- Blowout Q3: Raytheon Technologies (NYSE: RTX) reported Q3 revenue $22.48B (up 12% YoY) and adjusted EPS $1.70, smashing consensus (≈$21.3B and $1.41) [1] [2].
- Upgraded Outlook: Full-year 2025 guidance was lifted sharply. RTX now sees $86.5–87.0B in sales (prior $84.75–85.5B) and $6.10–6.20 EPS (prior $5.80–5.95) [3]. Organic sales growth is projected 8–9% (versus 6–7% prior).
- Drivers: Demand is broad-based. Collins Aerospace posted $7.62B (+8%) and Pratt & Whitney $8.42B (+16%) [4], reflecting rebounding commercial air travel and jet-engine orders. The Raytheon (defense) segment saw 10% sales growth, led by Patriot missile systems sold for Ukraine’s defense [5].
- Bullish Outlook: CEO Chris Calio hailed “strong execution” and a record $251B backlog [6] [7]. Analysts have turned upbeat: average 12‑month targets are around $165, with firms like Bernstein (target $181) and Citigroup ($182) seeing double-digit upside [8] [9]. The stock carries a consensus “Buy” rating.
- Market Reaction: RTX shares jumped roughly +6% in pre-market trading on Oct. 21 following the earnings release [10]. The rally reflects both the earnings beat and optimism that rising defense budgets and jet-engine demand will underpin further growth [11] [12].
Blowout Q3 Earnings
On Oct. 21, RTX reported a blowout quarter. Total sales jumped 12% year-over-year to $22.48 billion [13], handily above the ~$21.3B Wall Street estimate. Adjusted earnings came in at $1.70 per share, well above the consensus ~$1.41 [14] [15]. The results were driven by strength across its portfolio: Collins Aerospace revenues hit $7.62B (+8%), and Pratt & Whitney engine sales rose 16% to $8.42B (boosted by surging Airbus A320neo orders) [16]. RTX’s defense unit (legacy Raytheon) reported a 10% jump in sales, “predominantly from higher sales for its Patriot air defense systems” being used in Ukraine [17]. In sum, RTX delivered double-digit organic growth in every segment.
Chairman and CEO Chris Calio highlighted the broad-based strength. “Strong execution in the third quarter enabled us to deliver double-digit organic sales growth across all three segments and our sixth consecutive quarter of year-over-year margin expansion,” he said [18]. Calio noted that RTX secured $37 billion of new awards in Q3, reflecting “robust global demand,” and emphasized a record $251 billion backlog that underpins future revenue [19] [20].
Full-Year Forecast Raised
Alongside the earnings, RTX revised its 2025 guidance sharply higher. The company now expects $86.5–87.0 billion in full-year sales, up from its prior $84.75–85.5B range [21]. Adjusted EPS is seen at $6.10–6.20, raised from $5.80–5.95 [22]. These targets comfortably exceed the average analyst estimates. As Bloomberg notes, RTX’s raised outlook “signals confidence” that strong missile and aftermarket demand will offset headwinds like tariffs [23]. The increased forecast implies 8–9% organic growth in 2025 (versus 6–7% previously guided).
RTX’s bullish guidance aligns with the company’s statement that engine and missile demand remains robust. Despite earlier tariff concerns (a July warning of $500M in tariff costs), management is now convinced that “shortage of new jets has driven up service demand,” and that Pratt & Whitney is benefiting from “booming demand” as plane manufacturers ramp up production [24]. In effect, aerospace aftermarket and defense tailwinds have allowed RTX to shrug off trade-war impacts.
Aerospace & Defense Tailwinds
RTX’s performance reflects a confluence of favorable trends. Commercial air travel is recovering, driving more flying hours on older jets — a boon for RTX’s maintenance, repair and overhaul business in Collins Aerospace [25]. At the same time, global military spending is surging. The Patriot missile system, for example, has seen record sales to U.S. allies, fueling RTX’s defense growth [26]. As one industry analyst observes, “escalating global tensions… have prompted nations worldwide to significantly boost their defense budgets,” leaving RTX “poised for continued growth” given its entrenched position on key programs [27].
The vast $251B backlog that Calio cited largely reflects these geopolitical demands. (For context, TS2.tech reports RTX’s total backlog has reached a record ~$221B [28].) This backlog provides visibility well into future years. RTX’s Q3 disclosures noted billions of dollars in new orders for hypersonic defense, fighter jet engines, and other advanced systems. The company’s long-term project pipeline includes major Pentagon contracts — for example, a recent $2.8B award for 141 F-35 fighter engines — which have already lifted the shares when announced [29].
Stock Reaction and Analyst Outlook
Unsurprisingly, investors cheered the news. RTX stock gapped up over 6% in pre-market trading on Oct. 21 [30], extending a year-to-date run where the share price is up roughly 37%. The rally mirrors broader sector strength: the S&P Aerospace & Defense index is up ~34% in 2025, far outpacing the market. [31]. Bullish analyst commentary reinforced the move. Bernstein recently raised its 12-month target to $181 (about 14% above current levels) [32], and Citigroup analyst Jason Gursky set a $182 target in July [33]. By contrast, defensive technology analysts like Morgan Stanley praise RTX’s cost controls and backlog, while Wall Street consensus rates the stock a clear “Buy” [34].
With the new guidance, even traditional skeptics are turning more positive. The average 12-month price target across analysts is now in the mid-$160s [35]. For example, TS2.tech notes that market sentiment is largely bullish, with analysts citing RTX’s diversified aerospace/defense portfolio as a key strength [36]. In short, investors see RTX as a defensive growth play: it has growth drivers from travel’s return (jet engines) and from defense spending, which many expect to persist amid global crises [37].
Outlook and Forecasts
Looking ahead, the outlook for RTX remains bright but under watch. The company will hold a Q3 earnings call on Oct. 21, where management may provide more color on margins and the impact of tariffs. Analysts note potential margin risks from inflation and trade frictions, but for now those seem contained by the revenue surge [38]. Market forecasts have been revised upward accordingly. For example, Zacks now sees organic sales growth of ~7% for RTX in 2025, aided by the latest guidance. [39] Some analysts expect RTX to eventually lift its full-year earnings estimate again if demand remains strong.
Meanwhile, macro factors continue to favor RTX. The Pentagon’s multi-year budgets remain at generational highs, and airline fleets worldwide still need new engines and upgrade kits. If those trends continue, RTX’s raised guidance could prove conservative. As one executive quipped after the report, RTX has long been “an arm of the U.S. government” given its role in defense — but now it’s also capturing a profit tailwind from global aerospace demand [40].
Forecast: Based on the blowout quarter and backlog, many analysts have revised upward their models. Consensus estimates now see RTX growing revenues about 8–9% in 2025 with EPS around $6.10–6.15, roughly in line with management’s range. If global tensions remain high and jet demand stays strong, forecasts could rise further. On the stock, with a bullish technical setup and strong fundamentals, some strategists view RTX as having double-digit upside from current levels [41].
Sources: Company reports and earnings call; Reuters [42] [43]; Bloomberg [44]; Investing.com analysis [45] [46]; TS2.Tech financial analysis [47] [48]; sector news and analyst commentary. All data as of Oct. 21, 2025.
References
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