New York, January 27, 2026, 14:55 EST — Regular session
- RTX shares surged past the broader market following a strong quarterly sales report and the release of its 2026 targets.
- Investors are balancing robust demand in commercial aerospace with the risks posed by tariffs and changing policies.
- Markets will next focus on Wednesday’s Fed decision and the remainder of a defense-heavy earnings week.
Shares of RTX Corporation climbed 4.0% to $201.90 by 2:55 p.m. EST Tuesday, edging closer to the session peak of $203.33 after investors absorbed the company’s 2026 forecast. The iShares U.S. Aerospace & Defense ETF rose 1.6%, while the S&P 500 ETF added roughly 0.5%.
This shift is significant as defense and aerospace stocks are driving early 2026 trading, with investors eager to see if demand remains steady in munitions and commercial aviation. RTX operates in both arenas, supplying engines and avionics for airline fleets while its weapons division depends heavily on government contracts.
This comes at a time when the market shows little patience for cash concerns. Big contractors now face the challenge of boosting production and factory investment without eroding margins or cutting dividends to shareholders.
RTX reported fourth-quarter sales up 12%, hitting $24.2 billion, with adjusted earnings at $1.55 per share. These adjusted numbers exclude what the company labels significant or one-off items, while “organic” growth leaves out impacts from acquisitions and divestitures. Looking ahead, RTX projects adjusted sales between $92.0 billion and $93.0 billion in 2026, alongside free cash flow ranging from $8.25 billion to $8.75 billion—a key indicator of cash after capital expenditures. “We enter 2026 with great momentum and are well positioned to deliver our 2026 financial outlook,” Chairman and CEO Chris Calio said. (RTX)
On the earnings call, Calio told analysts RTX closed 2025 with a record backlog of $268 billion and a full-year book-to-bill ratio of 1.56, signaling demand outstripped shipments. He highlighted increased output across multiple munitions programs last year. CFO Neil G. Mitchill Jr. pointed to higher capital spending in 2026 to meet demand, adding, “we expect free cash flow to be between $8.25 billion-$8.75 billion for the full year.” (Investing)
RTX saw a boost from increased engine sales and robust demand for commercial maintenance and repairs, Reuters reported. The F135 engine, which powers Lockheed Martin’s F-35, drove much of the growth, alongside ongoing work on older engine models. The report also flagged cost pressures stemming from U.S. tariffs on metals and a White House directive this month tying buybacks, dividends, and executive pay to weapons delivery schedules. CFO Mitchill estimated tariff impacts around $600 million for 2025 and announced plans to raise investments in munitions facilities by $500 million in 2026. (Reuters)
The company disclosed its results and issued a press release in a Form 8-K filing on Tuesday, according to the SEC records. (SEC)
The scenario could still change. If tariffs push costs higher than expected, supply chain issues flare up again, or regulators tighten capital return rules, the stock might come under pressure. Investors could then doubt the achievability of the 2026 cash-flow targets.
Traders are gearing up for the Federal Reserve’s rate announcement on Jan. 28, closely eyeing potential shifts in yields and risk appetite. They’ll also be parsing the remainder of this week’s earnings from the sector to see if defense and aerospace demand holds steady through 2026. (Federalreserve)
