L3Harris Stock Rises on Earnings Beat. This Is a ‘Clear Inflection Point.’

L3Harris Technologies reported strong new orders and lifted its financial guidance. (David Kawai/Bloomberg)

L3Harris Technologies reported better-than-expected quarterly results. The stock is up with the company at a “clear inflection point.”

Thursday morning, the defense contractor announced second-quarter earnings per share of $2.78 from sales of $5.4 billion. Wall Street was looking for earnings per share of $2.48 from sales of $5.3 billion, according to FactSet. A year ago, the company reported EPS of $3.24 from sales of $5.2 billion.

New orders in the quarter were strong at $8.3 billion, 1.5 times sales.

Financial guidance moved higher as well. Management expects EPS to land between $10.40 and $10.60 a share. The midpoint of $10.50 is up a dime from prior guidance. Wall Street currently projects $10.49 a share, according to FactSet.

L3Harris stock closed up $1.3% at $273.22 on Thursday, while the S&P 500 added 0.1% and the Dow Jones Industrial Average fell 0.7%.

“This marks a clear inflection point, with our strongest top-line growth in six quarters and meaningful progress towards our 2026 Financial Framework,” said CEO Christopher Kubasik in a news release.

The 2026 framework, revealed in late 2023, aimed for 2026 sales of $23 billion and operating profit margins of 16%. Wall Street currently projects 2026 sales of just under $23 billion and operating profit margins just north of 16%.

Sales and profit margin guidance remained similar, but cash flow guidance moved higher. L3Harris now expects 2026 free cash flow of about $3 billion, up from the original guide for free cash flow of $2.8 billion.

“Defense is entering a generational investment cycle, as U.S. and allied budgets grow rapidly,” added Kubasik. “Demand is accelerating, and our portfolio is aligned with key growth areas—Golden Dome, space, missiles, shipbuilding, autonomy, and resilient communications.”

President Donald Trump announced his Golden Dome missile-defense shield for the U.S. in May. It will cost hundreds of billions to develop, according to government estimates.

Overall, it’s a solid report. More importantly, management feels confident about the future. Investors feel good too. Coming into Thursday trading, L3Harris stock was up about 28% this year.

Write to Al Root at allen.root@dowjones.com