Harris Corp.'s (HRS) fiscal second-quarter profit rose 8.3%, topping its estimate, as it saw strong demand from government and defense customers.
The maker of digital multiband radios benefited from the Pentagon seeking to save money by using cheaper, off-the-shelf technology that has already been tested in commercial markets. In November it agreed to buy Schlumberger Ltd.'s (SLB) satellite communications services business for $397.5 million.
For the period ended Dec. 31, Harris posted a profit of $151.1 million, or $1.18 a share, up from $139.5 million, or $1.06 a share, a year earlier. Excluding acquisition-related costs, earnings rose to $1.20 a share from $1.07. In October, it forecast earnings of $1.08 to $1.12 a share.
Revenue jumped 18% to $1.44 billion, matching the most recent average estimate of analysts in a Thomson Reuters poll.
Gross margin narrowed to 34.6% from 36.1%.
Harris' government communications business, the largest top-line contributor, saw revenue rise 20% but earnings drop 6.4%. At the RF Communications operation, revenue was up 18%.
Shares closed at $48.78 and traded at $49 after the market close.
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