RTX Corp. (RTX) stock traded lower Tuesday despite the aerospace and defense giant reporting better-than-expected third-quarter results and raising its full-year earnings and sales outlook. That is the kind of day where you beat on the top line, beat on the bottom line, raise guidance, and the market shrugs and takes a little off the top anyway.

The company benefited from strong commercial aerospace demand, higher defense sales and improved operating margins across its major businesses. So what gives? Sometimes a stock just needs a breather, and sometimes investors are already looking past the quarter to what comes next.

RTX Beats Earnings And Revenue Estimates

RTX reported third-quarter revenue of $24.965 billion, up 11% year over year and above the $24.080 billion analyst estimate.

Adjusted earnings rose to $2.26 per share, beating the $1.78 consensus estimate. The figure included a 25-cent benefit from tariff-related cost recoveries under the International Emergency Economic Powers Act. That is a nice little tailwind, though it is worth noting it is the kind of thing that does not necessarily repeat every quarter.

Organic sales increased 12%, while GAAP earnings climbed 34% to $1.89 per share.

Net income rose 35% to $2.583 billion, while adjusted net income increased 34% to $3.091 billion.

Operating cash flow reached $2.868 billion, including $2.119 billion in free cash flow. That is real money, not accounting magic.

Collins Aerospace And Pratt & Whitney Drive Growth

Collins Aerospace sales increased 10% to $8.382 billion, supported by 23% growth in commercial original equipment sales and 9% growth in aftermarket revenue.

Adjusted operating profit surged 50% to $1.788 billion, with margins reaching 21.3%. That is a big jump, the kind that makes you wonder how much of it is durable versus how much is a favorable mix and some tariff help.

Pratt & Whitney revenue rose 10% to $9.231 billion as aftermarket sales jumped 21%. Adjusted operating profit increased 29% to $968 million.

However, reported operating profit fell 19% to $608 million, reflecting a $363 million charge tied to a customer bankruptcy. That is the kind of one-off that makes the adjusted numbers look a lot prettier than the GAAP ones.

PW1100 engine maintenance, repair and overhaul output increased more than 35% year over year. For an engine maker, MRO output is the unglamorous plumbing that keeps the whole system flowing.

Raytheon Shifts Focus To Delivering Record Defense Orders

Raytheon sales grew 14% to $8.031 billion, while adjusted operating profit rose 32% to $1.134 billion.

RTX ended the quarter with a record $340 billion backlog and secured more than $81 billion in new awards.

These included approximately $37 billion in multiyear Tomahawk and AMRAAM missile contracts, supporting significantly higher production rates. That is a lot of missiles. And it raises a pleasant problem: now you have to actually build them.

During Tuesday's earnings call, CEO Christopher Calio said Raytheon has shifted its focus from securing contracts to expanding production capacity and strengthening its supply chain.

He also highlighted rising international defense demand across Europe, Asia-Pacific and the Middle East. In other words, the order book is not the constraint anymore. The factory floor is.

Commercial Aftermarket Demand Holds Firm

Calio said commercial aftermarket demand remains resilient despite cost pressures facing airlines.

He cited growing aircraft fleets, higher flight hours and pricing as key drivers of long-term growth. More planes flying more hours means more parts and service, which is a nice recurring revenue stream for the companies that make and maintain the engines.

CFO Neil Mitchill cautioned that Collins Aerospace margins could face pressure in the fourth quarter from higher research and development spending, digital investments and the absence of tariff-related recoveries.

However, he expects underlying operating margins to continue improving in 2027. So the near-term margin picture is a little cloudy, but the longer-term trend is still pointed the right way.

RTX Raises 2026 Earnings And Sales Outlook

RTX raised its 2026 adjusted earnings guidance to $7.65 to $7.75 per share, up from $7.10 to $7.25 and above the $7.24 analyst estimate.

The company also increased its adjusted sales forecast to $97 billion to $97.5 billion, compared with its previous outlook of $95 billion to $96 billion. Analysts had expected $96.068 billion.

RTX also raised its free cash flow outlook to $9 billion to $9.2 billion.

RTX Price Action: RTX shares were down 0.98% at $190.22 at the time of publication on Tuesday, according to market data.