarter ended September 30, 2024.
−Removed: The change in acquisition accounting adjustments of $0.1 billion in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, was primarily driven by a decrease in acquired intangibles amortization at Raytheon.
LIQUIDITY AND FINANCIAL CONDITION
−Removed: (dollars in millions) September 30, 2025 December 31, 2024
+Added: (dollars in millions) March 31, 2026 December 31, 2025
Cash and cash equivalents $ 6,818 $ 7,435
6 unchanged sentences
In addition to operating cash flows, other significant factors that affect our overall management of liquidity include:
−Removed: capital expenditures, customer financing
−Removed: Tabl e o f Contents
−Removed: requirements, investments in and divestitures of businesses, dividends, common stock repurchases, pension funding, access to the commercial paper markets, adequacy of available bank lines of credit, redemptions of debt, and the ability to attract long-term capital at satisfactory terms.
−Removed: At September 30, 2025, we had cash and cash equivalents of $6.0 billion, of which approximatel y 43% was held by RTX’s foreign subsidiaries.
+Added: capital expenditures, customer financing requirements, investments in and divestitures of businesses, dividends, common stock repurchases, pension funding, access to the commercial paper markets, adequacy of available bank lines of credit, redemptions of debt, and the ability to attract long-term capital at satisfactory terms.
+Added: At March 31, 2026, we had cash and cash equivalents of $6.8 billion, of which approximatel y 30% was held by RTX’s foreign subsidiaries.
We manage our worldwide cash requirements by reviewing available funds among the many subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed.
3 unchanged sentences
Our ability to access global debt markets and the related cost of these borrowings depends on the strength of our credit rating and market conditions.
−Removed: In March 2025, our Moody’s Investors Service outlook improved from Baa1/negative to Baa1/stable.
−Removed: In June 2025, our S&P Global rating was affirmed and our outlook was revised from BBB+/negative to BBB+/stable.
+Added: Our S&P Global rating remains at BBB+/stable.
+Added: In February 2026, our Moody’s Investors Service outlook improved from Baa1/stable to Baa1/positive.
Though the Company expects to continue having adequate access to funds, declines in our credit ratings or Company outlook could result in higher borrowing costs.
−Removed: As of September 30, 2025, we had a revolving credit agreement with various banks permitting aggregate borrowings of up to $5.0 billion, which expires in August 2028.
−Removed: As of September 30, 2025, there were no borrowings outstanding under this agreement.
−Removed: From time to time, we use commercial paper borrowings for general corporate purposes, including the funding of potential acquisitions, pension contributions, debt refinancing, dividend payments, and repurchases of our common stock.
+Added: As of March 31, 2026, we had a revolving credit agreement with various banks permitting aggregate borrowings of up to $5.0 billion, which expires in August 2028.
+Added: As of March 31, 2026, there were no borrowings outstanding under this agreement.
+Added: From time to time, we use commercial paper borrowings for general corporate purposes, including short-term funding related to potential acquisitions, pension contributions, debt refinancing, dividend payments, and repurchases of our common stock.
The commercial paper notes have original maturities of not more than 364 days from the date of issuance.
−Removed: As of September 30, 2025, our maximum commercial paper borrowing limit was $5.0 billion as the commercial paper is backed by our $5.0 billion revolving credit agreement.
−Removed: At September 30, 2025, we had no commercial paper borrowings outstanding.
−Removed: We made the following repayment of long-term debt during the nine months ended September 30, 2025:
+Added: As of March 31, 2026, our maximum commercial paper borrowing limit was $5.0 billion as the commercial paper is backed by our $5.0 billion revolving credit agreement.
+Added: At March 31, 2026, we had no commercial paper borrowings outstanding.
+Added: We made the following repayment of long-term debt during the quarter ended March 31, 2026:
Date Description of Notes Aggregate Principal Balance (in millions)
−Removed: August 18, 2025 3.950% notes due 2025
−Removed: May 7, 2025 3 Month SOFR plus 1.225% term loan due 2025
+Added: February 27, 2026 5.000% notes due 2026
We have an existing universal shelf registration statement, which we filed with the SEC on September 18, 2025, for an indeterminate amount of debt and equity securities for future issuance, subject to our internal limitations on the amount of debt to be issued under this shelf registration statement.
+Added: Table of Content s
We believe our cash on hand and future operating cash flows will be sufficient to meet our future operating cash needs.
1 unchanged sentence
Cash Flow - Operating Activities
−Removed: Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
1 unchanged sentence
$ 1,855 $ 1,305
−Removed: Included within Net income for the nine months ended September 30, 2024, was a $0.9 billion charge related to the Resolution of Certain Legal Matters and a $0.4 billion, net of tax, charge related to the Raytheon Contract Termination, both of which had no effect on cash flow in that period.
−Removed: These charges also had the effect of increasing Other accrued liabilities by $1.3 billion in the nine months ended September 30, 2024.
−Removed: Excluding the impact of these charges, the $0.8 billion increase in cash flows provided by operating activities in the nine months ended September 30, 2025 compared to in the nine months ended September 30, 2024, was primarily driven by higher net income after adjustments to reconcile to net cash provided by operating activities driven by our segment performance, the benefit of lower inventory growth, and an increase in accounts payable and accrued liabilities driven by the timing of collaborator payables.
−Removed: These increases were partially offset by an increase in accounts receivable due to higher volume and timing of collections, and higher tax payments in the nine months ended September 30, 2025.
−Removed: Tabl e o f Contents
+Added: Cash flows provided by operating activities increased by $0.6 billion for the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025, primarily due to higher net income after adjustments to reconcile to net cash provided by operating activities, driven by our segment performance.
+Added: The change in net working capital was relatively consistent year over year, as a decrease in accounts receivable was partially offset by a decrease in accounts payable and accrued liabilities and an increase in net contract asset and contract liabilities.
+Added: The decrease in accounts receivable, including collaborator receivables, was primarily due to the timing of collections.
+Added: The decrease in accounts payable and accrued liabilities was driven by the timing of payments, including collaborator payables, changes in accrued employee compensation driven by incentive compensation payments and tax payments, partially offset by higher material purchases.
+Added: The change in net contract asset and contract liability activity resulted from lower billings relative to revenue recognition during the period, primarily at Pratt & Whitney.
The Company enters into various factoring agreements with third-parties to sell certain of its receivables, primarily related to customer facilitated programs.
The activity in these agreements is generally dependent on underlying delivery volumes within our commercial OEM programs.
−Removed: Factoring activity resulted in a $1.0 billion increase in cash provided by operating activities during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.
−Removed: We made tax payments, net of refunds of $0.9 billion and $0.6 billion in the nine months ended September 30, 2025 and 2024, respectively.
+Added: Factoring activity resulted in a $0.2 billion increase in cash provided by operating activities during the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025.
+Added: We made tax payments, net of refunds of $0.3 billion and $0.1 billion in the quarters ended March 31, 2026 and 2025, respectively.
While the timing of cash flows are subject to a number of variables, for the Powder Metal Matter we estimate the accrual for expected customer compensation to be utilized consistent with the timing of execution of the fleet management plan, the period of increased aircraft on ground levels, and contractual terms with customers.
−Removed: We currently estimate a full year 2025 cash impact related to the Powder Metal Matter of approximately $1.1 billion to $1.3 billion, which includes the impact of cash paid, customer credits applied, and the timing of partner recovery.
+Added: We currently estimate a full year 2026 cash impact related to the Powder Metal Matter of approximately $0.7 billion, which includes the impact of customer credits applied and the timing of partner recovery.
Cash Flow - Investing Activities
−Removed: Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
2 unchanged sentences
Our investing activities primarily include capital expenditures, cash investments in customer financing assets, investments in and dispositions of businesses, payments related to our collaboration intangible assets and contractual rights to provide product on new aircraft platforms, and settlements of derivative contracts not designated as hedging instruments.
−Removed: The change in cash flows provided from investing activities in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, was primarily related to higher receipts from settlements of derivative contracts of $0.2 billion.
−Removed: This was partially offset by a $0.1 billion change in net proceeds received from divestitures.
−Removed: In the nine months ended September 30, 2025, we received $1.2 billion from the actuation and flight control business divestiture as compared to $1.3 billion from the CIS divestiture in the nine months ended September 30, 2025.
−Removed: During the nine months ended September 30, 2025 and 2024, other intangible assets increased by $0.3 billion and $0.4 billion, respectively, primarily related to collaboration payments made under our 2012 agreement to acquire Rolls-Royce’s collaboration interests in International Aero Engines AG (IAE) and exclusivity payments made on contractual commitments included within intangible assets.
+Added: The change in cash flows used in investing activities in the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025, was primarily related to higher receipts from settlements of derivative contracts of $0.1 billion.
Cash Flow - Financing Activities
−Removed: Nine Months Ended September 30,
+Added: Quarter Ended March 31,
(dollars in millions) 2026 2025
2 unchanged sentences
Our financing activities primarily include the issuance and repayment of commercial paper and other short-term and long-term debt, payment of dividends, and stock repurchases.
−Removed: The $0.6 billion change in cash flows used in financing activities in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, was primarily driven by higher long-term debt repayments of $0.6 billion in the nine months ended September 30, 2025.
+Added: The $0.8 billion change in cash flows used in financing activities in the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025, was primarily driven by higher long-term debt repayments of $0.5 billion.
Refer to “Note 8:
Borrowings and Lines of Credit” within Item 1 of this Form 10-Q for additional information on debt repayments.
−Removed: Additionally, lower share repurchases were more than offset by higher dividends paid in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.
−Removed: At September 30, 2025, management had remaining authority to repurchase approximately $0.6 billion of our common stock under the October 21, 2023 share repurchase program.
+Added: Table of Content s
+Added: At March 31, 2026, management had remaining authority to repurchase approximately $0.6 billion of our common stock under the October 21, 2023 share repurchase program.
Under the 2023 program, shares may be purchased on the open market, in privately negotiated transactions, under accelerated share repurchase (ASR) programs, and under plans complying with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended.
1 unchanged sentence
Our ability to repurchase shares is subject to applicable law.
−Removed: Tabl e o f Contents
−Removed: Our share repurchases, which include shares reacquired outside of our share repurchase program, were as follows:
−Removed: Nine Months Ended September 30,
−Removed: (dollars in millions;
−Removed: shares in thousands) $ Shares $ Shares
−Removed: Shares of common stock repurchased (1)
−Removed: $ 50 396 $ 136 1,365
−Removed: ASR Tranche 1 settlement - shares received (2)
−Removed: ASR Tranche 2 settlement - financing cash paid (2) (3)
−Removed: Total shares of common stock repurchased $ 50 396 $ 394 1,756
−Removed: (1) Amounts relate to share repurchases that were settled in cash during the period.
−Removed: (2) Includes the settlement of the ASR first and second tranches in the third quarter of 2024.
−Removed: (3) Excludes the change in fair value of the stock price from trade date to settlement date of $3 million, which is classified as an operating cash flow in our
−Removed: Condensed Consolidated Statement of Cash Flows.
−Removed: Pursuant to the ASR agreements entered into in 2023, the shares associated with the remaining portion of the aggregate purchase price have been settled over two tranches.
−Removed: In July 2024, the first tranche was settled upon final delivery to us of approximately 0.4 million shares of common stock.
−Removed: In September 2024, with respect to the second tranche, we owed approximately 2.2 million shares of common stock that we elected to cash settle for $261 million.
−Removed: The cash payment required as a result of the second tranche settlement was due to the significant increase in the price of our common stock during the ASR term.
−Removed: The final average price under the ASR was $94.28 per share.
Quantitative and Qualitative Disclosures About Market Risk
−Removed: There has been no significant change in our exposure to market risk during the nine months ended September 30, 2025.
+Added: There has been no significant change in our exposure to market risk during the quarter ended March 31, 2026.
For discussion of our exposure to market risk, refer to Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” contained in our 2025 Form 10-K.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.