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October 24, 2023

Engine issues cost Pratt & Whitney $5.4B in 3Q; commercial, military sales increase

Contributed A Pratt & Whitney geared turbo fan engine.
By Greg Bordonaro

East Hartford jet-engine maker Pratt & Whitney reported a $2.4 billion operating loss in the third quarter, largely related to previously disclosed quality issues with its popular geared turbofan (GTF) engines.

The subsidiary of defense giant RTX also reported an 83% decline in sales, to $926 million. However, that number included a $5.4 billion charge related to repairs on its GTF engines.

RTX first disclosed the engine quality issue during its second-quarter earnings call in July. RTX said it will need to remove 600 to 700 Pratt engines for early inspection over the next few years after finding a rare condition in powdered metal used to manufacture certain GTF engine parts.
The contamination could cause cracks to form, the company has said. 

Without the engine-related charge and other non-recurring costs, Pratt & Whitney said it would have posted a $413 million operating profit in the third quarter, driven by an increase in commercial and military sales. 

That includes a 25% increase in commercial original equipment sales, a 21% increase in commercial aftermarket sales, and a 7% increase in military sales, driven by increased demand for F135 development.

During the quarter, Pratt parent RTX reported a quarterly loss but also announced a $10 billion share repurchase plan that boosted its stock price 6% to $77.50 in early morning trading. 


 

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