RTX Corp recorded a $300 million non‑cash pretax charge in its fourth‑quarter 2025 financial statements. The charge reflects the transfer of $2.5 billion of defined‑benefit pension obligations to a Prudential Financial unit through an annuity buyout that was initiated on November 7 and is expected to close by December 30.
The $300 million charge will lower reported earnings for the quarter, but it is a one‑time, non‑cash item that does not affect cash flow. Adjusted earnings per share remain unchanged, as the company’s CFO noted that the charge is excluded from adjusted EPS calculations.
The move is part of RTX’s broader strategy to de‑risk its balance sheet. By transferring long‑term pension liabilities to an insurer, the company removes actuarial and longevity risk, simplifies future earnings volatility, and improves key financial ratios. The timing aligns with a broader industry trend of pension risk transfers and reflects management’s confidence in the company’s ability to absorb the accounting impact without harming core operations.
The annuity buyout does not alter retiree benefits. Approximately 60,000 beneficiaries—about one‑third of the plan’s participants—will continue to receive the same promised payments, while the insurer assumes all investment and longevity risk.
CFO Neil Mitchell explained that the transaction is a one‑time, non‑cash, pre‑tax charge of roughly $300 million. He emphasized that the charge will not affect adjusted EPS and that the company’s pension plans remain well‑funded, citing a similar $923 million transfer to Prudential in 2018.
Analysts have not reported a significant market reaction to the announcement, viewing the charge as a neutral balance‑sheet optimization that does not alter RTX’s earnings guidance or cash‑flow outlook.
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