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Textron Inc. (NYSE: TXT) reports higher Q2 EPS and 2026 goals

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Textron Inc. reported second quarter 2026 results with revenue of $3.83 billion, up from $3.72 billion a year earlier. GAAP diluted EPS was $1.42 versus $1.35, and adjusted EPS increased to $1.62 from $1.55, reflecting growth across all manufacturing segments.

Textron Aviation revenue was $1.54 billion and Bell $1.07 billion, while Systems and Industrial generated $347 million and $848 million, respectively. The company initiated a sale process for the Industrial segment. Backlogs were $8.0 billion at Aviation, $7.5 billion at Bell and $3.3 billion at Systems.

Manufacturing operating cash flow for the quarter was $235 million, with non-GAAP manufacturing cash flow before pension contributions of $154 million, and Textron returned $209 million through share repurchases. Management reaffirmed 2026 guidance for GAAP EPS of $5.39–$5.59, adjusted EPS of $6.40–$6.60, and manufacturing cash flow before pension contributions of $700–$800 million, while highlighting dependence on additional MV‑75 Cheyenne funding.

Positive

  • None.

Negative

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Filing Explained

Without additional MV-75 funding, Textron discloses a potential $0.20 to $0.30 adjusted EPS and $150 million to $250 million cash-flow impact.

Textron’s July 28 Form 8-K records the completed quarter and reiterates a full-year outlook that assumes additional fiscal 2026 funding for the MV-75 Cheyenne program; the company says the outlook would be affected if that funding is not received.

At July 4, the consolidated balance sheet showed cash and equivalents, alongside current and long-term debt.

Without the additional MV-75 funding, the company says adjusted EPS could be negatively impacted by $0.20 to $0.30 and cash flow by $150 million to $250 million.

The specific resolution is approval and obligation of the additional funding through an Above Threshold Reprogramming request and a related contract modification.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Q2 2026 total revenues $3,827 million Three months ended July 4, 2026, versus $3,716 million in Q2 2025
Q2 2026 net income $248 million Net income for the three months ended July 4, 2026, versus $245 million in 2025
Q2 2026 diluted EPS $1.42 GAAP diluted EPS for Q2 2026 versus $1.35 in the prior-year quarter
Q2 2026 adjusted diluted EPS $1.62 Non-GAAP adjusted EPS for Q2 2026 versus $1.55 in Q2 2025
Q2 2026 manufacturing cash flow before pension $154 million Non-GAAP manufacturing cash flow before pension contributions, versus $336 million in Q2 2025
Share repurchases Q2 2026 $209 million Cash used for purchases of Textron common stock during the second quarter of 2026
2026 adjusted EPS outlook $6.40–$6.60 Full-year 2026 adjusted diluted EPS guidance range
2026 manufacturing cash flow outlook $700–$800 million Guidance for 2026 manufacturing cash flow before pension contributions
LIFO inventory provision financial
"Add: LIFO inventory provision | 41 | ... in the GAAP to non-GAAP reconciliation"
An accounting adjustment companies using the Last-In, First-Out (LIFO) method make to reflect differences between the cost of recently purchased inventory and older inventory layers; often reported as a LIFO reserve or provision. Think of a pantry where you use the newest cans first while older, cheaper cans remain on the shelf — the provision captures the hidden profit or loss tied up in those older layers when prices change. Investors look at it because the provision alters reported income, inventory values and potential tax effects, making it important for comparing profitability and cash flow across periods or with companies using other inventory methods.
segment profit financial
"Segment profit (a) (b) | 353 | 352 | ... used to evaluate operating performance"
Segment profit is the portion of a company's earnings produced by a single business unit or division after subtracting the costs directly tied to that unit. It shows how much money that part of the company actually contributes, like checking which room in a house uses most of the electricity. Investors use it to identify strong or weak businesses inside a company, guide capital allocation, and make clearer comparisons between divisions.
Above Threshold Reprogramming regulatory
"additional fiscal year 2026 funding on the MV-75 Cheyenne program through an Above Threshold Reprogramming request"
manufacturing cash flow before pension contributions financial
"Manufacturing cash flow before pension contributions, a non-GAAP measure that is defined and reconciled"
Manufacturing cash flow before pension contributions is the money a company’s production operations generate from selling goods and running factories, measured before any payments set aside for employee pensions. Investors use it like a household checking how much income is left from work-related activity before retirement savings: it shows the core business’s ability to cover daily costs, invest in equipment, and reveal whether pension obligations might strain future cash.
International Emergency Economic Powers Act (IEEPA) regulatory
"tariffs recovered in the second quarter of 2026 that were previously imposed under the International Emergency Economic Powers Act (IEEPA)"
A U.S. law that lets the president impose wide economic controls—like trade bans, asset freezes, and export limits—when a national emergency is declared. For investors it matters because these powers can suddenly change which countries, companies, or products can be traded or owned, similar to a circuit breaker that can shut off parts of a market and alter company revenues, supply chains, or the value of holdings overnight.
Total revenues $3,827 million up from $3,716 million in the second quarter of 2025
GAAP diluted EPS $1.42 up from $1.35 in the second quarter of 2025
Adjusted diluted EPS $1.62 up from $1.55 in the second quarter of 2025
Net income $248 million slightly above $245 million in the second quarter of 2025
Manufacturing cash flow before pension contributions $154 million down from $336 million in the second quarter of 2025
Share repurchases $209 million amount of Textron common stock repurchased in the second quarter of 2026
Guidance

Textron reaffirmed 2026 guidance for GAAP EPS of $5.39–$5.59, adjusted EPS of $6.40–$6.60, and manufacturing cash flow before pension contributions of $700–$800 million, noting potential $0.20–$0.30 adjusted EPS and $150–$250 million cash flow downside if additional MV-75 Cheyenne funding is not received.

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FAQ

What were Textron (TXT) second quarter 2026 revenues and earnings?
Textron reported Q2 2026 revenue of $3.83 billion, up from $3.72 billion a year earlier. GAAP diluted EPS was $1.42 versus $1.35, and adjusted EPS, a non-GAAP measure, was $1.62 compared with $1.55 in second quarter 2025.

How did Textron (TXT) perform by business segment in Q2 2026?
Textron Aviation generated $1.54 billion of revenue, Bell $1.07 billion, Textron Systems $347 million, and Industrial $848 million. Backlogs reached $8.0 billion at Aviation, $7.5 billion at Bell and $3.3 billion at Systems, supporting future activity.

What cash flow and capital returns did Textron (TXT) report for Q2 2026?
Manufacturing net cash from operating activities was $235 million in Q2 2026. Non-GAAP manufacturing cash flow before pension contributions totaled $154 million, compared with $336 million a year earlier. Textron also returned $209 million to shareholders through common stock repurchases during the quarter.

What 2026 earnings and cash flow guidance did Textron (TXT) provide?
Textron reaffirmed 2026 GAAP EPS guidance of $5.39–$5.59 and adjusted EPS of $6.40–$6.60. It also guided manufacturing cash flow before pension contributions to $700–$800 million, noting potential $0.20–$0.30 EPS and $150–$250 million cash flow downside if MV‑75 funding is not approved.

What is happening with Textron’s (TXT) Industrial segment?
Textron has initiated a sale process for its Industrial segment. In Q2 2026, Industrial delivered $848 million of revenue and $59 million of segment profit, with performance driven by higher pricing at Kautex and lower volume at Textron Specialized Vehicles.

How did Textron (TXT) Aviation and Bell businesses perform operationally in Q2 2026?
Textron Aviation revenue was $1.5 billion, with 40 jet and 44 commercial turboprop deliveries. Bell revenue reached $1.1 billion, supported by higher H‑1 and MV‑75 military volume and 36 commercial helicopter deliveries, though Bell segment profit declined modestly year over year.

What non-GAAP measures did Textron (TXT) highlight in this release?
Textron emphasized adjusted net income, adjusted diluted EPS and manufacturing cash flow before pension contributions. These exclude items such as LIFO inventory provision, intangible asset amortization, special charges and pension contributions, and are reconciled to GAAP figures in detailed tables.
0000217346FALSE00002173462026-07-282026-07-28


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 28, 2026
TEXTRON INC.
(Exact name of Registrant as specified in its charter)
Delaware1-548005-0315468
(State of
Incorporation)
(Commission File Number)
(IRS Employer
Identification Number)
40 Westminster Street, Providence, Rhode Island  02903
(Address of principal executive offices)
Registrant’s telephone number, including area code: (401) 421-2800
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Common Stock – par value $0.125TXTNew York Stock Exchange
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐     Pre-commencement communications pursuant to Rule 13e-4(c)) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b–2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company   ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02    Results of Operations and Financial Condition
On July 28, 2026, Textron Inc. (“Textron” or the "Company") issued a press release announcing its financial results for the fiscal quarter ended July 4, 2026. This press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
A discussion of the reasons why management believes that the presentation of non-GAAP financial measures provides useful information to investors regarding Textron’s financial condition and results of operations is attached to the press release attached hereto as Exhibit 99.1.
Item 9.01    Financial Statements and Exhibits 
(d) Exhibits
The following exhibits are filed herewith:
Exhibit
Number
Description
99.1
Press release dated July 28, 2026 announcing financial results for fiscal quarter ended July 4, 2026.
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
TEXTRON INC.
(Registrant)
By:/s/ Mark S. Bamford
Mark S. Bamford
Vice President and Corporate Controller
Date: July 28, 2026



tm2026022d1_ex99-1img01a.jpg                        
Corporate Communications Department
NEWS Release


Textron Reports Second Quarter 2026 Results

•EPS of $1.42; adjusted EPS of $1.62, up from $1.55 in the prior year
•Revenues of $3.8 billion, up 3%, or $111 million, compared to the prior year
•Revenues up $500 million, or 7%, in the first half of 2026, compared to the prior year
•Initiated sale process for the Industrial Segment


Providence, Rhode Island – July 28, 2026 – Textron Inc. (NYSE: TXT) today reported second quarter 2026 net income of $1.42 per share, compared to $1.35 in the second quarter of 2025. Adjusted net income, a non-GAAP measure that is defined and reconciled to GAAP in an attachment to this release, was $1.62 per share for the second quarter of 2026, compared to $1.55 per share in the second quarter of 2025.

"The second quarter continued a strong start to the year for Textron with revenue growth in each of our manufacturing segments contributing to higher revenues of $500 million through the first half of the year,” said Textron CEO Lisa M. Atherton. “Bell continued to advance the MV-75 Cheyenne with the successful production of key long-lead parts and components. At Textron Aviation, healthy demand drove strong order activity and the Ascend continued to scale with the delivery of the first five aircraft to NetJets."

Cash Flow

Net cash provided by operating activities of the manufacturing group for the second quarter was $235 million, compared to $395 million in last year's second quarter. Manufacturing cash flow before pension contributions, a non-GAAP measure that is defined and reconciled to GAAP in an attachment to this release, totaled $154 million for the second quarter, compared to $336 million in last year's second quarter.

In the quarter, Textron returned $209 million to shareholders through share repurchases.

Outlook

Textron reiterated its expectation for full-year 2026 GAAP earnings per share from continuing operations to be in the range of $5.39 to $5.59, or $6.40 to $6.60 on an adjusted basis, which is reconciled to GAAP in an attachment to this release. Textron also reiterated manufacturing cash flow before pension contributions, a non-GAAP measure, to be in the range of $700 million to $800 million.
The company's current full year outlook assumes receipt of additional fiscal year 2026 funding on the MV-75 Cheyenne program through an Above Threshold Reprogramming request. Absent the receipt of any additional funding and inclusive of other outlook assumptions, our adjusted EPS could be negatively impacted by $0.20 to $0.30 and cash flow could also be negatively impacted by $150 million to $250 million.



Second Quarter Segment Results

Textron Aviation

Textron Aviation’s revenues were $1.5 billion, up 1%, or $22 million from last year's second quarter, reflecting higher aircraft revenues of $17 million and higher aftermarket parts and services revenues of $5 million. The increase in aircraft revenues was primarily due to higher pricing, partially offset by lower volume and mix. The decrease in volume and mix largely reflected lower Citation jet and defense volume, partially offset by higher commercial turboprop volume.

Textron Aviation delivered 40 jets in the quarter, compared with 49 in the second quarter of 2025, and 44 commercial turboprops, up from 34 in last year's second quarter.

Segment profit was $165 million in the second quarter, down $5 million, or 3% from a year ago, primarily due to an unfavorable impact from manufacturing inefficiencies and lower aircraft volume and mix, partially offset by lower warranty costs.

Textron Aviation backlog at the end of the second quarter was $8.0 billion.

Bell
Bell revenues were $1.1 billion, up 6%, or $58 million from the second quarter of 2025. The revenue increase in the quarter was driven by higher military revenues of $47 million, largely due to higher volume on H-1 production and the MV-75 program. Commercial helicopters, parts and services revenues increased $11 million compared to the second quarter of 2025, primarily due to higher pricing.

Bell delivered 36 commercial helicopters in the quarter, up from 32 in last year's second quarter.

Segment profit of $75 million was down $5 million, or 6%, from last year's second quarter, primarily due to an unfavorable impact from program performance and from the mix of military programs, partially offset by lower research and development costs.

Bell backlog at the end of the second quarter was $7.5 billion.

Textron Systems

Textron Systems revenues were $347 million, up 7%, or $23 million from the second quarter of 2025, primarily due to higher volume on armored land vehicles and military training and support services provided by Airborne Tactical Advantage Company (ATAC).

Segment profit of $44 million was up $4 million, or 10%, compared with the second quarter of 2025, primarily due to lower research and development costs.

Textron Systems backlog at the end of the second quarter was $3.3 billion.


Industrial

Industrial revenues were $848 million, up 1%, or $9 million from the second quarter of 2025.

Kautex revenues increased $17 million, largely due to a favorable impact from pricing and from foreign exchange rate fluctuations. Textron Specialized Vehicles' revenues decreased $8 million, reflecting lower volume and mix and the impact from the disposition of the Powersports business, partially offset by higher pricing.
Segment profit of $59 million was up $5 million, or 9%, from the second quarter of 2025, primarily due to higher pricing, net of inflation, partially offset by lower volume and mix. Pricing, net of inflation includes tariffs recovered in the second quarter of 2026 that were previously imposed under the International Emergency Economic Powers Act (IEEPA).

Finance

Finance segment revenues were $14 million, and profit was $10 million in the second quarter of 2026, as compared to segment revenues of $15 million and profit of $8 million in the second quarter of 2025.

Conference Call Information

Textron will host its conference call today, July 28, 2026 at 8:00 a.m. (Eastern) to discuss its second quarter results and outlook. The call will be available via webcast at www.textron.com or by direct dial at (888) 596-4144 in the U.S. or (646) 968-2525 outside of the U.S.; Access Code: 6969175.

In addition, the call will be recorded and available for playback beginning at 11:00 a.m. (Eastern) on Tuesday, July 28, 2026 by dialing (800) 770-2030; Access Code: 6969175.

A package containing key data that will be covered on today’s call can be found in the Investor Relations section of the company’s website at www.textron.com.

About Textron Inc.
Textron Inc. is a multi-industry company that leverages its global network of aircraft, defense, industrial and finance businesses to provide customers with innovative solutions and services. Textron is known around the world for its powerful brands such as Bell, Cessna, Beechcraft, Pipistrel, Jacobsen, Kautex, Lycoming, E-Z-GO, and Textron Systems. For more information visit: www.textron.com.
###

Forward-looking Information
Certain statements in this release and other oral and written statements made by us from time to time are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which may describe strategies, goals, outlook or other non-historical matters, or project revenues, income, returns or other financial measures, often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “guidance,” “project,” “target,” “potential,” “will,” “should,” “could,” “likely” or “may” and similar expressions intended to identify forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors that may cause

our actual results to differ materially from those expressed or implied by such forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update or revise any forward-looking statements. In addition to those factors described in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q under “Risk Factors”, among the factors that could cause actual results to differ materially from past and projected future results are the following: Interruptions in the U.S. Government’s ability to fund its activities, pay its obligations, and/or conduct government functions necessary for the certification of aircraft and aircraft parts and other activities of our businesses; changing priorities or reductions in the U.S. Government defense budget, including those related to military operations in foreign countries; our ability to perform as anticipated and to control costs under contracts with the U.S. Government; the U.S. Government’s ability to unilaterally modify or terminate its contracts with us for the U.S. Government’s convenience or for our failure to perform, to change applicable procurement and accounting policies, or, under certain circumstances, to withhold payment or suspend or debar us as a contractor eligible to receive future contract awards; changes in foreign military funding priorities or budget constraints and determinations, or changes in government regulations or policies on the export and import of military and commercial products; volatility in the global economy or changes in worldwide political conditions that adversely impact demand for our products; volatility in interest rates or foreign exchange rates and inflationary pressures; risks related to our international business, including establishing and maintaining facilities in locations around the world and relying on joint venture partners, subcontractors, suppliers, representatives, consultants and other business partners in connection with international business, including in emerging market countries; our Finance segment’s ability to maintain portfolio credit quality or to realize full value of receivables; performance issues with key suppliers or subcontractors; legislative or regulatory actions, both domestic and foreign, impacting our operations or demand for our products; our ability to control costs and successfully implement various cost-reduction activities; the efficacy of research and development investments to develop new products or unanticipated expenses in connection with the launching of significant new products or programs; the timing of our new product launches or certifications of our new aircraft products; our ability to keep pace with our competitors in the introduction of new products and upgrades with features and technologies desired by our customers; pension plan assumptions and future contributions; demand softness or volatility in the markets in which we do business; cybersecurity threats, including the potential misappropriation of assets or sensitive information, corruption of data or, operational disruption; difficulty or unanticipated expenses in connection with integrating acquired businesses; the risk that acquisitions do not perform as planned, including, for example, the risk that acquired businesses will not achieve revenue and profit projections; the impact of changes in tax legislation; the risk of disruptions to our business and the business of our suppliers, customers and other business partners due to unexpected events, such as pandemics, natural disasters, acts of war, strikes, terrorism, social unrest or other societal, geopolitical or macroeconomic conditions; risks related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs; the ability of our businesses to hire and retain the highly skilled personnel necessary for our businesses to succeed; uncertainty related to the Company's ability to satisfy the necessary conditions to consummate the separation of its Industrial segment; risks related to the Company’s ability to effect a successful separation and realize the anticipated benefits of the separation on a timely basis or at all; and the risk that additional U.S. Government fiscal 2026 funding for the MV-75 program is not approved and obligated pursuant to a contract modification and we incur significant unreimbursed costs.

Investor Contacts:
Scott Hegstrom – 401-457-2288
Kyle Williams – 401-457-2288

Media Contact:
Mike Maynard – 401-457-2362


TEXTRON INC.
Revenues by Segment and Reconciliation of Segment Profit to Net Income
(Dollars in millions, except per share amounts)
(Unaudited)
Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
REVENUES
MANUFACTURING:
Textron Aviation (a)$1,544 $1,522 $3,029 $2,738 
Bell1,074 1,016 2,144 1,999 
Textron Systems (a)347 324 685 623 
Industrial848 839 1,634 1,631 
3,813 3,701 7,492 6,991 
FINANCE14 15 30 31 
Total revenues$3,827 $3,716 $7,522 $7,022 
SEGMENT PROFIT
MANUFACTURING:
Textron Aviation (a)$165 $170 $319 $292 
Bell75 80 147 170 
Textron Systems (a)44 40 86 78 
Industrial59 54 99 84 
343 344 651 624 
FINANCE 10 8 22 18 
Segment profit (a) (b)353 352 673 642 
Corporate expenses and other, net (a)(42)(42)(89)(95)
Interest expense, net for Manufacturing group(29)(26)(58)(51)
LIFO inventory provision(41)(38)(80)(67)
Intangible asset amortization(7)(8)(15)(16)
Special charges (c)— (4)— (4)
Non-service components of pension and postretirement income, net70 67 140 133 
Income before income taxes304 301 571 542 
Income tax expense(56)(56)(103)(90)
Net income$248 $245 $468 $452 
Diluted earnings per share (EPS)$1.42 $1.35 $2.67 $2.48 
Diluted average shares outstanding175,006,000181,091,000175,591,000182,379,000
Net income and EPS GAAP to Non-GAAP reconciliation:
Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
Net income - GAAP$248 $245 $468 $452 
Add: LIFO inventory provision41 38 80 67 
Intangible asset amortization7 8 15 16 
Special charges— 4 — 4 
Total adjustments48 50 95 87 
Income taxes on adjustments(13)(14)(24)(23)
Total adjustments, net of tax35 36 71 64 
Adjusted net income - Non-GAAP (b)$283 $281 $539 $516 
Diluted earnings per share - GAAP$1.42 $1.35 $2.67 $2.48 
Add: LIFO inventory provision, net of tax0.17 0.16 0.34 0.28 
Intangible asset amortization, net of tax
0.03 0.03 0.06 0.06 
Special charges, net of tax
— 0.01 — 0.01 
Adjusted diluted earnings per share - Non-GAAP (b)$1.62 $1.55 $3.07 $2.83 


(a)Effective January 4, 2026, the beginning of our 2026 fiscal year, the business activities of the Textron eAviation segment were realigned within Textron's other operating segments resulting in the elimination of the Textron eAviation segment as a separate reporting segment. Under the segment realignment, a significant part of Textron eAviation, including Pipistrel, became part of the Textron Aviation segment to enable the business to more effectively leverage the development, manufacturing and sales expertise at Textron Aviation. In addition, Textron eAviation’s manned and unmanned products for military applications and related research and development activities are included in the results of the Textron Systems segment, which is best suited to provide more direct access to the targeted customer base for these products. Lastly, certain Textron eAviation research and development activities encompassing digital flight control and air vehicle management systems, which we expect will benefit several of our segments, is reported within corporate expenses. The prior period has been recast to reflect the segment realignment.
(b)Segment profit, adjusted net income and adjusted diluted earnings per share are non-GAAP financial measures as defined in "Non-GAAP Financial Measures and Outlook" attached to this release.
(c)In the second quarter of 2025, we initiated restructuring actions to reduce operating expenses in the Textron Systems segment in connection with the termination of certain U.S government development programs. We incurred $8 million in special charges, which included $5 million of severance costs and $3 million of contract termination costs. These charges were partially offset by a pre-tax gain of $4 million recognized in the second quarter of 2025 related to the sale of the Powersports business.


TEXTRON INC.
Condensed Consolidated Balance Sheets
(In millions)
(Unaudited)

July 4,
2026		January 3,
2026
Assets
Cash and equivalents$1,436 $1,940 
Accounts receivable, net916 823 
Inventories4,720 4,278 
Other current assets909 872 
Net property, plant and equipment2,570 2,590 
Goodwill2,312 2,321 
Other assets4,572 4,628 
Finance group assets699 677 
Total Assets$18,134 $18,129 
Liabilities and Shareholders' Equity
Current portion of long-term debt$355 $5 
Accounts payable1,215 1,185 
Other current liabilities3,092 3,163 
Other liabilities1,918 1,980 
Long-term debt3,111 3,534 
Finance group liabilities389 387 
Total Liabilities10,080 10,254 
Total Shareholders' Equity8,054 7,875 
Total Liabilities and Shareholders' Equity$18,134 $18,129 

TEXTRON INC.
MANUFACTURING GROUP
Condensed Schedule of Cash Flows
(In millions)
(Unaudited)

Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
Cash Flows from Operating Activities:
Net income$240 $236 $450 $435 
Depreciation and amortization94 100 190 192 
Deferred income taxes and income taxes receivable/payable60 11 97 26 
Pension, net(61)(58)(121)(117)
Gain on business disposition— (4)— (4)
Changes in assets and liabilities:
Accounts receivable, net(35)38 (96)54 
Inventories(157)(101)(446)(284)
Accounts payable(69)(8)93 163 
Other, net163 181 (39)(184)
Net cash from operating activities235 395 128 281 
Cash Flows from Investing Activities:
Capital expenditures(95)(78)(228)(134)
Net proceeds from corporate-owned life insurance policies2 26 3 57 
Net proceeds from business disposition— 16 — 16 
Proceeds from sale of property, plant and equipment4 9 6 9 
Other investing activities, net— (1)— 14 
Net cash from investing activities(89)(28)(219)(38)
Cash Flows from Financing Activities:
Net proceeds from long-term debt— — — 495 
Principal payments on long-term debt and nonrecourse debt(1)(1)(75)(353)
Purchases of Textron common stock(209)(214)(377)(429)
Dividends paid(4)(4)(7)(7)
Other financing activities, net(2)(5)50 (5)
Net cash from financing activities(216)(224)(409)(299)
Total cash flows from continuing operations(70)143 (500)(56)
Total cash flows from discontinued operations— (1)— (1)
Effect of exchange rate changes on cash and equivalents(3)16 (4)23 
Net change in cash and equivalents(73)158 (504)(34)
Cash and equivalents at beginning of period1,509 1,194 1,940 1,386 
Cash and equivalents at end of period$1,436 $1,352 $1,436 $1,352 
Manufacturing cash flow GAAP to Non-GAAP reconciliation:
Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
Net cash from operating activities - GAAP$235 $395 $128 $281 
Less: Capital expenditures(95)(78)(228)(134)
Add: Total pension contributions10 10 20 22 
Proceeds from sale of property, plant and equipment 4 9 6 9 
Manufacturing cash flow before pension contributions - Non-GAAP (a)$154 $336 $(74)$178 
(a) Manufacturing cash flow before pension contributions is a non-GAAP financial measure as defined in "Non-GAAP Financial Measures and Outlook" attached to this release.

TEXTRON INC.
Condensed Consolidated Schedule of Cash Flows
(In millions)
(Unaudited)

Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
Cash Flows from Operating Activities:
Net income$248 $245 $468 $452 
Depreciation and amortization94 100 190 192 
Deferred income taxes and income taxes receivable/payable63 7 102 24 
Pension, net(61)(58)(121)(117)
Gain on business disposition— (4)— (4)
Changes in assets and liabilities:
Accounts receivable, net(35)38 (96)54 
Inventories(157)(101)(446)(284)
Accounts payable(69)(8)93 163 
Captive finance receivables, net59 (13)46 (26)
Other, net162 182 (49)(190)
Net cash from operating activities304 388 187 264 
Cash Flows from Investing Activities:
Capital expenditures(95)(78)(228)(134)
Net proceeds from corporate-owned life insurance policies2 26 3 57 
Net proceeds from business disposition— 16 — 16 
Proceeds from sale of property, plant and equipment4 9 6 9 
Finance receivables repaid6 8 13 17 
Finance receivables originated(6)(21)(15)(21)
Proceeds from the disposition of non-captive assets— 59 24 59 
Other investing activities, net— (1)4 14 
Net cash from investing activities(89)18 (193)17 
Cash Flows from Financing Activities:
Net proceeds from long-term debt— — — 495 
Principal payments on long-term debt and nonrecourse debt(1)(9)(75)(364)
Purchases of Textron common stock(209)(214)(377)(429)
Dividends paid(4)(4)(7)(7)
Other financing activities, net(2)(5)50 (5)
Net cash from financing activities(216)(232)(409)(310)
Total cash flows from continuing operations(1)174 (415)(29)
Total cash flows from discontinued operations— (1)— (1)
Effect of exchange rate changes on cash and equivalents(3)16 (4)23 
Net change in cash and equivalents(4)189 (419)(7)
Cash and equivalents at beginning of period1,610 1,245 2,025 1,441 
Cash and equivalents at end of period$1,606 $1,434 $1,606 $1,434 


TEXTRON INC.
Non-GAAP Financial Measures and Outlook
(Dollars in millions, except per share amounts)
We supplement the reporting of our financial information determined under U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial measures. These non-GAAP financial measures exclude certain significant items that may not be indicative of, or are unrelated to, results from our ongoing business operations. We believe that these non-GAAP measures may be useful for period-over-period comparisons of underlying business trends and our ongoing business performance, however, they should be used in conjunction with GAAP measures. Our non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define similarly named measures differently. We encourage investors to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. We utilize the following definitions for the non-GAAP financial measures included in this release and have provided a reconciliation of the GAAP to non-GAAP amounts for each measure:
Segment Profit
Segment profit is an important measure used by our chief operating decision maker for evaluating performance and for decision-making purposes. Segment profit for the manufacturing segments excludes the non-service components of pension and postretirement income, net; LIFO inventory provision; intangible asset amortization; interest expense, net for Manufacturing group; certain corporate expenses; gains/losses on major business dispositions; and special charges. The measurement for the Finance segment includes interest income and expense along with intercompany interest income and expense.
Adjusted Net Income, Adjusted Diluted Earnings Per Share and Outlook
Adjusted net income and adjusted diluted earnings per share exclude LIFO inventory provision, net of tax; intangible asset amortization, net of tax; special charges, net of tax; and gains/losses on major business dispositions, net of tax. LIFO inventory provision is excluded to reflect the impact on net income as if our inventories were accounted for using a FIFO basis instead of a LIFO basis in order to improve comparability with other companies in our industry who have not elected to use the LIFO inventory costing method. Intangible asset amortization is excluded to improve comparability as the impact of such amortization can vary substantially from company to company depending upon the nature and extent of acquisitions and exclusion of this expense is consistent with the presentation of non-GAAP measures provided by other companies within our industry. Management believes that it is important for investors to understand that these intangible assets were recorded as part of purchase accounting and contribute to revenue generation. We consider items recorded in special charges, such as enterprise-wide restructuring, certain asset impairment charges, and acquisition-related restructuring, integration and transaction costs, to be of a non-recurring nature that is not indicative of ongoing operations.

Three Months EndedSix Months Ended
July 4,
2026		June 28, 2025July 4,
2026		June 28,
2025
Net income - GAAP$248 $245 $468 $452 
Add: LIFO inventory provision41 38 80 67 
Intangible asset amortization7 8 15 16 
Special charges— 4 — 4 
Total adjustments48 50 95 87 
Income taxes on adjustments(13)(14)(24)(23)
Total adjustments, net of tax35 36 71 64 
Adjusted net income - Non-GAAP$283 $281 $539 $516 
Diluted earnings per share - GAAP$1.42 $1.35 $2.67 $2.48 
Add: LIFO inventory provision, net of tax0.17 0.16 0.34 0.28 
Intangible asset amortization, net of tax0.03 0.03 0.06 0.06 
Special charges, net of tax— 0.01 — 0.01 
Adjusted diluted earnings per share - Non-GAAP$1.62 $1.55 $3.07 $2.83 

2026 Outlook
Diluted EPS
Net income - GAAP (a)$940 $975 $5.39 $5.59 
Add: LIFO inventory provision, net of tax1500.87
Intangible asset amortization, net of tax250.14
Adjusted net income - Non-GAAP (a)$1,115 —$1,150 $6.40 —$6.60 
(a) The company's current full year outlook assumes receipt of additional fiscal year 2026 funding on the MV-75 Cheyenne program through an Above Threshold Reprogramming request. Absent the receipt of any additional funding and inclusive of other outlook assumptions, our adjusted EPS could be negatively impacted by $0.20 to $0.30 and cash flow could also be negatively impacted by $150 million to $250 million.

TEXTRON INC.
Non-GAAP Financial Measures and Outlook (Continued)
(Dollars in millions, except per share amounts)

Manufacturing Cash Flow Before Pension Contributions and Outlook
Manufacturing cash flow before pension contributions adjusts net cash from operating activities (GAAP) for the following:
•Deducts capital expenditures and includes proceeds from insurance recoveries and the sale of property, plant and equipment to arrive at the net capital investment required to support ongoing manufacturing operations;
•Excludes dividends received from Textron Financial Corporation (TFC) and capital contributions to TFC provided under the Support Agreement and debt agreements as these cash flows are not representative of manufacturing operations;
•Adds back pension contributions as we consider our pension obligations to be debt-like liabilities. Additionally, these contributions can fluctuate significantly from period to period and we believe that they are not representative of cash used by our manufacturing operations during the period.
While we believe this measure provides a focus on cash generated from manufacturing operations, before pension contributions, and may be used as an additional relevant measure of liquidity, it does not necessarily provide the amount available for discretionary expenditures since we have certain non-discretionary obligations that are not deducted from the measure.

Three Months EndedSix Months Ended
July 4,
2026		June 28,
2025		July 4,
2026		June 28,
2025
Net cash from operating activities - GAAP$235 $395 $128 $281 
Less: Capital expenditures(95)(78)(228)(134)
Add: Total pension contributions10 10 20 22 
Proceeds from sale of property, plant and equipment4 9 6 9 
Manufacturing cash flow before pension contributions - Non-GAAP$154 $336 $(74)$178 

2026 Outlook
Net cash from operating activities - GAAP (a)$1,294 —$1,394 
Less: Capital expenditures(650)
Add: Total pension contributions50
Proceeds from sale of property, plant and equipment6
Manufacturing cash flow before pension contributions - Non-GAAP (a)$700 —$800 
(a) For additional information regarding our 2026 cash flow outlook see Footnote (a) on the previous page.

Source: View Original Filing on SEC EDGAR

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