L3Harris' Q3 Earnings Surpass Estimates, Revenues Increase Y/Y

Core Viewpoint - L3Harris Technologies, Inc. reported strong third-quarter 2024 results with adjusted earnings per share of $3.34, exceeding estimates and showing year-over-year growth, driven by solid revenue and operating income growth [1][2]. Financial Performance - Adjusted earnings per share of $3.34 beat the Zacks Consensus Estimate of $3.27 by 2.1% and increased 4.7% from $3.19 in the same quarter last year [1] - Total revenues reached $5.29 billion, slightly missing the consensus estimate by 0.5%, but reflecting a 7.7% increase from $4.92 billion year-over-year [2] - GAAP earnings were reported at $2.10 per share, up from $2.02 in the prior-year period [1] Revenue Drivers - The revenue increase was attributed to the acquisition of Aerojet Rocketdyne and organic growth of 5%, primarily from resilient communication products and night vision devices [2] - Integrated Mission Systems segment revenues grew 6.6% to $1.67 billion, driven by higher aircraft missionization volumes and advanced electronics demand [3] - Communication Systems segment revenues increased 10.1% to $1.38 billion, supported by strong demand for communication equipment and night vision devices [4] Segment Performance - Space and Airborne Systems segment revenues were nearly flat at $1.68 billion, impacted by the divestiture of the antenna business [3] - Aerojet Rocketdyne segment reported a 31% revenue increase to $596 million, with operating income rising to $75 million from $56 million [4] Financial Position - As of September 27, 2024, L3Harris had $539 million in cash and cash equivalents, down from $560 million at the end of 2023 [5] - Long-term debt decreased to $11.09 billion from $11.16 billion [6] - Net cash flow from operating activities was $1.43 billion for the first nine months of 2024, compared to $1.31 billion in the prior-year period [6] Guidance - L3Harris updated its 2024 revenue guidance to a range of $21.10-$21.30 billion, with adjusted earnings expected between $12.95-$13.15 per share [7] - The adjusted segment operating margin is now expected to be 15.5%, an increase from the previous guidance [7] Market Position - L3Harris currently holds a Zacks Rank 3 (Hold), indicating a stable outlook in the market [8]