L3Harris(LHX) - 2024 Q3 - Quarterly Results

Financial Performance - Revenue for Q3 2024 was $5.3 billion, an 8% increase year-over-year, with 5% organic growth[1] - Orders reached $7.2 billion with a book-to-bill ratio of 1.4x[1] - Year-to-date revenue for 2024 is $15,802 million, compared to $14,079 million in the same period of 2023, reflecting an increase of 12.2%[21] - Revenue growth was primarily driven by the acquisition of Aerojet Rocketdyne and strong demand in the Communication Systems segment[3] - Revenue for the year 2024 was reported at $15,802 million, an increase from $14,079 million in 2023, indicating a growth of 12.2%[28] - Third quarter revenue for 2024 reached $5,292 million, a 7.7% increase from $4,915 million in Q3 2023[21] - Revenue for Q3 2024 was $5,292 million, up from $4,915 million in Q3 2023, marking a 7.7% year-over-year growth[27] Profitability Metrics - Operating margin was 9.4%, while adjusted segment operating margin improved to 15.7%[1] - Operating margin for Q3 2024 improved to 9.4%, up from 9.3% in Q3 2023, representing a 10 basis points increase[21] - Operating income for Q3 2024 was $495 million, compared to $479 million in Q3 2023, reflecting a 3.4% increase[29] - Adjusted segment operating income for Q3 2024 was $833 million, up from $735 million in Q3 2023, representing a 13.3% increase[29] - The operating margin for Q3 2024 was 9.4%, slightly down from 9.7% in Q3 2023[29] Earnings Per Share - Diluted EPS for Q3 2024 was $2.10, a 4% increase from Q3 2023, and non-GAAP diluted EPS was $3.34, up 5%[1] - Non-GAAP diluted EPS for Q3 2024 was $3.34, compared to $3.19 in Q3 2023, marking a 4.7% increase[33] Cash Flow and Operations - Cash from operations increased by 44% to $780 million, driven by net income growth[8] - Adjusted free cash flow rose 18% to $728 million, reflecting improved operational efficiency[8] - Free cash flow for Q3 2024 was $702 million, significantly higher than $395 million in Q3 2023, indicating an increase of 77.5%[34] - Adjusted free cash flow for Q3 2024 was $728 million, compared to $617 million in Q3 2023, reflecting an 18% increase[34] - Net cash provided by operating activities increased to $780 million in Q3 2024, compared to $543 million in Q3 2023, a growth of 43.6%[25] Guidance and Projections - 2024 revenue guidance increased to a range of $21.1 billion to $21.3 billion[1] - The 2024 adjusted segment operating margin guidance was raised to approximately 15.5%[1] - The company expects to exceed its 2024 cost savings target of $400 million, updating it to at least $600 million[2] - The company provided 2024 revenue guidance of approximately $5,400 million, slightly up from the previous guidance of $5,300 - $5,400 million[13] - The operating margin guidance for 2024 is expected to be in the mid to high 24% range, an increase from the prior mid 24%[13] Tax and Income - The effective tax rate on non-GAAP income is expected to be between 13.0% and 13.5%, unchanged from the prior year[17] - The effective tax rate on non-GAAP income for Q3 2024 was 12.9%, consistent with the rate of 12.9% in Q3 2023[30] - Non-service FAS pension income for 2024 is projected to be approximately $310 million, consistent with the previous year[17] Assets and Liabilities - Total assets as of September 27, 2024, were $41,889 million, a slight increase from $41,687 million at the end of December 29, 2023[26] - Total equity rose to $19,062 million as of September 27, 2024, compared to $18,829 million at the end of December 29, 2023, reflecting a 1.2% increase[26] - Short-term debt decreased to $1,177 million as of September 27, 2024, from $1,602 million at the end of December 29, 2023, a reduction of 26.4%[26] - The company’s long-term debt, net, was $11,093 million as of September 27, 2024, compared to $11,160 million at the end of December 29, 2023[26] Segment Performance - The company reported a significant increase in revenue for the AR segment, with Q3 2024 revenue at $596 million, a 31% increase from $455 million in Q3 2023[15] - Year-to-date revenue for the AR segment is $1,719 million, reflecting a substantial 278% increase compared to $455 million in the same period of 2023[15] Strategic Initiatives - The LHX NeXt initiative is expected to incur costs through 2025, including workforce optimization and IT expenses[37] - The annual gross run rate savings from the LHX NeXt transformation initiative is anticipated to include savings from labor optimization and procurement[37] - The company anticipates ongoing operational measures to enhance efficiency and profitability through strategic initiatives[37]