L3Harris Technologies (NYSE:LHX) has released its financial results for the third quarter of 2024, demonstrating robust performance across key financial metrics.
Key Financial Metrics
| Metric | Q3 2024 | YoY Change | Consensus Estimates | Beat/Miss |
|---|---|---|---|---|
| Total Revenue | $5.3B | +8% | $5.28B | Beat |
| GAAP EPS | $2.10 | +4% | - | - |
| Non-GAAP EPS | $3.34 | +5% | $3.26 | Beat |
In the third quarter of 2024, L3Harris achieved a total revenue of $5.3 billion, surpassing Wall Street consensus estimates of $5.28 billion. The non-GAAP EPS also exceeded expectations at $3.34 compared to the estimated $3.26. The company demonstrated solid financial performance with both GAAP and non-GAAP EPS experiencing growth. The increase in revenue was primarily attributed to strong order inflows and strategic acquisitions, including Aerojet Rocketdyne.
Revenue Performance by Segment
| Segment | Q3 2024 Revenue | YoY Change |
|---|---|---|
| Communication Systems | +10% | Meets Guidance |
| Integrated Mission Systems | Positive trend | |
| Space and Airborne Systems | Flat (0%) | Below Expectations |
Revenue performance varied across L3Harris's major segments. The Communication Systems segment witnessed a robust 10% growth, driven by heightened demand for resilient communication equipment and international sales. Integrated Mission Systems also showed positive growth, bolstered by increased demand for advanced electronics and reliable solutions. However, the Space and Airborne Systems segment showed flat revenue compared to the previous year, adversely impacted by strategic divestitures.
Key Operational Highlights
- Orders reached $7.2 billion, achieving a book-to-bill ratio of 1.4x.
- Operating margin recorded at 9.4% with an adjusted segment operating margin of 15.7%.
- Cash from operations increased significantly by 44% to $780 million.
Comments from Company Officers
Christopher E. Kubasik, Chair and CEO, expressed confidence in the company's strategic direction stating, 'Our Trusted Disruptor strategy is driving value and improving operational efficiencies across segments. The LHX NeXt initiative is exceeding expectations in cost savings and has led to an updated 2024 savings target to at least $600 million.'
Kubasik added, 'We are well on track to achieving our 2026 goal of at least 16% segment operating margins, driven by continued strategic initiatives and market demands.'
Shareholder Returns
- No specific dividends or share repurchase programs were announced in the report.
Forward Guidance
- 2024 revenue guidance has been increased to a range of $21.1B - $21.3B.
- Adjusted segment operating margin guidance has been increased to approximately 15.5%.
- Non-GAAP diluted EPS guidance is revised to a range of $12.95 - $13.15 for 2024.
Stock Price Reaction
Following the earnings release, L3Harris Technologies' stock price experienced a slight decline of 0.67%, reflecting a mixed reaction from investors despite beating most financial estimates.
In conclusion, L3Harris Technologies continues to demonstrate strong operational execution and strategic foresight, positioning the company for sustained growth in the coming years.
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