The stock of L3Harris Technologies plummeted 3.5 % in premarket trade on Monday after the defense contractor's fourth-quarter sales fell short of forecasts and the company issued a cautious outlook.
Revenue declined 7% year over year to $4.4 billion in the fourth quarter.
Revenue from aviation systems declined by 37%. The revenue from communication systems declined by 11%.
In the fourth quarter of 2020, aviation and communication systems accounted for 43% of the company's revenue, but sales of businesses, delayed awards, and supply chain difficulties resulted in lower revenue in the two verticals. Their share of the company's overall fourth-quarter sales decreased to under 36%, a drop of more than 7 percentage points in a year.
In the previous year, orders totaled more than $18 billion. The business now expects $17.5 billion in revenue in 2022, at the midpoint of its range, with organic growth of 2%. At the midpoint of its guidance range, adjusted profit per share is expected to be $13.50, up from $12.95 in 2021.
In the fourth quarter, adjusted EPS of $3.30 exceeded expectations.