The TOW weapon system, manufactured by defense contractor Raytheon, is used as a heavy assault anti-armor weapon.

The TOW weapon system, manufactured by defense contractor Raytheon, is used as a heavy assault anti-armor weapon. (RAYTHEON COMPANY)

Raytheon Sales Fall Amid Weak Defense Spending

Features Reuters

U.S. weapons maker Raytheon Co (RTN), the maker of Tomahawk and Amraam missiles, reported a 4 percent fall in quarterly sales as U.S. defense spending remained weak.

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Net income attributable to Raytheon fell to $551 million, or $1.79 per share, in the first quarter ended March 29, from $596 million, or $1.89 per share a year earlier.

On an adjusted basis, the company earned $1.26 per share.

U.S. arms makers have increased sales to international markets and boosted their cybersecurity businesses to offset slowing sales to the military.

Raytheon said on Monday that it would buy network security company Websense Inc, adding more than 20,000 commercial customers to its government clients at a time when data breaches are surging.

Larger rival Lockheed Martin Corp <LMT.N>, which is also increasing focus on its commercial cybersecurity business, reported a 6 percent fall in quarterly profit on Tuesday.

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Raytheon's bookings rose 4.1 percent in the first quarter, partly due to a $769 million order for its Patriot missiles from South Korea. Orders had fallen 5.4 percent in the fourth quarter.

Revenue fell to $5.29 billion from $5.51 billion a year earlier.

Up to Wednesday's close of $109.65, Raytheon's shares had risen 9.4 percent in the past 12 months, slightly less than the 10.6 percent rise in the Dow Jones U.S. Aerospace and Defense index <.DJUSAE>.

(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Simon Jennings)