Pratt & Whitney posts 41% increase in 1Q operating profits, but parent company warns of $850M tariff impact
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Pratt & Whitney’s East Hartford headquarters at 400 Main St.
East Hartford jet-engine maker Pratt & Whitney reported a 41% increase in operating profits during the first quarter of 2025, but its parent company warned of a significant potential impact from the Trump administration’s tariff policies.
Pratt & Whitney parent company Raytheon Technologies on Tuesday outlined a potential $850 million impact on its operating profits in 2025 as a result of various tariffs.
That includes a $300 million impact on operating profits from 10% global reciprocal tariffs; a $250 million impact from 25% tariffs on Mexico and Canada; a $250 million impact from 145% tariffs on China and China’s 125% tariffs on the U.S.; and a $50 million impact from a 25% tariff on steel and aluminum.
The vast majority of those tariff costs will hit Raytheon’s Pratt & Whitney (about $400 million) and Collins Aerospace ($400 million) units, company executives said Tuesday during an earnings call with analysts.
The tariff impact takes into account mitigation efforts that the company plans to employ. The estimates are also based on the notion that current tariff rates will be in place for the rest of the year, which could change if the Trump administration negotiates new trade deals with foreign countries.
“There are a variety of mitigations available to us,” said Raytheon Chief Financial Officer Neil G. Mitchill Jr. during the earnings call, “and frankly, many of them are new in terms of … our application of them, because … we lived in an environment where most of our goods were coming across the border without a duty. And so we'll continue to mature our mitigation strategies.”
In an earnings presentation, Raytheon outlined several mitigation strategies, including operational and contractual options and drawbacks.
During the first quarter, Pratt & Whitney reported $7.4 billion in sales, up 14% from the year-ago period, and a 41% increase in operating profits to $580 million.
The higher sales were driven by a 28% increase in Pratt’s commercial aftermarket business, a 4% increase in military and a 3% increase in commercial original equipment sales, the company said.
Pratt also reported lower R&D spending during the quarter, which offset higher selling, general and administrative expenses, the company said.
Raytheon during the quarter reported a 5% increase in sales to $20.3 billion, and an adjusted profit of $1.9 billion, up 11% from a year ago.
RTX’s stock price was down about 11% to $115 in early morning trading as of 9:52 a.m.
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