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Jul 03, 2020
L3Harris Q2 2020 Earnings Report
L3Harris reported second quarter 2020 results with revenue up 138% and flat versus prior-year GAAP and pro forma, respectively.
Key Takeaways
L3Harris Technologies reported second quarter 2020 revenue of $4.4 billion, up 138% and flat versus prior-year GAAP and pro forma, respectively, and up 2.3% on an organic basis. Net income was $278 million. GAAP EPS was $1.30. Non-GAAP EPS was $2.83.
2Q20 revenue $4.4 billion, up 138% and flat versus prior-year GAAP and pro forma, respectively
Up 2.3% on an organic basis; funded book-to-bill of 1.09
GAAP earnings per share from continuing operations (EPS) of $1.30, down 41% and 29% versus prior-year GAAP and pro forma, respectively
Non-GAAP EPS of $2.83, up 13% versus prior-year adjusted pro forma
Revenue by Segment
Forward Guidance
L3Harris updates 2020 guidance as follows: Revenue $18.2 - $18.6 billion, up organically 3% - 5% on an adjusted pro forma basis (unchanged from previous guidance). GAAP net income margin of 7.1%+. Adjusted EBIT margin of 17.5%+. GAAP EPS of $6.03 - $6.43 . Non-GAAP EPS of $11.15 - $11.55 (unchanged from previous guidance). Operating cash flow and adjusted free cash flow at $2.8 - $2.9 billion and $2.6 - $2.7 billion, respectively (unchanged from previous guidance). ~$1.7 billion in share repurchases, inclusive of proceeds from divestitures announced year-to-date (unchanged from previous guidance)
Positive Outlook
- Revenue $18.2 - $18.6 billion, up organically 3% - 5% on an adjusted pro forma basis (unchanged from previous guidance)
- Adjusted EBIT margin of 17.5%+
- Non-GAAP EPS of $11.15 - $11.55 (unchanged from previous guidance)
- Operating cash flow and adjusted free cash flow at $2.8 - $2.9 billion and $2.6 - $2.7 billion, respectively (unchanged from previous guidance)
- ~$1.7 billion in share repurchases, inclusive of proceeds from divestitures announced year-to-date (unchanged from previous guidance)
Challenges Ahead
- GAAP net income margin of 7.1%+(decreased from previous guidance of ~8.4%)
Historical Earnings Impact
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Avg. Return Before/After Earnings
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