RTX Corp. NYSE:RTX, a U.S. aerospace and defense manufacturer, has raised its full-year sales and profit forecast as demand for its military and commercial aerospace products continues to grow. The company now expects adjusted earnings of $7.10 to $7.25 per share, up from its previous forecast of no more than $6.90 and above the average analyst estimate. RTX shares rose 8% at 9:35 a.m. in New York on Thursday, marking their largest intraday gain since October, after the stock had gained 6.3% this year through Wednesday's close while trailing the broader S&P 500 Index.
RTX reported second-quarter revenue of $24.7 billion, representing a 14% increase, while adjusted earnings reached $1.89 per share compared with the $1.66 analysts had expected on average. Chief Executive Officer Chris Calio said the stronger outlook reflected the company's first-half performance and a backlog that had increased 22% from a year earlier. Rising defense spending linked to the wars in Iran and Ukraine appears to be supporting demand for military equipment, while a robust air travel market is strengthening RTX's commercial engine aftermarket business.
RTX produces military hardware including Tomahawk cruise missiles and SM-6 air defense missiles and has been working with the U.S. military to increase production. Earlier in July, the company began feasibility studies to qualify additional European suppliers for priority missile components, including a partnership with Diehl Defence, a defense manufacturer, aimed at doubling Stinger missile production. RTX has also held preliminary discussions with General Motors NYSE:GM, a U.S. automaker, about increasing domestic production, while Lockheed Martin NYSE:LMT, a U.S. defense contractor and RTX competitor, has reached a separate agreement with GM on similar objectives. RTX is also expanding its use of artificial intelligence through its planned acquisition of Aiir Innovations, an Amsterdam-based company whose technology analyzes borescope videos during engine maintenance and may reduce tasks that previously required substantial time to minutes.