A month has gone by since the last earnings report for RTX (RTX). Shares have lost about 3.4% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is RTX due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
RTX Q1 Earnings Surpass Estimates, Revenues Increase Y/Y
RTX Corporation’s first-quarter 2026 adjusted earnings per share (EPS) of $1.78 beat the Zacks Consensus Estimate of $1.52 by 17%. The bottom line improved 21.1% from the year-ago quarter’s level of $1.47.
RTX’s Total Revenues
Quarterly revenues came in at $22.08 billion, up 8.7% from $20.31 billion in the year-ago period. Sales also beat the consensus mark of $21.56 billion by 2.43%, supported by broad-based organic growth and a company backlog that stood at $271 billion.
RTX’s Operational Performance
Total costs and expenses increased nearly 7.2% year over year to $19.59 billion in the quarter. The company generated an adjusted operating profit of $2.56 billion compared with $2.04 billion in the prior-year quarter.
RTX posted an interest expense of $390 million compared with $443 million in the prior-year period.
Demand visibility remained a key theme. RTX ended the quarter with total backlog of $271 billion, including $162 billion tied to commercial programs and $109 billion tied to defense. Within Raytheon, backlog totaled $74 billion, and the segment’s first-quarter book-to-bill was 0.96, with a rolling 12-month book-to-bill of 1.48. The update reinforced the company’s view that durable end-market demand is supporting production ramps across the portfolio.
RTX’s Segmental Performance
Collins Aerospace: Sales in this segment totaled $7.6 billion, up 5% year over year. This improvement was driven by a 15% increase in commercial OE, a 7% increase in commercial aftermarket, and a 9% increase in defense.
Pratt & Whitney: This segment’s sales totaled $8.17 billion, reflecting an improvement of 11% from the year-ago quarter’s reported number. Sales growth was driven by a 19% increase in commercial aftermarket and a 7% increase in military, partially offset by a 1% decrease in commercial OE.
Raytheon: This segment recorded sales of $6.95 billion, up 10% year over year. This increase was driven by higher volume on land and air defense systems, including Patriot and GEM-T, as well as higher volume on naval munitions programs.
RTX’s Financial Update
RTX had cash and cash equivalents of $6.82 billion as of March 31, 2026, compared with $7.44 billion as of Dec. 31, 2025.
The long-term debt totaled $32.97 billion as of March 31, 2026, compared with $34.29 billion as of Dec. 31, 2025.
Operating cash flow totaled $1.86 billion, while capital expenditures were $0.55 billion, resulting in free cash flow of $1.31 billion.
The balance sheet profile remains important as RTX continues investing in capacity expansions and higher output across its aerospace and defense operations.
RTX Lifted 2026 Sales & Earnings Outlook
Following the first-quarter performance, RTX raised its full-year 2026 outlook for adjusted sales and adjusted earnings while maintaining its free cash flow expectations. The company now expects adjusted sales of $92.5-$93.5 billion, up from its prior range of $92.0-$93.0 billion. It continues to project organic sales growth of 5%-6% for the year.
RTX also increased its adjusted earnings outlook to $6.70-$6.90 per share from $6.60-$6.80 previously, while reaffirming free cash flow expectations of $8.25-$8.75 billion. The Zacks Consensus Estimate for 2026 EPS is pegged at $6.80, which is in line with the midpoint of the company’s newly guided range.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a upward trend in estimates review.
VGM Scores
Currently, RTX has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, RTX has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
