Executive Summary

Q2 2026 filings and earnings call were not available in our sources; consensus indicates revenue ~$5.77B and EPS ~$2.99, implying modest year-over-year growth vs Q2/Q3 2025. Values retrieved from S&P Global*.
L3Harris raised FY2025 guidance twice in H1/H3 2025 (revenue to ~$22B and non-GAAP EPS to $10.50–$10.70), supported by 10% organic growth in Q3 and robust bookings; Aerojet Rocketdyne posted record momentum in missiles and space propulsion .
Q3 2025 featured broad-based strength: revenue $5.66B (+7% y/y), adjusted segment margin 15.9%, and non-GAAP EPS $2.70; orders were $6.7B (book-to-bill 1.2x). Management highlighted a $2.2B South Korea AWACS award post-quarter as an international growth catalyst .
Near-term headwinds included softer cash generation due to customer payment delays and higher tax rates; management expects Q4 cash catch-up and reiterated FY2025 FCF ~$2.65B .

What Went Well and What Went Wrong

What Went Well

Organic growth and margin durability: Q3 2025 organic revenue +10% with adjusted segment margin 15.9%, marking the eighth consecutive quarter of margin expansion .
Aerojet Rocketdyne execution: Double-digit organic growth and margin expansion (Q3 operating margin 12.7%) on higher production volumes across missiles, munitions, and space programs .
International wins and pipeline: Post-quarter $2.2B Korea AWE&C award and strong NATO-linked demand (Germany/Czech radios), reinforcing global positioning. “We are positioned to deliver... missionized business jets,” CEO noted .

What Went Wrong

Cash flow timing and payment delays: Q3 2025 CFO highlighted temporary customer-related delays impacting CFO ($546M) and adjusted FCF ($449M), with Q4 catch-up expected .
Higher effective tax rates: Non-GAAP ETR increased (Q3: 15.6%) and FY2025 bridge reflected ~30c headwind from tax reform .
SAS mix/program timing: Earlier periods saw pressure from unfavorable mix and classified program timing before improvement in Q3; SAS margin down 30 bps in Q2, then up 50 bps in Q3 .

Financial Results

Metric	Q2 2025	Q3 2025	Q2 2026 (Consensus)
Revenue ($USD Billions)	$5.43B	$5.66B	$5.77B*
Non-GAAP Diluted EPS ($)	$2.78	$2.70	$2.99*
GAAP Operating Margin (%)	10.5%	11.0%	—
Adjusted Segment Operating Margin (%)	15.9%	15.9%	—
EBITDA ($USD Billions)	$0.999B*	$1.038B*	$1.055B*

*Values retrieved from S&P Global.

Comparison vs estimates (recent quarters):

Metric	Q2 2025 Actual	Q2 2025 Consensus	Surprise	Q3 2025 Actual	Q3 2025 Consensus	Surprise
Revenue ($USD Billions)	$5.43B	$5.32B*	Beat	$5.66B	$5.51B*	Beat
Primary EPS ($)	$2.78	$2.50*	Beat	$2.70	$2.57*	Beat
EBITDA ($USD Billions)	$0.999B*	$0.965B*	Beat	$1.038B*	$0.999B*	Beat

*Values retrieved from S&P Global.

Segment breakdown (revenues and margins):

Segment	Q2 2025 Revenue ($MM)	Q2 2025 Margin (%)	Q3 2025 Revenue ($MM)	Q3 2025 Margin (%)
Communication Systems	$1,376	24.4%	$1,462	26.1%
Integrated Mission Systems	$1,622	13.2%	$1,700	12.0%
Space & Airborne Systems	$1,787	12.3%	$1,809	12.1%
Aerojet Rocketdyne	$698	13.3%	$755	12.7%

KPIs:

KPI	Q2 2025	Q3 2025
Orders ($B)	$8.3	$6.7
Book-to-Bill (x)	1.5x	1.2x
Cash from Operations ($MM)	$640	$546
Adjusted Free Cash Flow ($MM)	$574	$449
GAAP Diluted EPS ($)	$2.44	$2.46
Non-GAAP ETR (%)	9.5%	15.6%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total Company Revenue	FY2025	~$21.75B	~$22B	Raised
Non-GAAP EPS	FY2025	$10.40–$10.60	$10.50–$10.70	Raised
Adjusted Segment Operating Margin	FY2025	Mid–High 15%	High 15%	Raised
Free Cash Flow	FY2025	~$2.65B	~$2.65B (reiterated)	Maintained
CS Revenue	FY2025	$5.6–$5.7B	~$5.7B	Maintained/Top-end
IMS Revenue	FY2025	~ $6.4B	~ $6.5B	Raised
SAS Revenue	FY2025	~$7.1B	~$7.1B (reaffirmed)	Maintained
AR Revenue	FY2025	~$2.8B	$2.8–$2.9B	Raised
Non-GAAP ETR	FY2025	13.5%–14.5%	13.5%–14.5% (unchanged)	Maintained
Weighted Avg Diluted Shares	FY2025	~188	~188 (unchanged)	Maintained
Capex	FY2025	~2% revenue	~2% revenue (unchanged)	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2025)	Previous Mentions (Q3 2025)	Current Period (Q2 2026)	Trend
AI/technology initiatives	Army Titan with Palantir; strong progress integrating AI-defined vehicles	Program Digital Cockpit on Palantir Foundry; AI to improve execution	Not available	Strengthening, enterprise rollout
Supply chain/awards timing	Mission cadence impacted Canadian Maritime Helicopter contract; monetization offsets	Government shutdown delaying awards and export licenses; DFAS capacity challenges	Not available	Near-term headwind; Q4 catch-up expected
Missile/propulsion capacity	AR record quarter; tactical/interceptor ramps	AR backlog $8.3B; capacity expansions (VA/AR/AL)	Not available	Durable multi-year growth
Space programs (Golden Dome/SDA)	HBTSS constellation readiness; SDA Tranche 3 bid confidence	Expect awards post reopen; factory readiness for Tranche 1/2/3	Not available	Pipeline building; award timing key
International demand	Germany/Czech radio awards; NATO interoperability	$2.2B Korea AWACS; Middle East/Europe growth	Not available	Broadening across regions
Tax/ETR	FY2025 non-GAAP ETR raised due to tax reform (~30c EPS headwind)	Non-GAAP ETR Q3: 15.6%	Not available	Higher tax rate embedded
R&D/IRAD	LHX NeXt savings; monetization of legacy assets; transformation investments	Balanced IRAD/CRAD/Shield Capital; spend by opportunity, not % of revenue	Not available	Focused, opportunity-driven

Management Commentary

“We delivered another strong quarter… on track to achieve our 2026 Financial Framework and positioned to deliver long-term profitable growth,” CEO Christopher Kubasik (Q3 2025 press release) .
“We are increasing revenue guidance to $22 billion… increasing segment operating margin guidance to high 15%… non-GAAP EPS $10.50–$10.70,” CFO Kenneth Bedingfield (Q3 2025 call) .
On awards timing: “The government shutdown is clearly the challenge… we missed that quarter endpoint… we need Congress to resolve this” (Q3 2025 call) .
On AI execution: “Program Digital Cockpit… leveraging automation and artificial intelligence… to strengthen program performance” (Q3 2025 call) .
On missile capacity: “We are on every major interceptor program… expanding capacity as the nation looks to significantly increase missile production” (Q3 2025 call) .

Q&A Highlights

ISR trajectory: Backlog doubled in 12 months; ramp across multiple classified programs; international Armed Overwatch interest (CEO) .
Golden Dome pipeline: Confidence across HPTSS and SDA Tranche 3; award timing contingent on government reopening (CEO) .
Aerojet Rocketdyne medium-term: Double-digit growth outlook, margins steady mid-12s; portfolio spans missiles and space propulsion (CFO) .
Contracting and multi-year needs: Industry push for multi-year missile contracts to underwrite capacity investments; customers supportive (CEO/CFO) .
International teaming: Flexibility to prime/sub/merchant supply; footprint and technology transfer tailored per country (CEO) .

Estimates Context

Q2 2026 S&P Global consensus: Revenue $5.77B*, EPS $2.99*, EBITDA $1.055B*.
Implied trajectory: Above Q2 2025 revenue ($5.43B) and Q3 2025 ($5.66B), consistent with FY2025 revenue guidance upgrades and Aerojet/SAS ramps .
Potential estimate revisions: Continued strong international wins (e.g., Korea AWACS), ISR classified ramps, and missile capacity investments may bias top-line upward, while higher non-GAAP tax rates and Q4 cash timing inform EPS/FCF cadence .
*Values retrieved from S&P Global.

Key Takeaways for Investors

Backdrop remains favorable: defense demand (Golden Dome, missile capacity, NATO restocking) aligns with LHX’s portfolio; watch SDA/HBTSS and multi-year missile contracts as stock catalysts .
Execution driving guidance raises: Two FY2025 upgrades underpin confidence; adjusted margins stable at ~16% with LHX NeXt savings and program performance .
Aerojet Rocketdyne is a multi-year growth engine: Capacity expansions and backlog support durable double-digit growth in missiles and space propulsion .
International momentum accelerating: Large Korea AWACS award and European radio wins highlight competitive edge; sustained global pipeline .
Near-term monitoring: Award timing post-shutdown, non-GAAP tax rate impacts, and Q4 cash conversion are key to quarterly prints .
Estimates setup for Q2 2026: Consensus points to modest y/y growth; upside likely tied to award cadence and capacity scaling. Values retrieved from S&P Global*.
Positioning: Balanced prime/sub/merchant strategy, AI-enabled execution tools, and footprint flexibility enhance win rates and margins .

Note: We searched for Q2 2026 8-K 2.02, press releases, and the earnings call transcript; these were not available in our document set at this time. All quantitative comparisons and guidance are anchored to Q2/Q3 2025 primary sources and Q2 2026 S&P Global consensus where noted.

L3HARRIS TECHNOLOGIES, INC. /DE/ (LHX)·Q2 2026 Earnings Summary