What does gross profit mean?

The profit remaining after subtracting the direct costs of manufacturing products and delivering services from total sales.

How do you interpret gross profit?

An increase suggests improved manufacturing efficiency, better pricing power, or a favorable shift in product mix, while a decrease may indicate rising input costs or pricing pressures.

How does gross profit compare across companies?

Gross margins are highly comparable across aerospace and defense peers, though they vary based on the mix of long-cycle defense contracts versus commercial aftermarket services.

Raytheon Technologies RTX Gross Profit

Discontinued — last reported Q1 '18

Gross Profit at other companies

Howmet AerospaceHWM

$854M+31.0%

BoeingBA

$2.55B+5.3%

HEICOHEI

$569.53M+30.1%

L3Harris TechnologiesLHX

$1.4B+3.9%

Honeywell InternationalHON

$3.54B+2.2%

WoodwardWWD

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Other financials

Income statement

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Revenue$22.1B+8.7%

Operating income$2.6B+25.6%

Net income$2.1B+34.1%

EPS (diluted)$1.51+32.5%

Balance sheet

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Cash & equivalents$6.9B+32.3%

Total debt$38.9B-9.3%

Total equity$66.3B+7.7%

Total assets$170.43B+3.4%

Cash flow

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Operating cash flow$1.9B+42.2%

CapEx$546.0M+6.4%

Free cash flow$1.3B+65.3%

Valuation

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Market cap$259.34B+46.8%

Enterprise value$291.41B+35.9%

P/E35.7×-2.7×

P/S2.9×+0.7×

Profitability

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Gross margin48.1%—

Operating margin10.9%+2.7pp

Net margin8%+2.4pp

Returns & leverage

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Return on equity11.4%+3.8pp

Debt / equity0.6×-0.1×

Current ratio1×0.0×

Where this comes from

Calculated from Raytheon Technologies’s reported figures.

$15.2Btotal revenue−$8.0Btotal cost of revenue=$7.23B

The official record: Raytheon Technologies’s 10-K, filed February 6, 2020, on SEC EDGAR. View the filing →

Questions, answered.

What does gross profit mean?: The profit remaining after subtracting the direct costs of manufacturing products and delivering services from total sales.
How do you interpret gross profit?: An increase suggests improved manufacturing efficiency, better pricing power, or a favorable shift in product mix, while a decrease may indicate rising input costs or pricing pressures.
How does gross profit compare across companies?: Gross margins are highly comparable across aerospace and defense peers, though they vary based on the mix of long-cycle defense contracts versus commercial aftermarket services.