The acquisitions of Aerojet Rocketdyne (AR) and the Tactical Data Links (TDL) product line significantly expanded L3Harris's market presence and capabilities in missile solutions, space exploration, and tactical communications.

The pending divestiture of the CAS disposal group indicates a strategic shift away from commercial aviation, allowing L3Harris to focus on its core defense and government sectors. The fair value less costs to sell the CAS disposal group is $834 million.

The company embarked on LHX NeXt, a three-year program designed to enhance organizational agility and performance by leveraging scale and relationships across segments. This includes investments in enterprise tools and optimized processes.

Supply chain disruptions negatively impacted revenue, operating income and orders in the Communication Systems segment in fiscal 2022 and to a lesser extent in fiscal 2023, although supply chain resiliency initiatives mitigated these disruptions during 2023.

Management is focusing on program execution and continuous improvement, strengthening risk management, integrating recent acquisitions, and attracting and retaining skilled workforce.

The company reduced its total recordable injury rate (TRIR) and lost day injury rate (LDIR) by 37% and 41%, respectively, in the last three years. For fiscal 2023, TRIR declined by 24% and LDIR declined by 29%.

The company is highly dependent on revenue from U.S. Government customers, and a reduction in U.S. Government funding or changes in spending priorities could have an adverse impact on business, financial condition, results of operations, cash flows and equity.

A significant portion of revenue is derived from fixed-price contracts, which could subject the company to losses in the event of cost overruns or a significant increase in or sustained period of increased inflation.

The company faces a heightened risk of security breaches or disruptions from cyber-attacks, cyber intrusions, and insider threats, which could disrupt operations, compromise sensitive information, and damage reputation.

The company operates in highly competitive markets where some competitors are larger and can maintain higher levels of expenditures for research and development. The company concentrates on opportunities compatible with its resources, overall technological capabilities and objectives.

The company competes domestically and internationally against large defense companies such as BAE Systems, Boeing, General Dynamics, Lockheed Martin, Northrop Grumman, and RTX, as well as non-traditional defense contractors.

Principal competitive factors include product and system quality and reliability, technological capabilities, service, past performance, ability to develop and implement complex solutions, ability to meet delivery schedules, and cost-effectiveness.

Global supply chains experienced significant disruption from material availability and supplier performance, extended lead times, pricing volatility, inflationary pressures and labor issues, negatively impacting production flow, results of operations, financial condition and cash flows.

The company implemented supply chain resiliency initiatives such as leveraging scale to negotiate with suppliers, investing in tools and analytics to assess supplier risk, strengthening relationships with key suppliers, and seeking alternate supply sources.

The company is investing in enterprise tools and optimized, revamped processes to unlock further opportunities for margin expansion and create additional value for shareholders, as part of the LHX NeXt program.

The company invested $480 million in company-funded R&D in fiscal 2023, focused on technologies that expand capabilities across domains, representing 2% of total revenue.

The company relies on a combination of patents, copyrights, trademarks, trade secrets, know-how, confidentiality provisions and licensing arrangements to establish and protect intellectual property rights.

Competitors may develop competing products and services or technologies that gain market acceptance in advance of the company's offerings, or may develop new products that cause existing products to become non-competitive or obsolete.

The company repurchased 2.5 million shares of common stock for $0.5 billion in fiscal 2023 and has a remaining repurchase authorization of $3.9 billion, indicating management's view that shares are undervalued.

The company paid per share cash dividends of $1.14 each quarterly period of fiscal 2023, with an annualized per share cash dividend rate of $4.56, reflecting a commitment to returning value to shareholders.

The company is prioritizing debt repayment through the prioritization of capital allocation and potentially accelerated with proceeds from non-core asset divestitures.

The company has set environmental sustainability goals to reduce GHG emissions by 30% and water usage by 20% from 2019 levels and achieve a 75% solid waste diversion rate by 2026.

The company has reduced its total recordable injury rate (TRIR) and lost day injury rate (LDIR) by 37% and 41%, respectively, in the last three years, demonstrating a commitment to employee health and safety.

The company has established long-term goals for workforce diversity, with half of the workforce to be female and at least one third to be people of color. The company also has employee resource groups and diversity council to further these goals.

The company participates in U.S. and international markets that are subject to uncertain economic conditions, making it difficult to estimate growth and impacting the accuracy of future revenue, income and expenditure forecasts.

Ongoing instability and current conflicts in global markets, including in the Ukraine and Eastern Europe, Israel, the Gaza Strip and the Middle East and Asia, and the potential for other conflicts and future terrorist activities may adversely affect markets, insurance, operations and profitability.

Unfavorable credit conditions in financial markets outside of the U.S. could adversely affect the ability of international customers and suppliers to obtain financing and could result in decreased orders or impact the ability of customers to make payments.