Raytheon defense business drives quarterly profit beat

Raytheon Technologies on Tuesday topped analysts' estimates for quarterly profit and sales, boosted by strength in its defense business, which makes parts for Lockheed Martin's F-35 fighter jets.

Shares of the company rose 2.3% to $62.50 in premarket trading.

Raytheon said it achieved a record backlog of $73.1 billion from its defense business in the second quarter, pointing to strong demand from the U.S. government and international customers.

"This also points to how well our (defense) programs are funded and their alignment to the national defense strategy,'' Raytheon Chief Financial Officer Toby O'Brien told Reuters.

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Raytheon gets about 30% of its defense sales from international customers.

The company said it continues to see full-year free cash flow of $2 billion, with its commercial aerospace business to be around break-even and defense business generating about $3.5 billion in cash by the end of the year.

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The pandemic has extracted a heavy toll on the air industry, with Raytheon having warned last month it expects total commercial aero sales to be down about 50% between the second and fourth quarter.

Net loss attributable to common shareowners was $3.84 billion, or $2.55 per share, for the quarter ended June 30, compared with a profit of $1.90 billion, or $2.22 per share, a year earlier.

Ticker	Security	Last	Change	Change %
RTX	RTX CORP.	121.83	+1.49	+1.24%
LMT	LOCKHEED MARTIN CORP.	529.41	+3.66	+0.70%

Revenue rose 24% to $14.06 billion, above estimates of $13.48 billion, according to Refinitiv data.

Excluding items, Raytheon earned 40 cents per share, above Street estimates of 12 cents per share.