Textron Raises 2026 Outlook as Q3 Aviation and Systems Revenue Grows

Textron Inc. (NYSE: TXT) raised its 2026 adjusted earnings and manufacturing cash flow outlook after third-quarter revenue increased 4.1%, supported by double-digit growth at Textron Aviation and Textron Systems. Adjusted earnings per share rose 13.5%, while stronger cash generation provided the basis for a higher full-year cash flow range.

Revenue totaled $3.75 billion, compared with $3.60 billion a year earlier. Adjusted EPS increased to $1.76 from $1.55, while GAAP EPS rose to $1.56 from $1.31. Manufacturing cash flow before pension contributions climbed 48.8% to $418 million from $281 million.

Total segment profit declined 1.4% to $355 million despite the revenue growth, and segment profitability narrowed to 9.5% from 10.0%. Adjusted EBITDA was unchanged at $486 million.

Aviation and Systems drive growth

Textron Aviation generated revenue of $1.68 billion, up 13.6% from $1.48 billion. Aftermarket revenue increased 10% to $541 million, and the business delivered 51 jets and 32 commercial turboprops during the quarter. Textron said third-quarter orders were the strongest in three years, while backlog stood at nearly $8.0 billion.

Aviation segment profit increased 4.1% to $179 million, but its margin narrowed to 10.7% from 11.6%. The company also reported more than 1,200 flight-test hours across its Gen3 light-jet development programs as they move toward Federal Aviation Administration certification.

Textron Systems posted the fastest revenue growth among the company’s major segments. Revenue rose 16.1% to $360 million, driven by armored land vehicles and military training services provided through ATAC. Segment profit increased 21.3% to $57 million, lifting the margin to 15.8% from 15.2%.

Systems backlog ended the quarter at $3.49 billion. The segment also received a $230 million award for the Ship-to-Shore Connector program.

Bell revenue and profit decline

Bell revenue fell 9.1% to $933 million, while segment profit declined 17.4% to $76 million. Its margin decreased to 8.1% from 9.0%, and backlog was $7.56 billion at the end of the quarter.

The U.S. Army received congressional approval for an ATR request related to the MV-75 Cheyenne program, with approximately $300 million obligated through contract modifications. Textron said the program continued to mature, including installation of the first nacelles and the start of testing for the first gearboxes. Bell also ramped H-1 production activity for an order from Nigeria.

Industrial revenue was broadly stable at $765 million, up 0.5% on a reported basis and down 0.1% organically after an unfavorable foreign-exchange effect. Segment profit rose 22.6% to $38 million, improving the margin to 5.0% from 4.1%. The segment’s operating activity included E-Z-GO’s introduction of third-generation Samsung lithium-battery technology and Kautex’s preparations for additional Pentatonic battery-enclosure launches.

Textron Financial revenue declined to $13 million from $26 million, while segment profit fell to $5 million from $18 million. Textron attributed the decreases to gains recorded in the prior-year quarter from the disposition of non-captive assets.

Full-year outlook raised

Textron now expects 2026 adjusted EPS of $6.55 to $6.65, compared with its previous range of $6.40 to $6.60. The company also increased its forecast for manufacturing cash flow before pension contributions to between $800 million and $900 million from $700 million to $800 million. The outlook assumes approximately $50 million of pension contributions.

Adjusted EPS, segment profit, adjusted EBITDA, organic revenue growth and manufacturing cash flow before pension contributions are non-GAAP measures. Textron said these metrics should be considered alongside its GAAP results and may not be comparable with similarly named measures used by other companies.

The company cautioned that its outlook and other forward-looking statements remain subject to risks and uncertainties that could cause actual results to differ materially. It referred investors to the risk disclosures in its third-quarter earnings release, the release concerning its intended separation, and its regulatory filings.