Earnings release
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Exhibit 99.1 Earnings Release L3Harris Technologies Reports Strong Third Quarter 2025 Results, Increases 2025 Guidance MELBOURNE, Fla., October 30, 2025 — L3Harris Technologies (NYSE: LHX) reports third quarter 2025 results. Highlights* • Orders of $6.7 billion; book-to-bill of 1.2x • Revenue of $5.7 billion, up 7% versus prior year, and 10% organically • Operating margin of 11.0%; Adjusted segment operating margin of 15.9% • Diluted EPS of $2.46; Non-GAAP diluted EPS of $2.70, up 10% versus prior year • 2025 guidance increased on strong performance and higher expectations “We delivered another strong quarter, with robust organic revenue growth of 10%, reflecting our commitment to operational excellence and relentless focus on execution as drivers of profitable growth. We are driving sustained performance, marking our eighth consecutive quarter of year-over-year adjusted segment operating margin expansion, and advancing our strategic priorities in support of our customers’ missions. With increasing demand, a record pipeline, and timely investments made ahead of the curve in growth areas like space and munitions, we are on track to achieve our 2026 Financial Framework and positioned to deliver long-term profitable growth,” said Christopher Kubasik, Chair and CEO, L3Harris. Kubasik added, “The defense industry is entering a new era defined by urgency, speed, and mission focus. L3Harris is leading the way, delivering resilient, rapidly deployable solutions at an accelerated pace to meet evolving mission needs. We are executing with focus and capturing new opportunities both domestically and abroad, such as the $2.2 billion Korea Airborne Early Warning & Control award received just after quarter end.” *Organic revenue, adjusted segment operating margin and non-GAAP diluted EPS are non-GAAP financial measures defined on page 16. ___
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SUMMARY FINANCIAL RESULTS* Third Quarter Year to Date 2025 Guidance($ millions, except per share data)2025 2024 Change 2025 2024 Change Revenue (see Table 4 for organic revenue) Communication Systems$ 1,462 $ 1,382 $ 4,190 $ 4,022 Integrated Mission Systems1,700 1,608 4,914 4,906 Space & Airborne Systems 1,809 1,683 5,207 5,141 Aerojet Rocketdyne 755 669 2,082 1,886 Corporate eliminations (67) (50) (176) (153) Revenue $ 5,659 $ 5,292 7% $ 16,217 $ 15,802 3% ~$22B (Prior: ~$21.75B) Operating income Communication Systems 382 359 1,063 998 Integrated Mission Systems 204 204 621 589 Space & Airborne Systems 218 195 614 626 Aerojet Rocketdyne 96 76 265 234 Unallocated corporate items(279) (339) (846) (1,098) Operating income $ 621 $ 495 $ 1,717 $ 1,349 Adjusted segment operatingincome $ 900 $ 834 8% $ 2,563 $ 2,447 5% Margin Operating margin 11.0% 9.4% 10.6% 8.5% Adjusted segment operatingmargin 15.9% 15.8% 10 bps 15.8% 15.5% 30 bps high 15% (Prior: mid - high 15%) Tax rate Effective tax rate (GAAP) 18.5% 6.0% 15.7% 4.9% Effective tax rate (non-GAAP) 15.6% 9.7% 13.0% 7.8% EPS Diluted EPS $ 2.46 $ 2.10 $ 6.92 $ 5.50 Non-GAAP diluted EPS $ 2.70 $ 2.46 10% $ 7.87 $ 7.10 11% $10.50 - $10.70(Prior: $10.40 -$10.60) Pension adjusted non-GAAPdiluted EPS $ 2.36 $ 2.05 15% $ 6.74 $ 5.83 16% Diluted weighted-average commonshares outstanding 188.1 190.5 188.6 190.7 Cash flow Cash from operations $ 546 $ 780 (30%) $ 1,144 $ 1,430 (20%) Adjusted free cash flow $ 449 $ 728 (38%) $ 951 $ 1,286 (26%) ~$2.65B Repurchases of common stock$ 176 $ 190 (7%) $ 998 $ 512 95% *A reconciliation of adjusted segment operating income and margin, non-GAAP effective tax rate, non-GAAP diluted EPS and pension adjusted diluted EPS, and adjusted free cash flow on a forward-looking basis to GAAP is not available without unreasonable effort due to the unavailability of items for exclusion from the GAAP measure. We are unable to address the probable significance of this information, the variability of which may have a significant impact on future GAAP results. See Non-GAAP Financial Measures on page 7 for more information. We are not assuming, and forward-looking guidance for 2025 does not assume, impacts from a further prolonged government shutdown or any reduction in spending following the government shutdown. 2024 segment financial results recast to reflect strategic realignment of the Fuzing and Ordnance Systems (FOS) business from Integrated Mission Systems to Aerojet Rocketdyne, effective in 2025. See Table 9 - 2024 Segment Recast in our EX-99.1 Earnings Release for first quarter 2025. 1 1 1 PAGE 2
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Revenue: Third quarter revenue increased 7%, 10% organically, reflecting growth across all segments, primarily from higher volumes, including new program ramps and increased international deliveries. Operating Margin: GAAP Operating Margin: Third quarter increased 160 bps to 11.0% primarily driven by the absence of business divestiture- related losses, lower amortization of acquisition-related intangibles, and lower LHX NeXt implementation costs. Adjusted Segment Operating Margin: Third quarter increased 10 bps to 15.9% primarily driven by improved program performance and LHX NeXt driven cost savings across all segments, partially offset by impacts from higher margin Commercial Aviation Solutions (CAS) divestiture. Diluted EPS: GAAP Diluted EPS: Third quarter increased 17% to $2.46 driven by higher operating income and lower interest expense from decreased average outstanding short-term debt balances during third quarter 2025, partially offset by a higher effective tax rate. Non-GAAP Diluted EPS and Pension Adjusted Non-GAAP Diluted EPS: Third quarter increased 10% to $2.70 and 15% to $2.36, respectively, from higher adjusted segment operating income and lower interest expense from decreased average outstanding short-term debt balances during third quarter 2025, partially offset by a higher effective tax rate. Cash Flow: Cash From Operations and Adjusted Free Cash Flow: Third quarter decreased 30% to $546 million and 38% to $449 million, respectively, primarily due to temporary customer delays in payment. We remain confident in achieving our 2025 cash flow guidance assuming the government shutdown is resolved, with the strongest cash generation of the year expected in the fourth quarter. PAGE 3
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SEGMENT RESULTS* Communication Systems Third Quarter Year to Date 2025 Guidance($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,462 $ 1,382 6% $ 4,190 $ 4,022 4% ~$5,700(Prior: $5,600 -$5,700) Operating margin 26.1% 26.0% 10 bps 25.4% 24.8% 60 bps ~25% Revenue: Third quarter revenue increased 6% primarily driven by increased international deliveries for software-defined resilient communications and data-link equipment, as well as Next Generation Jammer program ramp, our flagship Electronic Warfare tactical jamming pod. Operating Margin: Third quarter operating margin increased 10 bps to 26.1%, primarily due to LHX NeXt driven cost savings, partially offset by unfavorable mix associated with lower volume of proprietary waveform license sales. Integrated Mission Systems Third Quarter Year to Date 2025 Guidance($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,700 $ 1,608 6% $ 4,914 $ 4,906 —% ~$6,500(Prior: ~$6,400) Operating margin 12.0% 12.7% (70) bps 12.6 % 12.0% 60 bps low - mid 12%(Prior: ~12%) Revenue: Third quarter revenue increased 6%. Excluding the impact of the divestiture of our CAS business, organic revenue increased 17% primarily due to multiple ISR classified programs ramping. Operating Margin: Third quarter operating margin decreased 70 bps to 12.0% primarily due to the divestiture of our CAS business, partially offset by favorable performance. *Organic revenue is a non-GAAP financial measure defined on page 16. PAGE 4
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Space and Airborne Systems Third Quarter Year to Date 2025 Guidance($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,809 $ 1,683 7% $ 5,207 $ 5,141 1% ~$7,100 Operating margin 12.1% 11.6% 50 bps 11.8% 12.2% (40) bps low 12% Revenue: Third quarter revenue increased 7%, primarily from increased FAA volume in our Mission Networks business and higher volume in our Airborne Combat Systems business, partially offset by lower classified program volume in our Intel and Cyber business. Operating Margin: Third quarter operating margin increased 50 bps to 12.1%, primarily due to improved program performance on classified development programs in our Space Systems business, monetization of legacy end-of-life assets aligned with our transformation and value creation priorities, and LHX NeXt driven cost savings, partially offset by unfavorable mix. Aerojet Rocketdyne Third Quarter Year to Date 2025 Guidance($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 755 $ 669 13% $ 2,082 $ 1,886 10% $2,800 - $2,900(Prior: ~$2,800) Operating margin 12.7% 11.4 % 130 bps 12.7% 12.4 % 30 bps mid 12% Revenue: Third quarter revenue increased 13%. Excluding the impact of the divestiture of our AOT business, organic revenue increased 15% from increased production volumes across key missile, munitions, and space programs, as well as new program ramps. Operating Margin: Third quarter operating margin increased 130 bps to 12.7%, primarily due improved performance and LHX NeXt driven cost savings. *Organic revenue is a non-GAAP financial measure defined on page 16. PAGE 5
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SUPPLEMENTAL INFORMATION 2025 Other Information Current Prior FAS/CAS operating adjustment ~$15 million ~$15 million Non-service FAS pension income ~$285 million ~$285 million Net interest expense ~$600 million ~$600 million Effective tax rate on non-GAAP income 13.5% - 14.5% 13.5% - 14.5% Weighted-average diluted shares ~188 ~188 Capital expenditures ~2% revenue ~2% revenue Non-GAAP diluted EPS and effective tax rate on non-GAAP income are non-GAAP financial measures defined on page 16. A reconciliation of non-GAAP diluted EPS and effective tax rate on non-GAAP income guidance is not available. See Non-GAAP Financial Measures on page 7 for more information. 1 1 PAGE 6
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Forward-Looking Statements This earnings release contains forward-looking statements within the meaning of federal securities laws made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Examples include, but are not limited to: share repurchases; divestiture and realignment impacts; 2025 guidance, including Q4 cash generation; the duration of delays in payment; budget increases; anticipated LHX NeXt initiative costs and savings; supplemental information for 2025; projection of other financial items; and assumptions underlying any of the foregoing. Investors should not place undue reliance on forward-looking statements, which reflect management’s current expectations, estimates, projections, assumptions and information currently available to management, and are not guarantees of future performance or actual results. Important risks that could cause our results to differ materially from those expressed in or implied by these forward- looking statements or from our historical results include, but are not limited to, risks arising from: competitive markets; U.S. Government spending priorities; changes in contract mix; inflation; tariffs and potential trade disputes; unilateral contract action by the U.S. Government and the impacts of the government shutdown; uncertain economic conditions; future geo- political events; supply chain disruptions; impacts of LHX NeXt; indebtedness; defined benefit plan liabilities and returns; interest rates and other market factors; and changes in effective tax rate or additional tax exposures. These and other important risks that could impact forward-looking statements are described more fully in the "Risk Factors" in our Form 10-K for fiscal 2024 and our Form 10-Q for Q1 2025 filed with the SEC. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are qualified by the cautionary statements in this section, and we have no duty to and disclaim any intention or obligation, other than imposed by law, to update or revise any forward-looking statements, whether as a result of new information, future events or developments or otherwise. Non-GAAP Financial Measures Management believes the adjustments to non-GAAP Financial Measures ("NGFMs") in the tables beginning on page 11 are useful to investors because the excluded costs do not reflect our ongoing operating performance. Such adjustments, considered together with the unadjusted GAAP financial measures, provide information that management believes is useful to investors to understand period-over-period operating results separate from items that management believes may disproportionately impact operating results in any particular period; however there is no guarantee that items excluded from NGFMs will not reoccur in future periods. Management also believes that NGFMs enhance the ability of investors to analyze business trends, understand performance and evaluate our initiatives to drive improved financial performance. Management utilizes NGFMs to guide forecasting and long-term planning and for compensation purposes. NGFMs should be considered in addition to, and not as a substitute for, financial measures presented in accordance with GAAP. A reconciliation of forward- looking NGFMs to GAAP is not available without unreasonable effort because of inherent difficulty in forecasting and quantifying comparable GAAP measures and applicable adjustments and other amounts necessary for a reconciliation because of potentially high variability, complexity and low visibility of applicable adjustments and other unusual amounts that could disproportionately impact future GAAP results, such as the impact of defined benefit plan performance, LHX NeXt, portfolio shaping activities, and the extent of tax deductibility. In addition, forward-looking NGFMs may be impacted by the government shutdown, the duration of which and the potential impacts of which are not clear at this time. Investor Relations Contact: Daniel Gittsovich, 321-724-3170 investorrelations@l3harris.com Media Relations Contact: Sara Banda, 321-306-8927 media@l3harris.com PAGE 7
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Table 1 - Condensed Consolidated Statement of Operations (Unaudited) Third Quarter Year to Date ($ millions, except per share amounts) 2025 2024 2025 2024 Revenue $ 5,659 $ 5,292 $ 16,217 $ 15,802 Cost of revenue (4,165) (3,873) (12,038) (11,675) General and administrative expenses (873) (924) (2,462) (2,778) Operating income 621 495 1,717 1,349 Non-service FAS pension income and other, net 98 101 287 275 Interest expense, net (152) (166) (454) (514) Income before income taxes 567 430 1,550 1,110 Income taxes (105) (26) (244) (54) Net income 462 404 1,306 1,056 Noncontrolling interests, net of income taxes — (4) — (7) Net income attributable to L3Harris $ 462 $ 400 $ 1,306 $ 1,049 Earnings per share attributable to common shareholders Basic $ 2.47 $ 2.11 $ 6.96 $ 5.53 Diluted $ 2.46 $ 2.10 $ 6.92 $ 5.50 Weighted-average common shares outstanding Basic 187.1 189.6 187.6 189.7 Diluted 188.1 190.5 188.6 190.7 “FAS” is defined as Financial Accounting Standards. 1 1 PAGE 8
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Table 2 - Condensed Consolidated Balance Sheet (Unaudited) ($ millions) October 3, 2025 January 3, 2025 Assets Current assets Cash and cash equivalents $ 339 $ 615 Receivables, net 1,528 1,072 Contract assets 3,677 3,230 Inventories, net 1,291 1,330 Income taxes receivable 281 379 Other current assets 477 461 Assets of business held for sale — 1,131 Total current assets 7,593 8,218 Non-current assets Property, plant and equipment, net 2,761 2,806 Goodwill 20,370 20,325 Intangible assets, net 7,072 7,639 Deferred income taxes 87 120 Other non-current assets 3,131 2,893 Total assets $ 41,014 $ 42,001 Liabilities and equity Current liabilities Short-term debt $ 725 $ 515 Accounts payable 1,902 2,005 Contract liabilities 2,231 2,142 Compensation and benefits 486 419 Other current liabilities 1,294 2,317 Liabilities of business held for sale — 235 Total current liabilities 6,638 7,633 Non-current liabilities Long-term debt, net of current portion 10,997 11,081 Deferred income taxes 1,039 942 Other non-current liabilities 2,808 2,766 Total liabilities 21,482 22,422 Total equity 19,532 19,579 Total liabilities and equity $ 41,014 $ 42,001 PAGE 9
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Table 3 - Consolidated Statement of Cash Flow (Unaudited) Third Quarter Year to Date ($ millions) 2025 2024 2025 2024 Operating Activities Net income $ 462 $ 404 $ 1,306 $ 1,056 Adjustments to reconcile to net cash provided by operatingactivities: Depreciation and amortization 309 324 913 963 Share-based compensation 35 23 83 76 Net periodic benefit income (66) (72) (216) (215) Share-based matching contributions under definedcontribution plans 64 57 200 199 Deferred income taxes 245 467 151 220 (Increase) decrease in: Receivables, net (91) 188 (474) 163 Contract assets 180 (207) (454) (372) Inventories, net (33) 40 53 46 Other current assets 4 (6) (18) (32) Increase (decrease) in: Accounts payable (131) 155 (93) (45) Contract liabilities (86) (12) 91 (150) Compensation and benefits 42 (44) 67 (145) Other current liabilities (227) (26) (495) 59 Income taxes (177) (469) 144 (258) Other operating activities 16 (42) (114) (135) Net cash provided by operating activities 546 780 1,144 1,430 Investing Activities Capital expenditures (119) (78) (266) (290) Proceeds from sales of businesses, net of cash divested — — 831 158 Other investing activities (10) (15) (28) (19) Net cash provided by (used in) investing activities (129) (93) 537 (151) Financing Activities Proceeds from issuances of long-term debt, net — 585 — 2,826 Repayments of long-term debt (3) (2) (614) (2,609) Change in commercial paper, maturities under 90 days, net (260) (404) 210 93 Proceeds from commercial paper, maturities over 90 days — — — 688 Repayments of commercial paper, maturities over 90 days — (520) — (1,205) Repurchases of common stock (176) (190) (998) (512) Dividends paid (225) (220) (678) (665) Other financing activities 104 42 105 75 Net cash used in financing activities (560) (709) (1,975) (1,309) Effect of exchange rate changes on cash and cashequivalents — 14 18 9 Net decrease in cash and cash equivalents (143) (8) (276) (21) Cash and cash equivalents, beginning of period 482 547 615 560 Cash and cash equivalents, end of period $ 339 $ 539 $ 339 $ 539 PAGE 10
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Reconciliation of Non-GAAP Financial Measures Table 4 - Organic Revenue Reconciliation (Unaudited) Third Quarter Year to Date 2024 ($ millions) GAAP Adjustments Organic GAAP Adjustments Organic CS $ 1,382 $ — $ 1,382 $ 4,022 $ — $ 4,022 IMS 1,608 (158) 1,450 4,906 (296) 4,610 SAS 1,683 — 1,683 5,141 (76) 5,065 AR 669 (10) 659 1,886 (30) 1,856 Corporate eliminations (50) — (50) (153) — (153) Revenue $ 5,292 $ (168)$ 5,124 $ 15,802 $ (402)$ 15,400 Adjustment to exclude amounts attributable to divested businesses. 1 1 PAGE 11
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Table 5 - Reconciliation of Operating Income to Adjusted Segment Operating Income (Unaudited) Third Quarter Year to Date ($ millions) 2025 2024 2025 2024 Revenue $ 5,659 $ 5,292 $ 16,217 $ 15,802 Operating income $ 621 $ 495 $ 1,717 $ 1,349 Unallocated corporate items: Amortization of acquisition-related intangibles 192 210 579 642 Merger, acquisition, and divestiture-related expenses 10 25 40 86 Business divestiture-related losses and impairment of goodwill — 29 17 67 LHX NeXt implementation costs 25 41 99 216 Other unallocated corporate items 52 34 111 87 Total unallocated corporate items 279 339 846 1,098 Adjusted segment operating income $ 900 $ 834 $ 2,563 $ 2,447 Refer to Key Terms and Non-GAAP Definitions on page 16. 1 1 1 1 PAGE 12
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Table 6 - Reconciliation of Effective Tax Rate to Effective Tax Rate on Non-GAAP Income (Unaudited) Third Quarter 2025 2024 ($ millions) Earnings Before Tax Tax Expense (Benefit) Effective Tax Rate Earnings Before Tax Tax Expense Effective Tax Rate Income before income taxes $ 567 $ 105 18.5 % $ 430 $ 26 6.0 % Merger, acquisition, and divestiture-related expenses10 3 25 — Business divestiture-related losses and impairment ofgoodwill — (32) 29 (6) LHX NeXt implementation costs 25 18 41 31 Non-GAAP income before income taxes $ 602 $ 94 15.6 % $ 525 $ 51 9.7 % Year to Date 2025 2024 ($ millions) Earnings Before Tax Tax Expense (Benefit) Effective Tax Rate Earnings Before Tax Tax Expense Effective Tax Rate Income before income taxes $ 1,550 $ 244 15.7 % $ 1,110 $ 54 4.9 % Merger, acquisition, and divestiture-related expenses40 7 86 16 Business divestiture-related losses and impairment ofgoodwill 17 (55) 67 (8) LHX NeXt implementation costs 99 25 216 53 Non-GAAP income before income taxes $ 1,706 $ 221 13.0 % $ 1,479 $ 115 7.8 % Refer to Key Terms and Non-GAAP Definitions on page 16. 1 1 1 1 1 1 1 PAGE 13
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Table 7 - Reconciliation of Diluted EPS to Non-GAAP Diluted EPS and Pension Adjusted Non-GAAP Diluted EPS (Unaudited) Third Quarter Year to Date ($ millions, except per share data) 2025 2024 2025 2024 Diluted weighted-average common shares outstanding 188.1 190.5 188.6 190.7 Diluted EPS $ 2.46 $ 2.10 $ 6.92 $ 5.50 Significant and/or non-recurring items included in diluted EPS above: Merger, acquisition, and divestiture-related expenses 0.05 0.13 0.21 0.45 Business divestiture-related losses and impairment of goodwill — 0.15 0.09 0.35 LHX NeXt implementation costs 0.13 0.22 0.52 1.13 Income taxes on above adjustments and other, net 0.06 (0.14) 0.13 (0.33) Non-GAAP diluted EPS $ 2.70 $ 2.46 $ 7.87 $ 7.10 Less: per share impact of: FAS/CAS operating adjustment (0.01) (0.03) (0.04) (0.10) Non-service FAS pension income (0.33) (0.38) (1.09) (1.17) Pension adjusted non-GAAP diluted EPS $ 2.36 $ 2.05 $ 6.74 $ 5.83 Refer to Key Terms and Non-GAAP Definitions on page 16. Third quarter 2024 amount updated to exclude adjustment of $1.10 per share and $0.22 per share for amortization of acquisition-related intangible assets and related income tax expense, respectively. Year to date 2024 amount updated to exclude adjustment of $3.37 per share and $0.84 per share for amortization of acquistion-related intangible assets and related income tax expense, respectively. Net of tax effect. 1 1 1 2 2 3 3 1 2 3 PAGE 14
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Table 8 - Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow (Unaudited) Third Quarter Year to Date ($ millions) 2025 2024 2025 2024 Net cash provided by operating activities $ 546 $ 780 $ 1,144 $ 1,430 Capital expenditures (119) (78) (266) (290) Proceeds from disposal of property, plant and equipment, net — — 9 — Free cash flow 427 702 887 1,140 Cash used for merger, acquisition and severance 22 26 64 146 Adjusted free cash flow $ 449 $ 728 $ 951 $ 1,286 Refer to Key Terms and Non-GAAP Definitions on page 16. 1 1 PAGE 15
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Key Terms and Non-GAAP Definitions Description Definition Merger, acquisition, anddivestiture-related expensesTransaction and integration expenses associated with the Aerojet Rocketdyne acquisition; external costsrelated to pursuing acquisition and divestiture portfolio optimization; non-transaction costs related todivestitures; and salaries of employees in roles dedicated to planned divestiture and acquisition activity. Business divestiture-relatedlosses and impairment ofgoodwill In 2024, includes loss on sale and impairment of goodwill recognized in connection with the sale of ourantenna and related businesses and a loss associated with the then pending divestiture of our CASbusiness. In 2025, includes loss recognized in connection with the sale of our Commercial AviationSolutions business. LHX NeXt implementationcosts Includes costs related to workforce optimization costs, incremental IT expenses for implementation of newsystems, third-party consulting expenses and other related costs, including costs related to personneldedicated to this project. Organic revenue* Excludes the impact of completed divestitures and is reconciled in Table 4. Orders Total value of funded and unfunded contract awards received from the U.S. Government and othercustomers, including incremental funding and adjustments to previous awards, excluding unexercisedcontract options and potential orders under ordering-type contracts, such as indefinite delivery, indefinitequantity (IDIQ) contracts. Non-GAAP income beforeincome taxes* Represents income before income taxes adjusted for items reconciled in Table 6. Effective tax rate on non-GAAP income* Represents the effective tax rate (tax expense as a percentage of income before income taxes) adjustedfor the tax effect of items reconciled in Table 6. Adjusted segment operatingincome and margin* On a consolidated basis represents operating income and margin, excluding unallocated corporatedepartment items and items reconciled in Table 5. Non-GAAP diluted EPS* Represents EPS (earnings per share attributable to common shareholders) adjusted for items reconciledin Table 7. Pension adjusted non-GAAPdiluted EPS* Represents Non-GAAP diluted EPS, described above, adjusted for the after tax per share impact of theFAS/CAS operating adjustment and Non-service FAS pension income reconciled in Table 7. Adjusted free cash flow* Net cash provided by operating activities less capital expenditures, plus proceeds from disposal ofproperty, plant and equipment and cash used for merger, acquisition and severance reconciled in Table 8. Cash used for merger,acquisition, and severance*Cash related to merger, acquisition and divestiture-related expenses (described above) and severancecosts included in LHX NeXt implementation costs. _____ *Refer to Non-GAAP Financial Measures on page 7 for more information. PAGE 16