Despite RTX Corp (NYSE:RTX) reporting better-than-expected Q2 results, shares fell 3.5% in pre-open Tuesday after the company slashed its full-year free cash flow forecast.
Q2 EPS came in at $1.29, $0.11 better than the analyst estimate of $1.18. Revenue for the quarter was $18.3B ahead of the consensus for revenue of $17.68B. The revenue beat was driven by strong performance in the Collins Aerospace Systems and Pratt & Whitney business segments.
"Accelerating demand in global commercial aerospace and strong defense spending allowed us to deliver 12 percent sales growth and increased operating profit year-over-year, with top-line growth across all RTX business units," said RTX Chairman and CEO Greg Hayes.
"Based on the strong performance year-to-date and strong end-markets, we are raising our full year sales outlook and tightening our adjusted EPS outlook. However, we are lowering our free cash flow outlook to reflect the impact of an issue that has recently come to light, which will require Pratt & Whitney to remove certain engines from service for inspection earlier than expected. The continued safe operation of our fleet will always remain our number one priority."
RTX now sees FY EPS at $5.00 per share on revenue of $73.5B. Analysts were looking for a profit per share of $5.02 on revenue of $72.75B. FCF is now expected at $4.3B, down from the prior forecast of $4.8B.