Executive Summary

Q4 2025 results and the 8-K/earnings call are not yet available as of Nov 20, 2025; this recap synthesizes Q3 2025 results, Q2 2025 trends, FY25 guidance updates, and Q4-to-date press releases to frame expectations into Q4.
Momentum into Q4: Q3 revenue grew 7% (10% organic) to $5.66B with adjusted segment operating margin at 15.9% and non-GAAP EPS $2.70; book-to-bill was 1.2x, and FY25 guidance was raised (revenue to ~$22B; EPS to $10.50–$10.70).
What to watch for in Q4: management guided to “strongest cash generation of the year” in Q4 and reiterated ~$2.65B FY25 adjusted FCF despite Q3 cash delays, assuming government reopens—setting up a potential positive cash catalyst.
Demand signals strengthened intra-quarter with a >$2.2B Korea AEW&C award post-Q3 and an Army NGC2 transport-layer award, supporting backlog and FY26 trajectory commentary.
Risks into Q4: timing/award flow and collections tied to government shutdown; SAS (Space) legacy program cost outcomes; mix in CS margins.

What Went Well and What Went Wrong

What Went Well
- Double-digit organic growth and margin expansion in Q3; non-GAAP EPS +10% Y/Y to $2.70; adjusted segment margin 15.9% (8th straight Y/Y expansion). “We delivered another strong quarter…on track to achieve our 2026 Financial Framework.”
- Aerojet Rocketdyne delivered 13% revenue growth and +130 bps margin expansion in Q3, with record backlog and multiple interceptor programs; capacity investments progressing.
- International wins and pipeline: ROK AEW&C (~$2.26B) after quarter-end; strong NATO radio demand; NGC2 Manpack award supports Army network modernization.
What Went Wrong
- Q3 cash from operations fell 30% Y/Y to $546M on temporary customer payment delays; free cash flow down similarly, increasing Q4 execution intensity.
- SAS faced legacy/classified program challenges earlier in 2025; while Q3 SAS margin improved to 12.1%, management still flagged past program pressures and stabilization into 2026.
- Award/cash timing risk from the government shutdown—management cited slower export licenses and collections; Q4 depends on reopening and catch-up in December.

Financial Results

Trailing performance heading into Q4 (oldest → newest):

Metric	Q4 2024	Q2 2025	Q3 2025
Revenue ($B)	$5.52	$5.43	$5.66
GAAP Diluted EPS ($)	$2.37	$2.44	$2.46
Non-GAAP Diluted EPS ($)	$3.47	$2.78	$2.70
Operating Margin (%)	10.3%	10.5%	11.0%
Adjusted Segment Operating Margin (%)	15.3%	15.9%	15.9%
Cash from Operations ($B)	$1.13	$0.64	$0.55

Segment revenue and margin (oldest → newest):

Segment	Q4 2024 Revenue ($B)	Q4 2024 Margin (%)	Q2 2025 Revenue ($B)	Q2 2025 Margin (%)	Q3 2025 Revenue ($B)	Q3 2025 Margin (%)
Communication Systems	$1.44	22.7	$1.38	24.4	$1.46	26.1
Integrated Mission Systems	$1.77	13.4	$1.62	13.2	$1.70	12.0
Space & Airborne Systems	$1.73	10.8	$1.79	12.3	$1.81	12.1
Aerojet Rocketdyne	$0.63	11.5	$0.70	13.3	$0.76	12.7

KPIs (oldest → newest):

KPI	Q4 2024	Q2 2025	Q3 2025
Orders ($B)	$24.2 FY (book-to-bill 1.14x)	$8.3 (B2B 1.5x)	$6.7 (B2B 1.2x)
Adjusted Free Cash Flow ($B)	$1.03 (Q4)	$0.574	$0.449

Notes: Non-GAAP definitions and reconciliations provided by the company; Q4 2025 actuals pending.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2025	~$21.75B (Q2)	~$22B (Q3)	Raised
Non-GAAP EPS (new methodology)	FY 2025	$10.40–$10.60 (Q2)	$10.50–$10.70 (Q3)	Raised
Adjusted Segment Operating Margin	FY 2025	Mid–High 15% (Q2)	High 15% (Q3)	Raised (tightened)
Adjusted Free Cash Flow	FY 2025	~ $2.65B (raised in Q2)	~ $2.65B (Q3)	Maintained
CS Revenue	FY 2025	$5.6–$5.7B (Q2)	~ $5.7B (Q3)	Raised (midpoint)
CS Margin	FY 2025	~25% (Q2)	~25% (Q3)	Maintained
IMS Revenue	FY 2025	~ $6.4B (Q2)	~ $6.5B (Q3)	Raised
IMS Margin	FY 2025	~12% (Q2)	Low–Mid 12% (Q3)	Raised
SAS Revenue	FY 2025	~ $7.1B (Q2)	~ $7.1B (Q3)	Maintained
SAS Margin	FY 2025	Low 12% (Q2)	Low 12% (Q3)	Maintained
AR Revenue	FY 2025	~ $2.8B (Q2)	$2.8–$2.9B (Q3)	Raised
AR Margin	FY 2025	Mid 12% (Q2)	Mid 12% (Q3)	Maintained
Non-GAAP ETR	FY 2025	13.5%–14.5% (updated in Q2)	13.5%–14.5% (Q3)	Maintained
Net Interest Expense	FY 2025	~$600M (Q2)	~$600M (Q3)	Maintained
Diluted Shares	FY 2025	~188–189 (Q2)	~188 (Q3)	Slightly lower
Capex	FY 2025	~2% of revenue (Q2)	~2% of revenue (Q3)	Maintained

Earnings Call Themes & Trends

Topic	Q2 2025 (Prev-2)	Q3 2025 (Prev-1)	Q4 2025 (to date)	Trend
Golden Dome / Missile Defense	Positioned across HBTSS and interceptors; building space sensor capacity; expect acceleration with EO and leadership installs.	Confident on HPTSS/HBTSS and SDA Tranche 3 timing (award timing dependent on gov reopening).	No Q4 call; programmatically reinforced by ROK AEW&C win supporting missionization franchise.	Improving pipeline
Aerojet Rocketdyne capacity & growth	Record demand; fastest grower into 2026; investments in VA/AR/AL to scale SRM capacity.	Record backlog ($8.3B); mid-teens growth; margins ~mid-12s; capacity expansion continues.	Continuation; management dual-hatting CFO as AJRD President to drive execution.	Strengthening
Space & Airborne Systems execution	SAS margin pressure improving; TR-3 ramp; FAA mission networks strength.	SAS margin +50 bps; program performance improving, but prior legacy dev programs still a watch item into 2026.	No new commentary; watch award flow amid shutdown.	Stabilizing
LHX NeXt cost savings/digital	$1B program ahead of plan; monetizing legacy assets; 7th straight Y/Y margin expansion.	8th straight margin expansion; continued savings; Digital Cockpit on Palantir rolling out.	Ongoing transformation; reiterations via press updates.	Positive
International/NATO demand	Germany/Czech radios; broader NATO momentum; ISR wins.	$2.2B Korea AEW&C award post-Q3; robust global demand pipeline.	Dividend declared; continued engagement; NGC2 supports U.S. modernization.	Expanding
Government funding / shutdown	N/A	Shutdown slowing awards/licensing/cash; assuming reopening and catch-up in Q4.	No resolution yet as of Q3 call; Q4 cash guide maintained contingent on reopening.	Risk to timing

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 release.
“We are driving sustained performance, marking our eighth consecutive quarter of year-over-year adjusted segment operating margin expansion.” — Q3 release.
“Aerojet Rocketdyne…reached a record financial backlog of $8.3 billion…we are the sole manufacturer of solid rocket motors for PAC-3…we understand our critical role in scaling capacity.” — Q3 call.
“We are increasing revenue guidance to $22 billion…increasing segment operating margin guidance to high 15%…non-GAAP EPS $10.50–$10.70…reiterating free cash flow of $2.65B.” — CFO, Q3 call.
“Program Digital Cockpit…built on Palantir's Foundry…accelerates decision making, strengthens program execution…onboarding across all segments through the end of 2025.” — CEO, Q3 call.

Q&A Highlights

Space/SAS margin trajectory: legacy program challenges are “nearing completion”; expect more stability into 2026, while not giving segment guidance yet.
Aerojet growth and margins: mid-teens growth outlook sustained across missile solutions and space propulsion; margin anchored in mid-12% with portfolio mix (development vs production).
Award/cash timing risk: shutdown delays slowed awards, export licenses, and cash collections; management assumes reopening in November and a “busy December” to catch up.
Multi-year contracting for capacity: company pushing for 5–7 year multi-year deals to underwrite capex for SRM expansion; customer receptivity improving; could enhance supply chain visibility and pricing.
Segment color: CS margins sensitive to mix (U.S. vs international and waveform software timing), but ~25% FY25 still targeted; IMS organic ISR growth durable; SAS improving execution.

Estimates Context

Wall Street consensus (S&P Global) for Q4 2025 could not be retrieved at this time due to data access limits; we will update once available. Results vs estimates cannot be assessed for Q4 yet.
FY25 company guidance currently implies H2 strength (particularly Q4 cash), but without retrievable consensus we cannot quantify beat/miss risk heading into the print.

Key Takeaways for Investors

Backdrop supportive: Q3 delivered 10% organic growth with sustained margin expansion; FY25 revenue/EPS guidance raised, suggesting durable demand and execution heading into Q4.
Cash is the near-term catalyst: despite Q3 working-capital pressure, management reiterated ~$2.65B FY25 FCF and guided strongest cash generation in Q4—monitor collections as shutdown risk abates.
Aerojet outperformance continues: record backlog, broad program exposure (PAC‑3, THAAD, NGI, GPI), and capacity investments underpin double-digit growth and mid‑12% margins.
International and missionization franchise expanding: $2.2B Korea AEW&C and ongoing NATO comms momentum diversify growth and support FY26 upside commentary.
Watch SAS normalization: Q3 SAS margin ticked higher with better performance; remaining legacy program risk seems to be burning down toward 2026 stability.
Contracting/award timing is the swing factor: shutdown has deferred awards and slowed cash; multi-year constructs could accelerate capacity scaling and improve visibility if adopted.
Mix matters for CS margins: international deliveries and waveform software timing can swing quarterly margins, but ~25% FY margin target remains.

Appendix: Q4-to-Date Press Releases (Context)

ROK AEW&C selection (~$2.26B) for Global 6500-based fleet (post-Q3, supports missionization franchise).
U.S. Army NGC2 award ($24M) for transport-layer gateway manpack to 4th Infantry Division (modernization signal).
Quarterly dividend declared: $1.20 per share, payable Dec 5, 2025.

Disclosure: Q4 2025 8-K (Item 2.02) and earnings call transcript are not yet available; prior-quarter documents and guidance updates were used for this recap.

L3HARRIS TECHNOLOGIES, INC. /DE/ (LHX)·Q4 2025 Earnings Summary