RTX Corp. (NYSE:RTX)

Goodwill

Goodwill demonstrated a gradual decrease over the five-year period, declining from 54,285 million US dollars in 2020 to 52,789 million US dollars in 2024. This reflects a consistent albeit modest reduction in the recognized goodwill value.

Collaboration Assets

Collaboration assets showed steady growth each year, increasing from 5,021 million US dollars in 2020 to 6,159 million US dollars in 2024. This upward trend suggests ongoing investments or capitalization in collaborative initiatives or partnerships.

Exclusivity Assets

Exclusivity assets exhibited significant growth from 2,541 million US dollars in 2020 to 3,692 million US dollars in 2024, indicating an expanding portfolio of exclusive rights or assets contributing increasing value over time.

Developed Technology and Other

Values associated with developed technology and other intangible assets fluctuated slightly, rising from 954 million US dollars in 2020 to a peak of 1,219 million US dollars in 2023 and subsequently settling at 1,197 million US dollars in 2024. This suggests relative stability with minor variations in these intangible assets.

Customer Relationships

Customer relationships showed a consistent declining trend from 30,241 million US dollars in 2020 to 29,388 million US dollars in 2024. This slow decrease may indicate amortization, attrition, or changes in customer base valuation over time.

Amortized Intangible Assets, Gross Amount

The gross amount of amortized intangible assets increased steadily from 38,757 million US dollars in 2020 to 40,436 million US dollars in 2024, reflecting additions to amortizable intangible assets during the period.

Accumulated Amortization

Accumulated amortization consistently grew more negative each year, starting from -6,932 million US dollars in 2020 reaching -15,456 million US dollars in 2024, indicating progressive amortization expense recognized against these assets.

Amortized Intangible Assets, Net

The net amortized intangible assets decreased steadily from 31,825 million US dollars in 2020 to 24,980 million US dollars in 2024, driven by amortization outpacing additions, reducing the carrying amount of these assets.

Trademarks and Other

Trademarks and other indefinite-lived intangible assets remained relatively stable with a slight downward movement from 8,714 million US dollars in 2020 to 8,463 million US dollars in 2024, suggesting minor adjustments or impairments.

Indefinite-Lived Intangible Assets

This category mirrors the values of trademarks and other indefinite-lived intangible assets, showing a stable to slightly declining trend over the period.

Identifiable Intangible Assets

Identifiable intangible assets showed a clear decreasing trend from 40,539 million US dollars in 2020 to 33,443 million US dollars in 2024, reflecting net reductions possibly due to disposals, amortization, or impairments.

Goodwill and Intangible Assets Combined

The combined value of goodwill and intangible assets decreased steadily from 94,824 million US dollars in 2020 to 86,232 million US dollars in 2024. This indicates a net depletion of these non-current assets over the observed period, driven by decreases primarily in goodwill and identifiable intangible assets net of amortization.

The financial data reveals several key trends and shifts over the five-year period, specifically in total assets, shareowners’ equity, and net income attributable to common shareowners under both reported and goodwill-adjusted bases.

Total Assets

Reported total assets demonstrate a slight decline from 2020 through 2022, decreasing from US$162,153 million to US$158,864 million, followed by a modest recovery in 2023 and 2024 reaching US$162,861 million. Adjusted total assets (which exclude goodwill) follow a similar but more pronounced downward trajectory between 2020 and 2022, falling from US$107,868 million to US$105,024 million, and subsequently rising in the last two years to US$110,072 million. This suggests that while overall assets remained relatively stable by 2024, the tangible asset base fluctuated more noticeably.

Shareowners’ Equity

Reported shareowners’ equity shows a gradual increase from 2020 through 2021, moving from US$72,163 million to US$73,068 million, followed by a small decline in 2022 to US$72,632 million. However, there is a sharp drop in equity in 2023 to US$59,798 million, with only a slight increase in 2024 to US$60,156 million. The adjusted shareowners’ equity, which reflects equity excluding goodwill, exhibits a markedly different pattern: a moderate rise from US$17,878 million to US$18,792 million between 2020 and 2022, then a substantial decline to US$6,099 million in 2023, before experiencing a partial recovery to US$7,367 million in 2024. This disparity indicates significant goodwill impairments or write-downs impacting adjusted equity.

Net Income Attributable to Common Shareowners

The reported net income shows considerable variability. In 2020, it reflects a significant loss of US$3,519 million, followed by a strong recovery in 2021 and 2022 with profits of US$3,864 million and US$5,197 million respectively. In 2023, net income declines to US$3,195 million, but rebounds to US$4,774 million in 2024. Adjusted net income closely parallels the reported figures from 2021 onwards, but differs notably in 2020 with a less severe loss of US$336 million, suggesting that goodwill adjustments mitigate some of the losses recognized in that year. The overall trend reflects recovery and profitability restoration after the initial loss in 2020.

In summary, the data portrays a company with stable overall asset levels but significant changes in asset composition and equity, especially after adjustments for goodwill. The fluctuations in adjusted equity and the marked recovery in net income post-2020 indicate effective earnings stabilization and possible impairments affecting book values during the period. The divergence between reported and adjusted figures underscores the material impact of goodwill on the financial statements.

The financial data reveals several notable trends and changes over the five-year period from 2020 to 2024. Both reported and goodwill-adjusted metrics provide distinct perspectives on the company’s performance.

Net Profit Margin

The reported net profit margin shows a recovery from a negative value of -6.22% in 2020 to positive margins thereafter, peaking at 7.75% in 2022. This is followed by a decline in 2023 to 4.64%, with a slight rebound to 5.91% in 2024. Adjusted net profit margin closely mirrors the reported figures except for 2020, where the adjusted margin is less negative at -0.59%, indicating the impact of goodwill adjustments moderates losses in that year.

Total Asset Turnover

Both reported and adjusted total asset turnover ratios exhibit consistent improvement across the years. Reported turnover increases steadily from 0.35 in 2020 to 0.50 in 2024, reflecting more efficient asset use. The adjusted turnover starts higher at 0.52 in 2020 and grows to 0.73 in 2024, indicating even greater asset utilization efficiency when goodwill accounting effects are removed.

Financial Leverage

Financial leverage based on reported data remains relatively stable around 2.2 until 2022, increasing to 2.71 in 2023 and maintaining this level in 2024. Adjusted leverage values are significantly higher than the reported figures, starting at 6.03 in 2020 and decreasing slightly until 2022. However, it spikes dramatically to 17.74 in 2023 before falling to 14.94 in 2024. This volatility suggests significant changes in capital structure or goodwill impact affecting leverage metrics in these years.

Return on Equity (ROE)

Reported ROE moves from a negative -4.88% in 2020 to steady positive values, reaching 7.94% in 2024, indicating improving profitability relative to shareholder equity. The adjusted ROE shows a much sharper upward trajectory, starting from -1.88% in 2020 and soaring to 64.8% by 2024. This indicates that after removing goodwill effects, the company’s equity profitability improved remarkably, particularly post-2021.

Return on Assets (ROA)

Reported ROA follows a pattern similar to net profit margin, shifting from negative -2.17% in 2020 to positive territory, peaking at 3.27% in 2022, dipping in 2023, then recovering moderately in 2024. Adjusted ROA is generally higher than the reported figures, indicating better asset returns once goodwill adjustments are accounted for. Although the adjusted ROA declines after 2022, it still maintains a better level than reported, ending at 4.34% in 2024.

Overall, the company demonstrates an improved financial performance trend over the observed period, especially after adjustments for goodwill. Efficiency ratios such as total asset turnover show consistent improvement, while profitability and returns indicators reveal recovery from initial losses and substantial growth when adjusted for goodwill effects. However, the pronounced volatility in adjusted financial leverage, particularly the sharp increase in 2023, may warrant further examination to understand the underlying causes and implications on financial risk.

The financial data reveals significant fluctuations and overall improvement across the reported and adjusted net income metrics over the five-year period. The reported net income attributable to common shareowners demonstrates a substantial turnaround from a considerable loss of $3,519 million in 2020 to positive and growing profits in subsequent years, reaching $4,774 million by 2024. This indicates a recovery and strengthening of profitability after a challenging initial year.

Concurrently, the adjusted net income, which likely excludes goodwill-related adjustments, follows a similar trajectory. While the adjustment notably reduces the 2020 loss to $336 million, it matches the reported figures exactly from 2021 onwards, reflecting improved operating results that drive earnings upward consistently through 2024.

The reported net profit margin aligns with the income trends, showing a negative margin of -6.22% in 2020 before rebounding to a positive 6.00% in 2021. It continues to improve, reaching a peak margin of 7.75% in 2022, followed by a slight decline to 4.64% in 2023, and recovering somewhat to 5.91% in 2024. This pattern suggests operational efficiencies or revenue growth tempered by periods of higher costs or investments in 2023.

The adjusted net profit margin reflects similar dynamics, starting with a minimal negative margin of -0.59% in 2020, then increasing to 6.00% in 2021 and 7.75% in 2022. The margin dips to 4.64% in 2023 and rises again to 5.91% in 2024, mirroring the reported margin movement. This consistency suggests that goodwill adjustments had minimal impact from 2021 onwards, with performance driven primarily by core business operations.

Overall, the data highlights a positive turnaround in profitability and margins after a significant loss in 2020, with adjusted figures reinforcing a strong underlying business recovery. The slight margin contraction in 2023 may warrant further scrutiny to identify specific factors affecting profitability during that year.

Total Assets

The reported total assets displayed a slight fluctuation over the five-year period, initially decreasing from 162,153 million US dollars in 2020 to 158,864 million in 2022, followed by a modest increase reaching 162,861 million by 2024. The adjusted total assets, which exclude goodwill, showed a downward trend from 107,868 million in 2020 to 105,024 million in 2022, then reversed to grow steadily, reaching 110,072 million by 2024.

Total Asset Turnover

The reported total asset turnover ratio reflected a consistent improvement over the years, starting at 0.35 in 2020 and rising to 0.5 by 2024, indicating enhanced efficiency in using assets to generate revenue. The adjusted total asset turnover demonstrated a similar upward trend but at higher values, increasing from 0.52 in 2020 to 0.73 in 2024. This suggests a more pronounced improvement in asset utilization efficiency when goodwill is excluded from total assets.

Overall Insights

Both reported and adjusted metrics indicate a general stabilization and slight recovery in asset base following a decline in the early part of the period. More notably, the asset turnover ratios reveal an ongoing enhancement in operational efficiency, with adjusted turnover ratios consistently outperforming the reported figures. This suggests that the company’s core assets, excluding goodwill, are being leveraged more effectively to generate sales over time.

Reported Total Assets

The reported total assets have shown a slight decrease from US$162,153 million in 2020 to US$158,864 million in 2022, followed by a modest recovery to US$162,861 million by the end of 2024. This indicates relative stability in asset base over the five-year period with minor fluctuations.

Adjusted Total Assets

Adjusted total assets demonstrate a consistent decline from US$107,868 million in 2020 to US$105,024 million in 2022. Subsequently, a recovery trend is observed, reaching US$110,072 million by 2024. This pattern suggests that after an initial reduction, the company's asset value excluding goodwill has strengthened somewhat in recent years.

Reported Shareowners’ Equity

Reported equity remained relatively stable around the US$72,000 million mark from 2020 through 2022. However, a significant decline occurs in 2023 down to US$59,798 million, with minimal recovery to US$60,156 million in 2024. This suggests potential adverse events affecting retained earnings or equity adjustments during that period.

Adjusted Shareowners’ Equity

The adjusted equity, which excludes goodwill, decreased markedly from US$17,878 million in 2020 to only US$6,099 million in 2023. A slight improvement to US$7,367 million is observed in 2024. This sharper decline relative to the reported figures highlights substantial goodwill impairments or write-downs impacting net equity.

Reported Financial Leverage

Reported financial leverage ratios remain relatively stable between 2.19 and 2.25 from 2020 to 2022, then increase significantly to 2.71 by 2023 and maintain this level in 2024. The rise in leverage suggests an increase in the proportion of debt or a decrease in equity, aligning with the reduction in reported equity values.

Adjusted Financial Leverage

Adjusted financial leverage shows a pronounced increase from 6.03 in 2020 to an elevated 17.74 in 2023, before a slight reduction to 14.94 in 2024. This sharp increase corroborates the significant decline in adjusted equity and indicates that the company is operating with substantially higher leverage when goodwill is excluded from the analysis.

Net Income Trends

The reported net income attributable to common shareowners demonstrated significant volatility over the five-year period. It started with a substantial loss of $3,519 million in 2020, followed by a considerable recovery in 2021 with a net income of $3,864 million. The upward trend continued to $5,197 million in 2022. However, there was a decline in 2023 to $3,195 million before rising again to $4,774 million in 2024. The adjusted net income, which excludes certain items, showed a similar pattern but with a notably smaller loss of $336 million in 2020, aligning exactly with reported figures from 2021 onward, indicating that adjustments primarily affected the 2020 figures.

Shareowners’ Equity Trends

Reported shareowners’ equity remained relatively stable from 2020 to 2022, fluctuating narrowly around the $72 billion mark but experienced a pronounced decline in 2023 to approximately $59.8 billion and a slight increase to $60.2 billion in 2024. In contrast, the adjusted shareowners’ equity was substantially lower throughout the period, reflecting the exclusion of goodwill or other adjustments. It showed a gradual increase from about $17.9 billion in 2020 to $18.8 billion in 2022, followed by a dramatic drop to approximately $6.1 billion in 2023 and a minor recovery to $7.4 billion in 2024, indicating possible reassessment or impairment of goodwill or related adjustments primarily in 2023.

Return on Equity (ROE) Analysis

The reported ROE followed the trends in net income and equity, showing negative returns in 2020 (-4.88%) followed by progressively positive returns, reaching 7.94% in 2024. These values suggest a recovery and gradual improvement in profitability relative to reported equity. Remarkably, adjusted ROE figures depict a much stronger performance when adjusted for goodwill or other items. After a slight negative in 2020 (-1.88%), adjusted ROE surged dramatically from 20.74% in 2021 to a peak of 64.8% in 2024. This implies that the exclusion of goodwill and related adjustments reveals a substantially more efficient use of shareholder capital, especially in the most recent years, despite the decline in adjusted equity values.

Overall Insights

The data illustrates a turnaround from a significant loss in 2020 to consistent profitability in subsequent years. While reported equity remained relatively stable with a notable drop in 2023, adjusted equity witnessed a sharper decline, signaling potential impairments or revaluations. The strong divergence between reported and adjusted ROE highlights the impact of goodwill-related adjustments on financial performance metrics, suggesting underlying operational improvement when intangible assets are excluded. The sharp increase in adjusted ROE from 2022 onward suggests heightened profitability efficiency against reduced adjusted equity, which might warrant further investigation regarding asset base quality and sustainability of returns.

Net Income Trends

The reported net income attributable to common shareowners experienced significant fluctuations across the periods. In 2020, there was a substantial loss amounting to -3,519 million US dollars, which shifted to a positive net income of 3,864 million US dollars in 2021. This upward trend continued, peaking at 5,197 million US dollars in 2022, followed by a decrease to 3,195 million in 2023, and then an increase again to 4,774 million in 2024. The adjusted net income follows a similar pattern, except the initial loss in 2020 was markedly smaller at -336 million US dollars, indicating that adjustments had a significant positive effect on net income for that year.

Assets Analysis

Total assets on a reported basis showed a slight overall decline from 162,153 million US dollars in 2020 to 158,864 million in 2022, followed by a modest recovery to 162,861 million by 2024. Adjusted total assets displayed a consistent decline from 107,868 million in 2020 to 105,024 million in 2022, before increasing to 110,072 million in 2024. This suggests a generally stable asset base, with adjustments reducing the asset base to a lower level but also showing some recovery in recent years.

Return on Assets (ROA) Observation

Reported ROA values mirror the net income trends, with a negative return of -2.17% in 2020 turning positive at 2.39% in 2021, peaking at 3.27% in 2022. ROA declined to 1.97% in 2023 before improving to 2.93% in 2024. Adjusted ROA figures show a more favorable performance, with 2020's return nearly at break-even (-0.31%), then increasing significantly to 3.61% in 2021 and 4.95% in 2022. Although there was a decline to 2.95% in 2023, the adjusted ROA rose again to 4.34% in 2024. The adjusted ROA consistently exceeds the reported ROA, emphasizing the positive impact of adjustments on profitability measures.

Overall Insights

The data reveal a period of recovery and growth following a challenging year in 2020. Adjustments mainly affect the early period's net income and asset figures, leading to improved profitability indicators. The fluctuations in net income and ROA suggest variability in earnings quality or operational results over time. However, by 2024, both reported and adjusted measures indicate renewed strength in financial performance and asset efficiency.