RTX to Shift Focus from Space Prime to Component Supplier in Revised Strategy

Chris Calio, president and chief operating officer of RTX, announced during the company’s April 23 earnings call that the company will shift its focus away from competing to be a prime contractor in the space field. Instead, RTX will emphasize its strengths as a supplier of payloads, sensors, and components to other companies.

Calio described this shift as a pivot from being a space prime to being a component supplier, highlighting the company’s existing strengths in these areas. He mentioned that RTX has historical strength in certain space areas, as well as key components used in prime satellites and buses.

RTX had already been transitioning from the space prime role previously, with a focus on a merchant strategy. This shift was further solidified by Calio’s appointment as chairman and CEO of the company in May, replacing Greg Hayes.

In March, RTX withdrew from a fixed-price agreement to build seven missile tracking satellites for the Space Development Agency due to profitability concerns. However, Director Derek Tournear confirmed that RTX-made components will still be used in satellites built by L3Harris and Northrop Grumman.

Despite facing headwinds in technical learning and testing, RTX reported a loss of about $28 million on classified programs in the first quarter. Calio indicated that these losses would continue for another 12-18 months. The company plans to overcome these obstacles and continue its focus on being a component supplier in the space field.