L3Harris Beats Q1 Estimates, Raises Guidance, But Pre-Market Trades Lower
L3HARRIS TECHNOLOGIES INC (NYSE:LHX) delivered a strong beat on both the top and bottom lines for the first quarter of 2026, driven by surging demand across its defense portfolio. Despite the robust numbers and an upward revision to full-year earnings guidance, the stock is indicating a slightly lower open in pre-market trading, suggesting that some of the positive news may have already been priced in following a recent pullback.
Earnings and Revenue Performance
The company reported first-quarter revenue of $5.744 billion and non-GAAP diluted earnings per share (EPS) of $2.72. This comfortably surpassed consensus analyst estimates, which had called for revenue of approximately $5.47 billion and EPS of $2.57.
- Revenue: $5.744 billion vs. $5.47 billion estimate (Beat by ~5%)
- Non-GAAP EPS: $2.72 vs. $2.57 estimate (Beat by ~5.9%)
On a year-over-year basis, revenue surged 12% (15% organically), while GAAP diluted EPS jumped 33% from $2.04 in the same quarter last year. The bottom-line growth was fueled by higher operating income, lower interest expense, and a reduced effective tax rate of 13.1%, down from 15.9%.
Key Operational Highlights
Orders for the quarter reached a robust $7.8 billion, resulting in a book-to-bill ratio of 1.4x. This strong demand swelled the company’s total backlog to a record $40.7 billion, providing exceptional visibility into future revenue.
Segment performance was driven by broad-based growth:
- Space & Mission Systems: Revenue increased 24% year-over-year to $2.99 billion, driven by ramps in classified and international missionized aircraft programs, including a milestone related to material procurement for classified contracts.
- Communication & Spectrum Dominance: Revenue rose 3% to $1.855 billion, fueled by increased volume in night vision devices, international software-defined communications, and the Next Generation Jammer program.
- Missile Solutions: Revenue jumped 18% to $990 million, reflecting higher production volumes on key missile and munition programs prioritized by the Department of War.
Guidance and Outlook
Management updated its 2026 earnings per share guidance, raising the range. The company now expects full-year diluted EPS to be between $11.40 and $11.60, up from the prior range of $11.30 to $11.50.
This new guidance compares to the current consensus analyst estimate for full-year EPS of $11.71 and full-year sales of $23.67 billion. Notably, while the company’s revenue guidance of $23.0 billion to $23.5 billion is slightly below the current consensus sales estimate, the upward revision to EPS shows confidence in margin expansion.
Market Reaction
The stock is currently indicated to open down approximately 1.05% in pre-market trading. This modestly negative reaction comes despite a clear earnings beat and a guidance upgrade.
- Recent performance: The stock has fallen roughly 6.9% over the past month and 9.7% over the last two weeks.
- Potential drivers for the pullback: The market may be reacting to the fact that the revenue guidance, while strong, sits at the lower end of analyst sales hopes for the year. Additionally, cash flow from operations was negative $95 million in the quarter, a figure that may have tempered enthusiasm for the otherwise strong operational results. The negative pre-market action appears to be a continuation of selling pressure rather than a fundamental rejection of the quarter.
For a deeper dive into L3Harris's historical earnings performance and to view the latest analyst projections and estimates for upcoming quarters, visit the dedicated pages below.
View Historical Earnings Data View Analyst Forecasts and Ratings
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always conduct your own due diligence before making any investment decisions.