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L3Harris Technologies, Inc. (LHX - Free Report) reported third-quarter 2024 adjusted earnings (from continuing operations) of $3.34 per share, which beat the Zacks Consensus Estimate of $3.27 by 2.1%. The bottom line also increased 4.7% from the year-ago quarter’s figure of $3.19.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Excluding one-time items, the company reported GAAP earnings of $2.10 per share, up from $2.02 generated in the prior-year period.
The year-over-year improvement in the bottom line can be attributed to solid revenue and operating income growth.
LHX’s Total Revenues
L3Harris’ revenues totaled $5.29 billion, which missed the Zacks Consensus Estimate by 0.5%. However, the top line rose 7.7% from the year-ago quarter’s level of $4.92 billion.
The year-over-year revenue increase was due to the acquisition of Aerojet Rocketdyne. Organic revenue growth of 5%, primarily driven by the increasing demand for resilient communication products and night vision devices in the Communication Systems segment, also boosted the revenue growth.
L3Harris Technologies Inc Price, Consensus and EPS Surprise
Integrated Mission Systems: The segment recorded net revenues of $1.67 billion, indicating year-over-year growth of 6.6%. The improvement was driven by higher aircraft missionization volumes, increased advanced electronics demand for space and munitions programs and higher volumes in from Commercial Aviation Solutions business, the divestiture of which awaits closure.
This segment recorded an operating income of $204 million compared with $187 million in the third quarter of 2023. The operating margin expanded 30 basis points (bps) to 12.2%, driven by the improved program performance.
Space and Airborne Systems: Net revenues from the segment were $1.68 billion, almost flat year over year. The year-over-year revenue movement was adversely impacted by the divestiture of the antenna business in the second quarter.
The segment’s operating income declined to $195 million from $210 million reported in the year-ago quarter. The operating margin declined 90 bps to 11.6%, due to challenges on classified development programs and the absence of a non-recurring license sale.
Communication Systems: Net revenues from this segment increased 10.1% to $1.38 billion. This increase was driven by the robust demand for its resilient communication equipment, related waveforms and night vision devices.
The unit’s operating income improved to $359 million from $282 million reported in the year-ago quarter. The operating margin improved 350 bps to 26%, driven by higher volumes, favorable high margin international mix, proprietary waveform license sales and LHX NeXt cost savings.
Aerojet Rocketdyne: This segment reported revenues of $596 million, which improved 31% year over year. Its operating income of $75 million improved from $56 million in the third quarter of 2023.
Financial Position of LHX
As of Sept. 27, 2024, L3Harris had $539 million in cash and cash equivalents compared with $560 million as of Dec. 29, 2023.
The long-term debt as of the same date was $11.09 billion compared with $11.16 billion as of Dec. 29, 2023.
The net cash flow from operating activities amounted to $1.43 billion during the first nine months of 2024 compared with $1.31 billion in the prior-year period.
At the end of the third quarter, L3Harris’ adjusted free cash flow was $1.29 billion compared with $1.27 billion at the end of the year-ago quarter.
2024 Guidance of LHX
L3Harris partially updated its 2024 guidance. It now expects to generate revenues in the range of $21.10-$21.30 billion, narrower than its earlier guidance of $21.00-$21.30 billion. The Zacks Consensus Estimate for revenues is pegged at $21.30 billion, which lies in line with the higher end of the company’s new guided range.
L3Harris now expects its adjusted earnings to be in the range of $12.95-$13.15 per share, narrower than the prior guidance of $12.85-$13.15. The consensus estimate for adjusted earnings is pegged at $13.06 per share, which lies just above the midpoint of the company’s new guided range.
LHX now expects its adjusted segment operating margin to be 15.5% compared with the prior guided range of 15.2-15.4%. It still expects adjusted free cash flow to be approximately $2.2 billion.
Hexcel Corporation (HXL - Free Report) reported third-quarter adjusted earnings of 47 cents per share, which improved 23.7% from the year-ago quarter’s figure of 38 cents. The bottom line also surpassed the Zacks Consensus Estimate by 2.2%.
Net sales totaled $456.5 million, which beat the consensus estimate of $456.2 million by 0.1%. The top line also witnessed an improvement of 8.8% from the year-ago quarter’s figure of $419.5 million.
RTX Corporation (RTX - Free Report) reported third-quarter 2024 adjusted earnings per share of $1.45, which surpassed the Zacks Consensus Estimate of $1.33 by 9%. The bottom line also improved 16% from the year-ago quarter’s level of $1.25.
RTX’s sales totaled $20.09 billion, which surpassed the consensus estimate of $19.91 billion by 0.9%. The top line also surged 49.2% from $13.46 billion recorded in the third quarter of 2023.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter adjusted earnings of $6.84 per share, which beat the Zacks Consensus Estimate of $6.47 by 5.7%. The bottom line also rose 1% from the year-ago quarter's figure of $6.77.
Net sales totaled $17.10 billion, which missed the consensus estimate of $17.28 billion by 1%. The top line, however, increased 1.3% from $16.88 billion reported in the year-ago quarter.
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L3Harris' Q3 Earnings Surpass Estimates, Revenues Increase Y/Y
L3Harris Technologies, Inc. (LHX - Free Report) reported third-quarter 2024 adjusted earnings (from continuing operations) of $3.34 per share, which beat the Zacks Consensus Estimate of $3.27 by 2.1%. The bottom line also increased 4.7% from the year-ago quarter’s figure of $3.19.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Excluding one-time items, the company reported GAAP earnings of $2.10 per share, up from $2.02 generated in the prior-year period.
The year-over-year improvement in the bottom line can be attributed to solid revenue and operating income growth.
LHX’s Total Revenues
L3Harris’ revenues totaled $5.29 billion, which missed the Zacks Consensus Estimate by 0.5%. However, the top line rose 7.7% from the year-ago quarter’s level of $4.92 billion.
The year-over-year revenue increase was due to the acquisition of Aerojet Rocketdyne. Organic revenue growth of 5%, primarily driven by the increasing demand for resilient communication products and night vision devices in the Communication Systems segment, also boosted the revenue growth.
L3Harris Technologies Inc Price, Consensus and EPS Surprise
L3Harris Technologies Inc price-consensus-eps-surprise-chart | L3Harris Technologies Inc Quote
LHX’s Segmental Performance
Integrated Mission Systems: The segment recorded net revenues of $1.67 billion, indicating year-over-year growth of 6.6%. The improvement was driven by higher aircraft missionization volumes, increased advanced electronics demand for space and munitions programs and higher volumes in from Commercial Aviation Solutions business, the divestiture of which awaits closure.
This segment recorded an operating income of $204 million compared with $187 million in the third quarter of 2023. The operating margin expanded 30 basis points (bps) to 12.2%, driven by the improved program performance.
Space and Airborne Systems: Net revenues from the segment were $1.68 billion, almost flat year over year. The year-over-year revenue movement was adversely impacted by the divestiture of the antenna business in the second quarter.
The segment’s operating income declined to $195 million from $210 million reported in the year-ago quarter. The operating margin declined 90 bps to 11.6%, due to challenges on classified development programs and the absence of a non-recurring license sale.
Communication Systems: Net revenues from this segment increased 10.1% to $1.38 billion. This increase was driven by the robust demand for its resilient communication equipment, related waveforms and night vision devices.
The unit’s operating income improved to $359 million from $282 million reported in the year-ago quarter. The operating margin improved 350 bps to 26%, driven by higher volumes, favorable high margin international mix, proprietary waveform license sales and LHX NeXt cost savings.
Aerojet Rocketdyne: This segment reported revenues of $596 million, which improved 31% year over year. Its operating income of $75 million improved from $56 million in the third quarter of 2023.
Financial Position of LHX
As of Sept. 27, 2024, L3Harris had $539 million in cash and cash equivalents compared with $560 million as of Dec. 29, 2023.
The long-term debt as of the same date was $11.09 billion compared with $11.16 billion as of Dec. 29, 2023.
The net cash flow from operating activities amounted to $1.43 billion during the first nine months of 2024 compared with $1.31 billion in the prior-year period.
At the end of the third quarter, L3Harris’ adjusted free cash flow was $1.29 billion compared with $1.27 billion at the end of the year-ago quarter.
2024 Guidance of LHX
L3Harris partially updated its 2024 guidance. It now expects to generate revenues in the range of $21.10-$21.30 billion, narrower than its earlier guidance of $21.00-$21.30 billion. The Zacks Consensus Estimate for revenues is pegged at $21.30 billion, which lies in line with the higher end of the company’s new guided range.
L3Harris now expects its adjusted earnings to be in the range of $12.95-$13.15 per share, narrower than the prior guidance of $12.85-$13.15. The consensus estimate for adjusted earnings is pegged at $13.06 per share, which lies just above the midpoint of the company’s new guided range.
LHX now expects its adjusted segment operating margin to be 15.5% compared with the prior guided range of 15.2-15.4%. It still expects adjusted free cash flow to be approximately $2.2 billion.
LHX’s Zacks Rank
L3Harris currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Hexcel Corporation (HXL - Free Report) reported third-quarter adjusted earnings of 47 cents per share, which improved 23.7% from the year-ago quarter’s figure of 38 cents. The bottom line also surpassed the Zacks Consensus Estimate by 2.2%.
Net sales totaled $456.5 million, which beat the consensus estimate of $456.2 million by 0.1%. The top line also witnessed an improvement of 8.8% from the year-ago quarter’s figure of $419.5 million.
RTX Corporation (RTX - Free Report) reported third-quarter 2024 adjusted earnings per share of $1.45, which surpassed the Zacks Consensus Estimate of $1.33 by 9%. The bottom line also improved 16% from the year-ago quarter’s level of $1.25.
RTX’s sales totaled $20.09 billion, which surpassed the consensus estimate of $19.91 billion by 0.9%. The top line also surged 49.2% from $13.46 billion recorded in the third quarter of 2023.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter adjusted earnings of $6.84 per share, which beat the Zacks Consensus Estimate of $6.47 by 5.7%. The bottom line also rose 1% from the year-ago quarter's figure of $6.77.
Net sales totaled $17.10 billion, which missed the consensus estimate of $17.28 billion by 1%. The top line, however, increased 1.3% from $16.88 billion reported in the year-ago quarter.