RTX (RTX) risk factors, FY2024 10-K

INDUSTRY RISKS

1. 01Our business may be adversely affected by changes in global economic, capital market, and political conditions
2. 02Changes in U.S. government defense spending could negatively impact our financial position, results of operations, liquidity, and overall business
3. 03We face risks relating to our U.S. government contracts and programs, including the mix of our U.S. government contracts and programs, our performance, and our ability to control costs
4. 04Our international business is subject to economic, regulatory, competition, and other risks
5. 05Geopolitical factors and changes in policies and regulations could adversely affect our business
6. 06Our financial performance is dependent on the condition of the aerospace industry
7. 07We design, manufacture, and service products that incorporate advanced technologies; the introduction of new products and technologies involves risks, and we may not realize the degree or timing of benefits initially anticipated
8. 08Competition may reduce our revenues and margins and limit our future opportunities

OPERATIONAL RISKS

1. 09Our business and financial performance may be adversely affected by cyber-attacks on information technology (IT) infrastructure and products, as well as changes in cybersecurity regulations
2. 10We are dependent on a global supply chain and subject to risks related to the availability of materials and the performance of our suppliers; in recent years we have experienced supply chain disruptions that resulted in delays and increased costs and adversely affected our performance
3. 11Due to the nature of our products and services, a product safety failure, quality issue, or other failure affecting our or our customers’ or suppliers’ products or systems could seriously harm our business
4. 12We depend on the recruitment and retention of qualified personnel, and our failure to attract, train, and retain such personnel could seriously harm our business
5. 13Exports and imports of certain of our products are subject to various export control, sanctions, and import regulations and may require authorization from regulatory agencies of the U.S. or other countries
6. 14Our business and financial performance may be adversely affected by threats to our physical security and other events outside our control
7. 15We depend on our intellectual property and have access to certain third-party intellectual property; infringement or failure to protect our intellectual property or access to third party intellectual property could adversely affect our future growth and success

LEGAL, ENVIRONMENTAL, AND REGULATORY RISKS

1. 16As a U.S. government contractor, we are subject to risks relating to U.S. government audits, investigations, and disputes
2. 17A violation by Raytheon Company or the Company of any one of the deferred prosecution agreements or Securities and Exchange Commission (SEC) administrative order announced on October 16, 2024 could adversely affect our business
3. 18We are subject to litigation, environmental, anti-corruption, and other legal and compliance risks
4. 19Our business and financial performance may be adversely affected by climate change, including regulations, customer demand, technologies, and extreme weather

FINANCIAL, TAX, AND INSURANCE RELATED RISKS

1. 20Our debt levels and related debt service obligations could negatively impact our intended capital allocation, and we may be unable to obtain debt at competitive rates, on commercially reasonable terms, or in sufficient amounts
2. 21We use estimates in accounting for many of our programs, and changes in our estimates could adversely affect our future financial results
3. 22Significant changes in key estimates and assumptions with respect to our retirement plans, such as discount rate, expected return on plan assets (EROA), and other actuarial factors, could affect our future earnings, equity, and pension contributions
4. 23Additional tax expense or exposures could affect our future profitability
5. 24Goodwill and other intangible assets represent a significant portion of our assets, and any impairment of these assets could negatively impact our results of operations and financial condition
6. 25Quarterly cash dividends and share repurchases are subject to uncertainties and may affect our common stock price
7. 26We face certain significant risk exposures and potential liabilities that may not be adequately covered by indemnity or insurance

STRATEGIC INITIATIVE AND TRANSACTION RISKS

1. 27We may be unable to realize expected benefits from strategic initiatives
2. 28Failure to successfully manage potential future acquisitions, investments, divestitures, joint ventures, and other transactions, and other risks associated with these activities could adversely affect our future financial results
3. 29If either distribution of the stock of Carrier or Otis, together with certain related transactions, were to fail to qualify as a transaction that is generally tax-free, including as a result of subsequent acquisitions of our stock (including pursuant to the Raytheon merger), we could be subject to significant tax liabilities