RTX has announced that it will no longer compete to be a prime contractor in the space field, choosing instead to focus on its strengths as a supplier of payloads, sensors, and components to other companies. President and chief operating officer Chris Calio made this announcement during the company’s April 23 earnings call. Calio discussed the company’s decision to pivot from being a space prime to becoming more of a component supplier to space primes, emphasizing the shift as the right one for RTX given its strengths in those areas.
Calio will be succeeding Greg Hayes as chairman and chief executive officer of RTX in May. This news comes as RTX recently backed out of a fixed-price agreement to build seven missile tracking satellites for the Space Development Agency due to concerns over profitability. The SDA has removed those satellites from the planned constellation, relying instead on 28 other satellites already in production.
Before receiving the award for the missile tracking satellites, RTX had already begun to move away from its role as a space prime contractor. Last April, the company’s then-president of its space sector noted that this position had not yielded the desired results, prompting a shift in strategy. Calio also shared that RTX experienced losses of approximately $28 million on classified programs in the first quarter, with a timeframe of 12 to 18 months before those losses begin to decrease.
Despite these challenges, RTX remains committed to working through the losses and focusing on its strengths as a supplier of components to the space industry. The company’s decision to pivot away from being a space prime contractor aligns with its strategic goals for the future.