"Under the terms of the contract, the workforce has up to five days to come back in. So, we are starting to ramp and get things back in place."
— Scott Donnelly
03Detailed Report
TXT
Company TXT
Period
Q3 2024
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 24, 2026
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Executive Summary
Textron delivered a Q3 2024 revenue of approximately $3.4 billion, with adjusted earnings per share (EPS) of $1.40 for continuing operations, reflecting the operational disruptions from the IAM labor strike that affected Aviation production and services. Management highlighted a five-week strike impact, with ramp-up efforts already underway as the new five-year labor contract is ratified and workers return to full production. Despite the temporary headwind in Aviation, Textron reported a robust backlog of $7.6 billion across the portfolio as of the end of Q3, underpinning medium-term revenue visibility, particularly in the Bell and Textron Aviation segments. The company narrowed its full-year guidance materially, citing the aviation strike as the primary reason for the downgrade: 2024 adjusted EPS guidance moved to a range of $5.40–$5.60 from $6.20–$6.40, and manufacturing cash flow before pension contributions was trimmed to $650–$750 million from prior guidance of $900–$1,000 million. management emphasized the ramp in 2025, with anticipated revenue growth in Aviation and a multi-year trajectory driven by FLRAA and other programs, supported by a healthier supply chain and stabilized labor force. Backlog strength, favorable pricing in several segments, and a disciplined capital plan (including $215 million in quarterly share repurchases) frame Textron’s risk-reward into 2025. In summary, Textron faces near-term margin compression and cash flow headwinds from the strike, but the medium-term outlook remains constructive thanks to backlog, product updates, and selective program wins across Aviation, Bell, and Textron Systems.
Key Performance Indicators
Revenue
Decreasing
3.43B
QoQ: -2.84% | YoY: -11.95%
Gross Profit
Decreasing
492.00M
14.36% margin
QoQ: -16.33% | YoY: -23.48%
Operating Income
Decreasing
210.00M
QoQ: -41.01% | YoY: -15.66%
Net Income
Increasing
223.00M
QoQ: -13.90% | YoY: 12.63%
EPS
Increasing
1.19
QoQ: -11.19% | YoY: 16.67%
Revenue Trend
Margin Analysis
Financial Highlights
Textron QQ3 2024 highlights and trend context (USD, unless noted):
- Revenue: $3.427B in Q3 2024; management noted the quarter was impacted by the IAM strike, with Aviation delivering 41 jets (vs. 39 in prior-year Q3) and 25 commercial turboprops (vs. 38 prior-year).
- Gross profit: $492M; gross margin 14.36%; YoY gross profit decline approximately 23.5% based on segment mix and strike-related inefficiencies.
- Operating income: $210M; operating margin 6.13%; QoQ margin pressure driven by strike-related idle capacity and ramp costs (Q3 commentary cited a ~5-week disruption).
- Net income: $223M; net margin 6.51%; YoY net income up roughly 12.6% but QoQ down about 13.9% (reflecting the tax cadence and one-off items).
- EPS (continuing ops): $1.19; diluted $1.18; YoY EPS up ~16.7%; QoQ down ~11.2% (reflecting the revenue and cost headwinds from the strike).
- Backlog: $7.6B across Textron Aviation and Bell segments; Aviation backlog up by $162M QoQ to $7.6B; Bell backlog $6.5B.
- Free cash flow: $137M for the quarter; operating cash flow $207M; Capex $71M; free cash flow per share $0.733.
- Cash and liquidity: Cash and cash equivalents $1.716B; total cash + investments $1.716B; net debt $1.815B; total debt $3.531B; interest coverage ~8.1x; current ratio 1.83x.
- Share repurchases: ~2.4 million shares repurchased in Q3, totaling $215M; YTD repurchases ~10.1 million shares totaling ~$890M.
- 2024 guidance adjustments (post-strike): 2024 adjusted EPS guidance $5.40–$5.60 (down from $6.20–$6.40); Manufacturing cash flow before pension contributions guided to $650–$750M (down from $900–$1,000M). Management reiterated that the guidance reflects the aviation strike impact and ramp recovery through 4Q, with aviation revenue for the year ~ $5.5B and Bell margin guidance 10.5–11% for the year. A more balanced view applies for Systems (margin at or near the top of 11–12%), Industrial around 4%, eAviation loss of about $75M, and Finance segment around $30M.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
3.43B
-11.95%
-2.84%
Gross Profit
492.00M
-23.48%
-16.33%
Operating Income
210.00M
-15.66%
-41.01%
Net Income
223.00M
12.63%
-13.90%
EPS
1.19
16.67%
-11.19%
Key Financial Ratios
Gross Profit Margin
Weak
14.40%
Gross profit margin is below industry norms, profitability concerns
Operating Profit Margin
Fair
6.13%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Fair
6.51%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
1.36%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
3.21%
Return on equity suggests inefficient capital allocation
Current Ratio
Healthy
1.83
Current ratio shows adequate liquidity to meet short-term obligations
Debt to Equity
Moderate
0.52
Debt-to-equity indicates balanced capital structure with manageable debt
P/E Ratio
Fair Value
18.39x
P/E ratio in line with market averages
Price to Book
Fair Value
2.36x
Price-to-book ratio reasonable for profitable companies
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