RTX (RTX) 10-K risk factor changes: FY2021 vs FY2020

Our business, [removed: financial condition,] operating [removed: results] [added: results, financial condition] and [removed: cash flows] [added: liquidity] can be impacted by the factors set forth below, any one of which could cause our actual results to vary materially from recent results or from our anticipated future results.

[added: Our Business May be Adversely Affected by Changes in Global Economic, Capital Market and Political Conditions.] Our business, [removed: financial condition,] operating [removed: results] [added: results, financial condition] and [removed: cash flows] [added: liquidity] may be adversely affected by changes in global economic conditions and geopolitical risks, including credit market conditions, [added: the inflationary environment in the United States and internationally,] levels of consumer and business confidence, commodity prices, [added: supply chain challenges,] exchange rates, potential changes in policy positions or [removed: priorities that emerge from a new U.S. Administration due to a variety of factors,] [added: priorities,] levels of government spending and deficits, the [added: availability and cost of labor, the] threat environment, trade policies, political conditions, actual or anticipated default on sovereign [removed: debt] [added: debt,] and other challenges that could affect the global economy.

Tightening of credit in financial markets [added: also] could adversely affect the ability of our customers and suppliers to obtain financing for significant purchases and operations, could result in a decrease in or cancellation of orders for our products and services, and could impact the ability of our customers to make payments.

In addition, geopolitical [removed: risks, including changes in the threat environment and political conditions,] [added: risks] could affect government priorities, budgets and policies, which could impact sales of defense and other products and services.

[removed: Coronavirus] [added: The Coronavirus] Disease 2019 (COVID-19) [added: Pandemic] Has Affected and [removed: Will Continue] [added: Continues] to Affect Our Business, Supply [removed: Chains,] [added: Chain,] Operations and the Industries in which We Operate. [added: The ongoing COVID-19 pandemic has negatively affected our business, supply chains, operations and the industries in which we operate.]

The [removed: COVID-19 pandemic has significantly increased] global [removed: economic] [added: economic, supply] and demand [removed: uncertainty.][added: uncertainties caused by COVID-19 remain.]

[removed: In particular, the] [added: The unprecedented] decrease in air travel [removed: resulting from the COVID-19 pandemic has resulted in the loss of business and leisure passenger traffic and is] adversely [removed: affecting] [added: affected] our airline and airframer [removed: customers,] [added: customers] and their demand for our products and services.

Aircraft manufacturers [removed: are reducing] [added: reduced] production rates [removed: due to fewer expected aircraft deliveries] and [removed: cancelling] [added: cancelled] new airframer programs, and, as a result, demand for our original equipment manufacturer (OEM) products [removed: has] decreased.

In addition, significant declines in aircraft flight hours [removed: are resulting] [added: resulted] in reduced demand for our aftermarket parts and services.

[removed: Moreover, airlines] [added: Airlines] and airline leasing companies [removed: have been deferring, and are expected to continue to defer,] [added: deferred] maintenance [removed: services, which] [added: services and delayed and cancelled aircraft purchases,] negatively [removed: impacts] [added: impacting] our related revenues.

Some airlines [removed: have] accelerated retirement of certain aircraft, [removed: thereby] eliminating [added: demand for] our [added: spare parts and our] continuing [added: aftermarket] services and negatively impacting our [added: related] aftermarket [removed: revenues with respect to those aircraft.][added: revenues.]

[removed: Further, a] [added: A] significant portion of our long-term support contracts are driven by actual usage, and [removed: decreased usage has, and will continue to, negatively affect] [added: therefore,] our [added: related] revenues [removed: associated with these types of contracts.][added: have decreased.]

If [added: one or more customers exercise] financing [removed: commitments are exercised, the Company] [added: commitments, we] will need to divert cash to satisfy them, and these customers may be unable to make [removed: payments.][added: payments on a timely basis, or at all.]

We [removed: are continuing to face operational] [added: also experienced] challenges from the need to protect employee health and safety, workplace [removed: disruptions,] [added: disruptions] and restrictions on the movement of people and [removed: goods, at our own facilities and at customers and suppliers.][added: goods as a result of COVID-19.]

[removed: In addition, continued reduced operations and business disruption – including] [added: Moreover,] if [added: developments in the COVID-19 pandemic cause] significant portions of our workforce or our suppliers’ workforces [removed: are] [added: to be] unable to work effectively [added: –] due to facilities closures, illness, quarantines, government actions [added: including new] or [added: continuing government-mandated safety protocols or] other restrictions – [added: such business disruptions] could hinder or delay our production [removed: capabilities generally, and] [added: capabilities, could] otherwise impede our ability to perform on our obligations to our customers, and may also result in increased costs to us.

[added: Developments in the COVID-19 pandemic may affect our ability to] hire, develop and retain our talented and diverse workforce, and to maintain our corporate culture.

These impacts and the resulting volatility and disruption to the global capital markets may increase the cost of capital and may adversely impact access to [added: short-term and long-term] capital for the Company and our suppliers and customers including heightened counter party risks associated with foreign exchange hedging transactions, interest rate [removed: swaps,] [added: swaps and] solvency of revolving credit facility [removed: banks and the ability to raise capital both short-term and long-term.][added: banks.]

Any of these factors, depending on the severity and duration of the COVID-19 pandemic and its effects, could have a material adverse effect on our business, results of operations, financial condition and [removed: cash flows.][added: liquidity.]

The ultimate [added: duration and] financial impact of the COVID-19 pandemic is unknown at this time.

The extent of such impact depends on future developments, which are highly uncertain and cannot be predicted in the short- or long-term, including new information which may emerge concerning the scope, severity and duration of the COVID-19 pandemic, as well as any worsening of the pandemic, the effect of [removed: mutating strains] [added: additional variants] and whether additional outbreaks of the pandemic will continue to occur, [added: the efficacy, acceptance, distribution and availability of vaccines, new or continued] actions to contain the pandemic’s spread or treat its impact, [removed: timing of the availability of vaccines,] and [removed: their distribution, acceptance and efficacy, and] governmental, business and individual personal actions taken in response to the pandemic (including restrictions and limitations on travel and transportation, and changes in leisure and business travel patterns and work environments) among others.

Changes in U.S. Government Defense Spending Could Negatively Impact Our Financial Position, Results of Operations, Liquidity and Overall Business. [added: U.S. government sales constitute a significant portion of our consolidated sales.]

Changes in U.S. government defense spending for various reasons, including as a result of potential changes in policy positions or [removed: priorities which may result from the recent U.S. presidential and congressional election,] [added: priorities,] could negatively impact our results of operations, financial condition and liquidity.

In [removed: previous years] [added: recent years, U.S. government appropriations have been affected by larger U.S. government budgetary issues and related legislation, and] the U.S. government has been unable to complete its budget process before the end of its fiscal year, resulting in both governmental [removed: shut-downs] [added: shutdowns] and CRs providing only enough funds for U.S. government agencies to continue operating at prior-year levels.

As a result, U.S. government defense spending levels are subject to a wide range of outcomes and are difficult to predict beyond the near-term due to numerous factors, including the external threat environment, future governmental priorities and the state of [removed: governmental finances.]

We Face Risks Relating to Our U.S. Government Contracts and the Mix of Our U.S. Government Contracts and Programs that Could Negatively Impact our Financial Condition, Results of Operations, Liquidity and Overall Business. [added: The termination of one or more of our contracts, or the occurrence of performance delays, cost overruns, product failures, materials or components shortages, or contract definitization delays, could negatively impact our competitive position, results of operations, financial condition and liquidity.]

In [removed: these arrangements,] [added: addition, we are a subcontractor on some contracts and] the U.S. government could terminate the prime contract for convenience or otherwise, [added: without regard to our performance as a subcontractor.]

[removed: Further, we] [added: We] can give no assurance that we would be awarded new U.S. government contracts to offset the revenues lost as a result of the termination of any of our contracts.

[removed: Our] [added: In addition, our] U.S. government contracts typically involve the development, application and manufacture of advanced defense and technology systems and products aimed at achieving challenging goals.

These additional [removed: investment amounts] [added: investments] may not be worthwhile if we are not chosen for [removed: new contract] [added: these] awards.

[removed: Over] [added: Moreover, over] the past several years, the DoD has increased its use of Other Transaction Authority (OTA) contracts, under which it awards [added: certain prototypes,] research and [removed: development work] [added: production contracts] without all of the procurement requirements that typically apply to DoD contracts, including justification of sole source awards.

[removed: If] [added: Our business may be negatively impacted if] we are unable to perform on our OTA contracts, including any applicable non-traditional [removed: requirements, it could negatively impact our results of operations, financial condition and liquidity.][added: requirements.]

[removed: From] [added: Moreover, from] time to time, we may begin performance under an undefinitized contract action with a not-to-exceed price prior to completing contract negotiations in order to support U.S. government priorities.

[removed: We are also involved in programs that are classified by the U.S.] government, which have security requirements that place limits on our ability to discuss our performance on these programs, including any risks, disputes and claims.

Our International Operations Subject Us to Economic Risk As Our Results of Operations and Liquidity May Be Adversely Affected by Changes in Foreign Currency Fluctuations, Economic Conditions, Political Factors, Trade Policies, Sales Methods, and Changes in Local Government Regulation. [added: We conduct our business on a global basis, with a significant portion of sales derived from international operations, including U.S. export sales.]

[removed: Accordingly, fluctuations] [added: Our financial statements are denominated] in [added: U.S. Dollars, and] exchange [removed: rates] [added: rate fluctuations] may [removed: also give rise to] [added: cause] translation gains or losses when [removed: financial statements of] [added: translating] non-U.S. operating [removed: units are translated into U.S. Dollars.][added: unit financial statements.]

[removed: A] [added: In addition, a] strengthening of the U.S. Dollar against other major foreign currencies could adversely affect our results of operations.

In [removed: our commercial aerospace businesses,] [added: addition,] the majority of our [added: commercial aerospace business] sales [removed: are, consistent with established industry practice,] [added: are] transacted in U.S. Dollars, while the majority of costs [removed: at locations] outside the U.S. are incurred in the applicable local [removed: currency (principally the Euro,] [added: currency; therefore, fluctuations in] the [removed: Canadian Dollar,] [added: exchange rate of] the [removed: British Pound, and] [added: U.S. Dollar against] the [removed: Polish Zloty).][added: local currency could impact our results of operations.]

[removed: In particular,] Pratt & Whitney Canada is especially susceptible to fluctuations in exchange rates for this reason.

Our international sales and operations are subject to risks associated with local government laws, regulations and policies, including those related to [removed: tariffs] [added: tariffs, import quotas] and [added: other] trade barriers, investments, taxation, exchange controls, capital controls, employment regulations, and cash repatriation.

Government policies on international trade and [removed: investments such as import quotas, capital controls, taxes or tariffs,] [added: investments,] whether adopted by individual governments or regional trade blocs, can affect demand for our products and services, impact the competitive position of our [removed: products or] [added: products, impact our supply, and] prevent us from being able to manufacture or sell products in certain countries.

Given the current inflationary pressures both in the U.S. and in other countries in which we operate, we have and may continue to experience labor and material cost increases at a rate higher than what we have experienced in recent years.

Due to the nature of our government and commercial aerospace businesses, and the customer and supplier contracts within those businesses, we may not be able to increase our contract value or pricing to offset these cost increases, in particular on our fixed price contracts.

Our operating profits and margins under our contracts could be adversely affected by these factors, particularly if the current inflationary pressures are prolonged.

Similarly, expected increases in interest rates from recent historical lows in the U.S. and in other countries in which we operate could negatively impact financial markets and tighten the availability of, and increase the cost of capital for the Company, which could have an adverse effect on our operating results, financial condition and liquidity.

As a result of COVID-19, governments, businesses and individuals have taken actions such as instituting lockdowns, quarantines, border closings and other travel restrictions and requirements, adopting remote working and reducing business and leisure travel, which collectively led to an unprecedented decline in demand for commercial air travel.

Some airlines experienced bankruptcies, and some of our major customers were unable to make timely payment to us.

As a result of these developments, we experienced goodwill impairment charges, credit losses on receivables and contract assets, and unfavorable contract adjustments, among other financial impacts, predominantly in 2020.

In addition, the border closings, lockdowns and labor shortages resulting from COVID-19, as well as the continuing economic recovery, negatively impacted global supply and distribution capabilities.

Decreases in the availability of supplies, increases in the cost of supplies, and delivery issues have caused shortages and delays, as well as increased costs, for the procurement of raw materials, components and other supplies required for our performance.

Moreover, on September 24, 2021, in furtherance of an executive order, the U.S. Safer Federal Workforce Task Force issued guidance requiring federal contractors and subcontractors to comply with COVID-19 safety protocols, including requiring certain employees to be fully vaccinated against COVID-19 except in limited circumstances.

The implementation of this mandate may result in attrition, including attrition of critically skilled labor and difficulty in securing future labor needs, for our workforce, as well as the workforces of our subcontractors, suppliers and customers.

The mandate is currently subject to various legal proceedings.

As a result, the impact of mandate on our operations and performance, as well as on our subcontractors, suppliers and customers, is uncertain.

However, if ultimately required, the mandate could affect our performance on contracts, particularly due to disruptions in subcontractor or supplier performance or deliveries, and have a material adverse effect on our results of operations.

In 2021, new COVID-19

variants emerged and caused additional outbreaks, and there were issues related to availability, distribution and acceptance of vaccines against COVID-19.

Commercial air traffic demand, while improving in certain areas, has not recovered to pre-pandemic levels, and the timing of any such recovery remains uncertain.

Due to the continued effects of COVID-19 and related uncertainty, we expect to continue to experience the challenges described above for an uncertain period of time into the future.

In addition, due to the uncertain nature of the COVID-19 pandemic, we may face new challenges in the future that we had not experienced previously.

For example, we provide aircraft financing commitments, in the form of debt or lease financing, to commercial aerospace customers, who might experience a greater need to utilize our commitments due to the lasting impacts of COVID-19.

Our customers may also experience decreases in production or delays if they fail to comply or lose personnel as a result of existing or new vaccine mandates, which could decrease demand for our products and services.

We continue to conduct talent searches for fully vaccinated replacements for positions vacated due to the vaccine mandate, and it is critical that we find and train new qualified personnel.

governmental finances.

We are also involved in programs that are classified by the U.S.

Ongoing geopolitical uncertainty and trends such as populism and economic nationalism, a government’s adoption of “buy national” policies, or a government’s limiting exports of a unique material, such as rare earth minerals, over which it controls a significant portion of the global supply, or retaliation by another government against any such policies, such as tariffs, could negatively affect us.

Further, regime change in a major customer’s government could decrease or eliminate its demand for our products and services, as well as adversely affect our supply of materials or components from that county.

In addition, we face risks related to the unintended or unauthorized use of our products.

We conduct business in numerous countries that carry high levels of currency, political, compliance and economic risk.

Turkish companies supply components, some of which are sole-sourced, to our aerospace

Moreover, the Chinese government has generally expanded its ability to restrict China-related import, export and investment activities, which may have an adverse impact on our ability to conduct business or sell our commercial aerospace products in China.

In addition, in connection with the current status of international relations with Russia, particularly in light of potential conflict between Russia and Ukraine, the U.S. government has stated it is considering imposing enhanced export controls on certain products and sanctions on certain industry sectors and parties in Russia.

The governments of other jurisdictions in which we operate, such as the European Union and Canada, may also implement sanctions or other restrictive measures.

These potential sanctions and export controls, as well as any responses from Russia, could adversely affect the Company and/or our supply chain, business partners or customers.

the work.

For example, the enhanced focus on climate change has increased demand for more environmentally sustainable products and services, as described below.

Our competitors may develop sustainable products or services that are available to our customers before our products or services, or that are adopted more readily than our products or services.

Due to the Nature of Our Products and Services, a Product Safety Failure or Other Failure Affecting Our or Our Customers’ or Suppliers’ Products or Systems Could Seriously Harm Our Business. Our products and services are highly sophisticated and specialized, involve complex advanced technologies, are often integrated with third-party products and services and are utilized for specific purposes that require precision, reliability and durability.

Many of our products and services include both hardware and software that involve industrial machinery and intricate aviation and defense systems, including commercial and military jet engines, power and control systems and other aircraft parts, air and missile defense systems, and military sensors and command and control systems.

Technical, mechanical and other failures may occur from time to time, whether as a result of manufacturing or design defect, operational process or production issue attributable to us, our customers, suppliers, third party integrators or others.

In addition, our products could fail as a result of cyber-attacks, such as those that seize control and result in misuse or unintended use of our products, or other intentional acts.

Our Business May be Adversely Affected by Changes in Global Economic, Capital Market and Political Conditions.

These economic conditions affect businesses such as ours in a number of ways.

Public and private sector policies and initiatives in the U.S. and worldwide to address the transmission of COVID-19, such as the imposition of travel restrictions and the adoption of remote working, have impacted the Company’s business, operations and the industries in which we operate.

The disruption to air travel and commercial activities generally, and significant restrictions and limitations on businesses, attributable to the COVID-19 pandemic has negatively impacted the global supply, demand and distribution capabilities of the aerospace and commercial airlines industries.

COVID-19 may also limit the ability of our customers generally to perform, including in making timely payment to us.

In addition, we provide aircraft financing commitments, in the form of debt or lease financing, to commercial aerospace customers.

COVID-19 may increase the need for these customers to utilize these financing commitments due to the pandemic’s adverse impact on their businesses or the inability of these customers to obtain more favorable terms from other financing sources.

The COVID-19 pandemic has impacted, and will continue to impact, the Company’s supply chains, including the ability of suppliers and vendors to provide their products and services to the Company.

At this time, some of our suppliers have reduced or ceased operations as a result of COVID-19.

This supply chain impact could also contribute to performance delays on our customer obligations and increase our costs.

The continued spread of COVID-19 may also affect our ability to

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Any costs associated with COVID-19 may not be fully recoverable or adequately covered by insurance.

U.S. government sales constitute a significant portion of our consolidated sales.

In recent years, U.S. government appropriations have been affected by larger U.S. government budgetary issues and related legislation.

The termination of one or more of our contracts, or the occurrence of performance delays, cost overruns, product failures, materials or components shortages, or contract definitization delays, could negatively impact our results of operations, financial condition and liquidity.

In addition, we are a subcontractor and not the prime contractor on some contracts.

without regard to our performance as a subcontractor.

For example, Raytheon Company was awarded an OTA contract for the Lower Tier Air and Missile Defense Sensor (LTAMDS) in late 2019.

We conduct our business on a global basis, with a significant portion of sales derived from international operations, including U.S. export sales.

Our financial statements are denominated in U.S. Dollars.

For operating units with U.S. Dollar sales and local currency costs, there is foreign currency exposure that could impact our results of operations depending on market changes in the exchange rate of the U.S. Dollar against the applicable foreign currencies.

Ongoing geopolitical uncertainty and trends such as populism and economic nationalism could negatively impact us.

For example, a government’s adoption of “buy national” policies or retaliation by another government against such policies, such as tariffs, could have a negative impact on our results of operations.

We conduct business in certain countries primarily for our commercial aerospace businesses including Argentina, Brazil, China, India, Indonesia, Mexico, Morocco, Poland, Russia, South Africa, Turkey, Ukraine and countries in the Middle East and Central Asia, that carry high levels of currency, political, compliance and economic risk.

financial condition.

Our Financial Performance Is Dependent on the Condition of the Aerospace Industry.

We seek to achieve growth through the design, development, production, sale and support of innovative commercial aerospace and defense systems and products that incorporate advanced technologies.

Our reliance on U.S. and non-U.S. suppliers (including third-party manufacturing suppliers, subcontractors and service providers) and commodity markets to secure raw materials, parts, components and sub-systems used in our products exposes us to volatility in the prices and availability of these materials and services.

We must comply with various laws and regulations relating to the export and import of products, services and technology from and into the U.S. and other countries having jurisdiction over our operations.

Certain of our products, services and technologies have military or strategic applications and are on the U.S. Munitions List of the ITAR and the

Our Products Must Meet or Exceed Stringent Performance and Reliability Standards.

Our products and services involve advanced technologies in highly sophisticated products.

The impact of a catastrophic product failure or similar event, particularly in our commercial aerospace business, could be significant.

Actual or perceived design or production issues can result in significant reputational harm to our business, in addition to direct warranty, maintenance and other costs that may arise.

A significant product issue resulting in injuries or death, aircraft grounding or similar systemic consequences could have a material adverse effect on our business, reputation, financial position and results of operations.

There can be no assurance that we or our customers or other third parties will not experience operational process or product failures and other problems, including through manufacturing or design defects, process or other failures of contractors or third-party suppliers, cyber-attacks or other intentional acts, any of which could result in potential product, safety, quality, regulatory or environmental risks.

If our products do not perform as intended, including with respect to safety or reliability, the possible consequences include product recalls and product liability claims, significant financial losses, including fines, as well as a diversion of management attention and reputational damage that could reduce demand for our products and services.

Due to the specialized nature of our business, our future performance is highly dependent upon the continued services of our key technical personnel and executive officers, the development of additional management personnel, and the hiring of new qualified technical, manufacturing, marketing, sales and management personnel for our operations.

Our Business and Financial Performance May Be Adversely Affected By Cyber-attacks on Information Technology Infrastructure and Products

[removed: As a result of these transactions, we now] [added: We] operate in four principal business segments: Collins Aerospace Systems (Collins Aerospace), Pratt & Whitney, Raytheon Intelligence & Space (RIS) and Raytheon Missiles & Defense (RMD).

On April 3, 2020, [removed: UTC] [added: United Technologies Corporation (UTC)] (since renamed Raytheon Technologies Corporation) completed the separation of its business into three independent, publicly traded companies – UTC, Carrier Global Corporation (Carrier) and Otis Worldwide Corporation (Otis) [removed: (such separations, the “Separation Transactions”).][added: (the Separation Transactions).]

UTC distributed all of the outstanding shares of Carrier common stock and all of the outstanding shares of Otis common stock to UTC shareowners who held shares of UTC common stock as of the close of business on March 19, [removed: 2020, the record date for the distributions] [added: 2020] (the Distributions).

[removed: The] [added: In addition, as a result of the Separation Transactions and the Distributions, the] historical results of Carrier and Otis are presented as discontinued operations and, as such, have been excluded from both continuing operations and segment results for all periods presented.

[removed: *Raytheon Merger.* On April 3, 2020,] [added: Immediately] following the [removed: completion of the] Separation Transactions and [removed: the] Distributions, [removed: pursuant to an Agreement and Plan of Merger dated June 9, 2019, as amended,] [added: on April 3, 2020,] UTC and Raytheon Company [removed: (Raytheon)] completed their all-stock merger of equals transaction (the Raytheon [removed: Merger).][added: Merger), pursuant to which Raytheon Company became a wholly-owned subsidiary of UTC and UTC was renamed Raytheon Technologies Corporation (RTC).]

Refer to “Note 2: Business Acquisitions, Dispositions, Goodwill and Intangible Assets” within Item 8 of this Form 10-K for additional [removed: discussion] [added: information] on the [removed: Rockwell Acquisition.][added: goodwill impairment.]

UTC was determined to be the accounting acquirer in the [removed: merger,] [added: Raytheon Merger,] and as a result the financial statements of Raytheon Technologies for year ended December 31, 2020 include Raytheon Company’s financial position and results of operations for the period subsequent to the completion of the Raytheon Merger on April 3, 2020.

Performance in the general aviation sector is closely tied to the overall health of the economy and is [added: positively correlated to corporate profits.]

[removed: Our commercial aftermarket operations continue to evolve as a significant portion] [added: Many] of our aerospace operations’ customers are covered under long-term aftermarket service agreements at both Collins Aerospace and Pratt & [removed: Whitney.][added: Whitney, which are inclusive of both spare parts and services.]

RIS, RMD, and the defense operations of Collins Aerospace and Pratt & Whitney are affected by U.S. Department of Defense (DoD) budget and spending levels, changes in demand, changes in policy positions or priorities [removed: from a new U.S. Administration] and the global political environment.

[removed: The former Raytheon Company] [added: Our RIS and RMD] businesses, although experiencing [removed: minor] [added: some negative] impacts, [added: primarily from supply chain pressures and labor shortages,] have not experienced significant [removed: facility closures or other significant] business disruptions as a result of the COVID-19 pandemic.

[removed: Given the impacts described above that have resulted from the COVID-19 pandemic,] [added: As a result of all of these factors,] we expect our future operating results, particularly those of our Collins Aerospace and Pratt & Whitney [removed: businesses] [added: businesses,] to continue to be [removed: significantly] negatively [removed: impacted.][added: impacted when compared to pre-COVID-19 (2019) results.]

Our expectations regarding the COVID-19 pandemic and [removed: its] [added: ongoing recovery and their] potential financial impact are based on available information and assumptions that we believe are reasonable at this time; however, the actual financial impact is highly uncertain and subject to a wide range of factors and future developments.

While we believe that the long-term outlook for the aerospace industry remains positive due to the fundamental drivers of air travel demand, there [removed: is significant] [added: continues to be] uncertainty with respect to [removed: when] [added: the point at which] commercial air traffic [removed: levels will begin to recover, and whether and at what point] capacity will return to and/or exceed pre-COVID-19 levels.

[removed: Our latest estimates are] [added: However, we continue to estimate] that [removed: this] [added: a full] recovery may occur in 2023 or 2024.

[added: New information may continue to emerge concerning the] scope, severity and duration of the COVID-19 pandemic, as well as any worsening of the pandemic, the effect of [removed: mutating strains and whether] additional [removed: outbreaks of] [added: variants,] the [removed: pandemic will continue to occur,] [added: efficacy, acceptance, distribution and availability of vaccines, new or continued] actions to contain the pandemic’s spread or treat its impact, [removed: timing of the availability of vaccines,] and [removed: their distribution, acceptance and efficacy, and] governmental, business and individual [removed: personal] actions taken in response to the pandemic (including restrictions and limitations on travel and transportation, and changes in leisure and business travel patterns and work environments) among others.

We completed our annual goodwill impairment testing as of October 1, [removed: 2020] [added: 2021, where we compared the fair value of all of our reporting units to their respective carrying values (step 1)] and determined that no [removed: additional] adjustments to the carrying value of [removed: our] goodwill were necessary.

Refer to “Note 2: [added: Business] Acquisitions, Dispositions, Goodwill and Intangible Assets” [removed: within] [added: in] Item 8 of this Form 10-K for additional information.

[removed: For a discussion on the 2020 impacts see] [added: See] “Note 1: Basis of Presentation and Summary of Accounting Principles” within Item 8 of this Form [removed: 10-K.][added: 10-K for further discussion.]

Although [removed: the impact of COVID-19 on] our [removed: commercial] business [removed: is significant,] [added: has been and will continue to be impacted by COVID-19,] we currently believe we have sufficient liquidity to withstand the [removed: current estimated] [added: potential] impacts.

Global economic and political conditions, changes in raw material and commodity prices, [added: labor costs,] interest rates, foreign currency exchange rates, energy costs, levels of air travel, the financial condition of commercial airlines, and the impact from natural disasters and weather conditions create uncertainties that could impact our [removed: businesses in 2021.][added: businesses.]

The U.S. has imposed, and may impose additional, sanctions on [removed: Turkey] [added: Turkey,] as [added: well as contractual restrictions on the use of Turkish sources on certain military programs, as] a result of this or other political disputes.

Depending upon the scope and timing of U.S. sanctions [added: or contractual prohibitions] on Turkey and potential reciprocal actions, if any, such sanctions or actions could impact our sources of supply and could have a material adverse effect on our results of operations, cash flows or financial condition.

[removed: To date, the Chinese government has not imposed] sanctions on RTC or indicated the nature or timing of any future potential sanctions or other actions.

If China were to impose sanctions or take other regulatory action against RTC, our suppliers, [removed: teammates] [added: affiliates] or partners, it could potentially disrupt our business operations.

Likewise, [removed: it is uncertain whether] [added: regulatory] approvals previously granted for prior sales [removed: could also] [added: can] be paused or revoked if the products and services have not yet been delivered to the customer.

Due to the [removed: result of the] U.S. presidential and congressional [removed: election,] [added: elections] and the resulting uncertainty surrounding U.S. foreign policy on direct commercial sales for precision guided munitions with this customer, we determined that it [removed: is] [added: was] no longer probable that we will be able to obtain [removed: required] regulatory approvals for these [removed: contracts; however, this determination could change as the U.S. government’s foreign policy views are clarified.][added: contracts.]

[removed: In addition, we] [added: RMD also] recognized an unfavorable profit impact of $516 [removed: million,] [added: million related to these contracts,] primarily related to inventory reserves, contract asset impairments and recognition of supplier related obligations related to termination liability, which we [removed: now] do not expect to be utilized or otherwise directed to other customers.

[removed: Our contract liabilities include $405 million of] [added: These] advance payments [removed: received from the customer on these contracts, which] may become refundable to the customer if the contracts are ultimately terminated.

– Net [removed: Sales—a] [added: Sales — a] growth metric that measures our revenue for the current year;

– Operating [removed: Profit—a] [added: Profit (Loss) — a] measure of our profit [removed: from continuing operations] [added: (loss)] for the year, before non-operating expenses, net and income taxes; and

– Operating [removed: Margin—a] [added: Profit (Loss) Margin — a] measure of our [removed: operating] [added: Operating] profit [added: (loss)] as a percentage of [removed: total net sales.][added: Total Net Sales.]

| (dollars in millions) | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Total [removed: net sales] [added: Net Sales] | | | $ | [removed: 56,587] [added: 64,388] | | | | | $ | [removed: 45,349] [added: 56,587] | | | | | $ | [removed: 34,701] [added: 45,349] | |

| Operating profit (loss) | | | [removed: (1,889)] [added: 4,958] | | | | | | [removed: 4,914] [added: (1,889)] | | | | | | [removed: 2,877] [added: 4,914] | | |

| Operating [added: profit (loss)] margin | | | [removed: (3.3)] [added: 7.7] | | % | | | | [removed: 10.8] [added: (3.3)] | | % | | | | [removed: 8.3] [added: 10.8] | | % |

| Operating cash flow from continuing operations | | | $ | [removed: 4,334] [added: 7,142] | | | | | $ | [removed: 5,821] [added: 4,334] | | | | | $ | [removed: 2,670] [added: 5,821] | |

Backlog, which is equivalent to our remaining performance obligations [added: (RPO)] for our [added: sales] contracts, represents the [added: aggregate] dollar value of firm orders for which [removed: work] [added: products have not been provided or service] has not been performed and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity (IDIQ) type contracts).

We focus on adjusted earnings per share (EPS) and measures to assess our cash generation and the efficiency and effectiveness of our use of capital, such as free cash flow [removed: (FCF) and return on invested capital (ROIC), all] [added: (FCF), both] of which are not defined [removed: measurements] [added: measures] under U.S. [removed: Generally Accepted Accounting Principles (GAAP)] [added: GAAP] and may be calculated differently by other companies.

[removed: The] following discussions of comparative results among periods, including the discussion of segment results, should be viewed in this context.

Business Transformation and Operational Excellence

We are leveraging the Raytheon Merger to undertake various strategic initiatives to transform the Company and increase our existing focus on operational excellence.

These initiatives include our new Customer Oriented Results Excellence (CORE) operating system, significant investments in digital technologies across our business to enhance our products and services, and structural cost reduction initiatives.

We are also continuing to develop advanced technologies, including through specific technology-focused business acquisitions.

Coronavirus Disease 2019 (COVID-19) Pandemic

The COVID-19 pandemic continues to negatively affect the global economy, our business and operations, supply chains, and the industries in which we operate.

For a discussion of the risk factors associated with the COVID-19 pandemic, refer to Item 1A.

Risk Factors within Part I of this Form 10-K.

We have seen indications that commercial air travel is recovering in certain areas of demand; however, other areas continue to lag.

In addition, while global vaccination rates have increased, infection from COVID-19 variants have continued, which may impact the pace of the commercial aerospace recovery.

Further, the commercial air travel recovery is tied to general economic conditions and may be impacted by inflation or government budget deficits, among other factors.

As our commercial aerospace business recovers, we have seen increases in certain employee-related and discretionary costs, which had decreased in the aftermath of COVID-19 due to one-time cost reduction actions in 2020.

A recovery may also impact our judgments around credit risk related to estimated credit losses.

In addition, in March 2021, Congress passed the American Rescue Plan Act of 2021 (ARPA) which included pension funding relief provisions.

For further discussion, refer to the “FAS/CAS operating adjustment” subsection under the “Segment Review” section below.

We continue to monitor for any further government guidance related to COVID-19 that may be issued.

On September 24, 2021, in furtherance of an executive order, the U.S. Safer Federal Workforce Task Force issued guidance requiring federal contractors and subcontractors to comply with COVID-19 safety protocols, including requiring certain employees to be fully vaccinated against COVID-19 except in limited circumstances.

The implementation of this mandate may result in attrition, including attrition of critically skilled labor and difficulty in securing future labor needs, for our workforce, as well as the workforces of our subcontractors, suppliers and customers.

The mandate is currently subject to various legal proceedings.

As a result, the impact of mandate on our operations and performance, as well as on our subcontractors, suppliers and customers, is uncertain.

However, if ultimately required, the mandate could affect our performance on contracts, particularly due to disruptions in subcontractor or supplier performance or deliveries, and have a material adverse effect on our results of operations.

To date, the Chinese government has not imposed

We have direct commercial sales contracts for products and services to certain foreign customers, for which U.S. government review and approval have been pending.

The U.S. government’s approval of these sales is subject to a range of factors, including its foreign policies related to these customers, which are subject to continuing review and potential changes.

In particular, as of December 31, 2021, our Contract liabilities include approximately $430 million of advance payments received from a Middle East customer on contracts for which we no longer believe we will be able to execute or obtain required regulatory approvals.

In order to better assess the underlying performance of our business, we also focus on the change in organic net sales on both a consolidated basis and business segment basis, and the change in organic operating profit (loss) on a business segment basis, which allows for better year-over-year comparability.

See Results of Operations below for our definition of the organic change in Net sales and Operating profit (loss), which are not defined measures under U.S. Generally Accepted Accounting Principles (GAAP) and may be calculated differently by other companies.

We also focus on backlog as a key financial performance measure of our forward-looking sales growth.

Total backlog was $156 billion and $150 billion as of December 31, 2021 and 2020, respectively.

Segment backlog does not include intercompany backlog.

Backlog generally increases with bookings and/or orders and generally decreases as sales are recognized on these bookings and is affected by changes in foreign exchange rates, as well as contract cancellations and terminations, and cost underruns on cost-type contracts.

The

As such, the results of RIS and RMD for the second quarter of 2020 exclude results prior to the date of completion of the Raytheon Merger, the estimated impact of which is approximately $400 million of sales and approximately $45 million of operating profit.

These amounts, in addition to the first quarter of 2021 results, have been excluded from the organic changes for the year ended December 31, 2021 disclosed throughout our Results of Operations discussion.

Additionally, the organic change in Cost of sales and Operating profit (loss) excludes restructuring costs, the FAS/CAS operating adjustment and costs related to certain acquisition accounting adjustments.

| (dollars in millions) | | | 2021 | | | | | | 2020 | | |

| Other | | | 116 | | | | | | 14 | | |

(1) See “Results of Operations” for definition of organic.

Net sales increased $0.7 billion organically in 2021 compared to 2020 primarily due to higher organic sales of $1.3 billion at Pratt & Whitney, partially offset by lower organic sales of $0.6 billion at Collins Aerospace.

The $7.0 billion sales increase in Acquisitions and divestitures, net in 2021 compared to 2020, was primarily driven by the Raytheon Merger on April 3, 2020, partially offset by the sale of the Collins Aerospace military Global Positioning System (GPS) and space-based precision optics businesses in the third quarter of 2020 and the sale of our Forcepoint business in the first quarter of 2021.

On April 3, 2020, United Technologies Corporation (UTC) completed the Separation Transactions as defined below, and on April 3, 2020, completed the Raytheon Merger as defined below, to form the new company, Raytheon Technologies Corporation.

*Separation Transactions and Distributions*.

UTC distributed 866,158,910 and 433,079,455 shares of common stock of Carrier and Otis, respectively in the Distributions, each of which was effective at 12:01 a.m., Eastern Time, on April 3, 2020.

Throughout this Annual Report on Form 10-K, unless otherwise indicated, amounts and activity are presented on a continuing operations basis.

Upon closing of the Raytheon Merger, Raytheon Company became a wholly owned subsidiary of UTC, which changed its name to “Raytheon Technologies Corporation.”

On November 26, 2018, we completed the acquisition of Rockwell Collins (the Rockwell Acquisition), a leader in aviation and high-integrity solutions for commercial and military customers as well as leading-edge avionics, flight controls, aircraft interior and data connectivity solutions.

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positively correlated to corporate profits.

These agreements are comprehensive long-term spare part and service agreements with our customers.

Total sales to the U.S. government, excluding foreign military sales (FMS), were $26.0 billion, $9.1 billion and $6.6 billion in 2020, 2019 and 2018 or 45.9%, 20.1% and 18.9% of total net sales for those years, respectively.

Impact of the COVID-19 Pandemic

In March 2020, the coronavirus disease 2019 (COVID-19) was declared a pandemic by the World Health Organization and a national emergency by the U.S. government.

The pandemic has negatively affected the U.S. and global economy, disrupted global supply chains and financial markets, and resulted in significant travel restrictions, mandated facility closures and shelter-in-place and social distancing orders in numerous jurisdictions around the world.

Raytheon Technologies is taking all prudent measures to protect the health and safety of our employees, such as practicing social distancing, performing deep cleaning in all of our facilities, temperature screening, health questionnaires and enabling our employees to work from home where possible.

We have also taken appropriate actions to help support our communities in addressing the challenges posed by the pandemic, including the production and donation of personal protective equipment.

Our business and operations and the industries in which we operate have been significantly impacted by public and private sector policies and initiatives in the U.S. and worldwide to address the transmission of COVID-19, such as the imposition of travel restrictions and the adoption of remote working.

Additionally, public sentiments regarding air travel have also had a significant impact.

We began to experience issues related to COVID-19 in the first quarter of 2020, primarily related to a limited number of facility closures, less than full staffing, and disruptions in supplier deliveries, most significantly in our Collins Aerospace and Pratt & Whitney businesses.

The continued disruption to air travel and commercial activities and the significant restrictions and limitations on businesses, particularly within the aerospace and commercial airline industries, have negatively impacted global supply, demand and distribution capabilities.

These conditions, which began in the second quarter of 2020, continued through the remainder of 2020.

In particular, the unprecedented decrease in air travel resulting from the COVID-19 pandemic is adversely affecting our airline and airframer customers, and their demand for the products and services of our Collins Aerospace and Pratt & Whitney businesses.

Based on recent public data, revenue passenger miles (RPMs) declined by approximately 65% in the first eleven months of 2020, compared to the prior year, due to the pandemic.

As a result, our airline customers have reported significant reductions in fleet utilization, aircraft grounding and unplanned retirements, and have deferred and, in some cases, cancelled new aircraft deliveries.

Airlines have shifted to cash conservation behaviors such as deferring engine maintenance due to lower flight hours and aircraft utilization, requesting extended payment terms, deferring delivery of new aircraft and spare engines and requesting discounts on engine maintenance.

Some airline customers have filed for bankruptcy due to their inability to meet their financial obligations.

Additionally, we are seeing purchase order declines in line with publicly communicated aircraft production volumes as original equipment manufacturer (OEM) customers delay and cancel orders.

We continue to monitor these trends and are working closely with our customers.

We have been and continue to actively mitigate costs and adjust production schedules to accommodate these declines in demand.

We have also been taking actions to preserve capital and protect the long-term needs of our businesses, including cutting discretionary spending, significantly reducing capital expenditures and research and development spend, suspending our share buybacks in 2020, deferring merit increases and implementing temporary pay reductions, freezing non-essential hiring, repositioning employees to defense work, furloughing employees when needed, and personnel reductions.

In 2020, we recorded total restructuring charges of $777 million primarily related to personnel reductions at our Collins Aerospace and Pratt & Whitney businesses to preserve capital and at our corporate headquarters due to consolidation from the Raytheon Merger.

New information may emerge concerning the

We considered the deterioration in general economic and market conditions primarily due to the COVID-19 pandemic to be a triggering event in the first and second quarters of 2020, requiring an impairment evaluation of goodwill, intangible assets and other assets in our commercial aerospace businesses, Collins Aerospace and Pratt & Whitney.

Beginning in the second quarter of 2020, we observed several airline customer bankruptcies, delays and cancellations of aircraft purchases by airlines, fleet retirements and repositioning of OEM production schedules and we experienced a significant decline in revenues at our Collins Aerospace and Pratt & Whitney businesses due to a decline in flight hours, aircraft fleet utilization, shop visits and commercial OEM deliveries.

These factors contributed to a deterioration of our expectations regarding the timing of a return to pre-COVID-19 commercial flight activity, which further reduced our future sales and cash flows expectations.

Based on our updated forecast assumptions in the second quarter of 2020, we concluded that the carrying values of two of our Collins Aerospace reporting units were greater than their respective fair values, and accordingly, recorded a goodwill impairment charge of $3.2 billion.

We did not identify any further deterioration to our expectations in the third quarter of 2020 and, therefore, did not have a triggering event.

As described further in “Note 8: Commercial Aerospace Industry Assets and Commitments” within Item 8 of this Form 10-K, we have significant exposure related to our airline and airframer customers, including significant accounts receivable and contract assets balances.

Given the uncertainty related to the severity and length of the pandemic, as well as any worsening of the pandemic, mutations to the strains of the virus and the timing and impact of vaccines and whether there will be additional outbreaks of the pandemic and its impact across the aerospace industry, we may be required to record additional charges or impairments in future periods.

The recent U.S. presidential and congressional election could result in changes to the U.S. government’s foreign policies that may impact regulatory approval for direct commercial sales contracts for certain of our products and services to certain foreign customers.

In particular, we have direct commercial sales contracts for precision guided munitions with a certain Middle East customer, for which we have not yet obtained regulatory approval.

The aggregate notional amount of our outstanding foreign currency hedges was [removed: $11.6] [added: $8.5] billion and [removed: $13.0] [added: $11.6] billion at December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

A 10% unfavorable exchange rate movement in our portfolio of foreign currency contracts would have resulted in an increase in unrealized losses of [removed: $0.8] [added: $0.6] billion and [removed: $1.2] [added: $0.8] billion at December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

We believe these foreign currency forward exchange contracts and the offsetting underlying commitments, when taken together, do not create material market [removed: risk][added: risk.]

In order to minimize the exposure that exists from changes in the exchange rate of the U.S. Dollar against these other currencies, we hedge [added: a certain portion of sales to secure the rates at which U.S. Dollars will be converted.]

A 100 basis points unfavorable interest rate movement would have had an approximate $4 billion impact on the fair value of our fixed-rate debt at both December 31, [removed: 2020] [added: 2021] and [removed: 2019.][added: 2020.]

The investors in our fixed-rate debt obligations [added: generally] do not [removed: generally] have the right to demand we pay off these obligations prior to maturity.

Therefore, [added: we believe our] exposure to interest rate risk [removed: is not believed to be material for] [added: on] our fixed-rate [removed: debt.][added: debt is not material.]

We changed our methodology for quantifying our market risk exposure in the second quarter of 2020 to better align with how we manage our risk exposure.

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a certain portion of sales to secure the rates at which U.S. Dollars will be converted.

[removed: Formerly] [added: Raytheon Technologies, formerly] known as United Technologies Corporation (UTC), [removed: Raytheon Technologies] was incorporated in Delaware in 1934 and represents the combination of UTC’s aerospace businesses and Raytheon Company through the Separation Transactions and Distributions and Raytheon Merger [added: completed] in April 2020, as described in more detail below.

Separation Transactions and [removed: Distributions.] [added: Distributions; Raytheon Merger.] On April 3, 2020, UTC completed the separation of its business into three independent, publicly traded companies – UTC, Carrier Global Corporation (Carrier) and Otis Worldwide Corporation (Otis) (such separations, the “Separation Transactions”).

[removed: Raytheon Merger. On April 3, 2020,] [added: Immediately] following the completion of the Separation Transactions and the Distributions, [removed: pursuant to an Agreement and Plan of Merger dated June 9, 2019, as amended,] [added: on April 3, 2020,] UTC and Raytheon Company completed their all-stock merger of equals transaction (the “Raytheon [removed: Merger”).][added: Merger”), pursuant to which Raytheon Company became a wholly-owned subsidiary of UTC and UTC was renamed “Raytheon Technologies Corporation.”]

Collins Aerospace’s product lines include integrated avionics systems, [added: aviation systems,] communications systems, navigation systems, electric power generation, management and distribution systems, environmental control systems, flight control systems, air data and aircraft sensing systems, engine control systems, engine [added: components, engine] nacelle systems, including thrust reversers and mounting pylons, interior and exterior aircraft lighting, aircraft seating and cargo systems, [added: evacuation systems,] landing systems, including landing gear, wheels and braking systems, hoists and winches, fire and ice detection and protection systems, actuation systems, [removed: engine components,] and propeller systems.

Collins Aerospace also designs, [removed: produces] [added: manufactures,] and supports cabin interior, [removed: communications and aviation systems,] oxygen systems, food and beverage preparation, storage and galley systems, lavatory and wastewater management systems.

Collins Aerospace also provides [removed: information management] [added: connected aviation solutions and] services through worldwide voice and data communication networks and solutions.

Aftermarket services include spare parts, overhaul and repair, engineering and technical support, training and fleet management solutions, [added: asset management services] and information management services.

Collins Aerospace’s largest [added: commercial] customers are Boeing and Airbus with combined sales, prior to discounts and incentives, of [removed: 21%, 27%] [added: 18%, 21%] and [removed: 31%] [added: 27%] of total Collins Aerospace segment sales in [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018,] [added: 2019,] respectively.

[removed: Significant] [added: Collins Aerospace continued its significant] product development [removed: activity continues,] [added: activities,] including [added: for] major systems [removed: for Boeing’s T-7A and VC-25B,] [added: on] the [added: A321XLR, the Boeing 777X, the] Irkut MC-21, the Dassault [removed: Falcon 6X, the Leonardo AW249,] [added: 6X Falcon, and] the Xian MA700, [added: as well as systems in support of the Boeing T-7A trainer] and the [removed: COMAC C919.][added: Boeing VC-25B.]

Pratt & Whitney’s largest [added: commercial] customer by sales is Airbus, with sales, prior to discounts and incentives, of [removed: 30%, 31%] [added: 31%, 30%] and [removed: 36%] [added: 31%] of total Pratt & Whitney segment sales in [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018,] [added: 2019,] respectively.

Pratt & Whitney produces the PW1000G Geared Turbofan [added: (GTF)] engine family, the first of which, the PW1100G-JM, entered into service in January 2016.

The PW1000G [removed: Geared Turbofan] [added: GTF] engine has demonstrated a significant reduction in fuel burn and noise levels and lower environmental emissions when compared to legacy engines.

PW1000G [removed: Geared Turbofan] [added: GTF] engine models also power the Airbus A220 passenger aircraft and Embraer’s E-Jet E2 family of aircraft and have been [removed: selected] [added: certified by the Russian civil aviation authority] to power the [removed: new] Irkut MC-21 passenger aircraft.

In addition, P&WC’s PW800 engine has been selected to exclusively power Gulfstream’s [removed: new] [added: G400,] G500 and G600 business jets, as well as to power Dassault’s [removed: new] Falcon 6X business jet, which is scheduled to enter into service in 2022.

F135 engines are also used on F-35 aircraft purchased by Joint Strike Fighter partner countries and [added: other countries through] foreign military sales [removed: countries.][added: arrangements.]

In view of the risks and costs associated with developing new engines, Pratt & Whitney has entered into [removed: some] collaboration arrangements in which revenues, costs and risks are shared with third parties.

At December 31, [removed: 2020,] [added: 2021,] the interests of third-party collaboration participants in Pratt & Whitney-directed [removed: commercial] jet engine programs ranged, in the aggregate per program, from [removed: approximately] 13% to 49%.

Pratt & Whitney also continues to enhance its programs through performance improvement measures and product base [removed: expansion.][added: expansion, utilizing similar collaboration arrangements.]

The GTF [removed: engine] family now powers more than [removed: 900] [added: 1,100] aircraft across [removed: 50] [added: 58] airlines and three aircraft platforms: Airbus A320neo family, Airbus A220 and Embraer E-Jets [removed: E2 family.][added: E2.]

Raytheon Intelligence & Space. Raytheon Intelligence & Space (RIS) is a global leading developer and provider of integrated [removed: sensor and] [added: space,] communication [added: and sensor] systems for advanced [removed: missions, advanced training,] [added: missions in all domains,] and cyber and software solutions to intelligence, defense, federal and commercial customers.

[removed: domain] [added: These systems and solutions include end-to-end space solutions, data processing systems, multi-domain] intelligence [removed: solutions;] [added: solutions,] electronic warfare solutions, including high-energy laser weapons [removed: systems;] [added: systems, secure sensor solutions,] command and control [removed: systems; modernization, training and mission support services;] [added: systems, modernization services,] and advanced cyber analytics, systems defense and services.

RIS serves as a prime contractor or major subcontractor on contracts with the U.S. Intelligence Community, U.S. Department of Defense (DoD), Department of Homeland Security, the [removed: FAA,] [added: Federal Aviation Administration (FAA),] National Aeronautics and Space Administration, and other international and classified customers.

In [removed: 2020,] [added: 2021,] RIS continued to invest in advancing its [removed: current] products and [removed: services and] [added: services, as well as] developing next generation capabilities to meet evolving customer missions.

[removed: Significant] [added: RIS achieved significant] advancements [removed: include] [added: in key capabilities across its portfolio, including] laser technologies; intelligence surveillance and reconnaissance electro-optical/infrared (EO/IR) [removed: products;] radar [added: frequency products; tactical airborne radars] for [removed: 5th] [added: current] and [removed: 6th generation] [added: future manned and unmanned] aircraft; classified space mission systems; offensive and defensive cyber solutions; and the Next Generation Jammer system.

Raytheon Missiles & Defense. Raytheon Missiles & Defense (RMD) is a leading designer, developer, integrator producer and sustainer of integrated air and missile defense systems; defensive and combat solutions; large land- and sea-based radars; [removed: command, control, communications] [added: ballistic] and [removed: intelligence solutions;] [added: hypersonic missile defense systems;] and naval and undersea sensor solutions for the U.S. and foreign government customers.

RMD’s integrated air and missile defense systems include the proven Patriot [added: air and] missile defense system and [added: its Lower Tier Air and Missile Defense Sensor (LTAMDS), the first in a family of radars known as GhostEye™, as well as] next-generation radar systems to defeat advanced threats.

In [removed: 2020,] [added: 2021, RMD achieved key advancements in, or received contract awards for,] the following [removed: programs and awards continued to drive revenue] [added: programs, which drove its financial performance] and [removed: strategic imperatives] [added: positioned it] for [removed: RMD] [added: future] growth: [added: GhostEye,] the Lower Tier Air and Missile Defense [removed: System (LTAMDS),] [added: Sensor (LTAMDS);] the Advanced Medium Range Air-to-Air Missile [removed: (AMRAAM),] [added: (AMRAAM);] the Standard Missile Family (Standard Missile 2 (SM-2), Standard Missile 3 (SM-3) and Standard Missile 6 [removed: (SM-6)), Tomahawk variants, the] [added: (SM-6));] Patriot Engineering [removed: Services,] [added: Services;] the Qatar National Advanced Surface-to-Air Missile System [removed: (NASAMS),] [added: (NASAMS);] the Air and Missile Defense Radar [removed: (AMDR)/SPY-6,] [added: (AMDR)/SPY-6;] Poland [removed: Patriot,] [added: Patriot;] the Kingdom of Saudi Arabia Transportable Radar Surveillance and Control Model 2 (KSA [removed: TPY-2),] [added: TPY-2);] the Air Intercept Missile [removed: (AIM-9X), Qatar Early Warning Radar (EWR), Army Navy/Transportable Radar Surveillance] [added: (AIM-9X);] and [removed: Control Model 2 (AN/TPY-2)and] Phalanx SeaRAM.

In addition, RMD was [removed: down-selected in the competition for] [added: selected by] the [removed: sole provider] [added: U.S. Air Force] for the Long Range Stand Off (LRSO) [removed: Strike Initiative] [added: Weapon System Engineering] and [removed: the U.S. Air Force approved RMD’s StormBreaker smart weapon for fielding on the F-15 Eagle.][added: Manufacturing Development contract.]

Our [removed: former Raytheon Company businesses, Raytheon Intelligence & Space] [added: RIS] and [removed: Raytheon Missiles & Defense,] [added: RMD businesses,] although experiencing [removed: minor] [added: some negative] impacts, [added: including from the supply chain pressures and labor shortages discussed above,] have not experienced significant business disruptions as a result of the COVID-19 pandemic.

[removed: Raytheon Intelligence & Space] [added: RIS] and [removed: Raytheon Missiles & Defense] [added: RMD] together represent a significant portion of those sales.

| (dollars in millions) | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Sales to the U.S. government (1) | | | | | | $ | [removed: 25,962] [added: 31,177] | | | | | $ | [removed: 9,094] [added: 25,962] | | | | | $ | [removed: 6,560] [added: 9,094] | |

| Sales to the U.S. government as a percentage of [removed: total net sales] [added: Total Net Sales] (1) | | | | | | [removed: 46] [added: 48] | | % | | | | [removed: 20] [added: 46] | | % | | | | [removed: 19] [added: 20] | | % |

International Sales. Our [removed: international] sales [added: to international customers, based on customer end use location,] were as follows:

| Total international sales (1) | | | | | | $ | [removed: 22,027] [added: 24,377] | | | | | $ | [removed: 23,952] [added: 22,027] | | | | | $ | [removed: 19,035] [added: 23,952] | |

| Total international sales as a percentage of [removed: total net sales] [added: Total Net Sales] (1) | | | | | | [removed: 39] [added: 38] | | % | | | | [removed: 53] [added: 39] | | % | | | | [removed: 55] [added: 53] | | % |

| (dollars in millions) | | | [removed: 2020] | | | [added: 2021] | | | [added: | | | 2020 | | | | | |] 2019 | | |

Approximately 70% of our consolidated backlog as of December 31, [removed: 2020] [added: 2021] is not expected to be realized as sales in the next twelve months.

At December 31, [added: 2021 and] 2020, our defense backlog was approximately [removed: 45%] [added: 41% and 45%, respectively,] of total backlog.

In addition, the competitive [removed: landscapes] [added: landscape] in the industry segments we serve [removed: continue] [added: continues] to evolve with trends such as increased vertical integration by competitors and customers and the emergence of more commercial competitors on defense development programs.

In 2021, Collins Aerospace was awarded significant contracts for Airbus A320 Enhanced Vision Systems, Bombardier fleetwide connectivity solutions, and aircraft data access hardware for an undisclosed airline.

In the defense area, Collins Aerospace was awarded significant contracts for wheel and carbon brake systems for the B-52 modernization program, NP2000

propeller systems for 26 C-130H aircraft for the U.S. Air National Guard and Air Force Reserve, and AN/PCR-162 ground radios for the Handheld, Manpack and Small Form Fit (HMS) program.

Collins Aerospace also received numerous contract awards for buyer-furnished equipment installation for interiors, avionics, and wheels and brakes, and strategically important contract awards for its FlightSense® full life-cycle support services.

In November 2021, Collins Aerospace completed its previously announced acquisition of FlightAware, a digital aviation company that operates flight tracking and data platforms.

In 2021, Collins Aerospace’s F-16 Performance Base Logistics (PBL) program won the Secretary of Defense PBL-of-the-year award.

In 2021, Pratt & Whitney reached significant milestones on the GTF engine program, including the first flight of the GTF Advantage engine for the A320neo family.

The GTF Advantage configuration further extends the economic and environmental benefits of the existing GTF engine, as it reduces fuel consumption by an additional 1 percent, extending the engine's lead as the most efficient powerplant for the A320neo family.

Also in 2021, Pratt & Whitney’s V2500 program achieved 250 million flight hours.

Pratt & Whitney was announced as the engine provider on the Dassault Falcon 6X and Gulfstream G400, representing two new platforms for its PW800 engine.

In addition, Pratt & Whitney received a significant number of contract awards for the F135 program, which powers all three variants of the F-35 Lightning II fighter aircraft and achieved several F135 production milestones, including the delivery of the 800th production engine and continuing to add more F135 engine maintenance, repair, overhaul and upgrade (MRO&U) global capacity by activating MRO&U facilities, or depots, in the Netherlands and Australia.

Significant activity continued on development programs, including testing the first XA101 engine as part of the Adaptive Engine Transition Program.

In November 2021, RIS completed its previously announced acquisition of SEAKR Engineering, a supplier of advanced space electronics.

Also in December 2021, RIS completed its previously announced divestiture of its global training and services business.

Ballistic and hypersonic missile defense systems include portable radar systems and a portfolio of effectors.

Major new awards in 2021 include a contract to develop the Missile Defense Agency’s (MDA) Next Generation Inceptor (NGI) as a strategic partner of Northrop Grumman.

Also, in partnership with Northrop Grumman, RMD successfully completed the first flight test for the scramjet-powered Hypersonic Air-breathing Weapon Concept (HAWC) program.

The HAWC program is a joint Defense Advanced Research Projects Agency (DARPA) and U.S. Air Force effort that seeks to develop and demonstrate critical technologies to enable an effective and affordable air-launched hypersonic cruise missile.

Coronavirus Disease 2019 (COVID-19) Pandemic. The COVID-19 pandemic continues to negatively affect the global economy, our business and operations, and the industries in which we operate.

Government, business and individual actions in response to COVID-19 have resulted in continued disruption to air travel and commercial activities and significant restrictions and limitations on businesses, particularly within the aerospace and commercial airline industries.

While commercial air travel in certain areas appears to be recovering, it continues to lag in other areas and remains below pre-pandemic levels.

Overall, the ongoing disruption from the pandemic continues to adversely affect our airline and airframer customers and their demand for

the products and services of our Collins Aerospace and Pratt & Whitney businesses.

In addition, the COVID-19 pandemic and continuing economic recovery continues to negatively impact the global supply chain and distribution capabilities and we have experienced negative impacts from supply chain pressures.

The pandemic continues to cause product and labor shortages, delivery delays, and increased costs of raw materials, labor and supplier products and services around the world.

We are working with our suppliers and subcontractors to mitigate delays in our receipt of necessary raw materials, components and other supplies and to reduce supply chain costs.

Backlog. Backlog, which is equivalent to our remaining performance obligations (RPO) for our sales contracts, represents the aggregate dollar value of firm orders for which products have not been provided or service has not been performed and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity (IDIQ) type contracts).

Total backlog was $156 billion and $150 billion as of December 31, 2021 and 2020, respectively.

Attracting, developing, advancing and retaining the best talent is critical for us to execute our strategy and grow our business.

Individuals with technical, engineering, and science backgrounds, experience, or interests are particularly important for us to succeed in the industries in which we compete.

In 2021, we renamed the compensation committee of the RTC Board of Directors the Human Capital & Compensation Committee and designated the committee to provide oversight of human capital management.

Workforce Demographics.

Our employees are located in 54 countries, with 72% of our employees located in the U.S.

Diversity, Equity and Inclusion (DE&I).

We believe a work environment where all individuals are respected, valued and supported enables them to focus on developing the most innovative solutions to our industry’s greatest challenges.

We have established a DE&I advisory board of senior leaders.

We review diversity in talent development and promotion, employee compensation practices and succession planning, and embed DE&I training into our leadership development programs.

We have nine diverse employee resource groups.

We also invest in a more diverse workforce by supporting science, technology, engineering and mathematics initiatives for women and students of color, and providing opportunities and support to military veterans.

As of December 31, 2021, women represented 25% of our global workforce and 30% of our global executives, and people of color represented 31% of our U.S. employee population and 17% of our U.S. executives.

Upon closing of the Raytheon Merger, Raytheon Company became a wholly owned subsidiary of UTC, which changed its name to “Raytheon Technologies Corporation.”

In 2020, Collins Aerospace was awarded significant contracts for all four of the Future Vertical Lift (FVL) platforms, the Next Generation Ejection Seat (the ACES 5), Ground Based Strategic Deterrent, Bell H-1 Tail Drive System, the Next-Gen APU

[Table of](#ic1191af84175493ba8c7c5a12ec749b7_2194) [C](#ic1191af84175493ba8c7c5a12ec749b7_2194)[ontents](#ic1191af84175493ba8c7c5a12ec749b7_2194)

Fuel Nozzle, and the Mounted Assured Positioning, Navigation and Timing System (MAPS GenII).

Our products supported the first flight of the Boeing 777X, and enabled entry into service for the Embraer Praetor 500 and 600.

Collins also delivered the first production Nacelle Enhancement Program (NEP) nacelle configuration on A350-900/1000.

Other significant development work includes Iridium Next, high-frequency (HF) Next, 6th-gen military aircraft, Tactical Combat Training Systems Increment II, NASA deep space exploration systems, distributed pulse oxygen system, Confident to Fly technologies, and the Federal Aviation Administration (FAA) CLEEN II demonstrator.

Mitsubishi and Pratt & Whitney have signed a contract in recognition of the formal pause in MRJ70 and MRJ90 engine development for the SpaceJet program.

In 2020, Pratt & Whitney reached significant milestones on the Geared Turbofan (GTF) engine program, including achieving an industry-leading engine dispatch reliability rate of 99.98% for the GTF engines for the Airbus A320neo.

Pratt & Whitney also delivered the 50,000th PT6 turboprop engine in the General Aviation segment.

Also in 2020, Pratt & Whitney received a significant number of contract awards for the F135 program, which powers all three variants of the F-35 Lightning II fighter aircraft.

F135 production milestones achieved included the delivery of the 600th and 700th production engines.

From a sustainment perspective, the F135 team supported the activation of half a dozen bases and ships around the world, including the first U.S. Navy aircraft carrier ready to deploy with F-35C aircraft on board.

Significant activity continues on Adaptive Engine Transition Program, 6th-gen propulsion, and other development programs.

RIS capabilities include space-based sensors and data processing systems; multi-

In addition, in December 2020, RIS completed its previously announced acquisition of Blue Canyon Technologies, a leading provider of small satellites and spacecraft components to the U.S. Air Force, NASA, and the Defense Advanced Research Projects Agency (DARPA).

Its command, control, communications and intelligence solutions include integrated, networked, actionable combat solutions for air and land combat commanders.

The Missile Defense Agency (MDA) awarded RMD significant contracts for AN/TPY-2 radars and the SM-3 missile.

Also, as part of a historic MDA demonstration, RMD’s advanced SM-3 Block IIA ballistic missile defense interceptor intercepted and destroyed an intercontinental ballistic missile target outside Earth’s atmosphere for the first time ever.

COVID-19 Pandemic. In March 2020, the coronavirus disease 2019 (COVID-19) was declared a pandemic by the World Health Organization and a national emergency by the U.S. government.

Our business and operations and the industries in which we operate have been significantly impacted by public and private sector policies and initiatives in the U.S. and worldwide to address the transmission of COVID-19, such as the imposition of travel restrictions and the adoption of remote working, as well as public sentiments regarding air travel.

In particular, the unprecedented decrease in air travel resulting from the COVID-19 pandemic is adversely affecting our airline and airframer customers, and their demand for the products and services of our Collins Aerospace and Pratt & Whitney segments.

Our airline customers have reported significant reductions in fleet utilization, aircraft grounding and unplanned retirements, and have deferred and, in some cases, cancelled, new aircraft deliveries.

They have shifted to cash conservation behaviors such as deferring engine maintenance due to lower flight hours and aircraft utilization, requesting extended payment terms, deferring delivery of new aircraft and spare engines and requesting discounts on engine maintenance.

Some airline customers have filed for bankruptcy due to their inability to meet their financial obligations.

Additionally, we are seeing purchase order declines in line with publicly communicated aircraft production volumes as original equipment manufacturer (OEM) customers delay and cancel orders.

In response to the COVID-19 impacts on our businesses, we have been and continue to actively mitigate costs and adjust production schedules to accommodate these declines in demand.

We have also been taking actions to preserve capital and protect the long-term needs of our businesses, including cutting discretionary spending, significantly reducing capital expenditures and research and development spend, suspending our share buyback program in 2020, deferring merit increases and implementing temporary pay reductions, freezing non-essential hiring, repositioning employees to defense work, furloughing employees when needed, and reducing personnel.

Raytheon Merger Integration. We continue to make progress on our integration activities to realize the benefits of the Raytheon Merger, including synergies, cost savings, innovation and enterprise-wide technology sharing opportunities (including technology-driven revenue synergies) and operational efficiencies.

We continue to integrate our business processes and systems, identify and mature technology and revenue synergy opportunities, achieve significant cost savings, harmonize our organizational model and policies, as well as promote a strong single-company culture.

Numerous aspects of these activities will continue into 2021.

Backlog. Backlog, which is equivalent to our remaining performance obligations (RPO), represents the aggregate amount of total contract transaction price related to firm orders that are unsatisfied or partially unsatisfied.

Segment backlog does not include intercompany backlog.

Our backlog by segment was as follows:

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Collins Aerospace Systems | | | $ | 23,005 | | | | | $ | 26,260 | |

| Pratt & Whitney | | | 78,135 | | | | | | 85,183 | | |

| Raytheon Intelligence & Space | | | 18,676 | | | | | | — | | |

| Raytheon Missiles & Defense | | | 29,593 | | | | | | — | | |

Collins Aerospace [added: Systems (Collins Aerospace)] sold certain aircraft parts and systems to The Boeing Company for the 737 MAX aircraft involved in these accidents.

We do not expect that the lawsuits or governmental investigations or inquiries will have a material adverse effect on our [removed: financial position,] results of [removed: operations] [added: operations, financial condition] or [removed: cash flows.][added: liquidity.]

[removed: In addition, we] [added: We] are subject to a number of [removed: other] lawsuits, investigations and claims (some of which involve substantial amounts).

For a discussion of contingencies related to certain [removed: other] legal proceedings, see “Note 19: Commitments and Contingencies” within Item 8 of this Form 10-K.

[removed: We] [added: Except as otherwise noted, while we are unable to predict the final outcome, based on information currently available, we] do not believe that [added: resolution of any of] these matters will have a material adverse effect upon our competitive position, results of operations, [removed: cash flows or] financial [removed: condition.][added: condition or liquidity.]

A further discussion of government contracts and related investigations, as well as a discussion of our environmental liabilities, can be found under the heading “Other Matters Relating to Our Business [removed: as a Whole] – [removed: Compliance with] Environmental [removed: and Other Government Regulations”] [added: Regulation”] within Item 1.

In the ordinary course of business, the Company and its subsidiaries and our properties are subject to regulatory and governmental examinations, information gathering requests, inquiries, investigations and threatened legal actions and proceedings.

For example, we are now, and believe that, in light of the current U.S. government contracting environment, we will continue to be the subject of one or more U.S. government investigations.

Our contracts with the U.S. government are also subject to audits.

Agencies that oversee contract performance include: the Defense Contract Audit Agency (DCAA), the Defense Contract Management Agency (DCMA), the Inspectors General of the U.S. Department of Defense (DoD) and other departments and agencies, the Government Accountability Office (GAO), the Department of Justice (DOJ), and Congressional Committees.

Other areas of our business operations may also be subject to audit and investigation by these and other agencies.

From time to time, agencies investigate or conduct audits to determine whether our operations are being conducted in accordance with applicable requirements.

Such investigations and audits may be initiated due to a number of reasons, including as a result of a whistleblower complaint.

Such investigations and audits could result in administrative, civil or criminal liabilities, including repayments, fines, treble or other damages, forfeitures, restitution, or penalties being imposed upon us, the suspension of government export licenses or the suspension or debarment from future U.S. government contracting.

U.S. government investigations often take years to complete.

The U.S. government also reserves the right to debar a contractor from receiving new government contracts for fraudulent, criminal or other seriously improper conduct.

The U.S. government could void any contracts found to be tainted by fraud.

Like many defense contractors, we have received audit reports recommending the reduction of certain contract prices because, for example, cost or pricing data or cost accounting practices used to price and negotiate those contracts may not have conformed to government regulations.

Some of these audit reports recommend that certain payments be repaid, delayed, or withheld, and may involve substantial amounts.

We have made voluntary refunds in those cases we believe appropriate, have settled some allegations and, in some cases, continue to negotiate and/or litigate.

The Company may be, and has been, required to make payments into escrow of disputed liabilities while the related litigation is pending.

If the litigation is resolved in the Company’s favor, any such payments will be returned to the Company with interest.

Our final allowable incurred costs for each year are also subject to audit and have, from time to time, resulted in disputes between us and the U.S. government, with litigation resulting at the Court of Federal Claims (COFC) or the Armed Services Board of Contract Appeals (ASBCA) or their related courts of appeals.

In addition, the DOJ has, from time to time, convened grand juries to investigate possible irregularities by us.

We also provide products and services to customers outside of the U.S., and those sales are subject to local government laws, regulations and procurement policies and practices.

Our compliance with such local government regulations or any applicable U.S. government regulations (e.g., the Foreign Corrupt Practices Act (FCPA) and International Traffic in Arms Regulations (ITAR)) may also be investigated or audited.

Other than as specifically disclosed in this Form 10-K, we do not expect these audits, investigations or disputes to have a material effect on our financial position, results of operations or liquidity, either individually or in the aggregate.

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| | | | For the fiscal year ended December 31, [removed: 2020] [added: 2021] | | |

| | | | For the transition period [removed: from to] [added: from to] | | |

(Address of principal executive [removed: offices, including zip code)][added: offices) (Zip Code)]

The aggregate market value of the voting Common Stock held by non-affiliates at June 30, [removed: 2020] [added: 2021] was approximately [removed: $93,495,749,819,] [added: $128,558,489,983,] based on the New York Stock Exchange closing price for such shares on that date.

At January [removed: 29, 2021,] [added: 31, 2022,] there were [removed: 1,519,478,134] [added: 1,492,330,987] shares of Common Stock outstanding.

Portions of the Registrant’s Definitive Proxy Statement for its [removed: 2021] [added: 2022] Annual Meeting of Shareowners are incorporated by reference in Part II and III of this Form 10-K.

| Item 1. | | | [removed: [Business](#ic1191af84175493ba8c7c5a12ec749b7_1955)] [added: [Business](#i02f2f3ecab4d4159bc1f9a202e7b68a9_13)] | | | [removed: [4](#ic1191af84175493ba8c7c5a12ec749b7_1955)] [added: [4](#i02f2f3ecab4d4159bc1f9a202e7b68a9_13)] | | |

| Item 1A. | | | [Risk [removed: Factors](#ic1191af84175493ba8c7c5a12ec749b7_1962)] [added: Factors](#i02f2f3ecab4d4159bc1f9a202e7b68a9_16)] | | | [removed: [13](#ic1191af84175493ba8c7c5a12ec749b7_1962)] [added: [13](#i02f2f3ecab4d4159bc1f9a202e7b68a9_16)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#ic1191af84175493ba8c7c5a12ec749b7_1969)] [added: Comments](#i02f2f3ecab4d4159bc1f9a202e7b68a9_19)] | | | [removed: [27](#ic1191af84175493ba8c7c5a12ec749b7_1969)] [added: [27](#i02f2f3ecab4d4159bc1f9a202e7b68a9_19)] | | |

| Item 2. | | | [removed: [Properties](#ic1191af84175493ba8c7c5a12ec749b7_1976)] [added: [Properties](#i02f2f3ecab4d4159bc1f9a202e7b68a9_22)] | | | [removed: [28](#ic1191af84175493ba8c7c5a12ec749b7_1976)] [added: [27](#i02f2f3ecab4d4159bc1f9a202e7b68a9_22)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#ic1191af84175493ba8c7c5a12ec749b7_1982)] [added: Proceedings](#i02f2f3ecab4d4159bc1f9a202e7b68a9_25)] | | | [removed: [28](#ic1191af84175493ba8c7c5a12ec749b7_1982)] [added: [28](#i02f2f3ecab4d4159bc1f9a202e7b68a9_25)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#ic1191af84175493ba8c7c5a12ec749b7_1988)] [added: Disclosures](#i02f2f3ecab4d4159bc1f9a202e7b68a9_28)] | | | [removed: [29](#ic1191af84175493ba8c7c5a12ec749b7_1988)] [added: [28](#i02f2f3ecab4d4159bc1f9a202e7b68a9_28)] | | |

| Item 5. | | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#ic1191af84175493ba8c7c5a12ec749b7_2013)] [added: Securities](#i02f2f3ecab4d4159bc1f9a202e7b68a9_34)] | | | [removed: [30](#ic1191af84175493ba8c7c5a12ec749b7_2013)] [added: [29](#i02f2f3ecab4d4159bc1f9a202e7b68a9_34)] | | |

| Item 7. | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#ic1191af84175493ba8c7c5a12ec749b7_7)] [added: Operations](#i02f2f3ecab4d4159bc1f9a202e7b68a9_40)] | | | [removed: [33](#ic1191af84175493ba8c7c5a12ec749b7_7)] [added: [31](#i02f2f3ecab4d4159bc1f9a202e7b68a9_40)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#ic1191af84175493ba8c7c5a12ec749b7_2068)] [added: Risk](#i02f2f3ecab4d4159bc1f9a202e7b68a9_103)] | | | [removed: [63](#ic1191af84175493ba8c7c5a12ec749b7_2068)] [added: [59](#i02f2f3ecab4d4159bc1f9a202e7b68a9_103)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#ic1191af84175493ba8c7c5a12ec749b7_2075)] [added: Data](#i02f2f3ecab4d4159bc1f9a202e7b68a9_106)] | | | [removed: [65](#ic1191af84175493ba8c7c5a12ec749b7_2075)] [added: [61](#i02f2f3ecab4d4159bc1f9a202e7b68a9_106)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#ic1191af84175493ba8c7c5a12ec749b7_2091)] [added: Disclosure](#i02f2f3ecab4d4159bc1f9a202e7b68a9_208)] | | | [removed: [133](#ic1191af84175493ba8c7c5a12ec749b7_2091)] [added: [121](#i02f2f3ecab4d4159bc1f9a202e7b68a9_208)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#ic1191af84175493ba8c7c5a12ec749b7_2097)] [added: Procedures](#i02f2f3ecab4d4159bc1f9a202e7b68a9_211)] | | | [removed: [133](#ic1191af84175493ba8c7c5a12ec749b7_2097)] [added: [121](#i02f2f3ecab4d4159bc1f9a202e7b68a9_211)] | | |

| Item 9B. | | | [Other [removed: Information](#ic1191af84175493ba8c7c5a12ec749b7_2103)] [added: Information](#i02f2f3ecab4d4159bc1f9a202e7b68a9_214)] | | | [removed: [133](#ic1191af84175493ba8c7c5a12ec749b7_2103)] [added: [121](#i02f2f3ecab4d4159bc1f9a202e7b68a9_214)] | | |

| Item 10. | | | [Directors, Executive Officers and Corporate [removed: Governance](#ic1191af84175493ba8c7c5a12ec749b7_2119)] [added: Governance](#i02f2f3ecab4d4159bc1f9a202e7b68a9_220)] | | | [removed: [134](#ic1191af84175493ba8c7c5a12ec749b7_2119)] [added: [122](#i02f2f3ecab4d4159bc1f9a202e7b68a9_220)] | | |

| Item 11. | | | [Executive [removed: Compensation](#ic1191af84175493ba8c7c5a12ec749b7_2126)] [added: Compensation](#i02f2f3ecab4d4159bc1f9a202e7b68a9_223)] | | | [removed: [135](#ic1191af84175493ba8c7c5a12ec749b7_2126)] [added: [123](#i02f2f3ecab4d4159bc1f9a202e7b68a9_223)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#ic1191af84175493ba8c7c5a12ec749b7_2132)] [added: Matters](#i02f2f3ecab4d4159bc1f9a202e7b68a9_226)] | | | [removed: [135](#ic1191af84175493ba8c7c5a12ec749b7_2132)] [added: [123](#i02f2f3ecab4d4159bc1f9a202e7b68a9_226)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#ic1191af84175493ba8c7c5a12ec749b7_2138)] [added: Independence](#i02f2f3ecab4d4159bc1f9a202e7b68a9_229)] | | | [removed: [135](#ic1191af84175493ba8c7c5a12ec749b7_2138)] [added: [124](#i02f2f3ecab4d4159bc1f9a202e7b68a9_229)] | | |

| Item 14. | | | [Principal Accountant Fees and [removed: Services](#ic1191af84175493ba8c7c5a12ec749b7_2145)] [added: Services](#i02f2f3ecab4d4159bc1f9a202e7b68a9_232)] | | | [removed: [136](#ic1191af84175493ba8c7c5a12ec749b7_2145)] [added: [124](#i02f2f3ecab4d4159bc1f9a202e7b68a9_232)] | | |

| Item 15. | | | [Exhibits, Financial Statement [removed: Schedules](#ic1191af84175493ba8c7c5a12ec749b7_2158)] [added: Schedules](#i02f2f3ecab4d4159bc1f9a202e7b68a9_238)] | | | [removed: [137](#ic1191af84175493ba8c7c5a12ec749b7_2158)] [added: [125](#i02f2f3ecab4d4159bc1f9a202e7b68a9_238)] | | |

| Item 16. | | | [Form 10-K [removed: Summary](#ic1191af84175493ba8c7c5a12ec749b7_2164)] [added: Summary](#i02f2f3ecab4d4159bc1f9a202e7b68a9_241)] | | | [removed: [143](#ic1191af84175493ba8c7c5a12ec749b7_2164)] [added: [131](#i02f2f3ecab4d4159bc1f9a202e7b68a9_241)] | | |

Raytheon Technologies Corporation and its subsidiaries’ names, abbreviations thereof, logos, and [removed: product] [added: products] and [removed: service] [added: services] designators are all either the registered or unregistered trademarks or tradenames of Raytheon Technologies Corporation and its subsidiaries.

Names, abbreviations of names, logos, and products and [removed: service] [added: services] designators of other companies are either the registered or unregistered trademarks or tradenames of their respective owners.

Securities registered pursuant to Section 12(g) of the Act: None

| Item 6. | | | [Reserved](#i02f2f3ecab4d4159bc1f9a202e7b68a9_37) | | | [30](#i02f2f3ecab4d4159bc1f9a202e7b68a9_37) | | |

| Item 9C. | | | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i02f2f3ecab4d4159bc1f9a202e7b68a9_1946) | | | [121](#i02f2f3ecab4d4159bc1f9a202e7b68a9_1946) | | |

| [SIGNATURES](#i02f2f3ecab4d4159bc1f9a202e7b68a9_244) | | | | | | | | |

[Table of](#ic1191af84175493ba8c7c5a12ec749b7_2194) [C](#ic1191af84175493ba8c7c5a12ec749b7_2194)[ontents](#ic1191af84175493ba8c7c5a12ec749b7_2194)

| Item 6. | | | [Selected Financial Data](#ic1191af84175493ba8c7c5a12ec749b7_4) | | | [32](#ic1191af84175493ba8c7c5a12ec749b7_4) | | |

| [SIGNATURES](#ic1191af84175493ba8c7c5a12ec749b7_2170) | | | | | | | | |

[Table of](#ic1191af84175493ba8c7c5a12ec749b7_2194) [C](#ic1191af84175493ba8c7c5a12ec749b7_2194)[ontents](#ic1191af84175493ba8c7c5a12ec749b7_2194)

We have [added: significant] properties in approximately 30 countries, with approximately [removed: 550] [added: 540] significant properties comprising approximately [removed: 80] [added: 75] million square feet of productive space.

Approximately [removed: 55%] [added: 30%] of our [added: square footage related to our] significant properties [removed: are] [added: is] leased, and [removed: 45% are] [added: 70% is] owned.

Approximately [removed: 70%] [added: 60%] of our [added: square footage related to our] significant properties [removed: are] [added: is] located in the United States.

Our fixed assets as of December 31, [removed: 2020] [added: 2021] include manufacturing facilities and non-manufacturing facilities such as warehouses, laboratories, office space, and a substantial quantity of machinery and equipment, including general purpose machinery and equipment using special jigs, tools and fixtures and in many instances having automatic control features and special adaptations.

The facilities, warehouses, machinery and equipment in use as of December 31, [removed: 2020] [added: 2021] are in good operating condition, are well-maintained and substantially all are generally in regular use.

[Table of](#ic1191af84175493ba8c7c5a12ec749b7_2194) [C](#ic1191af84175493ba8c7c5a12ec749b7_2194)[ontents](#ic1191af84175493ba8c7c5a12ec749b7_2194)

Raytheon Technologies’ common stock is listed on the New York Stock Exchange under the ticker symbol “RTX.” There were [removed: approximately 45,151] [added: 43,342] registered shareowners at [removed: January 29,] [added: December 31,] 2021.

The following graph presents the cumulative total shareowner return for the five years ending December 31, [removed: 2020] [added: 2021] for our common stock as compared to the Standard & Poor’s 500 Stock [removed: Index, the Dow Jones 30 Industrial Average] [added: Index] and the S&P Aerospace & Defense (A&D) Index.

These figures assume that all dividends paid over the five-year period were reinvested, and that the starting value of each index and the investment in common stock was $100.00 on December 31, [removed: 2015.][added: 2016.]

| Company/Index | | | [removed: 12/31/2016] [added: 12/31/2017] | | | | | | [removed: 12/31/2017] [added: 12/31/2018] | | | | | | [removed: 12/31/2018] [added: 12/31/2019] | | | | | | [removed: 12/31/2019] [added: 12/31/2020] | | | | | | [removed: 12/31/2020] [added: 12/31/2021] | | |

| Raytheon Technologies Common [removed: Stock(1)] [added: Stock] | | | [removed: 17.14] [added: 19.13] | | | | | | [removed: 19.13] [added: \-14.66] | | | | | | [removed: \-14.66] [added: 43.82] | | | | | | [removed: 43.82] [added: \-16.73] | | | | | | [removed: \-16.73] [added: 23.27] | | |

| S&P 500 Index | | | [removed: 11.96] [added: 21.83] | | | | | | [removed: 21.83] [added: \-4.38] | | | | | | [removed: \-4.38] [added: 31.49] | | | | | | [removed: 31.49] [added: 18.40] | | | | | | [removed: 18.40] [added: 28.71] | | |

| S&P Aerospace & Defense [removed: Index(2)] [added: Index] | | | [removed: 18.90] [added: 41.38] | | | | | | [removed: 41.38] [added: \-8.07] | | | | | | [removed: \-8.07] [added: 30.33] | | | | | | [removed: 30.33] [added: \-16.06] | | | | | | [removed: \-16.06] [added: 13.22] | | |

| Company/Index | | | Base Period [removed: 12/31/2015] [added: 12/31/2016] | | | | | | [removed: 12/31/2016] [added: 12/31/2017] | | | | | | [removed: 12/31/2017] [added: 12/31/2018] | | | | | | [removed: 12/31/2018] [added: 12/31/2019] | | | | | | [removed: 12/31/2019] [added: 12/31/2020] | | | | | | [removed: 12/31/2020] [added: 12/31/2021] | | |

[removed: ][added: ]

The following table provides information about our purchases during the quarter ended December 31, [removed: 2020] [added: 2021] of equity securities that are registered by us pursuant to Section 12 of the Exchange Act.

| [removed: 2020] [added: 2021] | | | | | | Total Number of Shares Purchased (000’s) | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased as Part of a Publicly Announced Program (000’s) | | | | | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (dollars in millions) | | | | | |

On December 7, [removed: 2020,] [added: 2021,] our Board of Directors authorized a share repurchase program for up to [removed: $5] [added: $6] billion of our common stock, replacing the previous program announced on [removed: October 14, 2015.][added: December 7, 2020.]

No shares were reacquired in transactions outside the program during the quarter ended December 31, [removed: 2020.][added: 2021.]

The information required by Item 5 with respect to securities authorized for issuance under equity compensation plans is contained within Item 12 of this Form 10-K.

| Raytheon Technologies Common Stock | | | $ | 100.00 | | | | | $ | 119.13 | | | | | $ | 101.67 | | | | | $ | 146.22 | | | | | $ | 121.77 | | | | | $ | 150.10 | |

| S&P 500 Index | | | 100.00 | | | | | | 121.83 | | | | | | 116.49 | | | | | | 153.17 | | | | | | 181.35 | | | | | | 233.41 | | |

| S&P Aerospace & Defense Index | | | 100.00 | | | | | | 141.38 | | | | | | 129.97 | | | | | | 169.39 | | | | | | 142.18 | | | | | | 160.98 | | |

| October 1 - October 31 | | | | | | 291 | | | | | | $ | 89.66 | | | | | 291 | | | | | | $ | 2,972 | | | | |

| November 1 - November 30 | | | | | | 1,927 | | | | | | 85.58 | | | | | | 1,927 | | | | | | 2,807 | | | | | |

| December 1 - December 31 | | | | | | 1,657 | | | | | | 83.10 | | | | | | 1,657 | | | | | | 5,960 | | | | | |

| Total | | | | | | 3,875 | | | | | | $ | 84.83 | | | | | 3,875 | | | | | | | | | | | |

Under the 2021 program, shares may be purchased on the open market, in privately negotiated transactions, under accelerated share repurchase programs, and under plans complying with Rules 10b5-1 and 10b-18 under the Exchange Act.

We may also reacquire shares outside of the program from time to time in connection with the surrender of shares to cover taxes on vesting of restricted stock and as required under our employee savings plan.

Our ability to repurchase shares is subject to applicable law.

On April 3, 2020, United Technologies Corporation (UTC) completed the previously announced separation of its business into three independent, publicly traded companies – UTC, Carrier Global Corporation (Carrier) and Otis Worldwide Corporation (Otis) (such separations, the “Separation Transactions”).

UTC distributed all of the outstanding shares of Carrier common stock and all of the outstanding shares of Otis common stock to UTC shareowners who held shares of UTC common stock as of the close of business on March 19, 2020, the record date for the distributions (the Distributions) effective at 12:01 a.m., Eastern Time, on April 3, 2020.

On April 3, 2020, following the completion of the Separation Transactions and the Distributions, UTC and Raytheon Company completed their previously announced all-stock merger of equals transaction (the “Raytheon Merger”).

Upon closing of the Raytheon Merger, UTC changed its name to “Raytheon Technologies Corporation.”

The information required by Item 5 with respect to securities authorized for issuance under equity compensation plans is incorporated herein by reference to the section of our Proxy Statement for the 2021 Annual Meeting of Shareowners titled “Approve Amendment to the Raytheon Technologies Corporation 2018 Long-Term Incentive Plan.”

| Dow Jones 30 Industrial Average(2) | | | 16.50 | | | | | | 28.11 | | | | | | \-3.48 | | | | | | 25.34 | | | | | | 9.72 | | |

(1) Historical stock prices presented in the chart have been adjusted to reflect the impact of the Distributions on April 3, 2020.

(2) Prior to the Separations Transactions, Distributions and Raytheon Merger, UTC chose the Dow Jones 30 Industrial Average as its comparable index.

After the Separations Transactions, Distributions and Raytheon Merger, the Company chose the S&P A&D Index as a more informative comparable index.

Both indices are presented, in accordance with Securities and Exchange Commission (SEC) rules, which require that if a company selects a different index from that used in the immediately preceding fiscal year, the company’s stock performance must be compared against both the newly selected index and previous index in the year of change.

| Raytheon Technologies Common Stock | | | $ | 100.00 | | | | | 117.14 | | | | | | $ | 139.55 | | | | | $ | 119.10 | | | | | $ | 171.29 | | | | | $ | 142.64 | |

| S&P 500 Index | | | 100.00 | | | | | | 111.96 | | | | | | 136.40 | | | | | | 130.42 | | | | | | 171.49 | | | | | | 203.04 | | |

| Dow Jones 30 Industrial Average | | | 100.00 | | | | | | 116.50 | | | | | | 149.24 | | | | | | 144.05 | | | | | | 180.56 | | | | | | 198.11 | | |

| S&P Aerospace & Defense Index | | | 100.00 | | | | | | 118.90 | | | | | | 168.11 | | | | | | 154.54 | | | | | | 201.41 | | | | | | 169.05 | | |

[Table of](#ic1191af84175493ba8c7c5a12ec749b7_2194) [C](#ic1191af84175493ba8c7c5a12ec749b7_2194)[ontents](#ic1191af84175493ba8c7c5a12ec749b7_2194)

| October 1 - October 31 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 1,767 | | | | |

| November 1 - November 30 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,767 | | | | | |

| December 1 - December 31(1) | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,000 | | | | | |

| Total | | | | | | — | | | | | | $ | — | | | | | — | | | | | | | | | | | |

(1) The remaining authority to repurchase approximately $1.8 billion of our common stock under the previously approved October 14, 2015 share repurchase program was revoked and replaced as of December 7, 2020 with a $5.0 billion share repurchase program authorized on December 7, 2020, as discussed below.

At December 31, 2020, the maximum dollar value of shares that may yet be purchased under this current program was $5.0 billion.

We did not make any share repurchases during the quarter ended December 31, 2020.

Reserved.

The following selected consolidated financial data should be read in conjunction with the information contained in Item 7 of this Form 10-K and the Consolidated Financial Statements and notes thereto included in Item 8 of this Form 10-K, which are incorporated herein by reference, in order to understand the factors that may affect the comparability of the financial data presented below.

Five-Year Summary

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| (in millions, except per share amounts and number of employees) | | | 2020 | | | | | | 2019 | | | | | | 2018 | | | | | | 2017 | | | | | | 2016 | | |

| For The Year | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Net sales (1), (3), (4) | | | $ | 56,587 | | | | | $ | 45,349 | | | | | $ | 34,701 | | | | | $ | 29,713 | | | | | $ | 28,528 | |

| Research and development (3), (4) | | | 2,582 | | | | | | 2,452 | | | | | | 1,878 | | | | | | 1,876 | | | | | | 1,857 | | |

| Operating profit (loss) (1), (3), (4) | | | (1,889) | | | | | | 4,914 | | | | | | 2,877 | | | | | | 2,989 | | | | | | 3,252 | | |

| Restructuring costs(3), (4) | | | 777 | | | | | | 245 | | | | | | 158 | | | | | | 92 | | | | | | 166 | | |

| Net income (loss) from continuing operations (1), (3), (4) | | | (2,928) | | | | | | 3,731 | | | | | | 1,406 | | | | | | 1,468 | | | | | | 2,133 | | |

| Net income (loss) from continuing operations attributable to common shareowners (1), (3), (4) | | | (3,109) | | | | | | 3,510 | | | | | | 1,216 | | | | | | 1,313 | | | | | | 2,009 | | |

| Income (loss) from discontinued operations attributable to common shareowners | | | (410) | | | | | | 2,027 | | | | | | 4,053 | | | | | | 3,239 | | | | | | 3,046 | | |

| Diluted earnings (loss) per share—Net income (loss) from continuing operations attributable to common shareowners (1), (3), (4) | | | (2.29) | | | | | | 4.06 | | | | | | 1.50 | | | | | | 1.64 | | | | | | 2.43 | | |

| Cash dividends per common share | | | 2.16 | | | | | | 2.94 | | | | | | 2.84 | | | | | | 2.72 | | | | | | 2.62 | | |

| Average diluted shares of Common Stock outstanding | | | 1,358 | | | | | | 864 | | | | | | 810 | | | | | | 799 | | | | | | 826 | | |

| Cash flows provided by operating activities of continuing operations (3), (4) | | | 4,334 | | | | | | 5,821 | | | | | | 2,670 | | | | | | 2,282 | | | | | | 3,003 | | |

| Capital expenditures (3), (4) | | | 1,795 | | | | | | 1,868 | | | | | | 1,467 | | | | | | 1,556 | | | | | | 1,265 | | |

| Acquisitions, including net cash payments, debt assumed & equity issued | | | 35,077 | | | | | | 9 | | | | | | 30,783 | | | | | | 25 | | | | | | 24 | | |

| Repurchases of Common Stock | | | 47 | | | | | | 151 | | | | | | 325 | | | | | | 1,453 | | | | | | 2,254 | | |

| Dividends paid on Common Stock (excluding ESOP) | | | 2,732 | | | | | | 2,442 | | | | | | 2,170 | | | | | | 2,074 | | | | | | 2,069 | | |

| At Year End | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Working capital (3), (4), (5) | | | $ | 7,580 | | | | | $ | (2,397) | | | | | $ | (2,284) | | | | | $ | 2,975 | | | | | $ | 1,370 | |

| Total assets (1), (2), (5) | | | 162,089 | | | | | | 107,792 | | | | | | 103,471 | | | | | | 65,994 | | | | | | 60,252 | | |

| Long-term debt, including current portion (3), (4), (5) | | | 31,576 | | | | | | 40,959 | | | | | | 43,763 | | | | | | 26,917 | | | | | | 23,131 | | |

| Total debt (3), (4), (5) | | | 31,823 | | | | | | 43,252 | | | | | | 45,191 | | | | | | 27,279 | | | | | | 23,696 | | |

| Total debt to total capitalization | | | 30 | | % | | | | 49 | | % | | | | 53 | | % | | | | 46 | | % | | | | 45 | | % |

| Total equity | | | $ | 73,852 | | | | | $ | 44,231 | | | | | $ | 40,610 | | | | | $ | 31,421 | | | | | $ | 29,169 | |

| Total backlog (1), (3), (4) | | | 150,119 | | | | | | 111,665 | | | | | | 93,844 | | | | | | 75,636 | | | | | | 72,328 | | |

| Number of employees (3), (4) | | | 181,000 | | | | | | 121,600 | | | | | | 117,300 | | | | | | 81,600 | | | | | | 77,700 | | |

(1) Amounts prior to 2018 do not reflect the adoption of Accounting Standards Update (ASU) 2014-09, *Revenue Recognition from Contracts with Customers (Topic 606)*, in the first quarter of 2018 using the modified retrospective approach.

(2) Amounts prior to 2019 do not reflect the adoption of ASU 2016-02, *Leases (Topic 842)*, in the first quarter of 2019 using the modified retrospective approach.

(3) Amounts prior to 2020 do not reflect the impact of the Raytheon Merger.

See “Note 2: Business Acquisitions, Dispositions, Goodwill and Intangible Assets” within Item 8 of this Form 10-K for additional information.

(4) Amounts prior to 2018 do not reflect the acquisition of Rockwell Collins, Inc. (Rockwell Acquisition).

(5) Excludes assets and liabilities related to discontinued operations, for all periods presented.

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Management has assessed the effectiveness of RTC’s internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

In making its assessment, management has utilized the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in its *Internal Control—Integrated Framework*, released in 2013*.* Management concluded that based on its assessment, RTC’s internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of RTC’s internal control over financial reporting, as of December 31, [removed: 2020,] [added: 2021,] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.

We have audited the accompanying consolidated balance [removed: sheet] [added: sheets] of Raytheon Technologies Corporation and its subsidiaries (the “Company”) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the related consolidated statements of operations, of comprehensive income (loss), of changes in equity and of cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] including the related notes [added: and financial statement schedule listed in the index appearing under Item 15(a)(2)] (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2020] [added: 2021] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the [added: company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.]

The principal considerations for our determination that performing procedures relating to the [removed: valuation of acquired customer relationship] [added: goodwill] and [removed: tradename] [added: indefinite-lived] intangible assets [removed: arising from the merger with Raytheon] [added: impairment assessments] is a critical audit matter are [added: (i)] the significant judgment by management when [removed: determining] [added: developing] the fair value of [removed: the these] [added: certain reporting units and indefinite-lived] intangible assets, [removed: which in turn led to] [added: (ii)] a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating [removed: audit evidence relating to] management’s [added: significant] assumptions [removed: for the forecasted revenue] [added: related to sales] growth [removed: rates] [added: rates, terminal growth rates,] and [removed: the] discount [removed: rate.][added: rates, as applicable, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.]

[removed: Testing] [added: These procedures also included, among others (i) testing] management’s process [removed: included] [added: for developing the fair value estimates, (ii)] evaluating the appropriateness of the [removed: valuation] [added: discounted cash flow and relief from royalty] methods, [added: (iii)] testing the [removed: completeness, accuracy] [added: completeness] and [removed: relevance] [added: accuracy] of [removed: the] underlying data used in the [removed: valuations] [added: estimates,] and [added: (iv)] evaluating the reasonableness of [added: the] significant assumptions [added: used by management] related to [removed: the forecasted revenue] [added: sales] growth [removed: rates] [added: rates, terminal growth rates,] and [removed: the] discount [removed: rate.][added: rates, as applicable.]

Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company’s [added: discounted cash flow and relief from royalty methods, and the terminal growth rates and] discount [removed: rate assumption.][added: rates assumptions.]

If the completed distributions of Carrier or Otis, in each case, or certain internal business separation transactions, were to fail to qualify for tax-free treatment, the Company could be subject to significant liabilities, and there could be material adverse impacts on the Company’s business, [removed: financial condition,] results of [removed: operations and cash flows] [added: operations, financial condition or liquidity] in future reporting periods.

As described in Note 1 to the consolidated financial statements, a significant portion of the Company’s revenues of [removed: $56.6] [added: $64.4] billion for the year ended December 31, [removed: 2020] [added: 2021] are from long-term contracts associated with the design, development, manufacture or modification of complex aerospace or defense equipment or related services.

Within the Pratt & Whitney [removed: segment these] [added: segment, the] variables and significant judgments relate to current and past maintenance cost and frequency experience.

Management reviews contract estimates at completion on a periodic basis and no less than annually or when a change in circumstances [removed: warrant] [added: warrants] a modification to a previous estimate.

The principal considerations for our determination that performing procedures relating to revenue recognition - contract estimates at completion is a critical audit matter are [added: (i)] the significant judgment by management in developing their estimates of total revenue and total costs at completion, including significant judgments and assumptions on a contract by contract [removed: basis.][added: basis, and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and in evaluating audit evidence related to management’s estimates of total revenue and total cost at completion for contracts.]

These procedures also included, among others, testing management’s process for developing the estimated total revenue and total costs at [removed: completion.][added: completion, including evaluating on a test basis the reasonableness of certain significant judgments and variables considered by management specific to each contract or performance obligation.]

[removed: *Certain Goodwill] [added: *Goodwill] and [removed: Unamortized] [added: Indefinite-lived] Intangible Assets Impairment Assessments*

As described in Notes 1 and 2 to the consolidated financial statements, the Company’s consolidated goodwill and [added: indefinite-lived] intangible asset balances were [removed: $54.3] [added: $54.4] billion and [removed: $40.5] [added: $8.7] billion, respectively, as of December 31, [removed: 2020.][added: 2021.]

Goodwill and [removed: unamortized] [added: indefinite-lived] intangible assets are subject to impairment testing annually, or more frequently if events or changes in circumstances indicate the asset might be impaired.

[removed: In] [added: Beginning in] the second quarter of 2020, [removed: management] [added: we] observed several airline customer bankruptcies, delays and cancellations of aircraft purchases by airlines, fleet retirements and repositioning of [added: OEM] production [removed: schedules.][added: schedules and we experienced significant unfavorable EAC adjustments at our Collins Aerospace and Pratt & Whitney businesses due to a decline in flight hours, aircraft fleet utilization, shop visits and commercial OEM deliveries.]

[removed: The] [added: second quarter of 2020, we evaluated the Collins Aerospace and Pratt & Whitney reporting units for goodwill impairment and determined that the] carrying [removed: value] [added: values] of two [added: of the six] Collins Aerospace reporting units exceeded the sum of discounted [added: future] cash [removed: flows] [added: flows,] resulting in goodwill impairments of $3.2 billion.

In developing [removed: the] [added: our] estimates for the fair value of [added: our] reporting units and [removed: unamortized] [added: indefinite-lived] intangible assets, significant judgment is required [removed: by management] in the determination of the appropriateness of using a qualitative assessment or quantitative assessment.

For the quantitative assessments that are performed for goodwill and [removed: unamortized] [added: indefinite-lived] intangible assets, fair value is primarily based on income approaches using a discounted cash flow method and relief from royalty method, respectively, which have significant assumptions related to sales growth rates, projected operating profit, terminal growth rates, discount [removed: rates] [added: rates,] and royalty rates.

These procedures included testing the effectiveness of controls relating to management’s goodwill and [removed: unamortized] [added: indefinite-lived] intangible assets [removed: quantitative] impairment assessments, including controls over the valuation of [removed: the Company’s] [added: certain] reporting units and [removed: unamortized] [added: indefinite-lived] intangible assets.

Evaluating management’s assumptions related to sales growth [removed: rates, projected operating profit,] [added: rates] and terminal growth rates involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the [removed: reporting units and unamortized intangible assets,] [added: relevant businesses] (ii) the consistency with external market and industry data, and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

| (dollars in millions, except per share amounts; shares in millions) | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| [removed: Product] [added: Products] sales | | | | | | $ | [removed: 43,319] [added: 49,270] | | | | | $ | [removed: 32,998] [added: 43,319] | | | | | $ | [removed: 24,141] [added: 32,998] | |

| [removed: Service] [added: Services] sales | | | | | | [removed: 13,268] [added: 15,118] | | | | | | [removed: 12,351] [added: 13,268] | | | | | | [removed: 10,560] [added: 12,351] | | |

| Total Net Sales | | | | | | [removed: 56,587] [added: 64,388] | | | | | | [removed: 45,349] [added: 56,587] | | | | | | [removed: 34,701] [added: 45,349] | | |

| Cost of [added: sales -] products [removed: sold] | | | | | | [removed: 38,137] [added: 41,095] | | | | | | [removed: 26,910] [added: 38,137] | | | | | | [removed: 21,083] [added: 26,910] | | |

| Cost of [added: sales -] services [removed: sold] | | | | | | [removed: 9,919] [added: 10,802] | | | | | | [removed: 7,688] [added: 9,919] | | | | | | [removed: 6,382] [added: 7,688] | | |

| Research and development | | | | | | [removed: 2,582] [added: 2,732] | | | | | | [removed: 2,452] [added: 2,582] | | | | | | [removed: 1,878] [added: 2,452] | | |

| Selling, general and administrative | | | | | | [removed: 5,540] [added: 5,224] | | | | | | [removed: 3,711] [added: 5,540] | | | | | | [removed: 2,864] [added: 3,711] | | |

| Total Costs and Expenses | | | | | | [removed: 56,178] [added: 59,853] | | | | | | [removed: 40,761] [added: 56,178] | | | | | | [removed: 32,207] [added: 40,761] | | |

| Goodwill impairment | | | | | | [removed: (3,183)] [added: —] | | | | | | [removed: —] [added: (3,183)] | | | | | | — | | |

| Other income, net | | | | | | [removed: 885] [added: 423] | | | | | | [removed: 326] [added: 885] | | | | | | [removed: 383] [added: 326] | | |

| Operating profit (loss) | | | | | | [removed: (1,889)] [added: 4,958] | | | | | | [removed: 4,914] [added: (1,889)] | | | | | | [removed: 2,877] [added: 4,914] | | |

| Non-service pension [removed: benefit] [added: income] | | | | | | [removed: (902)] [added: (1,944)] | | | | | | [removed: (829)] [added: (902)] | | | | | | [removed: (659)] [added: (829)] | | |

| Interest expense, net | | | | | | [removed: 1,366] [added: 1,322] | | | | | | [removed: 1,591] [added: 1,366] | | | | | | [removed: 1,032] [added: 1,591] | | |

| /s/ NEIL G. MITCHILL, JR. | | | | | |

| Neil G. Mitchill, Jr. | | | | | |

| /s/ AMY L. JOHNSON | | | | | |

| Amy L. Johnson | | | | | |

A portion of the total goodwill balance relates to goodwill associated with certain reporting units in the Collins Aerospace Systems, Raytheon Missiles & Defense, and Raytheon Intelligence & Space segments.

February 11, 2022

| Debt extinguishment costs | | | | | | 649 | | | | | | — | | | | | | — | | |

| Debt extinguishment costs | | | | | | 649 | | | | | | — | | | | | | — | | |

| Debt extinguishment costs | | | | | | (649) | | | | | | — | | | | | | — | | |

| Common Stock plans activity | | | | | | — | | | | | | 2 | | | | | | 7 | | |

*Coronavirus Disease 2019 (COVID-19) Pandemic.* The COVID-19 pandemic continues to negatively affect the global economy, our business and operations, supply chains, and the industries in which we operate.

As a result of COVID-19, commercial air travel demand experienced an unprecedented downturn as governments, businesses and individuals reacted to the pandemic in ways such as lockdowns, quarantines, border closings and other travel restrictions and requirements, the adoption of remote working and decreased leisure travel.

In addition, the border closings, lockdowns and labor shortages resulting from COVID-19 negatively impacted global supply and distribution capabilities.

Decreases in the availability, cost and delivery of supplies have caused shortages and delays for the procurement of raw materials, components and other supplies required for our performance.

Our Raytheon Intelligence & Space (RIS) and Raytheon Missiles & Defense (RMD) businesses, although experiencing some negative impacts, primarily from supply chain pressures and labor shortages, have not experienced significant business disruptions as a result of the COVID-19 pandemic.

- Goodwill impairment charges of $3.2 billion related to two of our Collins Aerospace reporting units.

Refer to “Note 2: Business Acquisitions, Dispositions, Goodwill and Intangible Assets” for additional information;

We have seen indications that commercial air travel is recovering in certain areas of demand; however, other areas continue to lag.

In addition, while global vaccination rates have increased, infection from COVID-19 variants have continued, which may impact the pace of the commercial aerospace recovery.

Further, the commercial air travel recovery is tied to general economic conditions and may be impacted by inflation or government budget deficits, among other factors.

As our commercial aerospace business recovers, we have seen increases in certain employee-related and discretionary costs, which had decreased in the aftermath of COVID-19 due to one-time cost reduction actions in 2020.

A recovery may also impact our judgments around credit risk related to estimated credit losses.

On September 24, 2021, in furtherance of an executive order, the U.S. Safer Federal Workforce Task Force issued guidance requiring federal contractors and subcontractors to comply with COVID-19 safety protocols, including requiring certain employees to be fully vaccinated against COVID-19 except in limited circumstances.

The implementation of this mandate may result in attrition, including attrition of critically skilled labor and difficulty in securing future labor needs, for our workforce, as well as the workforces of our subcontractors, suppliers and customers.

The mandate is currently subject to various legal proceedings.

As a result, the impact of mandate on our operations and performance, as well as on our subcontractors, suppliers and customers, is uncertain.

However, if ultimately required, the mandate could affect our performance on contracts, particularly due to disruptions in subcontractor or supplier performance or deliveries, and have a material adverse effect on our results of operations.

For our consolidated non-wholly owned subsidiaries, a noncontrolling interest is recognized to reflect the portion of equity that is not attributable to us.

We reclassified certain prior period amounts to conform to our current period presentation.

These reclassifications include the reclassification of assets and liabilities related to discontinued operations to Other assets, current and Other accrued liabilities, respectively, and the reclassification of debt extinguishment costs, which were previously included in Interest expense, net.

Therefore, the

As described in more detail above in “Accounts Receivable,” we are exposed to credit losses on our contract assets related to our sales of products and services to commercial customers and regularly assess our allowance for expected credit losses as it relates to our Contract assets.

Our sales to and

The current portion of our operating lease liabilities is included in Accrued liabilities on our Consolidated Balance Sheet.

For those income tax positions where it is not more-likely-than-not

providing services.

segments.

| Total Net Sales | | | | | | $ | 296 | | | | | $ | (407) | | | | | $ | (106) | |

program.

Approximately 40% of our RPO relates to long-term commercial aerospace maintenance contracts at Pratt & Whitney, which are generally expected to be realized over a span of up to 15 years.

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| /s/ ANTHONY F. O’BRIEN | | | | | |

| Anthony F. O’Brien | | | | | |

| /s/ MICHAEL J. WOOD | | | | | |

| Michael J. Wood | | | | | |

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*Change in Accounting Principle*

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it accounts for leases in 2019.

company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

*Valuation of Acquired Customer Relationship and Tradename Intangible Assets*

As described in Note 2 to the consolidated financial statements, the Company completed its merger with Raytheon Company (“Raytheon”) on April 3, 2020 for net consideration of $33.2 billion.

The merger was accounted for using the acquisition method of accounting, and the Company was treated as the accounting acquirer.

As a result of this merger, $12.9 billion of customer relationship intangible assets and $5.4 billion of tradename intangible assets were recorded.

Fair value of the customer relationship intangible assets were estimated using a discounted cash flow valuation method and fair value of the tradename intangible assets were estimated using a relief from royalty valuation method.

Management applied significant judgment in determining the fair value of the intangible assets, which involved the use of significant assumptions for forecasted revenue growth rates and the discount rate.

In addition, the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls over management’s determination of forecasted revenue growth rates and the discount rate assumptions used in the valuation of the customer relationship and tradename intangible assets.

These procedures also included, among others, testing management’s process for determining the fair value of the customer relationship and tradename intangible assets.

Evaluating the reasonableness of the forecasted revenue growth rates involved considering the past performance of Raytheon, as well as economic and industry data.

The discount rate was evaluated by considering the cost of capital of comparable businesses and other industry factors.

*Tax-free Determinations of Certain Internal Separation Transactions and the Distributions of Carrier Global Corporation and Otis Worldwide Corporation.*

As described in Note 13 to the consolidated financial statements, management has determined that the distributions of Carrier Global Corporation (“Carrier”) and Otis Worldwide Corporation (“Otis”) on April 3, 2020, and certain related internal business separation transactions (the distributions and internal separation transactions referred to together as the “Transactions”), qualified as tax-free under applicable law.

In making these determinations, management applied the tax law in the relevant jurisdictions to their facts and circumstances and obtained tax rulings from the relevant taxing authorities, tax opinions, and/or other external tax advice related to the concluded tax treatment.

The principal considerations for our determination that performing procedures relating to the tax-free determinations of certain internal separation transactions and the distributions of Carrier and Otis is a critical audit matter are (i) the significant judgment by management in applying relevant tax laws and regulations and assumptions in determining that certain internal separation transactions and the distributions of Carrier and Otis qualify for tax-free status, and (ii) the significant impact to the financial statements if these tax-free determinations were determined to be inappropriate by the relevant taxing authorities.

This in turn led to a significant degree of auditor judgment, subjectivity and effort in performing procedures and in evaluating audit evidence relating to the tax-free determination of certain internal separation transactions and the distributions of Carrier and Otis.

These procedures included testing the effectiveness of controls relating to the significant judgments, including inputs and assumptions, relating to the determination of the tax-free nature of the transactions.

These procedures also included, among others, evaluating the information, including tax rulings from relevant taxing authorities, external opinions and other tax advice, tax law, and other relevant evidence used by management to support management’s position that the Transactions qualified for tax-free status.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the Transactions, related assumptions, and certain representations from management, as well as the application of relevant tax laws.

This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and in evaluating audit evidence relating to management’s estimates of total revenue and total cost at completion for contracts.

Testing management’s process included evaluating on a test basis the reasonableness of certain significant

judgments and variables considered by management specific to each contract or performance obligation.

Intangible assets included unamortized intangible assets of $8.7 billion as of December 31, 2020.

These factors contributed to a deterioration of management’s expectations regarding the timing of a return to pre-COVID-19 commercial flight activity, which reduced future sales and cash flows expectations.

Management considered these factors to be a triggering event requiring impairment evaluation of goodwill, intangible assets and other assets in its commercial aerospace businesses.

The principal considerations for our determination that performing procedures relating to certain goodwill and unamortized intangible assets quantitative impairment assessments is a critical audit matter are the significant judgment by management when developing the fair value measurements of these assets.

This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate management’s fair value measurements and the applicable significant assumptions for both goodwill and unamortized intangible assets relating to sales growth rates, projected operating profit, terminal growth rates, and discount rates.

These procedures also included, among others, testing management’s process for developing the fair value estimates, which included evaluating the appropriateness of the discounted cash flow and relief from royalty methods; testing the completeness, accuracy, and relevance of underlying data in the estimates; and evaluating the significant assumptions used by management relating to sales growth rates, projected operating profit, terminal growth rates and discount rates.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company’s discounted cash flow and relief from royalty methods, and terminal growth rate and discount rate assumptions.

Our management has assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Our management has concluded that based on its assessment, our internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2020] [added: 2021] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in its report which is set forth in Item 8 of this Annual Report on Form 10-K.

There were no changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2020] [added: 2021] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

None.

*Section 13(r)(1)(D)Disclosures*

The following activities are disclosed as required by Section 13(r)(1)(D) of the Securities Exchange Act of 1934, as amended (Exchange Act):

In the Company’s Form 10-Q report for the quarterly period ended on June 30, 2020, the Company disclosed, under the heading “Other Matters” in the “Business Overview” section of the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” activities as required by Section 13(r)(1)(D) of the Securities Exchange Act of 1934, as amended (Exchange Act).

Such disclosure is incorporated herein by reference.

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PART III

Not applicable.

PART III

The information required by Item 10 with respect to directors, the Audit Committee of the Board of Directors, audit committee financial experts, and the procedures by which our shareowners may recommend nominees to our Board of Directors is incorporated herein by reference to the sections of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Election of Directors” (including under the subheadings “Nominees” and [removed: “Nominating Process”)] [added: “How Candidates Are Identified”)] and “Corporate Governance” (including under the subheading “Board Committees”).

| Name | | | | | | Title | | | | | | Other Business Experience Since [removed: 1/1/2016] [added: 1/1/2017] | | | | | | Age as [removed: of 2/8/2021] [added: of 2/11/2022] | | |

| Roy Azevedo | | | | | | President, Raytheon Intelligence & Space (since April 2020) | | | | | | Vice President of Raytheon Company and President of its Space and Airborne Systems (SAS) business unit; Vice President and General Manager of the Intelligence, Surveillance and Reconnaissance Systems product line within SAS; Vice President and General Manager of the Secure Sensor Solutions product line within SAS | | | | | | [removed: 60] [added: 61] | | |

| Christopher T. Calio | | | | | | President, Pratt & Whitney (since January 2020) | | | | | | President, Commercial Engines, Pratt & Whitney; Executive Assistant to the Chairman & CEO, United Technologies Corporation; [removed: Executive Assistant to the President & CEO, United Technologies Corporation] | | | | | | [removed: 47] [added: 48] | | |

| Kevin G. DaSilva | | | | | | Corporate Vice President, Treasurer, Raytheon Technologies Corporation (since April 2020) | | | | | | Vice President and Treasurer, Raytheon Company | | | | | | [removed: 57] [added: 58] | | |

| Michael R. Dumais | | | | | | Executive Vice President, Chief Transformation Officer, Raytheon Technologies Corporation (since January 2021) | | | | | | Executive Vice President, Corporate Strategy & Development, United Technologies Corporation; Executive Vice President, Operations & Strategy, United Technologies Corporation; [removed: Senior Vice President, Strategic Planning, United Technologies Corporation] | | | | | | [removed: 54] [added: 55] | | |

| Gregory J. Hayes | | | | | | [removed: President,] [added: Chairman (since June 2021), President and] Chief Executive [removed: Officer and Director,] [added: Officer,] Raytheon Technologies Corporation (since November 2014) | | | | | | [added: President, Chief Executive Officer and Director, Raytheon Technologies Corporation;] Chairman, President and Chief Executive Officer, United Technologies Corporation | | | | | | [removed: 60] [added: 61] | | |

| Wesley D. Kremer | | | | | | President, Raytheon Missiles & Defense (since April 2020) | | | | | | Vice President of Raytheon Company and President of its Missile Systems business unit; President, Integrated Defense Systems, Raytheon Company | | | | | | [removed: 56] [added: 57] | | |

| [removed: Anthony F. O’Brien] [added: Neil G. Mitchill, Jr.] | | | | | | Executive Vice President and Chief Financial Officer, Raytheon Technologies Corporation (since April [removed: 2020)] [added: 2021)] | | | | | | [added: Corporate] Vice [added: President, Financial Planning & Analysis & Investor Relations, Raytheon Technologies Corporation; Acting Senior Vice] President [added: & Chief Financial Officer, United Technologies Corporation; Corporate Vice President, FP&A] and [added: Investor Relations, United Technologies Corporation; Vice President &] Chief Financial Officer, [removed: Raytheon Company] [added: Pratt & Whitney] | | | | | | [removed: 56] [added: 46] | | |

| Stephen J. Timm | | | | | | President, Collins Aerospace Systems (since February 2020) | | | | | | President, Avionics, Collins Aerospace Systems; Vice President and General Manager, Avionics, Collins Aerospace Systems; Vice President and General Manager, Avionics, Rockwell Collins, Inc.; Vice President & General Manager, Air Transport Systems, Rockwell Collins, Inc. | | | | | | [removed: 52] [added: 53] | | |

| Dantaya M. Williams | | | | | | Executive Vice President & Chief Human Resources Officer, Raytheon Technologies Corporation (since June 2020) | | | | | | Vice President, Human Resources, Pratt & Whitney Commercial Engines | | | | | | [removed: 46] [added: 47] | | |

Information concerning Section 16(a) compliance is incorporated herein by reference to the section of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Other Important Information” under the heading “Delinquent Section 16(a) Reports.” We have adopted a code of conduct that applies to all our directors, officers, employees and representatives.

Information regarding our Code of Conduct is incorporated herein by reference to the section of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Other Important Information” under the heading “Corporate Governance Information, Code of Conduct and How to Contact the Board.” This code is publicly available on our website at http://www.rtx.com/Our-Company/ethics-and-compliance.

Our Corporate Governance Guidelines and the charters of our Board of Directors’ Audit Committee, [removed: Compensation Committee,] Finance Committee, [added: Committee on] Governance and Public [removed: Policy] [added: Policy, Human Capital and Compensation] Committee and Special Activities Committee are available on our website at https://www.rtx.com/Our-Company/corporate-governance.

| Amy L. Johnson | | | | | | Corporate Vice President, Controller, Raytheon Technologies Corporation (since September 2021) | | | | | | Vice President, Finance, Pratt & Whitney Commercial Engines; Vice President and Controller, Pratt & Whitney | | | | | | 47 | | |

| Name | | | | | | Title | | | | | | Other Business Experience Since 1/1/2017 | | | | | | Age as of 2/11/2022 | | |

| Ramsaran Maharajh, Jr. | | | | | | Executive Vice President and General Counsel, Raytheon Technologies Corporation (since December 2021) | | | | | | Vice President, Legal, Raytheon Technologies Corporation; Chief of Staff, Office of the Chief Executive Officer, Raytheon Technologies Corporation; Executive Assistant to Chairman & CEO, United Technologies Corporation; Vice President & General Counsel, Pratt & Whitney | | | | | | 50 | | |

| | | | | | | | | | | | | | | | | | | | | |

| Frank R. Jimenez | | | | | | Executive Vice President and General Counsel, Raytheon Technologies Corporation (since April 2020) | | | | | | Vice President, General Counsel and Corporate Secretary, Raytheon Company | | | | | | 56 | | |

| Thomas A. Kennedy | | | | | | Executive Chair of the Board of Directors, Raytheon Technologies Corporation (since April 2020) | | | | | | Chairman and Chief Executive Officer, Raytheon Company | | | | | | 65 | | |

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| Robert K. Ortberg | | | | | | Director (since April 2020), Special Advisor to the Office of the Chief Executive Officer, Raytheon Technologies Corporation (since February 2020) | | | | | | Chief Executive Officer, Collins Aerospace Systems; Chairman, President and Chief Executive Officer of Rockwell Collins, Inc. | | | | | | 60 | | |

| Michael J. Wood | | | | | | Corporate Vice President, Controller, Raytheon Technologies Corporation (since April 2020) | | | | | | Vice President, Controller and Chief Accounting Officer, Raytheon Company | | | | | | 52 | | |

The information required by Item 11 is incorporated herein by reference to the sections of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Executive Compensation,” “Compensation of Directors” and “Report of the Compensation Committee.”

The information relating to security ownership of certain beneficial owners and management [removed: and the Equity Compensation Plan Information required by Item 12] is incorporated herein by reference to the sections of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Share [removed: Ownership,” “Executive Compensation” and “Approve Amendment to the Raytheon Technologies Corporation 2018 Long-Term Incentive Plan.”][added: Ownership.”]

Securities Authorized for Issuance Under Equity Compensation Plans

The following table provides information about our equity compensation plans that authorize the issuance of shares of our common stock as of December 31, 2021.

| | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | | | | | | Weighted average exercise price of outstanding options, warrants and right ($/share) (b) | | | | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | |

| Equity compensation plans approved by shareowners | | | 14,149,632(1) | | | | | | $ | 78.61 | | | | | 99,190,302(3) | | |

| Equity compensation plans not approved by shareowners | | | 1,072,217(2) | | | | | | — | | | | | | — | | |

(1) Consists of issuable shares of Common Stock under the Raytheon Technologies Corporation 2018 Long-Term Incentive Plan, as amended and restated, effective April 26, 2021 (2018 LTIP) authorized for issuance: (i) upon the exercise of outstanding non-qualified stock options; (ii) upon the exercise of outstanding Stock Appreciation rights (SARs); (iii) pursuant to outstanding RSU awards; and (iv) upon the settlement of outstanding deferred stock units and RSUs awarded under the Raytheon Technologies Corporation Board of Directors Deferred Stock Unit Plan, as amended and restated effective January 1, 2020.

Under the RTX LTIPs, each SAR referred to in clause (ii) is exercisable for a number of shares of Common Stock having a value equal to the difference between the market price of RTX on the exercise date and the exercise price.

For purposes of determining the total number of shares to be issued in respect of outstanding SARs as reflected in column (a) above, we have used the NYSE closing price for a share of Common Stock on December 31, 2021 of $86.06.

The weighted-average exercise price of outstanding options, warrants and rights shown in column (b) takes into account only the shares identified in clauses (i) and (ii).

(2) Consists of shares of Common Stock issuable pursuant to outstanding RSUs awards granted under the Raytheon Company 2019 Stock Plan and the Raytheon Company 2010 Stock Plan, as amended (RTN Stock Plans), that were assumed upon the Merger of UTC and RTN.

(3) Represents the maximum number of shares of Common Stock available to be awarded under the Plan as of December 31, 2021.

RSUs and PSUs (full-value awards) will result in a reduction in the number of shares of Common Stock available for delivery under the Plan in an amount equal to 4.03 times the number of shares subject to the awards.

SARs and stock options are not full-value awards and will result in a reduction in the number of shares of Common Stock available for delivery under the Plan on a one-for-one basis.

The information required by Item 13 is incorporated herein by reference to the sections of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Corporate Governance” (under the subheading “Director Independence”) and “Other Important Information” (under the subheading “Transactions with Related Persons”).

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The information required by Item 14 is incorporated by reference to the section of our Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Shareowners titled “Appoint [removed: an] [added: PwC LLP to Serve as] Independent Auditor for [removed: 2021,”] [added: 2022,”] including the information provided in that section with regard to “Audit Fees,” “Audit-Related Fees,” “Tax Fees” and “All Other Fees.”

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Consolidated Statement of Operations for the Years Ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018][added: 2019]

Consolidated Statement of Comprehensive Income [added: (Loss)] for the Years Ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018][added: 2019]

Consolidated Balance Sheet at December 31, [removed: 2020] [added: 2021] and [removed: 2019][added: 2020]

Consolidated Statement of Cash Flows for the Years Ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018][added: 2019]

Consolidated Statement of Changes in Equity for the Years Ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018][added: 2019]

[removed: |] Report of Independent Registered Public Accounting Firm [removed: on Financial Statement Schedule | | | | | | [I](#ic1191af84175493ba8c7c5a12ec749b7_2261) | | |][added: (PCAOB ID 238)]

| SCHEDULE II—Valuation and Qualifying Accounts for the three years ended December 31, [removed: 2020] [added: 2021] | | | | | | [removed: [II](#ic1191af84175493ba8c7c5a12ec749b7_2273)] [added: [134](#i02f2f3ecab4d4159bc1f9a202e7b68a9_250)] | | |

| [removed: 4.2] [added: 23] | | | [removed: [Description] [added: [Consent] of [removed: Securities.*](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit422020-12x3110xk.htm)] [added: PricewaterhouseCoopers LLP.*](https://www.sec.gov/Archives/edgar/data/101829/000010182922000005/exhibit232021-12x3110xk.htm)] | | | | | |

| 10.2 | | | [United Technologies Corporation Pension Preservation Plan, as amended and restated, effective January 1, [removed: 2020*](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)] [added: 2020](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)[,](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm) [](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)[incorporated by reference to Exhibit 10.2 to the Company](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)[’](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)[s Annual Report on Form 10-K (Commission file number 1-812) for the fiscal year ended December 31, 2020.](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1022020-12x3110xk.htm)] | | | | | |

| 10.5 | | | [United Technologies Corporation Executive Leadership Group Program, as amended and restated, effective October 15, 2013, incorporated by reference to Exhibit 10.11 to the Company’s Quarterly Report on Form 10-Q (Commission file number 1-812) for the quarterly period ended September 30, 2013; United Technologies Executive Leadership Group Program, effective April 1, 2019;](http://www.sec.gov/Archives/edgar/data/101829/000010182913000045/a2013-09x3010xqexhibit1011.htm) and [Raytheon Technologies Corporation Executive Leadership [removed: Group](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm) [](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[Program,] [added: Group Program,] effective April 3, [removed: 2020.](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[*](https://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)] [added: 2020](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[, incorporated by reference to Exhibit 10.5 to the Company](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[’](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[s Annual Report on Form 10-K (Commission file number 1-812) for the fis](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)[cal year ended December 31, 2020.](http://www.sec.gov/Archives/edgar/data/101829/000010182921000008/exhibit1052020-12x3110xk.htm)] | | | | | |

| 10.14 | | | [Form of Award Agreement for non-qualified stock option awards relating to the United Technologies Corporation Long-Term Incentive Plan (referred to above in Exhibit 10.11), incorporated by reference to Exhibit 10.15 to the [removed: Company](http://www.sec.gov/Archives/edgar/data/101829/000010182917000007/a2016-12x3110xkexhibit1015.htm)[’](http://www.sec.gov/Archives/edgar/data/101829/000010182917000007/a2016-12x3110xkexhibit1015.htm)[s] [added: Company’s] Annual Report on Form 10-K (Commission file number 1-812) for the fiscal year ended December 31, 2016.](http://www.sec.gov/Archives/edgar/data/101829/000010182917000007/a2016-12x3110xkexhibit1015.htm) | | | | | |

| 10.15 | | | [Schedule of Terms for performance share unit awards relating to the United Technologies Corporation Long-Term Incentive Plan (referred to above in Exhibit 10.11) (Rev. January 2016), incorporated by reference to Exhibit 10.17 [removed: to](http://www.sec.gov/Archives/edgar/data/101829/000010182916000050/a2015-12x3110xkexhibit1017.htm) [the Company](http://www.sec.gov/Archives/edgar/data/101829/000010182916000050/a2015-12x3110xkexhibit1017.htm)[’s] [added: to the Company’s] Annual Report on Form 10-K (Commission file number 1-812) for the fiscal year ended December 31, 2015.](http://www.sec.gov/Archives/edgar/data/101829/000010182916000050/a2015-12x3110xkexhibit1017.htm) | | | | | |