How did RTX's Q4 earnings surprise impact annual performance?

Raytheon Technologies (RTX) reported Q4 FY2024 earnings per share (EPS) of $5.58, slightly exceeding the consensus estimate of $5.47. This positive surprise had a favorable impact on the company's annual performance, as it indicates strong financial performance and operational efficiency. 1. **Impact on Annual EPS**: The Q4 earnings beat expectations suggests that RTX's annual EPS for FY2024 is likely to be higher than initially anticipated. The company's updated guidance reflects a more optimistic outlook for the year, with an EPS range of $5.50 to $5.58, compared to the previous estimate of $5.35 to $5.45. This upward revision in guidance reflects confidence in the company's ability to deliver strong earnings for the year. 2. **Impact on Annual Revenue**: RTX's Q4 revenue guidance of $79.3 billion to $79.8 billion also exceeded consensus estimates. This indicates that the company's annual revenue for FY2024 is expected to be higher than initially anticipated, contributing to a stronger financial performance. 3. **Market Reaction**: The market has responded positively to RTX's earnings beat and guidance update. The company's stock has outperformed the S&P 500, with a year-to-date increase of 47.8%. This suggests that investors are confident in RTX's growth prospects and are willing to pay a premium for the stock. 4. **Investor Sentiment**: The positive earnings surprise has likely boosted investor confidence in RTX's ability to navigate challenges in the defense segment and capitalize on opportunities in the commercial aerospace market. This sentiment is further supported by the recent expansion of Pratt & Whitney's facilities, which is expected to strengthen its position as the largest military engines field location. In conclusion, RTX's Q4 earnings surprise has had a positive impact on the company's annual performance, with the potential for higher EPS and revenue than initially anticipated. This has been reflected in the company's updated guidance and positive market reaction, indicating strong investor confidence in RTX's future prospects.