RTX Corp
For the period ended Jun 30, 2024. Filed Jul 25, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 25, 2024
RTX$189.53-1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-23.
0000101829-24-000012
Item 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-25.
0000101829-24-000027
Item 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 139 previous paragraphs and 189 current paragraphs.
85 unchanged; 47 reworded; 49 added; 7 removed; 0 previous and 8 current paragraphs rearranged.
Tables are not compared: 35 previous and 42 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (49)
Current report
Legal Matters. The Company has made progress in the quarter ended June 30, 2024 toward resolving several outstanding legal matters, herein referred to as “Expected Resolution of Certain Legal Matters.” The Company expects to enter into a deferred prosecution agreement with the Department of Justice (DOJ) and to be subject to an administrative order with the Securities and Exchange Commission (SEC) to resolve the previously disclosed criminal and civil government investigations into improper payments made by Raytheon Company and its joint venture, Thales-Raytheon Systems (TRS), in connection with certain Middle East contracts since 2012 (Thales-Raytheon Systems and Related Matters); the Company also expects to enter into a deferred prosecution agreement and a False Claims Act (FCA) settlement agreement with the DOJ to resolve previously disclosed criminal and civil government investigations into defective pricing claims for certain legacy Raytheon Company contracts entered into between 2011 and 2013 and in 2017 (DOJ Investigation and Contract Pricing Disputes). In addition, the Company has made progress in the quarter ended June 30, 2024 toward resolving certain voluntarily disclosed export controls violations primarily identified in connection with the integration of Rockwell Collins and, to a lesser extent, Raytheon Company, including certain violations expected to be resolved pursuant to a consent agreement with the Department of State (DOS) (Trade Compliance Matters). As a result of the progress made, we recorded a combined pre-tax charge of $918 million during the quarter ended June 30, 2024, which included an accrual of $269 million related to the DOJ Investigation and Contract Pricing Disputes (in addition to amounts previously accrued), an accrual of $364 million related to Thales-Raytheon Systems and Related Matters (in addition to amounts previously accrued), and an accrual of $285 million related to Trade Compliance Matters. See “Note 1: Basis of Presentation” and “Note 16: Commitments and Contingencies” within Item 1 of this Form 10-Q for additional information.
Current report
Net sales increased $4.0 billion organically in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to higher organic net sales of $2.3 billion at Pratt & Whitney, $1.2 billion at Collins, and $0.7 billion at Raytheon.
Current report
Net products sales increased $2.7 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily driven by increases in external products sales of $1.6 billion at Pratt & Whitney, $0.8 billion at Collins, and $0.3 billion at Raytheon.
Current report
Net services sales increased $0.8 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to increases in external services sales of $0.8 billion at Pratt & Whitney and $0.2 billion at Collins, partially offset by a decrease in external services sales of $0.1 billion at Raytheon, including the sale of our CIS business in the first quarter of 2024.
Current report
Other cost of sales increased $0.4 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily driven by a $0.5 billion charge at Raytheon related to the anticipated termination of a fixed price development contract with a foreign customer (herein referred to as “Raytheon Contract Termination”), partially offset by the absence of charges of $0.1 billion at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Current report
The decrease in total cost of sales due to Acquisitions and divestitures, net of $0.4 billion for both the quarter and six months ended June 30, 2024 compared to the quarter and six months ended June 30, 2023, was primarily driven by the sale of our CIS business within our Raytheon segment completed in the first quarter of 2024.
Current report
Restructuring actions relate to ongoing cost reduction efforts including workforce reductions and the consolidation of facilities.
Current report
Net products cost of sales increased $3.1 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily driven by increases in external products cost of sales at Pratt & Whitney, Raytheon, and Collins, all driven by the products sales changes noted above, a $0.5 billion charge related to the anticipated Raytheon Contract Termination in the second quarter of 2024, and charges of $0.2 billion at Collins as a result of initiating alternative titanium sources recorded in the first quarter of 2024.
Current report
Net services cost of sales increased $0.7 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to increases in external services cost of sales at Pratt & Whitney and Collins, partially offset by a decrease in external services sales at Raytheon, all driven by the services sales changes noted above.
Current report
Company-funded research and development expenses in the six months ended June 30, 2024 were relatively consistent with the six months ended June 30, 2023.
Current report
Selling, general, and administrative expenses decreased $0.2 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, primarily driven by the absence of a $0.1 billion charge at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Current report
Selling, general and administrative expenses decreased $0.1 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily driven by the absence of a $0.1 billion charge at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Current report
Other Income (Expense), Net
Current report
The decrease in Other income (expense), net of $0.9 billion for the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily due to a $0.9 billion charge related to the Expected Resolution of Certain Legal Matters.
Current report
The decrease in Other income (expense), net of $0.6 billion for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily due to a $0.9 billion charge related to the Expected Resolution of Certain Legal Matters, partially offset by a $0.4 billion gain on sale of Raytheon’s CIS business, net of transaction costs.
Current report
The decrease in Operating profit of $1.0 billion for the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily driven by a $0.9 billion charge related to the Expected Resolution of Certain Legal Matters and a $0.6 billion charge related to the anticipated Raytheon Contract Termination, partially offset by the operating performance of our segments and the absence of $0.2 billion of charges at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Current report
The increase in the effective tax rate for the quarter ended June 30, 2024 as compared to the quarter ended June 30, 2023 is primarily driven by a $918 million charge associated with the Expected Resolution of Certain Legal Matters accrued during the quarter ended June 30, 2024 where no tax benefit has been recorded. Additionally, the annualized effective tax rate currently forecasted for 2024 is higher than the comparable period in 2023, principally driven by lower U.S. federal research and development tax credits and higher non-U.S. income taxes. The higher forecasted non-U.S. income taxes are principally driven by legislation enacted during the quarter ended June 30, 2024 by the Organisation for Economic Co-operation and Development’s (OECD) Pillar Two initiatives.
Current report
•a charge of $438 million, net of tax, related to the anticipated Raytheon Contract Termination, which had an unfavorable impact on diluted EPS of $0.33; and
Current report
•acquisition accounting adjustments of $393 million, net of tax, which had an unfavorable impact on diluted EPS of $0.29.
Current report
•acquisition accounting adjustments of $384 million, net of tax, which had an unfavorable impact on diluted EPS of $0.26; and
Current report
•charges on our contract assets and customer financing assets related to a customer insolvency of $114 million, net of tax and noncontrolling interest, which had an unfavorable impact on diluted EPS of $0.08.
Current report
Net income attributable to common shareowners for the six months ended June 30, 2024 includes the following:
Current report
•charge related to the Expected Resolution of Certain Legal Matters of $918 million, which had an unfavorable impact on diluted EPS of $0.69;
Current report
•acquisition accounting adjustments of $782 million, net of tax, which had an unfavorable impact on diluted EPS of $0.58;
Current report
•a charge of $438 million, net of tax, related to the anticipated Raytheon Contract Termination, which had an unfavorable impact on diluted EPS of $0.33;
Current report
Net income attributable to common shareowners for the six months ended June 30, 2023 includes the following:
Current report
•acquisition accounting adjustments of $769 million, net of tax, which had an unfavorable impact on diluted EPS of $0.52; and
Current report
•charges on our contract assets and customer financing assets related to a customer insolvency of $114 million, net of tax and noncontrolling interest, which had an unfavorable impact on diluted EPS of $0.08.
Current report
(2) Operating Profit includes a $0.6 billion charge in the second quarter of 2024 related to the anticipated Raytheon Contract Termination and a $0.4 billion gain, net of transaction and other related costs, in the first quarter of 2024 related to the sale of our CIS business. See “Note 5: Changes in Contract Estimates at Completion” and “Note 2: Acquisitions and Dispositions” within Item 1 of this Form 10-Q, respectively, for additional information.
Current report
(3) Includes a $0.9 billion charge in the second quarter of 2024 related to the Expected Resolution of Certain Legal Matters. See “Note 1: Basis of Presentation” within Item 1 of this Form 10-Q for additional information.
Current report
In addition to the amounts included in the table above, during the quarter ended June 30, 2024, Raytheon initiated the termination of a fixed price development contract with a foreign customer. As a result of this action, Raytheon recognized a $575 million charge related to the estimated impact of this termination. This charge includes the write-off of remaining contract assets and our best estimate of the expected settlement in conjunction with this termination.
Current report
The organic net sales increase of $1.2 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily relates to higher commercial aerospace aftermarket sales of $0.6 billion, higher commercial aerospace OEM sales of $0.4 billion, and a $0.2 billion increase in defense sales. The increase in commercial aerospace sales was principally driven by an increase in commercial air traffic, which has resulted in an increase in flight hours, and increased volume across all OEM sales channels. The defense sales increase was primarily due to higher volume.
Current report
The organic profit increase of $0.4 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily due to higher commercial aerospace operating profit of $0.4 billion, principally driven by the higher aftermarket and OEM sales volume discussed above. Defense operating profit was relatively flat in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 as the higher volume discussed above was partially offset by higher space program costs.
Current report
Defense Bookings– In addition to a number of smaller bookings, in the quarter ended June 30, 2024, Collins booked $1.9 billion to support the U.S. Air Force’s next-generation Survivable Airborne Operations Center and $254 million for F-35 landing gear Lots 18 and 19.
Current report
The increase in Other operating profit of $0.2 billion in the quarter ended June 30, 2024, compared to the quarter ended June 30, 2023, reflects the absence of a $181 million charge related to a customer insolvency during the second quarter of 2023.
Current report
The organic net sales increase of $2.3 billion in the six months ended June 30, 2024, compared to the six months ended June 30, 2023 reflects higher commercial OEM sales of $1.0 billion primarily driven by volume and favorable mix and higher commercial aftermarket sales of $0.7 billion primarily driven by higher volume. The organic increase also includes higher military sales of $0.6 billion, driven by higher sustainment volume across multiple platforms.
Current report
Organic operating profit increase of $0.1 billion in the six months ended June 30, 2024, compared to the six months ended June 30, 2023 reflects higher commercial aerospace operating profit of $0.1 billion as the benefit from favorable large commercial OEM mix and higher commercial aftermarket volume was partially offset by the unfavorable impact from higher large commercial OEM volume, as well as, the absence of two favorable contracts matters totaling approximately $120 million during the six months ended June 30, 2023. Additionally, the increase in military operating profit of $0.1 billion, driven by the higher sales volume discussed above and favorable mix, was partially offset by higher production costs. The increases described above were also partially offset by higher research and development and selling, general and administrative expenses of $0.1 billion.
Current report
The increase in Other operating profit of $0.2 billion in the six months ended June 30, 2024, compared to in the six months ended June 30, 2023, reflects the absence of a $181 million charge related to a customer insolvency during the second quarter of 2023.
Current report
Defense Bookings– In addition to a number of smaller bookings, in the six months ended June 30, 2024, Pratt & Whitney booked $381 million for F135 sustainment and $302 million for F135 production.
Current report
The decrease in net sales and operating profit due to acquisitions / divestitures, net in thequarter ended June 30, 2024 compared to thequarter ended June 30, 2023 primarily relates to the sale of the CIS business completed in the first quarter of 2024.
Showing the first 40 of 49 passages. Open the source sections for the rest.
Removed paragraphs (7)
Previous report
(1) Excludes foreign military sales through the U.S. government.
Previous report
The increase in company-funded research and development of $0.1 billion for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by increased spending on commercial program development at Pratt & Whitney and Collins.
Previous report
Other Income, Net
Previous report
The increase in Other income, net of $0.3 billion for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to a $0.4 billion gain on sale of Raytheon’s Cybersecurity, Intelligence and Services (CIS) business, net of transaction costs in the first quarter of 2024. This increase was partially offset by the absence of a gain on sale of land during the first quarter of 2023 and the reversal of certain tax related indemnity receivables in the first quarter of 2024.
Previous report
•acquisition accounting adjustments of $385 million, net of tax, which had an unfavorable impact on diluted EPS of $0.26.
Previous report
In April 2024, we repaid $500 million of the 3 Month Secured Overnight Financing Rate (SOFR) plus 1.225% term loan due 2025.
Previous report
The $1.2 billion change in cash flows provided by (used in) operating activities in the quarter ended March 31, 2024, compared to in the quarter ended March 31, 2023, was driven by a favorable impact from accounts receivable primarily due to the timing of collections and the related increase in factoring discussed below. Included in the change in accounts payable and accrued liabilities was a change in collaborator payables at Pratt & Whitney, which was mostly offset by a change in collaborator receivables, included in accounts receivable, due to the timing of settlements.
Reworded paragraphs (47)
Previous wording
Effective July 1, 2023, we streamlined the structure of our core businesses to three principal business segments: Collins Aerospace (Collins), Pratt & Whitney, and Raytheon. Prior period information has been recast to conform to our current period presentation as discussed in our 2023 Annual Report on Form 10-K.
Current wording
Effective July 1, 2023, we streamlined the structure of our core businesses to three principal business segments: Collins Aerospace (Collins), Pratt & Whitney, and Raytheon. Prior period information has been recast to conform to our current period presentation.
Previous wording
Raytheon follows a 4-4-5 fiscal calendar while Collins and Pratt & Whitney use a quarter calendar end. Throughout this Quarterly Report on Form 10-Q, when we refer to the quarters ended March 31, 2024 and 2023 with respect to Raytheon, we are referring to their March 31, 2024 and April 2, 2023 fiscal quarter ends, respectively.
Current wording
Raytheon follows a 4-4-5 fiscal calendar while Collins and Pratt & Whitney use a quarter calendar end. Throughout this Form 10-Q, when we refer to the quarters and six months ended June 30, 2024 and 2023 with respect to Raytheon, we are referring to their June 30, 2024 and July 2, 2023 fiscal quarter ends, respectively.
Previous wording
Global Supply Chain. We are dependent on a global supply chain and in recent years have experienced supply chain disruptions that resulted in delays and increased costs which adversely affected our performance. These disruptions impacted our ability to procure raw materials, microelectronics, and certain commodities on a timely basis and/or at expected prices, and have been driven by supply chain market constraints and macroeconomic conditions, including inflation and labor market shortages. Current geopolitical conditions, including conflicts and other causes of strained intercountry relations, as well as sanctions and other trade restrictive activities, are contributing to these issues. Furthermore, our suppliers and subcontractors have been impacted by these same issues. As a result of the Canadian government’s imposition of sanctions in February 2024, which included U.S.- and German-based Russian-owned entities from which we source titanium for use in our Canadian operations, we recorded charges of $175 million in the first quarter of 2024 within our Collins segment. These charges are primarily related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources. We have implemented actions and programs to mitigate some of the impacts but anticipate supply chain disruptions to continue.
Current wording
Global Supply Chain. We are dependent on a global supply chain and in recent years have experienced supply chain disruptions that resulted in delays and increased costs which adversely affected our performance. These disruptions impacted our ability to procure raw materials, microelectronics, and certain commodities on a timely basis and/or at expected prices, and have been driven by supply chain market constraints and macroeconomic conditions, including inflation and labor market shortages. Current geopolitical conditions, including conflicts and other causes of strained intercountry relations, as well as sanctions and other trade restrictive activities, continue to contribute to these issues. Furthermore, our suppliers and subcontractors have been impacted by these same issues. As a result of the Canadian government’s imposition of sanctions in February 2024, including those imposed on U.S.- and German-based Russian-owned entities from which we source titanium for use in our Canadian operations, we recorded charges of $175 million in the first quarter of 2024 within our Collins segment. These charges are primarily related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources. We have implemented actions and programs to mitigate some of the impacts but anticipate supply chain disruptions to continue.
Previous wording
Economic Environment. High inflation levels have increased material and component prices, labor rates, and supplier costs and have negatively impacted our operating profit and margin, including impact on productivity expectations. Due to the nature of our government and commercial aerospace businesses, and their respective customer and supplier contracts, we are not always able to offset cost increases by increasing our contract value or pricing, in particular on our fixed-price contracts. Increasing material, component, and labor prices could subject us to losses in our fixed price contracts in the event of cost overruns. In addition, higher interest rates have increased the cost of borrowing and tightened the availability of capital. Among other things, these effects can constrain our customers’ purchasing power and decrease orders for our products and services and impact the ability of our customers to make payments and of our suppliers to perform. Moreover, volatility in interest rates and financial markets can lead to economic uncertainty, an economic downturn or recession and impact the demand for our products and services as well as our supply chain. We continue to pursue strategic and operational initiatives to help address these macroeconomic pressures, including our digital transformation, operational modernization, cost reduction, and advanced technology programs, and we apply our Customer Oriented Results Excellence (CORE) operating platform to the execution of these initiatives. However, the impact of these pressures and corresponding initiatives is uncertain and subject to a range of factors and future developments.
Current wording
Economic Environment. High inflation levels have increased material and component prices, labor rates, and supplier costs and have negatively impacted our operating profit and margin, including the impact on productivity expectations. Due to the nature of our government and commercial aerospace businesses, and their respective customer and supplier contracts, we are not always able to offset cost increases by increasing our contract value or pricing, in particular on our fixed-price contracts. Increasing material, component, and labor prices could subject us to losses in our fixed price contracts in the event of cost overruns. In addition, higher interest rates have increased the cost of borrowing and tightened the availability of capital. Among other things, these effects can constrain our customers’ purchasing power and decrease orders for our products and services and impact the ability of our customers to make payments and of our suppliers to perform. Moreover, volatility in interest rates and financial markets can lead to economic uncertainty, an economic downturn or recession and impact the demand for our products and services as well as our supply chain. We continue to pursue strategic and operational initiatives to help address these macroeconomic pressures, including our digital transformation, operational modernization, cost reduction, and advanced technology programs, and we apply our Customer Oriented Results Excellence (CORE) operating platform to the execution of these initiatives. However, the impact of these pressures and corresponding initiatives is uncertain and subject to a range of factors and future developments.
Previous wording
In February 2023, China announced sanctions against Raytheon Missiles & Defense (RMD) (a former RTX Corporation (RTX) business segment which became part of Raytheon as a result of the July 1, 2023 RTX segment realignment), and previously announced it may take measures against RTX, in connection with certain foreign military sales to Taiwan. The Chinese sanctions against RMD included a fine equal to twice the value of the arms that RMD sold to Taiwan since September 2020. In addition, in September 2022, China indicated that it decided to sanction our Chairman and Chief Executive Officer, Gregory Hayes, in connection with another foreign military sale to Taiwan involving RTX products and services. Most recently, in January 2024, China announced sanctions against Data Link Solutions LLC, a Collins Aerospace joint venture. If China were to impose additional sanctions, enforce announced sanctions, or take other regulatory action against RTX, our suppliers, affiliates, or partners, it could potentially disrupt our business operations. Any impact of these or other potential sanctions or other actions by China is uncertain.
Current wording
In February 2023, China announced sanctions against Raytheon Missiles & Defense (RMD) (a former RTX Corporation (RTX) business segment which became part of Raytheon as a result of the July 1, 2023 RTX segment realignment), and previously announced it may take measures against RTX, in connection with certain foreign military sales to Taiwan. The Chinese sanctions against RMD included a fine equal to twice the value of the arms that RMD sold to Taiwan since September 2020. In addition, in September 2022, China indicated that it decided to sanction our Chairman and former Chief Executive Officer, Gregory Hayes, in connection with another foreign military sale to Taiwan involving RTX products and services. In January 2024, China announced sanctions against Data Link Solutions LLC, a Collins joint venture and, most recently, in May 2024, China announced sanctions against Raytheon Missile Systems and the Javelin Joint Venture between Raytheon and Lockheed Martin. If China were to impose additional sanctions, enforce announced sanctions, or take other regulatory action against RTX, our suppliers, affiliates, or partners, it could potentially disrupt our business operations. Any impact of these or other potential sanctions or other actions by China is uncertain.
Previous wording
Preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. Management believes the most complex and sensitive judgments, because of their significance to the Condensed Consolidated Financial Statements, result primarily from the need to make estimates about the effects of matters that are inherently uncertain. See “Critical Accounting Estimates” within Item 7 and “Note 1: Basis of Presentation and Summary of Accounting Principles” within Item 8 of our 2023 Annual Report on Form 10-K, which describe the significant accounting estimates and policies used in preparation of the Consolidated Financial Statements. Actual results in these areas could differ from management’s estimates. There have been no significant changes in our critical accounting estimates during the quarter ended March 31, 2024.
Current wording
Preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. Management believes the most complex and sensitive judgments, because of their significance to the Condensed Consolidated Financial Statements, result primarily from the need to make estimates about the effects of matters that are inherently uncertain. See “Critical Accounting Estimates” within Item 7 and “Note 1: Basis of Presentation and Summary of Accounting Principles” within Item 8 of our 2023 Annual Report on Form 10-K, which describe the significant accounting estimates and policies used in preparation of the Consolidated Financial Statements. Actual results in these areas could differ from management’s estimates. There have been no significant changes in our critical accounting estimates during the six months ended June 30, 2024.
Previous wording
The factors contributing to the change year-over-year in total net sales for the quarter ended March 31, 2024 are as follows:
Current wording
The factors contributing to the change year-over-year in total net sales for the quarter and six months ended June 30, 2024 are as follows:
Previous wording
Net sales increased $2.1 billion organically in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily due to higher organic sales of $1.2 billion at Pratt & Whitney, $0.5 billion at Collins, and $0.4 billion at Raytheon.
Current wording
Net sales increased $1.9 billion organically in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily due to higher organic net sales of $1.1 billion at Pratt & Whitney, $0.6 billion at Collins, and $0.3 billion at Raytheon.
Previous wording
The Other operating profit change of $0.4 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 is primarily due to a $0.4 billion gain on sale of the Cybersecurity, Intelligence and Services (CIS) business, net of transaction and other related costs in the first quarter of 2024.
Current wording
The decrease in net sales due to Acquisitions and divestitures, net of $0.4 billion for both the quarter and six months ended June 30, 2024 compared to the quarter and six months ended June 30, 2023, was primarily driven by the sale of our Cybersecurity, Intelligence and Services (CIS) business within our Raytheon segment completed in the first quarter of 2024.
Previous wording
Net products sales increased $1.5 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily due to increases in external products sales of $0.9 billion at Pratt & Whitney, $0.4 billion at Collins, and $0.2 billion at Raytheon.
Current wording
Net products sales increased $1.2 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily due to increases in external products sales of $0.7 billion at Pratt & Whitney, $0.4 billion at Collins, and $0.1 billion at Raytheon.
Previous wording
Net services sales increased $0.6 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily due to increases in external services sales of $0.3 billion at Pratt & Whitney, $0.2 billion at Raytheon, and $0.1 billion at Collins.
Current wording
Net services sales increased $0.3 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily due to increases in external services sales of $0.5 billion at Pratt & Whitney and $0.1 billion at Collins, partially offset by a decrease in external services sales of $0.3 billion at Raytheon, primarily driven by the sale of our CIS business completed in the first quarter of 2024.
Previous wording
The factors contributing to the change year-over-year in total cost of sales for the quarter ended March 31, 2024 are as follows:
Current wording
The factors contributing to the change year-over-year in total cost of sales for the quarter and six months ended June 30, 2024 are as follows:
Previous wording
The organic increase in total cost of sales of $1.8 billion for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023, was primarily driven by the organic sales increases at Pratt & Whitney, Collins, and Raytheon noted above.
Current wording
The organic increase in total cost of sales of $1.5 billion for the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, was primarily driven by the organic net sales increases at Pratt & Whitney, Collins, and Raytheon noted above.
Previous wording
Other cost of sales increased $0.2 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily driven by $175 million of charges at Collins related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources.
Current wording
Other cost of sales increased $0.6 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily driven by a $0.5 billion charge related to the anticipated Raytheon Contract Termination in the second quarter of 2024 and $0.2 billion of charges recorded in the first quarter of 2024 at Collins related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources, partially offset by the absence of charges of $0.1 billion at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Previous wording
Net products cost of sales increased $1.5 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023, primarily driven by increases in external products cost of sales at Pratt & Whitney, Collins, and Raytheon, all driven by the products sales changes noted above, and charges at Collins as a result of initiating alternative titanium sources.
Current wording
Net products cost of sales increased $1.5 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, primarily driven by increases in external products cost of sales at Pratt & Whitney, Raytheon, and Collins, all driven by the products sales changes noted above, and a $0.5 billion charge related to the anticipated Raytheon Contract Termination in the second quarter of 2024.
Previous wording
Net services cost of sales increased $0.6 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023, primarily due to increases in external services cost of sales at Pratt & Whitney and Collins, each driven by the services sales changes noted above.
Current wording
Net services cost of sales increased $0.1 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, primarily due to increases in external services cost of sales at Pratt & Whitney and Collins, partially offset by a decrease in external services cost of sales at Raytheon, each driven by the services sales changes noted above.
Previous wording
Selling, general, and administrative expenses in the quarter ended March 31, 2024 were relatively consistent with the quarter ended March 31, 2023.
Current wording
Company- and customer-funded research and development expenses in the quarter ended June 30, 2024 were relatively consistent with the quarter ended June 30, 2023.
Previous wording
The increase in customer-funded research and development of $0.1 billion for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by higher expenses on commercial and defense programs at Collins and increased spending at Pratt & Whitney on military programs, partially offset by lower expenses on various development programs at Raytheon.
Current wording
The increase in customer-funded research and development of $0.1 billion for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily driven by higher expenses on commercial and defense programs at Collins and increased spending at Pratt & Whitney on military programs, partially offset by lower expenses on various development programs at Raytheon.
Previous wording
Other income, net includes equity earnings in unconsolidated entities, royalty income, foreign exchange gains and losses, and other ongoing and non-recurring items.
Current wording
Other income (expense), net includes equity earnings in unconsolidated entities, royalty income, foreign exchange gains and losses, and other ongoing and non-recurring items.
Previous wording
The change in Operating profit of $0.2 billion for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by a $0.4 billion gain on sale of the CIS business, net of transaction and other related costs, in the first quarter of 2024 and the operating performance of our segments. These items were partially offset by charges at Collins as a result of initiating alternative titanium sources, the change in our FAS/CAS operating adjustment, the change in Eliminations and other, and the change in Corporate expenses and other unallocated items, all of which are described below in “Segment Review.”
Current wording
The decrease in Operating profit of $0.8 billion for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily driven by a $0.9 billion charge related to the Expected Resolution of Certain Legal Matters, a $0.6 billion charge related to the anticipated Raytheon Contract Termination, $0.2 billion of charges at Collins related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources recorded in the first quarter of 2024, and the change in our FAS/CAS operating adjustment which is described below in “Segment Review.” The above items were partially offset by the operating performance of our segments, a $0.4 billion gain on sale of the CIS business, net of transaction and other related costs, and the absence of $0.2 billion of charges at Pratt & Whitney related to a customer insolvency recorded in the second quarter of 2023.
Previous wording
The change in Non-service pension income of $58 million for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by the decrease in the recognized actuarial net (gain) loss as a result of the merger of the remaining Raytheon Company qualified pension plans into the RTX Consolidated Pension Plan at December 31, 2023.
Current wording
The change in Non-service pension income of $73 million for the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily driven by the decrease in the recognized actuarial net (gain) loss as a result of the merger of the remaining Raytheon Company qualified pension plans into the RTX Consolidated Pension Plan at December 31, 2023.
Previous wording
Interest expense, net increased $90 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023. The increase in Interest expense of $81 million was primarily due to the long-term debt issuances in 2023, partially offset by the reversal of interest accruals as a result of the conclusion of the examination phases of the RTX and Rockwell Collins tax audits in the first quarter of 2024.
Current wording
Interest expense, net increased $232 million in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to an increase in Interest expense as a result of long-term debt issuances in 2023, partially offset by the reversal of interest accruals as a result of the conclusion of the examination phases of the RTX and Rockwell Collins tax audits in the first quarter of 2024.
Previous wording
Our effective tax rate for the quarter ended March 31, 2024 was 5.8% as compared to 18.4% for the quarter ended March 31, 2023. The lower effective tax rate for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 is primarily driven by the $275 million tax benefit recognized as a result of the conclusion of the examination phases of the RTX and Rockwell Collins audits, partially offset by the tax costs related to the sale of the CIS business of $143 million.
Current wording
The effective tax rate for the six months ended June 30, 2024 includes a $275 million tax benefit recognized in the quarter ended March 31, 2024 resulting from the conclusion of the examination phases of the RTX and Rockwell Collins audits and $143 million of tax costs associated with the sale of the CIS business. The resulting net tax benefit from these items, coupled with lower year to date pre-tax income, more than offset the effective tax rate impact of a $918 million charge associated with the Expected Resolution of Certain Legal Matters accrued during the quarter ended June 30, 2024 where no tax benefit has been recorded.
Previous wording
•acquisition accounting adjustments of $389 million, net of tax, which had an unfavorable impact on diluted earnings per share (EPS) of $0.29;
Current wording
•charge related to the Expected Resolution of Certain Legal Matters of $918 million, which had an unfavorable impact on diluted earnings per share (EPS) of $0.68;
Previous wording
The change in net EAC adjustments of $38 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to unfavorable changes in net EAC adjustments at Collins, partially offset by favorable changes in net EAC adjustments at Raytheon.
Current wording
The change in net EAC adjustments of $32 million in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily due to unfavorable changes in net EAC adjustments at Collins, partially offset by favorable changes in net EAC adjustments at Raytheon.
Previous wording
Backlog and Bookings. Total backlog was approximately $202 billion and $196 billion as of March 31, 2024 and December 31, 2023, respectively, which includes defense backlog of $77 billion and $78 billion as of March 31, 2024 and December 31, 2023, respectively. In the quarter ended March 31, 2024, Raytheon backlog was reduced by $1.1 billion as a result of the sale of the CIS business. Our defense operations consist primarily of our Raytheon business and operations in the defense businesses within our Collins and Pratt & Whitney segments. Defense bookings were approximately $11 billion and $12 billion for the quarters ended March 31, 2024 and 2023, respectively.
Current wording
Backlog and Bookings. Total backlog was approximately $206 billion and $196 billion as of June 30, 2024 and December 31, 2023, respectively. Total backlog includes commercial backlog of $129 billion and $118 billion as of June 30, 2024 and December 31, 2023, respectively, and defense backlog of $77 billion and $78 billion as of June 30, 2024 and December 31, 2023, respectively. In the quarter ended March 31, 2024, Raytheon backlog was reduced by $1.1 billion as a result of the sale of the CIS business.
Previous wording
The organic net sales increase of $0.5 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily relates to higher commercial aerospace aftermarket sales of $0.3 billion, principally driven by an increase in commercial air traffic which has resulted in an increase in flight hours. Commercial aerospace OEM sales increased $0.2 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 primarily due to increased volume across all OEM sales channels. Defense sales were up slightly in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 due to higher volume.
Current wording
The organic net sales increase of $0.6 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily relates to higher commercial aerospace aftermarket sales of $0.3 billion, higher commercial aerospace OEM sales of $0.2 billion, and a $0.1 billion increase in defense sales. The increase in commercial aerospace sales was principally driven by an increase in commercial air traffic, which has resulted in an increase in flight hours, and increased volume across all OEM sales channels. The defense sales increase was primarily due to higher volume.
Previous wording
The organic operating profit increase of $0.2 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to higher commercial aerospace operating profit of $0.2 billion, principally driven by the higher aftermarket sales volume discussed above partially offset by unfavorable OEM mix. This increase in commercial aerospace operating profit was partially offset by higher space program costs in our defense business and higher research and development costs.
Current wording
The organic operating profit increase of $0.3 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily due to higher commercial aerospace operating profit of $0.2 billion, principally driven by the higher aftermarket and OEM sales volume discussed above. Defense operating profit increased in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 due to the higher volume discussed above.
Previous wording
The decrease in Other operating profit of $0.2 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by $175 million of charges primarily related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources. Refer to “Note 1: Basis of Presentation” within Item 1 of this Form 10-Q for further information regarding sanctions.
Current wording
The decrease in Other operating profit of $0.2 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily driven by $175 million of charges in the first quarter of 2024, primarily related to the recognition of unfavorable purchase commitments and an impairment of contract fulfillment costs that are no longer recoverable as a result of initiating alternative titanium sources. See “Note 1: Basis of Presentation” within Item 1 of this Form 10-Q for additional information on Russia sanctions.
Previous wording
The organic net sales increase of $1.2 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 reflects higher commercial OEM sales of $0.6 billion primarily driven by higher GTF volume and favorable mix. The increase in military sales was $0.4 billion, driven by higher sustainment volume and favorable mix across multiple platforms as well as higher development volume. The increase also includes higher commercial aftermarket sales of $0.2 billion primarily driven by higher GTF volume.
Current wording
The organic net sales increase of $1.1 billion in the quarter ended June 30, 2024, compared to the quarter ended June 30, 2023, reflects higher commercial aftermarket sales of $0.4 billion, driven by higher volume and favorable mix. The increase in commercial OEM sales was $0.4 billion driven by higher volume and favorable mix within large commercial engines. The increase also includes higher military sales of $0.3 billion driven by higher sustainment volume across multiple platforms.
Previous wording
Organic operating profit was relatively consistent in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023. Commercial aerospace operating profit was flat as the benefit from favorable commercial OEM mix and higher commercial aftermarket volume was offset by the unfavorable impact from higher commercial OEM volume and commercial aftermarket mix, as well as, the absence of a $60 million favorable contract matter in the first quarter of 2023. Additionally, higher military operating profit, driven by the volume and favorable mix discussed above, was offset by higher research and development and selling, general, and administrative expenses.
Current wording
Organic operating profit increased $0.1 billion in the quarter ended June 30, 2024, compared to the quarter ended June 30, 2023. Commercial aerospace operating profit increased $0.1 billion as the benefit from higher commercial aftermarket volume as well as favorable large commercial OEM and commercial aftermarket mix, was partially offset by the unfavorable impact from higher large commercial OEM volume and the absence of a $60 million favorable contract matter in the second quarter of 2023. Additionally, the increase in military operating profit, driven by the sales volume discussed above and favorable mix, was more than offset by higher production costs and higher research and development and selling, general, and administrative expenses.
Previous wording
The organic net sales increase of $0.4 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to higher net sales of $0.2 billion from land and air defense systems programs, and $0.1 billion from advanced technology programs. The increase in land and air defense systems programs was primarily driven by higher net sales on certain international Patriot programs, higher net sales on Counter-Unmanned Aircraft Systems (C-UAS), andhigher volume on certain international National Advanced Surface-to-air Missile System (NASAMS) programs. The increase in advanced technology programs was primarily driven by higher volume on classified programs and an advanced development program.
Current wording
The organic net sales increase of $0.7 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily driven by higher net sales of $0.6 billion from land and air defense systems programs and $0.2 billion from advanced technology programs. The increase in land and air defense systems programs was primarily driven by higher net sales on certain international Patriot programs, higher net sales on C-UAS programs, higher volume on Stinger, and higher volume on certain international National Advanced Surface-to-air Missile System (NASAMS) programs. The increase in advanced technology programs was primarily driven by higher volume on classified programs and an advanced development program.
Previous wording
The organic operating profit increase of $0.1 billion in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023, was due to a favorable change in net EAC adjustments of approximately $60 million and higher volume of approximately $40 million on the sales increases noted above, partially offset by an unfavorable change in mix and other performance of approximately $50 million. The favorable change in net EAC adjustments benefited from the absence of an unfavorable impact related to a significant contract option exercised in the first quarter of 2023. The unfavorable change in mix and other performance was spread across numerous programs with no individual or common significant driver.
Current wording
The organic operating profit increase of $0.1 billion in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was due to a favorable change in net EAC adjustments of approximately $80 million and higher volume of approximately $70 million primarily driven by the sales increases noted above, partially offset by a decrease in mix and other performance of approximately $20 million. The favorable change in net EAC adjustments benefited from the absence of an unfavorable impact related to a significant contract option exercised in the first quarter of 2023, and the remaining change was spread across numerous individual programs.
Previous wording
Defense Backlog and Bookings– Backlog was $53 billion at March 31, 2024 and $52 billion at December 31, 2023. Included in the change in backlog was a $1.1 billion reduction related to the sale of the CIS business discussed above. In addition to a number of smaller bookings, in the quarter ended March 31, 2024, Raytheon booked $1.6 billion on a number of classified contracts,$1.2 billion to provide Patriot Air Defense systems to Germany,$818 million to provide Guidance Enhanced Missiles (GEM-T) for NATO Support and Procurement Agency (NSPA), $623 million to provide GEM-T for an international customer, $282 million to provide NASAMS for Ukraine, and $251 million to provide GEM-T for an international customer.
Current wording
Defense Backlog and Bookings– Backlog was $51 billion as of June 30, 2024 and $52 billion as of December 31, 2023. Included in the change in backlog was a $1.1 billion reduction related to the sale of the CIS business discussed above. In addition to a number of smaller bookings, in the quarter ended June 30, 2024, Raytheon booked $928 million on a number of classified contracts, $639 million to produce AN/SPY-6(V) radars for the U.S. Navy, and $393 million to design and build the Landsat Next Instrument Suite (LandIS) for NASA. In addition to these bookings, in the six months ended June 30, 2024, Raytheon booked $1.6 billion on a number of classified contracts,$1.2 billion to provide Patriot Air Defense systems to Germany,$818 million to provide Guidance Enhanced Missiles (GEM-T) for NATO Support and Procurement Agency (NSPA), $623 million to provide GEM-T for an international customer, $282 million to provide NASAMS for Ukraine, and $251 million to provide GEM-T for an international customer.
Previous wording
The increase in eliminations and other net sales of $55 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to an increase in intersegment eliminations, principally driven by Collins.
Current wording
The increase in eliminations and other net sales of $0.1 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, was primarily due to an increase in intersegment eliminations, principally driven by Collins.
Previous wording
The change in corporate expenses and other unallocated items operating profit of $53 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to the reversal of certain tax related indemnity receivables in the first quarter of 2024.
Current wording
The change in Corporate expenses and other unallocated items of $0.9 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, was primarily due to a $0.9 billion charge related to the Expected Resolution of Certain Legal Matters.
Previous wording
The change in eliminations and other operating profit of $56 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily due to a gain on sale of land in the first quarter of 2023.
Current wording
The change in eliminations and other operating profit of $0.1 billion in the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was primarily due to a gain on sale of land recorded in the first quarter of 2023.
Previous wording
The change in our FAS/CAS operating adjustment of $75 million in the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was driven by a decrease in CAS expense, primarily due to the recognition of historical CAS gain/loss experience.
Current wording
The change in our FAS/CAS operating adjustment of $72 million in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023, was driven by a decrease in CAS expense, primarily due to the recognition of historical CAS gain/loss experience.
Previous wording
Acquisition accounting adjustments for the quarter ended March 31, 2024 were relatively consistent with the quarter ended March 31, 2023, respectively.
Current wording
Acquisition accounting adjustments for the quarter and six months ended June 30, 2024 were relatively consistent with the quarter and six months ended June 30, 2023, respectively.
Previous wording
At March 31, 2024, we had cash and cash equivalents of $5.6 billion, of which approximately 31%was held by RTX’s foreign subsidiaries. We manage our worldwide cash requirements by reviewing available funds among the many subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed. The Company intends to repatriate certain undistributed earnings of its international subsidiaries that have been previously taxed in the U.S. Taxes associated with the future remittance of these earnings have been recorded. For the remainder of the Company’s undistributed international earnings, unless tax effective to repatriate, RTX will continue to permanently reinvest these earnings.
Current wording
At June 30, 2024, we had cash and cash equivalents of $6.0 billion, of which approximately 31%was held by RTX’s foreign subsidiaries. We manage our worldwide cash requirements by reviewing available funds among the many subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed. The Company intends to repatriate certain undistributed earnings of its international subsidiaries that have been previously taxed in the U.S. Taxes associated with the future remittance of these earnings have been recorded. For the remainder of the Company’s undistributed international earnings, unless tax effective to repatriate, RTX will continue to permanently reinvest these earnings.
Showing the first 40 of 47 pairs. Open the source sections for the rest.
Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
The organic increase in total cost of sales of $3.3 billion for the six months ended June 30, 2024 compared to the six months ended June 30, 2023, was primarily driven by the organic net sales increases at Pratt & Whitney, Collins, and Raytheon noted above.
Current report — wording carried from elsewhere
The change in Non-service pension income of $131 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily driven by the decrease in the recognized actuarial net (gain) loss as a result of the merger of the remaining Raytheon Company qualified pension plans into the RTX Consolidated Pension Plan at December 31, 2023.
Current report — wording carried from elsewhere
Interest expense, net increased $142 million in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 primarily due to an increase in Interest expense as a result of the long-term debt issuances in 2023.
Current report — wording carried from elsewhere
The change in net EAC adjustments of $70 million in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily due to unfavorable changes in net EAC adjustments at Collins, partially offset by favorable changes in net EAC adjustments at Raytheon.
Current report — wording carried from elsewhere
We believe bookings are an important measure of future performance for our defense businesses. Our defense operations consist primarily of our Raytheon business and operations in the defense businesses within our Collins and Pratt & Whitney segments. Defense bookings were approximately $11 billion and $13 billion for the quarters ended June 30, 2024 and 2023, respectively, and approximately $22 billion and $25 billion for the six months ended June 30, 2024 and 2023, respectively.
Current report — wording carried from elsewhere
The organic net sales increase of $0.3 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was primarily due to higher net sales of $0.4 billion from land and air defense systems programs primarily driven by higher net sales on certain international Patriot programs, higher net sales on Counter-Unmanned Aircraft Systems (C-UAS) programs, and higher volume on Stinger.
Current report — wording carried from elsewhere
The organic operating profit increase of $0.1 billion in the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023 was driven by a favorable change in mix and other performance of approximately $40 million spread across numerous individual programs, higher volume of approximately $30 million primarily driven by the sales increases noted above, and a net favorable change in EAC adjustments of approximately $20 million.
Current report — wording carried from elsewhere
The change in our FAS/CAS operating adjustment of $147 million in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, was driven by a decrease in CAS expense, primarily due to the recognition of historical CAS gain/loss experience.