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Date

July 24, 2025

Category

Market Insights

RTX Corp Q2 Earnings Show Momentum Across the Business

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RTX Corp, the world’s largest aerospace and defense company by market cap1, has been a stellar performer in the stock market in 2025, rising around 30%. Amid the conflict in the Middle East and increased defense spending commitments from NATO members, the stock has attracted significant investor interest.

Recently, RTX posted its earnings for the second quarter of 20252 and they were impressive. While some investors have focused on the company’s slightly adjusted full-year guidance, the underlying story is one of healthy growth and momentum across all business segments.

A Beat on the Top and Bottom Line

For Q2, RTX reported sales of $21.6 billion, up 9% year on year. This was comfortably ahead of the consensus forecast of $20.7 billion. Adjusted earnings per share (EPS) came in at $1.56, up 11%. This was also a material beat – the consensus forecast heading into the print was $1.45.

At the end of the quarter, the group had a backlog of $236 billion. This figure – which was made up of $144 billion in commercial sales and $92 billion in defense sales – was 15% higher than the figure a year earlier. On the back of this performance, the company raised its quarterly dividend by 8%. We believe investors also benefited from $0.9 billion worth of share buybacks during the quarter.

Broad Momentum

Breaking the Q2 results down, engine manufacturer Pratt & Whitney delivered an excellent performance, with adjusted sales up 12% year on year to $7,631 million. Growth in this segment was driven by a 19% increase in commercial aftermarket sales and a 15% increase in commercial original equipment (OE) sales.

Collins Aerospace also had a good quarter. Here, adjusted sales were up 9% year on year to $7,622 million, helped by growth in commercial air traffic.

As for the defense segment, Raytheon, it generated sales of $7,001 million, up 8% year on year. This growth was driven by increased volume in land and air defense systems, including the Patriot and NASAMS, as well as higher volume on naval missiles such as the SPY-6 and Evolved SeaSparrow.

Tariffs Hit Guidance

If there was one weak spot in the Q2 report, it was earnings guidance for 2025. This was adjusted down slightly due to the impact of tariffs, which are expected to cost the business around $500 million this year. For 2025, the group now expects adjusted EPS of $5.80 to $5.95 (versus $5.73 in 2024). Previously, it was expecting EPS of $6.00 to $6.15.

On the plus side, the company increased its guidance for 2025 sales. For the year, it now expects adjusted sales of $84.75 to $85.5 billion, up from $83.0 to $84.0 billion. Meanwhile, organic sales growth is expected to be 6-7%, up from 4-6% percent. Management was also optimistic in relation to the long-term outlook for the business.

Positioned for Long-Term Growth

Overall, it was a very solid report from RTX. Not only did the company beat on the top and bottom line, but it reported robust sales growth across all segments, a rising backlog, and increased dividends for investors.

Looking ahead, RTX appears well positioned for further growth, despite the impact of tariffs. With exposure to both the rapidly growing global defense market and the recovering commercial aerospace industry, we believe the company looks set to benefit from a range of powerful, enduring tailwinds.

Footnotes:

1Companies Market Cap, Largest defense contractors by market cap, as of July 24, 2025

2RTX, RTX reports Q2 2025 results, as of July 22, 2025

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