RTX (RTX) risk factors, FY2025 10-K

INDUSTRY RISKS

1. 01Changes in U.S. government defense spending could negatively impact our financial position, results of operations, liquidity, and overall business46% rewritten
2. 02We 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
3. 03Our international business is subject to economic, regulatory, competition, and other risks
4. 04Geopolitical factors and changes in policies and regulations could adversely affect our business
5. 05Our financial performance is dependent on the condition of the aerospace industry
6. 06We 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
7. 07Competition may reduce our revenues and margins and limit our future opportunities

OPERATIONAL RISKS

1. 08Our 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. 09We 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. 10Due 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. 11We depend on the recruitment and retention of qualified personnel, and our failure to attract, train, and retain such personnel could seriously harm our business53% rewritten
5. 12Exports 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. 13Our business and financial performance may be adversely affected by threats to our physical security and other events outside our control
7. 14We 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. 15As a U.S. government contractor, we are subject to risks relating to U.S. government audits, investigations, and disputes
2. 16A 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. 17We are subject to litigation, environmental, anti-corruption, and other legal and compliance risks
4. 18Our 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. 19Our 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. 20We use estimates in accounting for many of our programs, and changes in our estimates could adversely affect our future financial results
3. 21Significant 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. 22Additional tax expense or exposures could affect our future profitability
5. 23Goodwill 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. 24Quarterly cash dividends and share repurchases are subject to uncertainties and may affect our common stock price
7. 25We face certain significant risk exposures and potential liabilities that may not be adequately covered by indemnity or insurance

STRATEGIC INITIATIVE AND TRANSACTION RISKS

1. 26We may be unable to realize expected benefits from strategic initiatives
2. 27Failure to successfully manage and execute potential future acquisitions, investments, divestitures, joint ventures, and other transactions, and other risks associated with these activities could adversely affect our future financial results35% rewritten