Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
RTX Corp., profitability ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Gross Profit Margin
- The gross profit margin shows an overall upward trend with fluctuations over the analyzed period. Starting at 15.08% in 2020, it rose significantly to 19.4% in 2021 and further improved to 20.38% in 2022. A dip occurred in 2023 where it decreased to 17.54%, followed by a recovery to 19.09% in 2024. This pattern indicates periods of improved cost management or pricing power, albeit with some volatility.
- Operating Profit Margin
- Operating profit margin experienced a notable positive shift after 2020. Initially negative at -3.34% in 2020, it increased markedly to 7.7% in 2021 and slightly improved to 8.07% in 2022. However, it dipped to 5.17% in 2023, then rebounded to 8.1% in 2024. This indicates a recovery from operational losses to consistent operational profitability, though with some short-term challenges impacting margins.
- Net Profit Margin
- Net profit margin aligns with operational trends but at a lower level. From a negative margin of -6.22% in 2020, it turned positive at 6% in 2021 and rose further to 7.75% in 2022. The margin declined to 4.64% in 2023 before a modest recovery to 5.91% in 2024. The data suggests the company struggles with maintaining net profitability consistently, but positive margins in recent years reflect improved bottom-line performance.
- Return on Equity (ROE)
- ROE shows a steady improvement from negative equity returns in 2020 (-4.88%) to positive results thereafter. It increased to 5.29% in 2021 and rose to 7.16% in 2022. After a decline to 5.34% in 2023, ROE rebounded to 7.94% in 2024, indicating enhanced efficiency in generating profits from shareholders’ equity with a dip possibly linked to operational or market conditions in 2023.
- Return on Assets (ROA)
- Return on assets moved from a negative -2.17% in 2020 to positive figures starting in 2021 at 2.39%. It peaked at 3.27% in 2022, then declined to 1.97% in 2023, followed by an increase to 2.93% in 2024. This metric reflects improvements in asset utilization for profit generation, though the dip in 2023 points to efficiency or profitability challenges during that year.
Return on Sales
Return on Investment
Gross Profit Margin
RTX Corp., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross margin | 15,410) | 12,089) | 13,668) | 12,491) | 8,531) | |
| Net sales | 80,738) | 68,920) | 67,074) | 64,388) | 56,587) | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 19.09% | 17.54% | 20.38% | 19.40% | 15.08% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Boeing Co. | -2.99% | 9.93% | 5.26% | 4.84% | -9.78% | |
| Caterpillar Inc. | 34.49% | 33.04% | 26.91% | 26.30% | 25.47% | |
| Eaton Corp. plc | 38.20% | 36.36% | 33.19% | 32.28% | 30.52% | |
| GE Aerospace | 30.79% | 21.95% | 24.55% | 24.19% | 17.26% | |
| Honeywell International Inc. | 38.09% | 37.28% | 36.99% | 35.85% | 32.07% | |
| Lockheed Martin Corp. | 9.75% | 12.55% | 12.56% | 13.52% | 13.23% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Gross profit margin = 100 × Gross margin ÷ Net sales
= 100 × 15,410 ÷ 80,738 = 19.09%
2 Click competitor name to see calculations.
- Net Sales
- Net sales exhibited a steady upward trajectory throughout the analyzed period. Starting at 56,587 million US dollars in 2020, net sales increased each year, reaching 80,738 million US dollars by 2024. This consistent growth indicates expanding revenue generation and market demand over the five-year span.
- Gross Margin
- The gross margin showed notable fluctuations despite the overall rising trend in net sales. It increased significantly from 8,531 million US dollars in 2020 to a peak of 13,668 million US dollars in 2022. However, it experienced a decline in 2023 to 12,089 million US dollars before recovering strongly to 15,410 million US dollars in 2024. This suggests some variability in cost of goods sold or operational efficiencies during the period.
- Gross Profit Margin
- The gross profit margin, expressed as a percentage of net sales, mirrored the fluctuations observed in gross margin. It improved from 15.08% in 2020 to a high of 20.38% in 2022. Following this peak, it declined to 17.54% in 2023 but rebounded to 19.09% in 2024. While overall margins remain higher than at the start of the period, the dip in 2023 points to potential challenges in cost management or pricing strategies during that year.
- Overall Analysis
- The data reveals strong sales growth paired with variable profitability margins. Despite increasing net sales, gross profit margins did not consistently improve year-over-year, indicating fluctuations in cost control or pricing power. The rebound in both gross margin and gross profit margin in 2024 suggests corrective measures or improved market conditions. Continued focus on maintaining or improving gross profit margins will be important to sustain profitability amid rising sales.
Operating Profit Margin
RTX Corp., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating profit (loss) | 6,538) | 3,561) | 5,414) | 4,958) | (1,889) | |
| Net sales | 80,738) | 68,920) | 67,074) | 64,388) | 56,587) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 8.10% | 5.17% | 8.07% | 7.70% | -3.34% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Boeing Co. | -16.10% | -0.99% | -5.33% | -4.66% | -21.95% | |
| Caterpillar Inc. | 21.30% | 20.30% | 13.97% | 14.27% | 11.67% | |
| Eaton Corp. plc | 18.62% | 16.75% | 14.55% | 15.69% | 11.45% | |
| GE Aerospace | 23.29% | 8.49% | 6.05% | 8.58% | 5.49% | |
| Honeywell International Inc. | 19.33% | 19.32% | 18.12% | 18.03% | 17.45% | |
| Lockheed Martin Corp. | 9.87% | 12.59% | 12.65% | 13.61% | 13.22% | |
| Operating Profit Margin, Sector | ||||||
| Capital Goods | 9.56% | 10.11% | 8.29% | 9.11% | 3.00% | |
| Operating Profit Margin, Industry | ||||||
| Industrials | 9.94% | 9.90% | 9.06% | 9.24% | 3.13% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating profit margin = 100 × Operating profit (loss) ÷ Net sales
= 100 × 6,538 ÷ 80,738 = 8.10%
2 Click competitor name to see calculations.
- Operating Profit (Loss)
- The operating profit exhibited significant volatility over the five-year period. In 2020, a substantial loss of 1,889 million US dollars was recorded. This shifted dramatically to a positive operating profit of 4,958 million in 2021 and further increased to 5,414 million in 2022. However, 2023 saw a decline in operating profit to 3,561 million, before rebounding strongly to 6,538 million in 2024. This pattern indicates resilience and recovery after an initial loss and some fluctuation in the mid-period.
- Net Sales
- Net sales demonstrated a consistent upward trend throughout the period. Starting at 56,587 million US dollars in 2020, sales increased each year, reaching 64,388 million in 2021, 67,074 million in 2022, 68,920 million in 2023, and culminating at 80,738 million in 2024. The growth in net sales shows a steady expansion of the company's revenue base, with the most notable increase occurring between 2023 and 2024.
- Operating Profit Margin
- The operating profit margin mirrored the fluctuations seen in operating profit. Initially negative at -3.34% in 2020, it reversed to a positive margin of 7.7% in 2021 and slightly improved to 8.07% in 2022. In 2023, the margin decreased to 5.17%, reflecting the dip in operating profit, before improving again to 8.1% in 2024, which represents the highest margin recorded in the period. This indicates enhanced operational efficiency and profitability relative to sales in the later years.
- Overall Insights
- Overall, the data suggest a strong recovery and growth phase following a challenging year in 2020. The company achieved steady increases in net sales and managed to convert those into positive and increasingly stable operating profits and margins. The temporary decreases in operating profit and margin in 2023 may indicate some operational or market challenges, but the subsequent recovery in 2024 suggests effective management responses or favorable conditions. The upward trajectory in both revenue and profitability metrics by 2024 points to ongoing strengthening of financial performance.
Net Profit Margin
RTX Corp., net profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to common shareowners | 4,774) | 3,195) | 5,197) | 3,864) | (3,519) | |
| Net sales | 80,738) | 68,920) | 67,074) | 64,388) | 56,587) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 5.91% | 4.64% | 7.75% | 6.00% | -6.22% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Boeing Co. | -17.77% | -2.86% | -7.41% | -6.75% | -20.42% | |
| Caterpillar Inc. | 17.59% | 16.18% | 11.85% | 13.47% | 7.68% | |
| Eaton Corp. plc | 15.25% | 13.87% | 11.86% | 10.92% | 7.90% | |
| GE Aerospace | 18.67% | 14.68% | 0.31% | -9.17% | 7.81% | |
| Honeywell International Inc. | 14.82% | 15.43% | 14.00% | 16.11% | 14.64% | |
| Lockheed Martin Corp. | 7.51% | 10.24% | 8.69% | 9.42% | 10.45% | |
| Net Profit Margin, Sector | ||||||
| Capital Goods | 6.65% | 9.09% | 5.27% | 3.71% | 1.85% | |
| Net Profit Margin, Industry | ||||||
| Industrials | 8.06% | 8.32% | 5.04% | 5.85% | 0.09% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net profit margin = 100 × Net income (loss) attributable to common shareowners ÷ Net sales
= 100 × 4,774 ÷ 80,738 = 5.91%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Common Shareowners
- The net income experienced a significant turnaround over the period. Starting with a substantial loss of -3519 million US dollars in 2020, the company shifted to profitability in 2021 with earnings of 3864 million US dollars. This positive trend continued in 2022, reaching a peak of 5197 million US dollars. Although net income decreased to 3195 million in 2023, it rebounded strongly in 2024 to 4774 million US dollars, indicating resilience and overall growth in profitability.
- Net Sales
- Net sales showed a consistent upward trend throughout the entire period. Beginning at 56,587 million US dollars in 2020, sales increased steadily each year, reaching 64,388 million in 2021, 67,074 million in 2022, and 68,920 million in 2023. The most significant increase occurred between 2023 and 2024, where net sales jumped to 80,738 million US dollars. This steady growth in net sales suggests expanding market presence or enhanced revenue-generating activities.
- Net Profit Margin
- The net profit margin mirrored the trends observed in net income, starting from a negative margin of -6.22% in 2020. It improved notably to 6% in 2021 and further increased to 7.75% in 2022, reflecting enhanced operational efficiency or improved cost management alongside revenue growth. In 2023, the margin declined to 4.64%, aligning with the dip in net income but remained positive. In 2024, the margin again improved to 5.91%, consistent with the recovery in net income, although it did not reach the 2022 peak.
Return on Equity (ROE)
RTX Corp., ROE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to common shareowners | 4,774) | 3,195) | 5,197) | 3,864) | (3,519) | |
| Shareowners’ equity | 60,156) | 59,798) | 72,632) | 73,068) | 72,163) | |
| Profitability Ratio | ||||||
| ROE1 | 7.94% | 5.34% | 7.16% | 5.29% | -4.88% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 55.37% | 53.02% | 42.25% | 39.37% | 19.56% | |
| Eaton Corp. plc | 20.52% | 16.90% | 14.45% | 13.06% | 9.44% | |
| GE Aerospace | 33.90% | 34.63% | 0.62% | -16.17% | 16.04% | |
| Honeywell International Inc. | 30.64% | 35.68% | 29.74% | 29.85% | 27.23% | |
| Lockheed Martin Corp. | 84.26% | 101.24% | 61.86% | 57.62% | 113.60% | |
| ROE, Sector | ||||||
| Capital Goods | 18.15% | 27.89% | 13.39% | 8.48% | 4.42% | |
| ROE, Industry | ||||||
| Industrials | 23.51% | 27.70% | 15.38% | 15.38% | 0.24% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROE = 100 × Net income (loss) attributable to common shareowners ÷ Shareowners’ equity
= 100 × 4,774 ÷ 60,156 = 7.94%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Common Shareowners
- The net income experienced a significant turnaround over the five-year period. Beginning with a substantial loss of $3,519 million in 2020, the company moved to positive profitability in 2021, with net income of $3,864 million. This upward trend continued through 2022, reaching $5,197 million. Although there was a decline in 2023 to $3,195 million, the net income rebounded strongly in 2024, increasing to $4,774 million. Overall, the pattern reflects a recovery from loss to sustained profitability, with some variability in recent years.
- Shareowners’ Equity
- Shareowners’ equity showed relative stability initially, with a slight increase from $72,163 million in 2020 to $73,068 million in 2021. However, a gradual decline is evident from 2022 onwards, decreasing to $72,632 million and then dropping more sharply in 2023 to $59,798 million. The value remained nearly flat through 2024 at $60,156 million. This reduction in equity in the latter years may suggest asset write-downs, dividend payments exceeding earnings retention, or other capital structure changes.
- Return on Equity (ROE)
- ROE mirrored the net income trend. The company experienced negative return on equity at -4.88% in 2020, consistent with the loss recorded that year. In 2021, ROE improved to 5.29%, followed by a further increase to 7.16% in 2022. Although the ROE dipped to 5.34% in 2023, it rose again to 7.94% in 2024, the highest in the period analyzed. This indicates improved efficiency in generating returns for shareholders despite the decline in equity observed in recent years.
Return on Assets (ROA)
RTX Corp., ROA calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to common shareowners | 4,774) | 3,195) | 5,197) | 3,864) | (3,519) | |
| Total assets | 162,861) | 161,869) | 158,864) | 161,404) | 162,153) | |
| Profitability Ratio | ||||||
| ROA1 | 2.93% | 1.97% | 3.27% | 2.39% | -2.17% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Boeing Co. | -7.56% | -1.62% | -3.60% | -3.03% | -7.80% | |
| Caterpillar Inc. | 12.30% | 11.81% | 8.18% | 7.84% | 3.83% | |
| Eaton Corp. plc | 9.89% | 8.37% | 7.03% | 6.30% | 4.43% | |
| GE Aerospace | 5.32% | 5.81% | 0.12% | -3.28% | 2.25% | |
| Honeywell International Inc. | 7.59% | 9.20% | 7.97% | 8.60% | 7.40% | |
| Lockheed Martin Corp. | 9.59% | 13.19% | 10.84% | 12.41% | 13.47% | |
| ROA, Sector | ||||||
| Capital Goods | 3.59% | 5.21% | 2.84% | 1.86% | 0.80% | |
| ROA, Industry | ||||||
| Industrials | 5.24% | 5.61% | 3.31% | 3.40% | 0.04% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROA = 100 × Net income (loss) attributable to common shareowners ÷ Total assets
= 100 × 4,774 ÷ 162,861 = 2.93%
2 Click competitor name to see calculations.
The financial data indicates significant fluctuations in net income attributable to common shareowners over the analyzed period. In 2020, the company experienced a substantial net loss of $3,519 million. This situation reversed dramatically in 2021, with a net income of $3,864 million. The positive trend continued into 2022, reaching a peak of $5,197 million, followed by a decrease in 2023 to $3,195 million, and a subsequent increase again in 2024 to $4,774 million.
Total assets displayed relative stability throughout the period, showing minor variations. The asset base was $162,153 million at the end of 2020 and slightly decreased to $158,864 million in 2022. It then recovered somewhat, reaching $162,861 million by the end of 2024. This indicates a stable asset base with no significant expansion or contraction during the timeframe.
Return on Assets (ROA) reflected the profitability trends observed in net income. The ROA was negative in 2020 at -2.17%, corresponding with the net loss. It improved notably in 2021 to 2.39%, peaked in 2022 at 3.27%, then declined in 2023 to 1.97%, and improved again in 2024 to 2.93%. These variations suggest fluctuating efficiency in generating profit from the asset base, aligning with the overall net income performance.
- Summary of Key Trends:
- - A marked turnaround from a significant net loss in 2020 to consistently positive net incomes in subsequent years, though with some volatility.
- - The company maintained a relatively stable total asset base with minor fluctuations.
- - ROA trends mirrored net income progression, highlighting variable profitability and operational efficiency over the years.