Good morning, everyone, and welcome to the RTX 2023 Investor Day being held here in Paris. Please note during Q&A, we'll be taking questions only in the room this year. To ask a question, please raise your hand during the Q&A. We'll have mics for you. Please list your name and your company. Before we begin, I'd like to remind you that we'll be making forward-looking statements today, such as comments on future plans, objectives, expected performance. These are subject to risk and uncertainty. This could cause our actual actions or results to differ greatly. You should consult our SEC filings for descriptions of those risks and uncertainty. With that behind us, I'm excited to kick off our 2023 Investor Day. We are defined by the questions we ask and the challenges we take on. When will sustainable be the standard? Will data be the difference? Can materials be lighter? Can they handle 5,000 degrees? How can travel be transformed? How will we make the world safer, decisions faster? Are seamless communications the key? Can what's up there help us down here? Is human ingenuity limitless? Is our true potential endless? At RTX, we take on the big challenges, we ask the big questions, and we find answers. We are RTX. Now, please welcome RTX Chairman and Chief Executive Officer, Greg Hayes. Wow, an applause, that's cool. Bonjour, bienvenue à Paris. Good morning, and welcome to Paris, and thank you all for joining us today. It's amazing, it's been 2 years since our last Investor Day. We held it in East Hartford, what we thought was near the end of the pandemic, we were a little off. It's amazing to me how much things have changed in these last 2 years. I go back 4 years, and I think we were in this same room with the announcing the merger of Raytheon and United Technologies' aerospace business, and things really have changed since then. What hasn't changed, of course, is our commitments that we make. The commitments that we made back in 2020 when we brought these companies together, the commitments to focus on technology and talent, all of that remains the same. The, and the focus that we had on our financial results, returning $20 billion to share owners in the first 4 years after the merger, still on track. We're gonna talk about that today and more. What I would tell you, though, is what has also not changed is our commitment to the A&D marketplace. I believe we have the best technology, the best manufacturing capability, and the best people in the industry. There's 184,000 people working every day to solve our customers' most difficult problems, and with a focus on the mission of RTX. That mission is pretty simple, but very powerful. That is, our goal is to defend democracy around the world and connect the world through commercial aerospace. Simple, powerful, again, it is the focus of every single RTX employee that comes to work every single day. A couple of things I'll mention before we get into the agenda. You'll notice RTX as opposed to Raytheon Technologies. RTX will be the way we brand the company going forward, recognizing we have 3 great brands out there: Collins Aerospace, Raytheon, and Pratt & Whitney. Again, not to diminish anything from the heritage of United Technologies and Raytheon, if you think about the old ticker symbol for UTC, it was UTX, and RTN for Raytheon. Now it's RTX. Again, a nod to the past and a nod to the future. I think it's going to be an incredibly powerful brand as we go forward. With that, just a quick look at the agenda. We're going to start out, Chris Calio, our President and Chief Operating Officer, is going to talk about our path to 2025, also our path beyond 2025. Again, the goal line is not 2025, it's not 2030, it is a long way out. Recognizing that Raytheon, as a company, has a heritage of more than 100 years, Pratt is approaching its 100th anniversary in another year. These companies have been around a long time, the focus will be on how we sustain that into the future. After that, we'll have the business unit presidents come up, to have Steve Timm kick it off, talking about Collins. He'll be followed by Shane Eddy, talking about the Pratt & Whitney story, and then Wes Kremer adding cleanup, talking about the Raytheon company. It's important each of those presentations be about 30 minutes. Jennifer's going to come up and then spend about 10 minutes doing Q&A with everybody. After that, Neil's going to come up and kind of wrap it all up in terms of financial outlook for the next... After that, Chris, Neil, and I, with Jennifer's help, will take your questions for about 20 minutes at the end. It's gonna be a good program, a lot of information. I'd remind everybody, out on the internet is the presentations that you're gonna see, along with a number of appendices to, we'll sort through all of these numbers. Before we get started, though, I'd just like to introduce a few other folks that have just joined us here in Paris from the senior leadership. I'll start out with Dinesh Paliwal. Dinesh is our lead independent director, former CEO and Chairman of Harman International, our lead director since the merger. Welcome, Dinesh. Also Dantaya Williams. Dantaya, our Chief Human Resources Officer. Dantaya has been a busy woman these last few years, as I think about the 32,000 people she hired last year. Phenomenal work. Raja Maharajh, our General Counsel. Where's Raja? Thank you. Raja's also been busy trying to clean up things. Jeff Shockey, many of you know, our Vice President of Global Government Relations in D.C. Pam Erickson, our Chief Communications Officer, also been very busy. For all of this work that you see around you, she and her team have been very busy. Finally, Barbara Borgonovi, our VP of Corporate Strategy. She's also been busy, although we can't talk about what she's doing. Some others might. With that, let's just take a look at the portfolio, there's nothing new here, right? Right, we believe we have the best portfolio in aerospace and defense. I think importantly, well, you'll hear this number over and over again, $180 billion of backlog as we ended the Q1 of 2023. Think about that, $180 billion. As I break that down, about $70 billion is on the defense side and about $110 billion on the commercial side. When we talk about beyond 2025, you only need to look at the backlog. It's also a balanced portfolio, both domestic and international. About 30% of our revenue coming from international customers, 70% domestic. Very heavily weighted towards defense on the domestic side. What's important, though, to keep in mind is every second of every day, a plane takes off with RTX content, Pratt, Collins. Right? That's 11 million passengers a day. We also protect democracy around the world, 44 different countries rely on Raytheon defense technology to defend their borders. Very important, we've really seen that, of course, with Ukraine. Wes will talk a little bit about that. As far as Collins, again, the number one system provider on the 737, the A220, the 777, the 787, the A350, the A330, it goes on and on. Steve has a great portfolio. Right? They have $100 billion of product that is off of warranty today, flying around the world, generating more than $6 billion of aftermarket and only growing more and more every single day. Steve will also have the company focus on JADC2 with the 4 to 3 that Chris is going to talk about, going from 4 business units to 3. Pieces of RIS will be realigned into the Collins business, with a focus in mission systems area to have a single point of contact for the customer around JADC2, and you'll hear more about that from Steve. As far as Pratt, everybody knows about the GTF, and I think Shane has a great story to tell about where we are, what we need to do, and where we're going on GTF. That's for the A320, it's for the A220, as well as the E2. It's a powerful story and the best technology. I know there's questions about GTF, but I would tell you, last night, United announced an order for 120 A320 aircraft, be it A321 and I think some XLRs, Pratt powered with the GTF. There is confidence out there in the GTF. The V2500, of course, about 6,000 engines out there in the market, still in the sweet spot. The thing to think about with the V2500, I know people were worried there'd be lots of retirements with the pandemic. We have not seen that. In fact, about 30% of those 6,000 engines that are out there have yet to see their first shop visit. As you think about aftermarket at Pratt, it's not just GTF, but it's V2500, and it's Pratt & Whitney Canada, the premier small engine manufacturer in the world with over 60,000 engines in service. On the military side of Pratt, of course, we are the sole provider of fifth-gen engines. The F135 for the F-35, the B-21, the new long-range bomber, the F-22, which is the F119 engine, the sole provider of fifth-gen, and that is going to continue as we upgrade the F135 with a recently funded Engine Core Upgrade. Again, you'll hear more about that from Shane. Lastly, the Raytheon business. This is an incredible set of franchises that you're going to hear about. What's important as you think about the situation in Ukraine, the Russian invasion of Ukraine, it is with the help of every one of our products, whether it's been Patriot, NASAMS, Stingers, Javelins, Excalibur shells, all of those things on the battlefield every day being tested and proven to be the best technology in the world. More to come on that. Of course, other franchises, if you think about it. Besides Patriot, you've got AMRAAM, you've got Next Generation Jammer, you've got Standard Missile-3, Standard Missile-6, we talked about Excalibur, Tomahawk Long Range Cruise, it doesn't end there. LTAMDS is coming, which is a Patriot upgrade. You've got the HACM, which is the hypersonic Hypersonic Attack Cruise Missile. We're number one in hypersonics. We're number one in air defense. Incredible, incredible franchises. It doesn't end, right? The markets are gonna continue to grow. If you take a look at it, right now, there's about 12,500 end or aircraft in backlog. If you believe the Airbus numbers, which we do believe, there'll be about 44,000 aircraft delivered in the next 20 years. Think about that in context of there's about 28,000 aircraft out there flying today. You're going to be adding 44,000. Now, half of those will get retired, but you're still talking about almost doubling the fleet in the next 20 years, all of which plays to the sweet spot that we have in the commercial aerospace spot. Domestic RPMs, of course, as we think about the recovery from COVID, we're back to 100% domestically. I think we're back to about 70%-80%, and improving every single day on the wide body. For those of you that flew over from the U.S., I think most of you would agree, the planes are full, and that's good for business. I would also say the pace of the international recovery is also encouraging, especially in China. China, the domestic traffic is back to pre-pandemic levels, 70% back on the international side, again, all encouraging signs. I think just as importantly, as we think beyond 2025, we still think you'll see 3%-5% growth every single year, not just through the end of the decade, but for the next 20 years. I'd also just point out, next generation single aisle. We talked a lot about that two years ago, we talked a lot about that four years ago. I hope we're talking about that in the future, as well as way out there. If you talk to both Boeing and Airbus, they would tell you there's probably not going to be a new next-generation single aisle until at least 2035. Why is that important? Well, what it means is all of the equipment that we have today, Steve Timm's equipment, Shane Eddy's equipment, is going to be in service a lot longer. When we launched the GTF back in 2015, we thought a 10- or 15-year production life before it would be replaced. It's going to be much, much longer than that, which means a much, much stronger aftermarket over the next 10, 15, and 20 years. Spending to note, when we sat here a couple of five years ago, there was a question: where is defense spending going? That all changed on February 27, 2022, when Russia invaded Ukraine. As we look at it today, over the next five years, there's roughly $900 billion of additional defense spending globally that's addressable by RTX. That's a huge, huge number. I'd also say, with the debt ceiling behind us, I know there was concern what happens with the debt ceiling, we're only going to see a 3.3% top-line growth. We still believe all of our priorities, as we've seen with the markups, through the SASC, or through the Senate Armed Services and through the House Armed Services, all of our priorities are going to be funded, including the Engine Core Upgrade, AMRAAM, Patriot, you name it. The budgets are strong, the future is clearly bright. I think what's important to note is on the defense side, our technology is clearly aligned with the objectives of the DoD, whether it's hypersonics, whether it's JADC2, Indo-PACOM conflict, all of those things play to the strength of Raytheon. just a couple of thoughts, I think I'm already over before I sit down. As you think about it, key takeaways, you'll see this slide again at the end of the presentation. We're going to transform RTX, right? We're going to go from 4 business units to 3 business units and 3 very, very powerful franchises. We've got great end markets, importantly, we're not just focused on technology investments, we're focused on manufacturing excellence and structural cost reduction. We're going to deliver on those 2025 commitments. You know, we took up the capital return. Recall, we took $20 billion return to shareowners by 2024. That number is going to be $33 billion-$35 billion by the end of 2025. That's another $7 billion a year of capital back to shareowners in the form of dividends and share buyback. Again, we still see strong top-line growth, 6%-7% through 2025. We still see strong margin expansion and $9 billion of free cash flow. I know there's questions about it. Neil is going to come up and take everybody through that, and I think you'll see we have a very credible and achievable story around $9 billion. With that, let me turn it over to Chris Calio, our President and Chief Operating Officer, to talk about our transformation, how we're going to achieve these commitments. Thank you. Okay, well, good morning, everybody. Maybe one programming note before we start. If you see us sweating up here, I promise it's not because we're afraid of your questions. It's about 100 degrees up here under the lights, so just wanted to give that context. I'm going to pick up right where Greg left off, and that's our 2025 commitments. You know, since we issued those commitments in May of 2021, we as a team have spent a significant amount of time on the road out in our business units, really testing as part of our operating cadence that we do, the fundamentals of each of our business units and the fully realizable potential of each of our business units. Frankly, not just at the business unit segment level, but at the strategic business unit level, program, product line, key sites. What I will tell you is that exercise has really reaffirmed for us and reinforced that we are well-positioned for the 2025 commitments. A big piece of that is what Greg just talked about, which is our product portfolio. Our products are essential for the end markets that they serve, essential for the growing threats in the global defense environment, and of course, essential on those fastest-growing platforms that are fueling the recovery in commercial aerospace. I think that's reflected in our backlog. What we're going to talk about today, of course, is how we take that backlog and how we take those privileged product positions and convert them into our 2025 commitments. Perhaps more importantly, we're here to tell you how excited we are about the future, and the long-term potential of RTX just three-plus years into this merger. As Greg said, 2025 is not the end goal, 2030 is not the end goal. I don't know that there is an end goal, but there's tremendous potential here in the business, and we're going to take you through that today. Start with 2025, and I think as Greg has said previously, in terms of our commitments, there's no easy path. It's not supposed to be easy when you issue long-term commitments in the middle of a pandemic. That's okay. What you're going to see from us today is that we're going to continue to power through those things that have changed and have a very credible path, as Greg said, to the 2025 commitments. The environment has changed a little bit, right, since May of 2021. Let me take you through that and some of our puts and takes. On the demand side, we've lost $3 billion of sales due to the Russian sanctions. Everybody knows that. We've been pretty clear about that. We've also had some competitive, very competitive losses in our defense portfolio, in particular at RIS. Supply chain. Supply chain, though getting healthier for sure, we're going to continue to see elements of those constraints continue into 2024. I think we all know about rocket motors. We've been pretty clear about that. Structural castings, though getting healthier, will not be fully back to where we need it to be, by the end of this year. sort of raw materials. Raw materials, we're starting to see again, some tension in the lead times there. Continued tension in the supply chain, some of which will persist into 2024. Of course, the big change that everyone knows about, inflation. Inflation in labor, inflation in material. That added about $2 billion of headwind on an annual basis to us. Those are the things that have sort of been the headwinds since 2021, but we haven't sat around and just accepted those. We've continued to focus on those things that we can control to combat the headwinds, chief among them, pricing. We've had a lot of questions on our ability to do that, not only on the OE side, but most particularly in the aftermarket side, again, to combat those headwinds we've seen in the supply chain. Of course, cost reduction, something that's within our DNA. As you know, we're nearing about the $1.5 billion in cost synergies that we had committed to. We're going to take that up to $2 billion on the back of some additional cost reduction activity that we're doing and some of the cost that's going to come out as part of the 4 to 3 realignment that Greg mentioned. I'll touch about that a little bit later. Net-net, I would say we are navigating the puts and takes and are largely, you know, on track, albeit through a bit of a different path, given some of those changes in the environment. I've spoken to many of you in this room about our 2025 commitments, and there are, I would say, four recurring key themes that continue to come up. The first, of course, is the $9 billion in free cash flow that Greg just mentioned. Second is the incremental margin story at Collins. The third is the GTF path to aftermarket profitability and that ramp-up. The fourth is margin expansion in our Raytheon businesses. I'll start with the $9 billion in free cash flow and kind of walk you through where our confidence comes from. A big part of that is as we walk through the largest source of that cash, which is our strong operating profit growth. 75% of that is going to come from Pratt and Collins, and more than 75% of that growth at Pratt and Collins is going to come from our commercial aftermarket. You just heard Greg talk about the product portfolio and the aftermarket potential of this business, the right programs in the right part of their life in terms of the sweet spot of the aftermarket. We've also got tremendous visibility into our commercial aftermarket. If you think about this, we've got over 200 field service reps embedded with our customers all around the world, working with them on their fleet planning and fleet logistics. Of course, there's a ton of data coming off of our equipment each and every day that we run through our analytics platforms to understand when things are going to come off wing, what the work scoping is going to look like, and things of that nature. Very good visibility into the largest piece of that walk to the $9 billion in free cash flow. Again, as Greg said, Neil will take you through that in more detail a little bit later. Let me hit the next 3. Incremental margins at Collins. That's really an absorption and cost reduction story. As the volumes continue to increase, most notably in OE, keep in mind that Collins is capacitized for much larger OE rates than you're seeing today. You're going to see the benefits of absorption. In addition, Steve and team have kicked off a significant amount of transformation work from a cost perspective that you're going to also start to see the benefit of as we move through the period. Things like centers of excellence, moving to low-cost sources, network consolidation. The demand is clearly there for the Collins portfolio. Greg just talked about it, and it's a cost and absorption story going forward. Third is the profitability ramp on the GTF aftermarket. Before I get into that, maybe just a minute on fleet health. You know, to be clear, the fleet is not where it needs to be. Period, full stop. It's not where we need it to be, but more importantly, it's not where our customers need it to be. We are working tirelessly day and night to get that fleet into a better position, and we will certainly talk about that during Shane's presentation. I'll tell you, if you step back and you kind of look at what the causes are here, this is not a technical issue. This is an industrial issue. When we came into the year, we laid out a removal forecast with our customers, so they know how many removals we're going to have in a year, when those are going to come off. If you look at the actuals at this point in the year, we are virtually within a few percentage points of how we communicated that to our customers. The issue, unfortunately, as I said, an industrial one, it's the MRO lag. We have not been able to turn engines through our MRO facilities at the pace that we need to fill in the holes that we're seeing from the removals. We're starting to get to an inflection point here, as supply chain begins to get healthier. The truth of the matter is, we've not been good enough in getting those engines out of our MRO facilities. We truly believe that we're going to see an inflection point here in the H2 of the year and get to a much healthier, more manageable position on the fleet in the back half of the year. If you just sort of, again, step back and look at the long-term view of this program, the future is incredibly bright. We're going to continue to invest in those actions that not only bring customer satisfaction, but profitability of the program. As Greg said, this program is much larger than we had anticipated when we launched it. It's going to have a much, much longer run and much longer aftermarket run. Those investments include things like time on wing improvements in the hot section, combustor, and the remainder of that hot section. Things like additional capacity in our MRO network. We're going to go from 12 facilities today to 19 by 2025. Then increasing repair development, that we can not only increase our turn times, but not have as much part demand. That is the path to profitability on the GTF. First priority, of course, is fleet health, and Shane will talk about that today. The long-term prospects remain incredibly bright. Then the last question is on the margins at Raytheon. I'll tell you, that's really kind of a two-part story. One is improving contract mix. You're going to see international sales become a larger part of that mix, a more profitable mix. You're also going to start to see development programs, which are lower margin, shift into higher margin production programs. Two very powerful shifts there. Then the second piece is productivity. I know people have asked, where's the productivity in the programs? That's really a function of two things. One, it's getting through some difficult programs, achieving some of those milestones, de-risking some complex, fixed price development programs. We've got a path to do that as we head out to 2025. The second piece is just productivity on our production programs. Labor and supply chain have continued to improve, we've seen better flow in our shops, being able to protect our period of performance. In addition, Wes Kremer is going to take you through some additional operational and production efficiencies that we're investing in our shops. Again, productivity. As Greg Hayes said, we're going to take you through 2025, but this portfolio is built for long-term, sustainable, profitable growth. As Greg Hayes said, we firmly believe that we have the best portfolio in A&D. That's not some bumper sticker or high-level platitude. It's really borne out by the portfolio that Greg Hayes described. If you think about our portfolio, largely platform-agnostic, directly responsive to the macro threats and opportunities that are out there. Greg Hayes listed off all the programs on our commercial side: A320, A220, 737, A350, 787, where we've got fantastic positions. Steve's going to come up here and tell you that at Collins Aerospace, 70% of his product lines are number 1 or 2 in their segments. Shane's going to come up here and tell you, and Greg already did, we've got the premier small engine company in Pratt & Whitney Canada, sole source on over 200 programs. In the large commercial engine business, it is narrow-body focused, the fastest-growing segment of the commercial aerospace market, and we've got a young portfolio, both V and a growing portfolio at the GTF. When you think about Pratt & Whitney and Collins Aerospace, these programs have 20, 30, 40-year aftermarket tails. On the defense side, we've got a tremendous amount of what we would call franchise programs that'll be in place for decades to come. Again, advanced, you know, missile technologies, advanced systems, franchise programs all across the portfolio. Of course, we're investing heavily to not only deliver on the backlog today, but to continue to fill it for tomorrow. $10 billion in E&D and CapEx, just to make sure, as Greg said, that we're not only the best technological company in the space, but the best manufacturing company in the space. Let me take you through kind of our playbook and how we're going to harness this potential and really leverage our scale. It's really four things. It's our digital transformation, our operational modernization, our customer-focused realignment, and then, of course, our differentiated technology, our cross-company roadmap. It all starts at the end of the day with our CORE operating system. As many of you know, CORE is Customer-Oriented Results and Excellence. We launched this, or relaunched it effectively, in 2021. It's really a best of the best approach from the UTC ACE system and a best of approach from the Raytheon Six Sigma. It's a suite of tools that helps us get aligned and help us with continuous improvement in all facets of our organization. We use it for things like driving minutes out of how long it takes to assemble a cell in Collins' Foley, Alabama, facility. We use it to rearrange cells to make them more lean, like we've done in our Forest, Mississippi, at Raytheon in its facility. We've used it for some big strategic initiatives, like designing the million-square-foot turbine airfoil greenfield facility that Pratt's building in Asheville, North Carolina. It truly is the connective tissue which binds all three of these business units. While the products are different in each three, our fundamental processes, our fundamental way of working are largely the same. How we capture programs, how we design our products, how we manufacture them, and ultimately, how we keep them relevant and sustain them decades into the future. We've made some very solid progress since May of 2021 on our, I'll call it our CORE journey. As you can see here from the middle panel, it's been instrumental in removing thousands of suppliers, simplifying our supply chain. combating the headwinds we've seen from labor and inflation due to the cost reduction initiatives we've done, and taking square footage out of our facilities and our networks. I will tell you, there is so much more meat on that bone. You think about the 25 million assembly and test hours we've got across the enterprise, the 14,000 product suppliers, and the 170 manufacturing sites we have all over the world. There's an incredible amount of opportunity and significant runway as we continue to deploy our CORE operating system. It's an absolutely key enabler to leveraging not only our scale, but the expertise we have across the organization. We're using CORE candidly, to execute on the strategic pillars that I just talked about. Let me just take you through the first one, which is our digital transformation. We're going to invest over $3 billion over the next five years on our digital transformation. Now, a big part of that is what we would call strengthening our foundation. It's things like rationing applications, combining data centers and networks, and driving cloud adoption. I know it's not glamorous, but it takes a ton of cost and complexity out of the system. In addition, it's this type of infrastructure that we're gonna need to drive what we consider to be the most exciting piece of this, which is digitizing our product lifecycle. Today, we've got over 20, what we would call digitally enabled programs that have a significant part of and model-based tools and methods. Where we have used it, we've seen tremendous benefit. Think about it from a design perspective. We're able to iterate with our customers more quickly, do operational analysis more seamlessly with them, explore the design spaces, all going back and forth with our customer in a, in a, in a digital method. Where we've done this effectively, we've seen a 30% reduction in design cycle time. In addition, it allows us to do some, what we would call high fidelity testing. We can actually understand from a modeling perspective, how these are gonna test as they move into that EMD phase, again, which reduces significant program risk and cost. Then, of course, on our more mature programs, and Steve's gonna talk about this in a little more depth, we are using all the data that's coming off of our equipment to do work scope planning, inventory optimization, and the like. It is a tremendous benefit to us all across the enterprise. I will tell you, today, about virtually all of our programs and proposals are done using digital tools, and by 2027, we're anticipating we're gonna have 40% of our programs that we would call a digitally enabled program. I know people have said, "Well, you know, it's hard for me to understand what are the true benefits of digital? How do I see it drop to the bottom line?" We just told you about $2 billion in headwind we've seen from labor and inflation. A lot of that is helping us combat those. As we get through that and get into a more mature state in terms of our digital transformation, you will absolutely see the benefit through. Our digital investments are also being leveraged in terms of how we make and deliver our products, what we call Industry 4.0. Industry 4.0, for us, is really about automating our processes, connecting our machines, doing things better, faster, more cost efficiently. Today, we've got 15,000 machines connected across our enterprise, providing real-time data to our operators, helping them manage flow better in our factories. Not only allows us to help with the uptime of our equipment higher, 'cause we understand how they're operating and when they need maintenance, which again, provides significant capacity and ultimately higher utilization. We can actually continue to add capacity within our own four walls without buying new equipment by connecting our machines and making them more efficient. It's providing us real-time dimensional data, so we know that the parts coming off meet the very tight specifications that are required in aerospace, taking our quality numbers, you know, much higher and our yields much higher as well. Again, we're gonna take our connected machines from 15,000 to 20,000 over the next 5 years, our automation levels from about 8.5 million today to about 16.5 or so by 2027. A way to think about this is every process or series of processes that we automate will improve quality and cycle time, the paybacks on many of these are 2 to 2.5 years. Fantastic. It's fantastic investments. I'll give you a concrete example. There's one here on the right-hand side. It's our F135 bearing housing production done at our North Berwick facility in Maine for Pratt & Whitney. It's now 85% automated. It's allowed us to go from 3 cells down to 1 cell. It's allowed us to go from 1,300 operator interventions, close to 200 operator interventions to make one part. Tremendous cycle time and efficiency benefits. The other one here you see is LRSO. Actually, when Wes was up here a couple of years ago, he talked about using the digital thread as a differentiator to win LRSO on the design side. We're now seeing that translate into the next phase of the program. We take a 3D scan of a very intricate casting. We're able to see that it meets the tight tolerances. If it doesn't, we can re-op it. Before heading into the precision machining phase, make sure that we don't waste key material that has long lead times associated with it. Again, pretty critical given the situation that we're in. Next element is the business unit realignment, the customer-focused business unit realignment that Greg talked about. Again, we have the best portfolio, we believe in the business, but this was about getting the right pieces in the right places. Really, two moves. Large moves. The first was the multi-domain command and control and protected communications from Raytheon to Collins. Collins is already a leader in what we would consider to be edge communications. We're now putting together the tactical and the strategic in one place to really make it that JADC2 storefront that Greg talked about. We really do believe that communications and networks are the foundation of multi-domain operations, and this should be a game changer for us, Steve's gonna talk about that a little bit more. The second is moving the air traffic business from Raytheon today to the Connected Aviation Solutions business, again within Collins. As you know, data is transforming flight today. It's transforming fleet planning, flight tracking, the cabin experience. This brings everything together in one group to manage the full ecosystem of flight data systems that are coming off the airplane and help manage those. Again, a storefront for this critical initiative. Of course, there's the combination of the new Raytheon business unit. It's taking the sensing and effects from both RIS and RMD, focused on their core, putting them together in a customer-focused way, aligned to our key customers. Let me just give you an example. Just take the naval power business within Raytheon today. It will now be a single source of maritime sensors and precision weapons. You'll have classified radars from RIS with Next-Gen Jammer, combined now with the missiles from RMD and their tremendous sustainment capabilities. Again, a one-stop shop for our customers. Focus on their needs, prioritizing our investments on the things that they need from us. As you see here, the sales flows are in the middle, consistent with what we've talked about on our prior earnings calls. Most notably, of course, our 2025 commitments are maintained. Just one programming note, the restated historical financials you'll see in the appendix of the materials. We're gonna continue to report as 4 segments in Q2. We'll move to the 3 segments in Q3. On the Q2 call, we're gonna provide restated financials for the H1, and then updated segment outlook for the full year on that call. On the right-hand side, the benefits from this. Again, there are the longer-term benefits of what I would call customer satisfaction and win rate, but there are some very discrete benefits that are gonna happen in the near term. $200-$300 in cost synergies, which I mentioned up front, half of that from people, another half from what I would call indirect expenses, and we're still exploring some of the footprint consolidation opportunities as this integration matures. We're gonna eliminate or reduce, I should say, about $1.4 billion in company sales, again, making it easier for us to do business within our own four walls and making it easier for customers to do business with us. In addition, when you think about the customer benefits, 70% of the Raytheon SBU sales are gonna be with its primary customer. Again, making it easier to do business with us, making sure that we can focus on their priorities. Of course, now Collins, from a revenue synergy perspective, will lead more than 50% of those revenue synergy projects, again, helping us with the execution there. Of course, a key enabler on all of the revenue synergies is our technologies. That's the fourth pillar, our differentiated technologies. As you know, we're in a long cycle business. We've continued to invest for decades, and that's resulted in a robust pipeline of technologies across what we would consider to be the technology readiness level spectrum. Things that are in the early, more disruptive phase, to things on the verge of commercialization, and that's good. It keeps our 60,000 engineers across 22 technology disciplines very focused on what's coming next. That's important, because I would tell you that the technologies that we are seeing that are gonna impact our business are changing at rapid speeds. As we see the future of A&D products, they're gonna be, as we see here on the left-hand side, more connected, integrated, intelligent, and efficient. They're gonna be things that we're gonna need to put our 13 cross-technology roadmap to bear, to make sure that we can meet the needs of tomorrow. When I say a cross-technology roadmap, these are things that affect two, if not three of our business units, where we're able to collaborate to make sure that we've got the technologies to meet our customers' needs for tomorrow. These key areas include things like advanced materials, ceramic matrix composites. You've heard us talk about that before. gallium nitride for power density. Carbon composites, again, for efficiency, to manage heat. Power and thermal management. How do we take waste heat out of airborne applications? Think satellites, think missiles, think engines. Electrification. How do we use electrification to augment or replace some of the mechanical systems that we've got? Again, a key piece that we consider to be our sustainable aviation drive. High-assurance networks, making sure that we've got resilient networks and links in very contested environments that can't be jammed. Of course, AI and autonomy. I know everyone's talking about that, but it really is gonna transform the way our products operate. Think about a collaborative autonomy situation where a pilot is helping to command a swarm of drones. Think about technology and a missile helping to discriminate targets. Of course, think about the predictive maintenance capabilities on the commercial side. These are all gonna be geared towards what we consider to be the big macro opportunities in A&D. Connected aviation, how do we harness all of the technologies that we've got to make sure that all the information that we've got coming off the aircraft, we can harness and use, not only for our customers' use, but for our own use as well. There's millions of lines of data that are coming off aircraft every day. How do we harness it and leverage it? Of course, sustainable aviation, supporting the industry's drive to net zero, making it more efficient. You heard Greg say, next generation single aisle, maybe out in the future, but there are enabling technologies that we're investing in each and every year so that we're prepared to make that happen. Connected battlespace. Greg mentioned that before. This will be a key theme that Steve's going to talk about. It's really capabilities across all domains: air, sea, land, space. How do we connect them to give ourselves decision superiority? Of course, the multi-domain solutions. How do we integrate all of our capabilities into certain systems that give our customers what they need to persecute and prosecute very complex missions? We've had some early revenue synergy success. The pipeline remains robust. I will tell you, as these technology roadmaps become more mature and as our integration takes hold, I think you'll see our capture rate grow. Let me just close a little bit how Greg did as well, which is reiterating our investment thesis. Number one, you're going to hear it today, we still feel that we are well-positioned, Pratt, Collins, Raytheon, to hit our 2025 commitments. The team is really excited about the opportunities in front of us. Again, no peer that has our breadth and scope in terms of the portfolio at the nexus of the largest macro trends that are facing both defense and commercial aerospace. There's no doubt that RTX is greater than the sum of its parts. If you just think about the product portfolio, you marry it with our operational synergies, the technology synergy I articulated, and the ACE and CORE operating system as our guiding principle, we truly believe we'll be in a position to generate significant sales, free cash flow, which we'll be able to go and return capital to shareholders and continue to reinvest in this business for the long term, because we really do believe that we are going to be in a fantastic place to sustain top and bottom line growth well into the future. With that, I will ask my friend and colleague, Stephen Timm, President of Collins Aerospace, to come on up to the stage and talk Collins. Good morning. Good to be here. you know, I'll start right in. I know there's been some questions on what's in Collins. I'm going to tell you this. Collins, right away, as you know, is a company with a proud heritage of a lot of legacy and franchise leaders. Those leading franchises, I'm really optimistic about leading into the future. Let me tell you why. What you're going to hear from me is we are building on these pioneering businesses, these leading franchises, to shape Collins on what I will call the full potential. Full potential in the market. Also full potential from an operating structure perspective. To do that, and you know this, we work from a foundation that is unmatched in the market. Collins, as Chris has said, is the leading provider of aviation systems in the market and connectivity solutions in both commercial and defense segments. Over the last two decades, we have secured positions on 110,000 airplanes across those two segments. Additionally, that's created, as Greg talked about, an installed base of $160 billion, and I'm going to reference that as you think about going forward here into the market. Product leadership, Chris said this, I think I heard it somewhere, is the core of our business. 70% of all of our products are either number 1 or number 2 in the markets that we serve. Beyond the aircraft, you think about adjacencies, we're the number 1 provider of connectivity and resilient network solutions. Number one or number two, always, the connectivity going into both commercial and defense from an adjacency perspective. We've recently realigned, as Chris said here, our defense portfolio, and I'm going to talk quite a bit about that, but the key takeaway here is that we're putting Collins at the center of connected battlespace, JADC2, for segment leadership and postured to go do that. The one thing I know you all want to hear and talk about is in addition to those growth items I just mentioned, we are laser-focused on transformation, of taking these businesses, these heritage companies, and putting them into the transformation operating efficiency that you expect. To give you some numbers right out of the chute here, the transformation initiatives we've put in place have driven 30% incrementals last year, 30% this year, the next 2 years, 40%. When I talk about the commitments I made in 2021 going to 2025, that trajectory I just shared hits it. We're on target to those financial goals that I committed to you back in 2021. As I get onto the stage here, just a couple of things to think about just with me that I think are really powerful, that I don't want to lose. Preferred OE positions, the largest active installed base in the industry, adjacency through digital and connectivity, a realigned defense portfolio that is very synergistic and ready to go win even more than we already do, and transformationally, continued margin expansion that you all expect. That's why I'm optimistic about where Collins is starting. Let me give you a little bit of the profile. People ask: Where's all these pieces of Collins and what does it look like? The next two charts will give you that. We're a $23 billion business with about 80,000 employees around the globe. Truly a global business. 40% of our employees are outside the United States. A diversified business and balanced. If you look at it, not only balanced between aftermarket and OE, which we like, but commercial and defense. Not a pure play, commercial and defense. What I'm going to talk about, and you'll see this, is the scale of our commercial business gives us opportunity economically and speed of innovation for our defense customers. I'll talk more about that. Because of that, I will tell you, our growth and our transformation priorities are consistent with 2021, have us on track toward our 2025 goals, and are foundational to reaching what I call that full potential. From an investment perspective, we build on our leadership. We invest about $4 billion a year, both to differentiate and continue to win, both in structural transformation, to expand our margins, and growth. Not only are we committed to what I told you in 2021, but we are on track for that and building momentum beyond for our commitments to you. A little bit more about Collins and where things are in the business. This is something I really wanted to share because I know you get a lot of questions about, "So where's these pieces and how are you using them?" I hope you take away the complementary nature of how we've structured this business. There are 6 SBUs in this business, constructed very purposely to leverage common capabilities and technologies in the market, but also common capabilities and infrastructure for scale. I'm going to talk about that, about these businesses, despite having grown up separately, how we're using that common investment now to really drive efficiency in this business. Since 2021, we've made 3 really strategic alignments for this business that I want to talk about. The first is the one that's been talked about this morning. It's the realignment of my Mission Systems business with some of the heritage Raytheon components, I'll go into depth on this, but it's really about posturing us to lead JADC2 or connected battlespace. One I talked about in 2021, we've now structured into an organization, Connected Aviation Solutions. That is best-in-class capabilities from Rockwell Collins, United Technologies, ARINC, FlightAware, and now air traffic management from heritage Raytheon. It's really about taking those digital capabilities and accelerating the velocity of new solutions into our customers as a combination of those capabilities. The third, and one that I'm increasingly excited about, is advanced structures. We've taken capabilities, best-in-class from mechanical systems and our aerostructures business, and we've really focused on structural technologies. I'll give you a couple of examples of that real quickly. Thermoplastics, as an example. On the commercial side of our business, lighter weight, more sustainable materials, think seats, that we can bring great benefit to our commercial customer. On the defense side, exquisite high-performing structures like carbon-carbon for hypersonics in Wes's business. Even things we hadn't anticipated when we came together as Raytheon Technologies, now RTX. Three key changes. I will tell you also, while we operate six SBUs, there is a lot of focus on working across organizational lines, both within Collins, but also RTX. One of the things I'm going to highlight a little bit later is, how do you leverage, a word I'll use a lot today, shared infrastructure, where you can take the investments that maybe all these legacy businesses would have made over the last decades independently, but putting them together to really create scale and growth across these business? There's a lot of common DNA across these businesses within Collins, as you'll see here in a little bit. Really leveraging two or more businesses across common domains, technologies for site reductions, cost reductions, and best-in-class implementations going forward. You'll see three in the middle of the chart. Think about these common elements across all of my SBUs. Electronics and critical software, connectivity and digital solutions, and then, materials, machining, and structures. Those really drive a lot of commonality across two or more businesses. We also leverage common capabilities across two or more businesses into the market, really as a basis for our product leadership. You'll see at the bottom here, we've established seven very focused, market-driven strategic initiatives. Some of you that have come and visited us since 2021 at our sites, you've seen some of these technologies that we've put together to drive these seven strategic initiatives that are taking us forward. Things like operational efficiency, mission performance for our defense customers, more sustainable operations, as an example. I'll give you two. Hybrid propulsion, working with Shane's business in Pratt for more efficient flight. Another is autonomy. You think about the autonomous background that Collins has here, where on the commercial side, really reducing the workload of a commercial pilot, but on the other side, enabling really complex, integrated defense operations. That's the pedigree we bring forward in some of those strategic initiatives. I'm going to highlight two more coming up, and I hope you take this away. The combination of the capabilities we've brought together not only build on the installed base that we have, but really build on the capabilities to bring the last mile, connecting the aircraft, the airspace, in an integrated way like nobody else can, both commercially, something we call the connected ecosystem, and on the defense side, connected battlespace. I'll get into that. Okay, let me get into the things I know you want to see here in the 3 segments: commercial OE, commercial aftermarket, and defense. Commercial OE, let's start here. You know, our business starts with establishing strong positions on commercial aircraft, and we've done that. If you look at the left side of this chart, we have twice the content on the current high production aircraft as we did on previous generation. There's a reason behind that. Those share gains have treated us well as our aftermarket continues to grow by working very closely with our customers and our technology roadmaps. Of course, demand for new, higher efficient, higher performing airplanes continues. I think Greg referenced this, there's 12,500 aircraft in the backlog of just Airbus and Boeing at the end of last year. If you think that through, the way we look at it, the next five years, you're talking about a 60%-70% increase in production rates at those two, across the board, excuse me. Additionally, and something I really like, is we have great opportunities for incremental opportunities, despite the standard or beyond the standard positions, I should say, that we already have. For example, I'll give you two. 20% of Collins sales on OE is selectable. I think you all know, I was talking to someone about this this morning, that means that the customer actually selects and purchases directly from Collins. This is typically a higher margin segment for us, it's usually provided more differentiated solutions for our customers. The second, everybody thinks about that new next generation clean sheet. There's $40 billion of program opportunities out there right now on biz jet opportunities over the next 10 years, upgrades into the installed base that already exists for things like cost, weight reduction, performance of new solutions. One we don't always talk about, but it's gaining momentum to get ready for that next generation clean sheet, is the demonstration programs that we're actively participating at NASA, Boeing, and Airbus as well. What I like about these incremental opportunities, they're not only good for growth, of course, but they're really keeping us fresh and ready for that next generation aircraft as we take our products extensively across segments, biz jet, commercial, and defense. Let's talk aftermarket. You know, our aftermarket is impressive by any measure, $120 billion of content today flying on commercial aircraft. The base that I like here, and Greg talked about this, $100 billion out of warranty, growing at 8%. An 8% out-of-warranty flat hour profile. Specifically, if you look at our favorable mix here, think about this on those higher production aircraft that I just talked about. In 2019, 20% of the higher production aircraft, think 737, A320, A350, were out of warranty. By 2027, 40% of those higher production aircraft will be out of warranty. That clean sheet timing matters, but the installed base here really treats us well either way. Three primary channels in our aftermarket, you know these very well. First, parts and repair, you know it drives about over half, almost two-thirds of our aftermarket business through either break-fix or long-term agreements. Provisioning, less linear, typically beyond utilization and stocking levels. It's driven by maybe a new aircraft introduction to a fleet, new routes, new technologies, and as we're seeing now, summer readiness and ramp up. Finally, in the aftermarket, one that I'm going to talk a little bit about, I'm actually excited about, it's the background I have from a digital perspective. It's about 20% of our aftermarket is digital and upgrades. Solid 10% double-digit growth here in this segment of our aftermarket going forward. It's largely driven by avionics and interiors, where we have a really strong capture historically, a backlog of about $2 billion in expected upgrades through things like airspace modernization. It's increasingly becoming part of our aftermarket in subscription areas as well, things like FMS nav database, network services, and other subscriptions I'll get into. Overall, it's an $11 billion segment growing at double digit as the industry becomes more digitized. Something we call connected ecosystem. We heard it as connected aviation. Let me tell you a little bit about that and why I'm excited about it. A little offshoot here. This is one of those areas that I said was a unique point as a discriminator, a point of differentiation for Collins. For those of you that have been around aviation for a while, I would say this is something the industry's been working on for decades, frankly. I would describe it as a fragmented array of companies that have been working on kinda niche aspects of digital, either on the airplane or off the airplane, but there's been no comprehensive solution. That's different now. Collins is bringing and changing that by bringing an end-to-end set of capabilities across all segments, and I'll get into in a minute, airplane, network, and analytics. We're really changing that, and we're doing it with an open data, airlines care, and an open architecture approach, which is turning out to be a real discriminator for us as we go forward. The benefits here are quite broad. I mean, the digital transformation offers benefits across all facets of operations and maintenance. You think about dispatch reliability, airport operations, air traffic management, maintenance, and of course, sustainability operations. Let me just give you the examples, because I want to paint this picture for you, especially coming off the installed base conversation. You know, this starts with aircraft systems, and Chris referenced this. You've got to take data off an airplane and convert it to tangible value for your customer. By 2028, 50% of every commercial aircraft is going to have Collins connectivity equipment on it. In addition to that, across all of the Collins businesses, we have product line roadmaps that are digital smart products. The way that I like to think about it is that if you combine our air, our airplane positions with our airport positions, we have the broadest reaching digital footprint across all points of use in this thing we call a connected ecosystem. A good proof point of that, of course, is our work at American Airlines. We are in the process of equipping over 500 airplanes at American with ability to capture, securely transmit data from their aircraft through our cloud back to them, and of course, that data then gets turned into new solutions for efficiency on operations or maintenance. That's the airplane. Go to the network. Clearly, we are the network leader, the provider of network and resilient connectivity solutions. That comes in two forms for us. ARINC, first of all, think about ARINC. It's the largest command and control aviation network in the world. 75 million critical messages every single day at five nines reliability. Now we're coupling with that the Raytheon Air Traffic Management Solution, which provides, we provide two-thirds of the global ATM coverage on the globe. Truly connectivity leadership. I got to tell you, the fuel that really enables that, and this is the last mile, the part that's brought it all together, is how you actually take those analytics, convert it into insight, and provide tangible value that a customer is willing to pay for. We've done that in two ways: We take the product knowledge that we have, and we've infused that product knowledge, as well as our knowledge of the airline usage of our systems, into our predictive maintenance tool, we call it Ascensia. We have today over 150 predictive models on thousands of airplanes that are every day helping our customers be more efficient in their operations. Here's the one I'm really excited about on top of that. In 2021, we acquired FlightAware. This isn't about that app. This is about the digital research expertise, the horsepower in that organization to convert data to value for customers. Let me just give you a really simple example I know you'll all relate with, but it's a great example of how extensible this might be. We've been conducting predictive brake trials with our customers. You may think, well, how much impact can that have? What's interesting is that the unscheduled maintenance requirements and potentially AOG impacts of taking your brakes off or not getting them serviced when you need to, can be impactful. We used FlightAware data, Ascensia data, landing information, and weather that affects brakes, and in that, we're able to create models for more predictive operations of brakes. You think, well, what's the impact? For this particular trial with an airline, $1 million of savings per year, 20 metric tons of greenhouse gas saving because of less manufacturing, more resolute maintenance scheduling. For us, because they're under a maintenance contract, it's less manufacturing cost, more efficiency for us. Win-win. If you take those types of predictive solutions across the industry, all fleets, 30% reduction in unscheduled maintenance and 20% reduction in associated cost, that's a big deal going forward. Only Collins is in that position because of the systems on the airplane, the networks that connect them, and the ability to bring smart, intelligent analytics to value. Okay, switching to defense. I got to tell you, our capabilities are very well aligned with Allied and U.S. DoD priorities. Today, now, as a result of the realignment, very well balanced here in our portfolio with mission systems, heritage Raytheon, driving over 50% of our revenue. You can see that here. One of the pieces I'm going to get into is that the two pieces we brought together that are the foundation, the bookends of this connected battlespace leadership we're talking about, is that today, we already support 70% of all allied communications through our equipment, bringing together 14,000 terminals operationally for command and control. You've got both bookends of communications across all assets and doing it in intelligent ways. We've just brought together. That's why I'm excited about that. The remainder of our pie there, as you see, is that our aircraft systems now here also, 40,000 airplanes, 200 different platforms. One of the things that I'd like to talk about is just the leverage that we see between commercial and defense. We're not a pure play on purpose. The business that I've come from historically is one that's really good at investing in a common architecture that's extensible across commercial and defense. What that does is it creates a cost point, lower economically, both startup and ongoing for your customer, as well as faster innovation for your customer. Think about 5G derivatives in a defense application. In the middle of the chart, you'll see that like communications, or excuse me, like commercial, we are a segment leader in aircraft systems. In particular, I'll point out the fighter. We expect that to grow about 6%, where we have generally higher content, higher volume, and of course, will benefit same in defense because of sustainment readiness objectives, because of our large installed base on the defense side as well. I'd like to point out that we've got a really good pipeline of modernization, new program opportunities. We've won on the enduring fleet. As you see, those fleet types continue, B-52, wheels and brakes, power systems, MIDS J, prop upgrades on C-130s and others, really creating a lot of opportunity leading into another $20 billion of strategic upgrades that we expect. On next generation platforms, we've had some really good key wins, another $20 billion of wins going forward, we expect, where you really see the one RTX piece come forward as we work across the enterprise. Quick pause here to go to the right side of the chart, because I really want to make sure this is something that comes away. Like I talked, connected ecosystem on the commercial side, the whole impetus behind our realignment on the Collins side is to take on segment leadership in connected battlespace. First, you have to understand that we have to be aligned with the warfighter needs, a rapidly changing environment, and of course, an increasing peer threat. If you just sit back and think for a minute that we are on the verge of a fundamental shift in the way battles are going to be managed going forward. Today, a lot of our key assets aren't always, aren't as interoperable as they need to be, which means command decisions where you have to validate the intelligence, all the sensor information, bring it together, validate it, and make a command decision, needs to happen in minutes and seconds, and that can be tough, but not now. One of the things we're very focused on is how our solutions, because they require a more connected battlespace, are really going to bring a new level of interoperability. All domains, space, airborne, ground, and sea, all assets in those domains, so you can get the right information to the right person at the right time. The way that's going to play through is that there's a new concept, Joint All-Domain Command and Control, JADC2, a concept of operations by the DoD, where we expect $15 billion of awards and demonstrations in this plan. We're going to show you how we're doing that already. Clearly, this is a segment that's growing faster than the overall defense budgets here and one we're excited to lead. One point I'll go through here as I wrap this chart up, is several have asked, "So what did you bring across for capabilities across Collins and Raytheon?" I want to just give you 4 examples of the portfolio leadership here really quick. What did we bring together? It comes in 4 categories. First is resilient communications and networking. I talked about the 70% of all allied communications and the airborne radios, but you also have protected SATCOM on the Raytheon side that has come together. Really strong communications portfolio. On the nav side, assured navigation, military GPS in one business, precision navigation and timing in the other, coming together. Even in the most denied environments, contested environments, you get assured navigation. Number 3, autonomy. I talked about autonomy, the ability to have these assets work more interoperably, faster, with maximum coordination. We have 25 years of pedigree in this space. Lastly, and very powerfully, command and control. It's really about bringing intelligence together faster, securely, validated, so that command decisions can support mission performance. Those are the pieces we brought together, and if you look at the connected battle space, there's a few dimensions of how we're approaching this that are going to make a huge difference going forward. I will tell you, we have a clear understanding of these concept of operations and connecting both strategic and tactical assets across all these domains. You think about the pedigree of Collins and Raytheon coming together like no one, like no one else can, end to end. It means that we have to build on our existing positions, but now in an integrated manner, and that's really why we've come together. That was the impetus for our realignment to drive leadership in this space. One of the things we're going to leverage, and you'll hear about this, I think, is that we're building on the operational analysis capabilities that exist within RTX. So you sit with a customer, you model this rapidly changing environment, and then you show them how you're going to connect it together for them, you take it out to the field, and you prove it. So we're doing that. Our pedigree in open, in modular architectures in our commercial business, is avoiding the vendor lock that our customers hate. It's bringing best-in-class capabilities faster to the market so they get mission effectiveness. I'll tell you how we're building momentum in this. This is actually very interesting. There's been some large-scale demonstrations. I know some of you are familiar with Valiant Shield in 2022. There's other large-scale demonstrations that just completed where we're bringing JADC2 to life, not just talking about it with proven solutions. Just last month, we demoed the very first-of-kind directional communications, linking all platforms, including previously disadvantaged platforms, together at scale, all domains, in a highly contested environment. We also shared domains across partner allied networks, linking together those networks. Because you can bridge that data, you're taking command and control networks that previously didn't talk together and making them integrated. So there's a mouthful with that, but they're tremendously powerful, where we're uniquely positioned to bring all those pieces together. Bottom line, we're really confident in our ability to take that portfolio and lead on the aircraft and in space, but bring all those pieces together to lead the connected battle space. Switching gears completely, this is one that I'm very passionate about leading this company of so many heritage companies. Transitioning from our focus on growth is this transformation. You know, it's foundational to optimizing our cost structure and reaching what I call our full potential. Since 2020, if you look at the numbers on the left, we've achieved 400 basis points of margin expansion. It's really driven by a combination of volume and transformation. I know this is one of those key areas you're all asking about that Chris referenced up front. If you look forward to 2025, I'll break down a couple of examples of our transformation initiative, we're building momentum. We're delivering another $1 billion of cost reduction across six categories, and it's driven by a number of areas, but one's product cost. Let me just give you an example of what we're doing. We have transitioned 15 product families, that's literally hundreds of individual products, 1.3 million manufacturing hours, on our way to 2.7 million manufacturing hours by 2025 to these best cost locations. When you look at why are you confident? I'm confident because in the next to through now and now 2025, we'll deliver between 550 and 700 incremental basis points of expansion, with even increasingly dependence on the already set actions in our transformation plan, less on volume and more on the transformation actions we've taken, which really positions it not only for 25, but early in the H2 of the decade. We're really doing this by accelerating, as I said earlier, that common scale or infrastructure across our businesses. Let me just give you at least one example I'd like to share. We talk about sharing infrastructure across businesses. This is an example I think is really easy for everyone to understand. In that electronic COE that I talked about earlier, we have three SBUs: avionics, mission systems, and power and controls. There's 3,200 electronics products across those three businesses. Those three businesses grew up relatively separately. We're now leveraging common infrastructure and transitioning those 3,200 products in sequence to best cost locations. First part of that's labor arbitrage. The second part is you get to more advanced designs, things where you're looking at the designs for more automation. Our COMNAV surveillance products are 100% auto-placed, the componentry on those electronics. That's why I'm confident as we build the opportunities behind the COE, we're talking about a 40% site reduction across the electronic COE and doubling our best cost utilization at locations that provide that kind of leverage. In addition to that, it's the core Chris talked about. We are actively implementing core Industry 4.0 across all the Collins locations for continuous improvement. It's best practices like digital product lifecycle. We're doubling our automation content in our factories between now and 2027. It's about the smart factories to drive that cost reduction and productivity. Not only is it foundational to the commitments I'm giving you from a performance perspective, it's foundational to Collins' 2025 and beyond's full potential. I'll reiterate this in our financial summary here going forward, some numbers. From 2020 to 2025, we expect to grow sales 6%-7%, EBIT by 22%-25%. Overall, the takeaway is we remain committed to the 20% EBIT target we gave you back in 2021 towards 2025, now adjusted to 19% with the inclusion of the Raytheon business, the $2.7 billion that we brought over. When I step back from this, I gotta tell you, the key growth drivers I've shared, the transformation focused on margin expansion gives me a lot of confidence to our 2025 roadmap that I've been sharing with you. I'll tell you this, as a result of what you've seen in Q1, a lot of great momentum kicking out by our aftermarket on the commercial side to continue to see this momentum continue. I'll close with just a few takeaways. This is what I'd like you to take away. We're going to grow faster than our segments. Preferred OE positions, a very large active installed base, synergistic defense portfolio, adjacencies through connectivity and digital going forward. Very solid strategies as we invest to differentiate and to win going forward for our customers. Of course, I hope you take away we're building momentum in this transformation that's so fundamental to our business to drive our margin expansion into the future. I will tell you, as a leader of this business, I know my entire leadership team, very privileged to lead these heritage companies and shape them into their full potential. I know our 80,000 employees around the globe understand that mission and take it seriously every single day. We understand very clearly that our future is rooted in the transformation of this business, not only into a comprehensive portfolio, but really into the most efficient operating structure we can possibly deliver. That is the basis of this plan and, of course, our leadership in aerospace and defense. Okay. With that, Jennifer, you want to join me up here for some questions? That would be great. All right. Who wants to ask the first question? Noah? Thanks. Thanks, Steve. Just circling back to the margin expansion commentary, you cited the incremental being 30% last year, 30% this year, and then stepping up to 40% and 40% to get to the 2025s. It would seem like a lot of what's driving the margins higher in 2024 and 2025 is happening now. I guess, is the cost and transformation effort just stepping up so much at the end of this year, moving into 2024 and 2025? Is that really the answer to that? With pricing, you know, pricing in the aftermarket is really strong right now. Is that sustainable through 2025, or does that decelerate and start to go against you? Thanks, Noah. I guess 2 things. I'll start with the transformation projects that we talk about more formally didn't start just now. This is something that we've started a while ago. When Collins came together, you know, it's several businesses come together since 2012 with the Rockwell Collins acquisition in 2018, of course, Goodrich before that. The process of starting to invest in these best cost locations, as an example, started quite a while ago. Now, what we're doing is finding the common businesses to really begin that transition. I would say it's up-tempoed, but it's a multi-year implementation. Clearly, that's something that we've started a while ago. I don't think it's something you should think about as it has to ramp up to get to that. I think that momentum is just starting to build. That's why when I say I'm not only confident in 2025, this goes beyond 2025. When you think about the other COEs that really have other opportunities, I'm just showing you the Center of Excellence for electronics. The way I think about it is we're at the early end of that flywheel, just getting started to bring that kind of momentum going forward. 30%, 30%, 40%, 40%, it's pretty realistic in terms of being able to go hit that with upside. With respect to pricing, I think there's more opportunity this year as well. The reason I say that is because one of the things we've been very clear about with our customers is, you know, there's a new equilibrium in the supply chain that's occurring because some of the suppliers we used to have or the terms and conditions, perhaps, as expirations occur, we've been really aggressive about making sure we're managing the supply base on one end. I expect the way that that's occurring for us to go do the cost to do business is being reflected in how we work with our customers. That same kind of pricing leverage to offset the inflationary aspects that we're seeing is expected as we go forward, and that's the way we're treating it as an assumption as we go into the market. I guess just if the productivity was already there, it's always ongoing. We kind of knew that. The volume's there, the price is there, that's all there now. What drives the step up from the 30 to the 40? It's just a continuation of more product line movement. You're talking about best cost movement, so as you're labor arbitraging from one location to another, there's significant opportunities as we get more and more products in that pipeline. Part of what I showed you in those 3,200 products, we're just at the front end of that iceberg with respect to those that are already in the process of transitioning what we show in 2025, 2027. There's very discrete roadmaps between those product lines that are being developed to take this out into the future as well. Thanks, Noah. Okay. Rob? Thanks very much. Rob Stallard from Vertical Research. Steve, your targets for 2025 anticipate the disposal of the actuation business, which has been reported in the press. Maybe you could give us an update on what your thinking is around this, potential disposal. Thank you. Well, a couple of things, Rob. The first thing I'll tell you is that these numbers are as we're portfolioed today, period. With respect to what's in the press, I don't really have much comment on that. We're always going to examine our business from a portfolio perspective. That is part of the shaping that we need to do in this business, part of this, even our transformation we talk about, is you'll notice, I hope, I use the word complementary capabilities and technologies. Collins, as Chris said, is 50% of the revenue synergies going forward at the RTX level. Where we really focus our portfolio emphasis is on parts of our business that have kind of a one plus one greater than two opportunity. Those that don't might be more subject to consideration, right? We're always evaluating our portfolio, what you should take away from this is the real focus on those parts of our business that create synergy value from a revenue perspective, and that's really where a lot of our focus is. I won't get into the specifics of what might be in the pipeline today. Thanks for asking. Questions? Yep, Myles. Thanks. Steve, can you comment on the progress of recovery at the old legacy B/E Aerospace business, and in particular, is that a source of, you know, particularly punchy margins as wide-bodies come back into the fold over the next couple of years? Yeah, it's a good question. Thanks, Myles. I thought about this one. A couple things, I'll just give you some macros that I think you've heard probably from Greg and others in other earnings calls. You know, the wide-body is obviously very dependent upon, or we're very dependent on the wide-bodies in that business. That has pushed out a little bit, and we're looking at total recovery over hours in our interiors factories, which was largely B/E, in early 2026. That's pushed out a little bit from an hours perspective. That shift has gone more narrow-body than wide-body, but one of the things that's offered for us, that I'll tell you, is, our leader of that business, Ed Dryden, is very focused on taking a lot of the components that were in B/E, not really optimized. You think about SAP implementations and systems, et cetera. From a absorption perspective, we've made a number of moves this year to get to our best cost location. When I say best cost, you know, Tanauan, Philippines, and others, to continue in the absence of that wide-body volume coming back, being positioned to take advantage of these orders you're now seeing in the marketplace in wide-body. It's more optimized as we go forward. We're using it as an opportunity. It does push back a year, here's what I'll tell you: the fundamentals of that business are very good from a returns perspective. We've got to bear through the recovery time period, set it up in a way that allows us to benefit from the investments that we're making to optimize that business. The fundamentals are good, we feel good about that business overall. Yep, Ken? Hi, Ken Herbert with RBC. you called out, Steve, about 60% of the aftermarket is, as parts and repair, I believe, but I think you called out that the upgrades in digital may be seeing the fastest growth. Yeah. Can you just comment, at least maybe directionally, how margins are within the aftermarket between those different business lines? Would that be a significant headwind to aftermarket margins as you really see acceleration in parts of the business beyond just parts and repair? Thank you for the question. My expectations are not that it's headwind at all. I mean, as I said, it's about 20% of our aftermarket today. It's growing at double-digit. The equipage part of it, 'cause there's several, as you there's several pieces to that, as I demonstrated on the connected ecosystem piece. The equipment piece is. We have good margins on our equipment, as you know, that's in that garden variety place for equipment. Where you get to me, and that's the excitement that I talk about with FlightAware and the analytics, is the subscriptions we're starting to get into now. You equip American Airlines, 500 airplanes with the ability to transmit data. That's just investment with our airlines for them to take the data and harness it. What we're bringing through the trials example I gave you, and there are several others, there's a flight profile optimizer to save fuel and be more efficient in the operation of an airline. There's numerous, but they're subscriptions. Once you have the equipment on the airplane, it's really a bit of the razor. The razor blade is in these subscriptions, and those are good opportunities for margin expansion because the cost profile, obviously, the software isn't the same as the hardware. I don't view it as headwind, I view it as opportunity, but you've got to monetize that opportunity with a customer by bringing value. We tell our team, "This isn't something that you should expect other than to go in and demonstrate value, and then share that value with the customer." That's where we're seeing the opportunity. Last question. David? Thanks, Steve. Within that margin, incremental margin objective from now through 2025, do you assume OE commercial, specifically commercial aero OE and aftermarket, are they growing at similar rates, or is OE growing way above after? What are you assuming there that's baked into that 40% incremental? From an overall perspective, aftermarket growth continues in the overall 3% to 5% total, I think is what we've looked at, near term, faster than that going forward. Of course. Faster than OE. Faster than OE, for sure. Then OE settles out through the production rates that we're obviously very aligned on with all of the OEMs. You know, I think you're going to see double-digit aftermarket growth continue, and then you're going to see that temper itself. That's the way I would look at it. You've still got some of that growth left in the market. You're seeing that in flight hours. If you look at flight hours, I think I was looking at it even this morning, you're talking about the next 2 years, you should see double-digit across both single-aisle. That's predicated on some of the wide-body recovery that we built into our assumption set, but very consistent with what I think you'd see externally. Great. Well, thank you, Steve. Okay, thank you. We're now going to transition. I'd like to invite Shane Eddy, our President of Pratt & Whitney. Welcome, everybody, thank you again for being here today. I joined Pratt & Whitney in 2016, I had the good fortune to work with the operations team as we ramped both GTF and F135 to rate pre-COVID. I took over from Chris in 2022 as president, I have to tell you, I am thrilled to be here today representing the women and men of Pratt & Whitney. There are three key points I want to leave you with today, I'll start with our outstanding portfolio of products. I'm going to walk you through our unparalleled franchise, Pratt & Whitney Canada. I'm going to talk about our industry-leading military engine business, of course, I'm going to talk about the growth driver of Pratt & Whitney, the Geared Turbofan. Second, we're committed to our 2025 financial goals. As I walk through the presentation today, you'll see that we're well on our way. Third, the GTF is delivering on commitments, both for customers and for shareholders. As Greg said, I know there are questions about GTF. I intend to answer those today. It's important for you to leave here today, though, with the knowledge that GTF aftermarket is generating earnings. Those earnings grow rapidly going forward. I also want to say that all of us at Pratt & Whitney know that we need to earn the dependable engine reputation every day. We need to earn it in the minds of our customers by delivering dependable products and support. We need to earn it in the minds of our investors by continuing to deliver dependable returns. Let me start with a little bit more about Pratt & Whitney and who we are. For over 98 years, the people at Pratt & Whitney have united around our purpose of connecting people, growing economies, and defending freedom, we do this by designing, building, and supporting the safest and most dependable engines in aerospace. We have an incredible portfolio with leadership positions across all key segments, serving 17,000 customers. We have more than $100 billion in backlog. That's up 20% since 2021 against strong revenue growth, that excludes $100s of billions of F135 and GTF business yet to book. I want to echo a few comments from Chris and Greg. First, demand is strong. Commercial's recovered and growing, very well aligned with our expectations going forward. Second, CORE is our operating system. CORE provides the backbone for disciplined execution and driving productivity. Third, we're making disciplined investments in both product and industrial innovation to drive long-term profitable growth with strong cash generation. With these things in mind, we are confidently on track to deliver on the commitments we made at Investor Day in 2021. Let me get a little more into the numbers. Our products operate around the globe, yes, as Greg said, a Pratt & Whitney aircraft takes off or lands somewhere in the world every second of the day. Our portfolio is well-balanced between OEM and aftermarket, between military and commercial, demand is broad-based. You combine this installed base we have of more than 85,000 engines with products that are positioned to outperform in their segments. You add high aftermarket growth on products like GTF and F135 on top of our highly utilized mature fleets, and it creates significant and compound value. As I said, we've invested strategically over the last 10 years to deliver on this growth, and we continue to invest today, always with a focus on safety, quality, innovation, and productivity. This is aligned with what our customers expect and need, and this is aligned with the productivity we need to deliver strong financial performance as we grow the business. On the top right, you see the 780 basis points of ROS expansion, and we are confident in delivering on this commitment based on the momentum in our growing portfolio and on our enterprise focus in driving productivity through CORE. I want to go a little deeper into our three businesses, and I'll follow that with an overall view of what's going on in the aftermarket. Our installed base is growing across all segments. Pratt & Whitney Canada has unparalleled breadth and scale, serving business, general and regional aviation and helicopter missions, and we're primarily sole sourced on our current production platforms. This is a young fleet. Less than 40% of this fleet has seen their first shop visit. Shifting to military, we are the only fifth-generation military engine provider. We have over 1,000 F-135 engines in service today. This is the most capable fighter engine there is, and it's going to get more capable with our Engine Core Upgrade. Our defense business is very well positioned. We're 7,000 engines in service today, sole sourced on key platforms on bomber, tanker, mobility, and of course, fighter. Commercial is our highest growth business. We have 12,000 engines in service, strong demand in the mature fleet, with GTF delivering at rate, our fleet is actually getting younger over time. GTF continues to drive strong orders, we have over 50% delivery share on Airbus single-aisle program to date. GTF is our biggest growth driver, as Chris said, we are single-aisle focused going forward. Let's get into some of the details on GTF. I want to start with the fact that 10% of our fleet today, GTF-powered fleet, is out of service, waiting on an engine. I want to be clear, Chris said this is the result of gaps in our industrial performance. This is not tied to the performance of the engine. The engine is delivering on the commitments. It's delivering on the commitments we made for fuel burn. It's delivering on the emission and noise commitments we made. Dispatch reliability is 99.96%. That's aligned with customer expectation. Time on wing is better than the V2500 was at this point in the program. I can also say that we have the capacity in place today to support the GTF needs for maintenance, repair, and overhaul. Turn times in our shops are elevated because our shops have been waiting on parts. We're balancing both growth on the OEM side and growth on utilization as we work to recover the supply chain. We're making solid progress on the supply chain. I would give you an example. We've been talking about structural castings for the last 18 months. Our incrementals on structural castings year-to-date are 40% higher than they were last year. Again, we're making progress, and as Chris said, we still have a ways to go here. However, we're operating without full buffers in place, and as a result, any disruption on the Pratt & Whitney side is felt by our customers. I have a recent example of a supplier using incorrect material that was missing a heat treat step to make 1 batch of parts. We had to pause Neo production to remove that suspect material from the system. Our WIP positions are good, and we'll recover this in Q3, but it does mean lower new engine shipments in Q2. Clearly, this is not acceptable to our customers, nor frankly, to Pratt & Whitney, and that's on us, and we've got this. We understand the issues, we're aligned with our suppliers on demand, and we have hundreds of Pratt & Whitney people working every day, hand in hand with suppliers to increase rate. We're returning more engines to the fleet today than engines are being removed for service, so overall on AOG, I see this stabilizing and then trending down through the end of the year. Let's change gears and talk a little bit about time on wing. We have cut in several upgrades on this program, as you can see on the left of this slide, and we'll continue to invest to drive higher time on wing for our customers and of course, higher margins for Pratt & Whitney. Improvements include changes in the externals. We've improved hot section durability, we've extended the life on life-limited parts, and we've also improved oil sealing in the core of the engine. As of the beginning of June, 60% of our engines are in the latest configuration, 60% in the fleet, and we expect to achieve 90% in the latest configuration over the next 2-3 years. Block D was introduced in late 2020, and the Block D removal interval is double what the prior configuration was, and 4x where we were at entry into service. Now, like other programs, time on wing varies significantly depending on the mission and the operating environment. Three-quarters of our fleet today are flying in cooler environments. For this part of the fleet, time on wing is in line with expectations for where we want to be in the program, again, better than where we were on V2500 at this stage of the program. At the same time, operations in the hotter, sandier environments are seeing shortened intervals and lower time on wing than expected. This improves with Block D. There's more coming. Beyond the improvements that we already have made to the engine, we have additional improvements coming in 2024 and 2025. Primarily, these are changes around optimizing, cooling, and coding performance in the hot section, that'll close the gap with time on wing. I want to say a word on, specifically on oil seals. Block D on the A320neo introduced improved sealing in the core, and that has drastically reduced unscheduled removals. The same fix goes into the A220 and the E2 fleet in 2024. This is a known fix for a known issue and not something related to the architecture of the engine or the bearings, as has been speculated. Let's take a look now at how this plays through into profitability. 85% of our GTF fleet is on long-term agreement, and we have a range of offerings from limited to full coverage, and that provides customers with the options they need. These long-term agreements are important. They're important because they provide customers with predictable cost. They're also important because they maximize the value capture for Pratt & Whitney as we continue to optimize operating costs and expand margins over the life cycle of the product. When you think about what we're doing here, block upgrades, the time on wing, the high capture of LTAs, our team is constantly analyzing every visit and optimizing the fly forward for the customers, but also optimizing the fly forward to maximize our contract margins. Our contract portfolio today on GTF is less than 5% complete, so we have significant life remaining, and that enables us to address these technical issues early in the program. We've assumed all of these activities and the related costs in our contract modeling and of course, in our financial guidance. Other levers over time on wing include productivity on the OE side, productivity in repairs and overhaul, and of course, price. We have consistently adjusted price to offset inflation, that includes across our long-term agreement portfolio. Two-thirds of the long-term agreements in the GTF portfolio today are in line with expectations for mature margins, and our entry into service contracts have already started to expire. Overall, this means GTF aftermarket return on sales turned profitable in 2022. It grows incrementally every year and will be at teens ROS in 2025. If you look beyond 2027 on the lower left of the slide here, you can see how the Advantage is really coming in as a part of the mix of the fleet. That engine runs at cooler temperatures, which increases time on wing and additionally grows margins. The Advantage is fundamentally a more durable engine. We're combining more airflow through the core, which, as I said, lowers the overall operating temperature with an advanced hot section, including double-walled airfoils. This drives time on wing that will meet expectations right at entry into service. We're leveraging our experience from across our entire portfolio. We have engines in the portfolio that run at hotter temperatures. We have engines in the portfolio that run at higher speeds, and we're bringing all of this to bear on GTF Advantage. We have high confidence in the Advantage design based on exhaustive testing that we're doing at representative severe environment conditions to validate this durability. FAR Part 33 certification for the Advantage is mid-year 2024, and importantly, all life-limited parts will have full life right at entry into service. When you put this all together, it's this combination of ongoing durability enhancements on the base program and the Advantage introduction that drives GTF to mature time on wing, mature durability, and mature profitability. Again, we get there faster than we did on the V2500. Remember, we have over 10,000 engines in the program, including orders and options. As Greg said, with next gen now moving-- looking like it's moving, you know, significantly to the right, this program is going to be much larger than we ever planned. I want to shift now and talk about our industry-leading military engine business, and I want to start by saying we're proud to be the leader and the only provider of fifth-gen technology. F-22 was the first fifth-generation fighter, and it was powered by our F119 engine. The F135 is a derivative of the F119, and it powers all three variants of the F-35 Lightning. These platforms together have over a million hours in service, and F-35 today is setting the standard for fighter engine safety. F135's been flying since 2006, and it's performing extremely well. Readiness levels are fully recovered from where we were in 21, and our mission availability rates are above target. This engine has supported multiple upgrades of the airframe, and these are upgrades that put demands on the engine well beyond the original design requirement. The F135 is a very durable engine, and it's holding up well against these higher demands. As you know, the services are now planning additional block upgrade to the airframe, which will put additional needs on the engine, and we're on contract with the Joint Program Office for an Engine Core Upgrade that will support these block four requirements and make the jet even more capable than it is today. This is a drop-in upgrade, it's the most cost-effective and the fastest time to capability solution for all variants and all partners in the program. There's a huge benefit to having 1 million flight hours of fifth-generation experience, that is that we understand how the customer uses the product, and we get to see how it's operating up close every day. Something unique to fifth-generation that we don't talk a lot about is this combination of technical and material advancements that enable unparalleled stealth capability. The stealth capability of the engine is key to the stealth capability of the jet. We know stealth is going to be even more important for the next-generation fighter. If you step back and look at this overall, our experience and our investments in technology have not only positioned us to support the warfighter today, but it positions us well for that next-generation fighter. The third business in our portfolio is Pratt & Whitney Canada, and that's been said a couple of times today. This is the premier engine franchise, number one or number two in the key segments they serve. Growth at Pratt & Whitney Canada has been fueled by a derivative pipeline of continuous innovation. This is a very effective way, not only to bring in improvements to our customers, but also to continue driving the product down the operating cost learning curve and expand our margins. We have examples here, including the venerable PT6, still innovating after 60 years with the first of its kind electronic propeller and engine control system. We also have the PW127XT for the regional market. At introduction, 40% longer time on wing and 25% lower operating costs than the prior version. Over the last 10 years, Pratt & Whitney Canada has certified 25 engines. This includes both derivatives and new cores, always with a step change in performance for our customers and the segments they serve. In the last 5 years alone, we've seen 10 new aircraft go out with Pratt & Whitney Power, and 25% of our volume over the next 5 years will be from these new programs. This includes the PW800 that you see here, double-digit improvements in fuel consumption, in emissions and noise, and setting the standard for performance with 99.98 dispatch reliability. With utilization recovered and demand growing, Pratt & Whitney Canada is back to 2019 return on sales in 2023. Pratt & Whitney Canada is also leading our broad-based investments in sustainable propulsion. Steve mentioned this. We're working closely with Steve and his team at Collins to develop hybrid electric systems that partner advanced engines with electric motors and controllers to reduce fuel burn. The demonstrator you see here on a Dash 8 platform is on track to test flight in 2024. This program delivers technologies that reduce fuel consumption and emissions by as much as 30%. I want to transition now and wrap up our view of the businesses with a look at aftermarket. Our aftermarket strategy is focused on proximity to our customers and a strong network of program partners. All of this is aligned to driving customer satisfaction and financial performance from our long-term agreements. Growth is broad-based, commercial and military, new generation and mature. On mature programs, demand and utilization is very strong, on our new gen programs, the shop visit is compounded by our 25% annual growth rate in the installed base. This results in decades of aftermarket value to come. On the military side, the window is just now opening on the first heavy maintenance cycle for the F135. We're ready with capacity, repairs, material, and technical support to ensure benchmark turn times as F135 aftermarket grows. All of this translates to 50% aftermarket profit growth from 2022 to 2025. A final word on our aftermarket, we collect massive amounts of data from the operational fleet, we're building out capabilities to provide decision support for our aftermarket operations. Chris talked about this. This also helps the entire ecosystem, including design and manufacturing, ultimately leads to a digitized product life cycle with higher quality and lower cost. We have all of this high growth across our business. We continue to invest in both product and industrial innovation, to enable all of this, we're focused on driving a lean and cost-effective operating structure with disciplined execution and ROS expansion. I'll bring this to life by saying that CORE is our operating system, it starts with robust goal alignment and relentless focus on continuous improvement. Core and digital are key enablers to delivering on our 2025 commitments, I want to walk through a few examples here, I'm going to start with how we manufacture. Core in our factories is called the Standard Production System, Our first pilot in the Standard Production System was our turbine airfoil factory in Connecticut. Using SPS, we lifted output by 75% over a 12-month period, We did this by breaking bottlenecks, improving overall equipment effectiveness, improving overall labor effectiveness, All of that with only a 3% improvement, or a 3% increase in our in our labor input. We're leveraging this now in our new turbine airfoil factory in Asheville, We'll do that from day one. If you want to think about scale, SPS is currently active in about 25% of our manufacturing footprint. That'll be closer to 50% by the end of the year and 100% by 2025. We also leverage the learning on our factory floors with our suppliers in the supply base. In addition to that, we're using analytics and procurement to identify savings opportunity. Insights that we've gained on a pilot of 25 long-term agreements has shown double-digit improvement in cost, and now we're scaling this across the entire spend base. Digital solutions are important. They enable about 25% of our productivity initiatives, and we've applied model-based engineering or model-based enterprise to a really tough commodity, and that's the casting commodity. We've replaced flat files and 2D layouts that are traditionally used when we transition from design to manufacturing. We've replaced them with 3D models, model-based inspection and 3D scanning, all in a cloud environment, and significantly reduced our cost of quality, drove higher yields, and drove improved on-time delivery. Finally, I would say in the aftermarket, we're using leading-edge artificial intelligence along with digital twin and deep AR to improve our forecast accuracy by as much as 30% in the pilot. This pilot's demonstrated a 10% reduction in inventory while lowering our support cost and also improving our on-time delivery. So these are just a few examples of the CORE operating system and digital transformation. As has been said earlier, we're driving initiatives like this to scale across Pratt & Whitney, but also across RTX to create a sustainable cost structure to deliver on our commitments for 2025 and beyond. We launched CORE in 2021, and it's already enabled us to outperform our 2022 commitments, despite some of the headwinds that Chris showed that were not in our planning at Investor Day in 2021. As a result, you can see we're about halfway to our 2025 ROS target. We started with more than 1,200 initiatives, and about 25% of those have been completed, and the rest are in process. Importantly, our team continues to add to the project pipeline. We drive execution at a daily cadence. This is a classic inverted pyramid. It starts where value is added in our factories and in our office, and then it flows to the executive committee on a weekly drum beat. Let me bring this back to why we're here today. We are Pratt & Whitney. We are the dependable engine company. Delivering on commitments for our customers and shareholders is what we do. Demand trends are strong and support our forecast going forward. We have leading positions in all key segments. Supply chain is going to continue to be challenging. That said, we have full transparency with our partners and suppliers on demand. We've extended long-term agreement coverage on key raw material to ensure supply security. As I said, we work hand in hand with suppliers every day to improve yields, and also to make sure that we're going to have capacity ahead of our growth. GTF is generating earnings today with strong growth ahead. We are executing on our margin expansion plans there, and this includes driving time on wing up the learning curve, as we have done for every engine we've designed in the last 98 years. We have the advantage coming behind. Finally, we're transforming all elements of our cost structure with our sustainable operating system CORE. This is all enabled by digital transformation. When you put these things together, this is why we are confident in delivering on the 2025 commitments that we made 2 years ago. With that, I'll say thank you again for your time. I think Jennifer is going to join me on stage for a few questions. Wonderful. Thanks, Shane. All right. Oh, wonderful. Peter. No questions. No questions. Thanks. Thanks, Shane. Peter Arment from Baird. Maybe just to drill on your last comment about the supply chain, if you could just update us on how, just a little more color on this, on, availability of materials and how you're balancing that between the OE and then your MRO network, and just, when you think kind of things sync up to more normalized levels? Thanks. Yeah, I mean, on the slide, I think we showed that it's really about 2%, and if you thought about 2% of the parts, that's about 30 parts on the GTF that we're really focused on chasing that have been pacing us. The incrementals this year through the H1 are pretty good. I think Chris said that we see this going out into 2024, but importantly, we're going to be driving down our AOG trend. It is every day, you know, on these constrained materials. Because we're doing block upgrade, these constrained materials, we are having to make a decision between OE and the MRO shops, and we'll continue to do that and, you know, bring lift back into the fleet. Doug? Thanks. You know, you've laid out a plan here for progression in terms of dealing with the problems with the GTF we see today. Yeah. When you describe really two things here, when you describe your profitability on the GTF aftermarket right now, I mean, I think the costs you're seeing today have to be above what your plan would have been on the FMPs. Assuming that that's the case, and that these FMPs extend over some time, you know, what are the assumptions that you make in order to get to being able to book profits today? Just one side thing, we've heard a number of customers who've been pretty vocal about their concerns over the engine. Do you have any financial exposure to the kinds of issues that they're seeing, the grounded airplanes, and the costs that they're incurring? Maybe I'll start with the first piece and just the margins overall. Of course, in this portfolio, which most of the fleets in the portfolio that we talk about here, we're looking at total cost of the contract, total cost of the portfolio, total revenues of the portfolio. We actually book on a cost basis. We book revenue on a cost basis based on the, you know, I'll say, our calculation of the earnings that come with those costs. I talked about Block D coming in in 2020, late 2020. We actually had done an upgrade before that. If you think about this, as we have designed the improvements that go into the fleet, we've rolled those costs into the cost basis for the portfolio. This is expected cost for us going forward, you know, to upgrade the fleet over time. I think there's not a surprise here coming. When it comes to, you know, how we support our customers in terms of AOG situation, I wouldn't get into specific terms, but clearly when we're running at this level, you know, 10% of our fleet out of service, we are working very closely with our customers on that to, you know, to get through this, and we want to get the fleet healthy again. Again, all of those costs would be programmed into the portfolio and into our calculation as well. Thanks. Sheila? Thank you, guys. Sheila Kahyaoglu from Jefferies. Just to Doug's question, when we think about the Pratt contribution for free cash flow and EBIT, it's about 25% of the $9 billion, the incremental. How do we think about the commercial engine business versus military contributing to that, and then GTF versus V2500 on that target? How much of the reliability issues are embedded? Can you quantify it? Does that mean as the Block D upgrades are embedded, you have a big jump in 2026? Well, all of the first thing I would say is that all of the costs are contemplated in our, you know, our analysis and our calculation around the portfolio, the guidance we give and how we book. you know, clearly, in terms of the growth piece of it, the interesting thing, and Greg talked about this this morning, the mature commercial fleet, we actually see that versus where we were in 2021, staying at higher levels of utilization and lower retirements going forward, so it's contributing more. you know, the big growth driver is obviously GTF, and it's the GTF aftermarket growth, and then the contribution we're getting from expanding margins in the GTF. F135 is an important piece, too, just coming into the first heavy maintenance visit. You put all that together, and you get this, you know, between 2022 and 2025, doubling of profit dollars in the aftermarket. Jason? Yeah. Good morning. Jason Gursky from Citi. I just going back to Doug's and Sheila's questions really quickly, 10% of the fleet AOG today, I was wondering if you could just kind of give us a sense of what that should look like in a normalized environment. Your suggestion in trying to answer Doug's question, that all the costs have been incorporated and any potential compensation to airlines has been incorporated. I just wanna make sure that that's the case, that there are potentially going to be some announcements here from airline customers on some compensation that they've received for this overage on AOG, and that's already baked into your margin assumptions. I just wanna make sure we're really clear on what you're saying there. Thanks. Yeah. Again, the upgrade, you know, the content of the upgrade that we're doing on Block D is known, I talked about the fact that we have more upgrade coming over time, which will continue to push time on wing up, as we've done on the V-2500, as we've done on other programs. As that is identified, it is all rolled into the cost basis. There's not a surprise, coming there. Again, when it comes to how we work with customers, every contract has its own terms and conditions. I don't want to get into the specifics on a customer by customer basis. To the question of, is what we're doing today to support the fleet, is what we're doing to upgrade the engines over time contemplated in the cost basis on which we're talking about our margin growth here? The answer is yes. Let's take one last question. Matt? Hi, Matt Akers from Wells Fargo. Could you just refresh us on negative engine margin? Sort of where do you stand this year, and what does that look like, as you look out to 2025? Yeah, I don't know that we get into, you know, a specific number on negative engine margin. You know, as the, as the volume goes up, we are improving costs on the product, but as the volume goes up, you know, there is the negative engine margin drag. I don't think we get into the specifics on that. Yeah. Great. We are going to take a very short break, because we're running over a little bit. We'll return with Wes Kremer from the Raytheon. Please, the bathrooms are downstairs for the people in the room. We have some quick coffee. Very short. We'll be back soon. Welcome back, ladies and gentlemen. Please welcome Raytheon President, Wes Kremer. Good morning. It's really great to be back in Paris, and, you know, you'd think after all these years, I'd get tired of air shows. I have to say that, you know, when I grew up, my dream was always to be able to fly fighter jets, I love air shows. I got to achieve that dream. I flew for 11 years in the Air Force, one of the things that I bring to Raytheon and that we see reflected in our people is that mission mindset, that what we do is important, and it makes a difference in the world. Take a walk through any of our factories, what you're gonna see is that we collaborate, we innovate, we drive, we push, and at the end of the day, what we do is we deliver. I couldn't be prouder of who we are, and I'm really excited to be here today to talk about this opportunity. I'd kind of like to start with, you know, four things: what makes us strong, how we're evolving our business, how we're meeting our commitments, and where we're headed next. Let's start with what makes us strong. As Greg and Chris talked about, we have industry-leading franchise. You only have to look in Ukraine, and Greg mentioned several of the products there, the Middle East, Asia Pacific, futures, future weapons, all of those things play to the strength of our portfolio. In all areas, whether it's continuing production, whether it's refreshing our products, or whether it's delivering new capabilities, we have great positions in all of those. The second thing is that, you know, our customers count on us, but they also know that one of the things we have in the strength is this platform-agnostic approach. Whether it's talking about undersea or surface or air or space, we bring that platform-agnostic approach, and the great thing about our portfolio is not a single one of our programs account for more than 5% of our revenue. It's really a diverse piece of that. You know, the third thing is really our ability to solve problems. We're our customer's partner of choice. If you think about one of the most challenging issues that the defense industry has faced in the last several years is solving the hypersonic situation. You know, how do you manage the thermal profile of something that flies greater than 5 times the speed of sound? I know when I was up in 2021, there was a lot of questions about: where is Raytheon in hypersonics? Well, I'm excited to report that our strategy was the right strategy, and it worked. Today, we have over $3 billion of hypersonic programs. Our strategy was to focus on the air-breathing aspect and to be able to address a more tactical market, and that's exactly where we see our customers headed. I'm very proud of the team and all that we've accomplished in the hypersonics arena. The other thing we talked about in 2021, is we really talked about that there was three areas that we were gonna focus on. number one was delivering Patriot while transitioning to LTAMDS, and I'll talk a little bit about that later. Two, it was about refreshing our key production programs, and three, winning new opportunities. I'm proud to say that's exactly what we've done on all three of those counts, and it's what's led to our record backlog of over $50 billion. You can see here a good mix of different programs. Let me talk a little bit more about the backlog. There are some things that changed from 2021. What happened during COVID was we saw that some of our international sales are typically DCS and higher margin production programs slid out to the right a little bit. What it filled in with is new development programs, especially from the rising threat from China. We saw our wins not only in things like HACM, but several classified programs that really kind of filled in that near term. What that does, it certainly creates some near-term headwinds for us because the margin on those development programs tend to be lower, but it gives us incredible potential for the future. We see this demand going, headed in a favorable position, it really positions us for both top-line and bottom-line growth with very strong cash generation. Let's take a little bit closer look at the numbers here. As you know, we've reorganized Raytheon. I'll talk about that in a couple of minutes. What I really want to make sure is, as my other counterparts have said, is that we are still stand behind our 2025 financial commitments. We'll show the roll-up of that as we walk through. You know, we have a really strong book to bill. Our trailing 12 months, 1.32 as a combined Raytheon, we've got a balanced portfolio, 26% of it in international sales and a really strong development backlog here of 29%. I'll talk about how that mix is changing as we move through the next couple of years. Let me before we go into some of the financial numbers, what I want to talk about is how we reorganized Raytheon. Many people will say, "Hey, what's different about this than maybe Raytheon of, say, 2014, 2015, when we had 6 business units?" I'll tell you this, it's completely different. The way we're organized, as Chris talked about, is we are customer-facing. We developed these 8 strategic business units that primarily align with our customers. If you look at the first five here, you've got land warfare, obviously aligns with the Army and our international air defense customers, naval power, Navy, Air Force, air power. We also have space systems and then our advanced technologies, which is really our technology incubator. I want to talk for just a minute about space. You know, we've went through, I'll say, a couple of iterations in our strategy, but we've really settled on our strategy around space is largely returning to our roots, which is our focus on exquisite payloads, working with the other primes to develop incredible capability that gets put on those systems, along with our strong ground processing capabilities. That's always been the core part of our space business. With our acquisitions of companies like SEAKR and Blue Canyon, is to really focus on the new area, which is proliferated LEO. That's our space strategy, and hopefully, if you can decode the chart here a little bit, that you can kind of see where the different RIS components ended up in this, and then we also brought over, as Steve mentioned, a small part of the ISR portfolio that was in Collins. We really line up to our customers here. 70% of our forward-facing is exactly to that customer. That's what's different about how we're organized now. The front end of the business is focused on the customer, but the back end of the business, our engineerings, our operations, and our supply chain is cross-cutting. No longer do we have, you know, separate organizations in each. All of my factories are under one lead. All of supply chain is under one lead. We get that scale of being the company, and we also work very closely now with RTX at that level of bringing together, as Steve talked about, some of the commercial and defense types of products. What we see there is using the commercial throughput and productivity gives us an incredible accelerator in being able to put new programs into service, that's one of the synergies that we really see as we move through this. At the end of the day, I hope that what you see here as we put all of this together, is that we're creating a better focus for our customers, and we're aligning around our synergies. The final thing that we did here is something called Advanced Products & Solutions, this is, you can think of, this is where we supply product to other primes. Many of our products that we go on platforms like airborne radars and things like that, we deliver to another prime. We also have several things where we actually deliver internal to other parts of RTX. We've consolidated all of that together in APS so that we can have more of a customer-aligned model on that that's different than DoD kinds of customers. Finally, rounding that out is our cyber business, which is very focused on classified customers and government cyber. When I talk about where we're going in the future, there's really kind of 3 areas here that we talk about when we think of our portfolio, where our focus is, and how our mix changes over the next few years. The first has been on the emerging threat. We don't have to go very far to understand whether it's China, whether it's the, you know, rogue nations of Iran or North Korea, that there is concern and there is certainly a competition going on to develop deterrent capabilities, and we have done extremely well in this area. Talked about hypersonics, and of course, our big win in this is HACM, Hypersonic Attack Cruise Missile. This is really a franchise program for the future, probably the most impressive on this is how fast the team has been able to develop this. I'll talk a little bit about digital engineering and some of the things that we're using to accelerate these into the future. You know, the other thing that's always been a strength of Raytheon is our international demand. Whether you look to the Middle East, Asia Pacific, you know, this is the one time in my career where, you know, the drive for capability exists at the same time growing in every single marketplace in the world. For example, the defense budget in Japan this past year is up 27%, and we see those kinds of things all around the world. The other thing we see that clearly wasn't anticipated in 2021 is what's going on in Ukraine. Greg talked about some of the things there. You know, we have, and we've played an incredible amount, or we've played an incredibly important role in defending Ukraine, and it shows that our products work. When it has the Raytheon name on it, our customers count on it, and we're truly making a difference around the world. Those are kind of our three big areas. The one other one I would mention, because it's especially important here in Europe, is we also see that the F-35 is really becoming the platform of choice for air dominance in the world, and our portfolio is well aligned to that. Not only do we provide, you know, through Pratt, the engine, and the avionics through Collins, from a Raytheon perspective, the primary weapons package includes AMRAAM, AIM-9X, StormBreaker, and the Joint Strike Missile. Really key to our future franchises in moving forward. You know, the other product I'd like to talk a little bit about here is Patriot LTAMDS. I mentioned that as one of our key points in 2021. Let me give you an update on where we are with that. I said that we were gonna continue to deliver Patriot, but clearly, those sales were gonna decline. Fortunately, it's actually held up better than we ever expected. Not only have we now delivered Patriot to Poland, Romania, and Bahrain, but as we announced last quarter, we also had Switzerland join as the 18th Patriot partner nation. With the surge in Ukraine, the fact that Patriot is making such a difference there, we expect to still have some continued sales of Patriot to existing customers, especially here in Europe. That trail is really staying long. At the same time, we've been developing LTAMDS. LTAMDS is an incredible capability, despite all the challenges of COVID, we've been able to keep that on track. The six production representative units have all been delivered to the Army. They're in various stages of user acceptance testing, user training, qualification, environmental sorts of things. As we said in 2021, we expect the first U.S. production contract for LTAMDS to be awarded in 2024, the first international sales to be in either 2024 or 2025. Again, not going to be a contributor to our 2025 revenue in any meaningful way, but when we look to the latter half of the decade and into the 2030s, this promises to be, you know, a very strong franchise for us going forward. You know, the final thing is really the munitions replacements. As Greg talked about, you know, we've seen about $2 billion of contracts so far associated with Ukraine. We expect to see $3 billion or more over the next 12 to 18 months. It's hard to put it into very specific things because, you know, in many cases, what's happening is, as older munitions are being used, they're being replaced with newer versions of things, which, again, is positive for us. I think the one thing that is different is we're seeing this drive for interoperability, especially here in Europe, it's probably gonna provide additional opportunities beyond what we had originally thought, not only in replenishing US stores, but also the fact that some of the nations here in NATO expect to be able to, you know, build munitions depth and capability and having some magazine depth. Okay, the final thing on this is, you know, we are starting to see a lot of movement in Congress around multiyear production contracts. Again, really not significantly a revenue driver for us, but certainly something that gives stability in our supply base, helps drive efficiency, and certainly one of the things that will help contribute to our growth on the bottom line. When we look at all of these things, it gives us, and it gives me incredible confidence in our ability to still meet all the 2025 numbers. A little different profile maybe than we had thought in 2021, but certainly all of the ingredients are there for us to be able to continue to grow not only to 2025 but to beyond that, into the latter half of the decade. I think that, you know, this really sets the stage for many of the questions around margin and where we're going. The first thing we see here is that we are at the low point in our mix right now in 2023. All of the indicators, when we think about our mix going forward, continue to get more positive in 2024, 2025, and beyond. You can see there our international sales mix. Like I said, some of that got pushed out, now that's starting to come back in. You see that growing out to 2025. Our production, with the large development programs, we've had a lower percentage of that as we're going through our technology refresh, you can see production back to a 50/50 kind of thing. You see that we've won a lot of new development programs that will contribute to our mix going forward. We see by 2025, we're really back more in line with the historical mix that we saw across Raytheon. The other piece here on our production ramp, if I dig just a little bit deeper, is that one of the things that I talked about here is that, you know, these programs, like PhantomStrike, LTAMDS, and HACM, are all gonna move into production beyond 2025. Again, normal part of our development process, great opportunities for the future. The final thing I wanted to talk about here is, you know, what we're doing around addressing capacity. Certainly, we have seen a lot of challenges in our global supply base, and for Raytheon, it's most acutely manifested itself in the form of microelectronics and rocket motors, and we've talked about that on previous earnings calls. As we've previously said, you know, we expect to see some slight recoveries in 2023 and 2024 on rocket motors, but that's gonna continue to be something that plagues the industry here for at least for the next 18 months or so. We are starting to see some green shoots around microelectronics. That's starting to come back, as has been talked about. We expect that here in the latter half of the year to start seeing more of that capacity be delivered into our factories, and for us, that's really important. As we went through some of these redesigns, that was one of the challenges, was getting those new microelectronics and new suppliers stood up. We're starting to see that flow through. The other thing we've been doing is being proactive with our supply base. If you look out across our, you know, several thousand suppliers, at our, we've got about 300 suppliers where we have people deployed every single day, working shoulder to shoulder with teams there to help drive efficiency in their factories, to be able to get priority and to push product out the door. We're seeing that. We're also leveraging our scale. As I said, we're gonna be organized here now so that all of the Raytheon supply chain under one leader. Not only do we get the scale of Raytheon, but we're also working closely as RTX, and we're leveraging scale across the RTX enterprise. Steve talked about some of those partnerships that already exist there. What we're seeing is that, you know, we're overcoming the headwinds here around inflationary pressures and material shortages and really, you know, a strong path to our 2025 targets. When we look at our margin commitments of where we were going to get to, this is from 2022 today, we see that, you know, about half of that change is really due to a mix. We're confident that these levers, we're gonna have about 13%-17% from 2022 to 2025, and we'll expand our margins about 210 to 260 basis points. That's here, and you can see that it's kind of split. I think I really talked about volume, and hopefully there's no questions on the volume and the mix, but let me talk a little bit more about productivity, 'cause that's kind of the, that's the piece here that really gets to the other half of our margin expansion. One of the challenges that we had during COVID is going back to 2021, I talked about how we were really focused on our technology refresh. We were actually very proud of the fact that programs like AMRAAM, ESSM, Tomahawk, APG-79 V4, SM-6, SM-3, all of those were going through technology refreshes. We're now got those back on track. That was some of the delays here of you know, of delays when you're standing up new suppliers and you're going through a technology refresh. All of those are ramping to production here. Some have already ramped, and in the H2 of the year, the rest of those will ramp to full, back to full rate production. I would say we still face a few remaining headwinds, and that there are some fixed-price development programs within RIS that we'll see some additional headwinds here in the Q2. We're really on those focused on, you know, the next key milestones over the next 12 to 18 months or so, to really be able to drive those to completion, and that's where a lot of the focus is right now. I also want to point out that last quarter, we discussed that we had an option exercise on a production program in RMD that resulted in a write-down, and there's still 1 more remaining option that could be exercised on that contract. Overall, I think we've done a really solid job of absorbing the cost challenges that we've seen and really addressing our volume constraints. The other thing we've really done here is we continue to invest in our factories. We are driving automation. You go to our factory in Andover, and you'll see that we literally build a radar with robots, all the way from the chips to the trims to placing the actual assemblies in the radar. We're standing up this new business unit. We are going to see reductions in structural cost. We're streamlining efficiency. As Chris likes to say, "How do we remove the friction from the organization?" Part of how you do that is you organize in such a way. You saw how we're eliminating a lot of the intercompany business by how we've realigned with Collins. At the end of the day, you know, nothing really delivers productivity like a full factory, and that's where we're headed. You see the backlog on our existing programs, largely driven by Ukraine, things like our GEM-T missile for Patriot, NASAMS, the Next Generation Jammer, not only drive near-term sales growth, but they really provide opportunities through that volume for additional productivity. One example I'd like to specifically point out on investments is our Advanced Integration and Manufacturing Center, where we've optimized the layout, the process automation, and this is where we build our MTS turrets. We've got much higher planned productivity, and what we've seen so far is a 16% decrease in cycle time, an 80% reduction in material travel, and $12.4 million of cost reduction year to date. These factors are really the ones that will create the tailwinds that give us confidence in our ability, not only for top line, but really this is about the bottom line piece of how we get to the margins that we talked about for 2025. Not only are we focused on delivering today, we also have an incredibly bright future in front of us, and if you look at some of these programs, you can see that we have opportunities here in several areas that are literally measured in the tens of billions of dollars. One of the key enablers for this has been digital engineering, and Chris talked quite a bit about this. Let me talk about on HACM. A completely new environment, flying in the hypersonic flight regime. When we flew our first test of that, it was almost a perfect overlay of what we had predicted. It's giving us confidence, and it's giving our government customers confidence that we can use digital engineering to reduce the number of flights that we have to fly, and to be able to gain confidence by just anchoring the model in a few points with a few flight tests, that we can better and more quickly get items into the hands of our war fighters. That's just one of the things that we're really leveraging as we move forward. Again, to kind of wrap this up here, we are on track to meet our 2025 financial commitments. What we shared in 2021, different path, but we absolutely believe that through the volume, the mix, and the productivity, that we will be able to achieve what we committed to. You can see the numbers here, and clearly, some of the things that I talked about of the development programs, you know, has created a little bit of a niche here. We are on a path that's going to be an accelerating path as we see the H2 of this year into 2024 and 2025 to achieve those. To conclude, this is who we are. We are an incredible collection of franchise, arguably the industry-leading set of franchise. When you think about the threat environment that we're in, whether it's here in Europe associated with Ukraine, or whether it's the Asia Pacific region and the threat by China, we believe that our portfolio and the investments that we have made position us well for the future. As we see that mix change and the more international sales, we'll also see not only productivity and throughput, but we'll see margin improvement. It really creates great opportunity for us. Multi-year contracts would just be an additional thing to provide a tailwind, but at the end of the day, we have an incredible backlog, we're well-positioned, and I'm excited about the future. With that, I'd like to ask Jennifer to come up and we'll do one more round of questions. She'll be careful not to step in the. Thanks. crack on the stage. Thanks, Wes. All right. Who do we have here? Cai? Yes, thanks so much. Wes, you know, you've told us $210-$260 between 2022 and 2025, and you also mentioned, I guess, some near-term potential risks in terms of options, et cetera. As you look at that profile, 2022 to 2025, is it heavily backloaded so that we continue to struggle this year, struggle 2024, and then we have a huge 2025, or do you see that as a relatively linear uptrend? Yeah, it's not a linear path. It's definitely accelerating. As I said, 2023 is the low point in our mix, so you know, we do have some continued headwinds here in 2023. We feel confident in our ability to be able to manage those and bound those. What we're gonna see in 2024 is a significant ramp within an even larger ramp into 2025. You know, the reason I feel confident about that is almost all of that is already in backlog, so it's not stuff that we have to go out and get. It's here, the contracts are in, the orders are placed, the material's gonna show up, we have firm commitments on that, and that's gonna really allow us to ramp our factory. What you're gonna see here is, you know, we'll get going here, we'll do, you know, significantly better in 2024, and, you know, we'll really be knocking things out of the park in 2025. I mean, that's the way I would think about the profile. Great. Seth? Thanks. Good morning. Seth Seifman from JP Morgan. You showed the improvement in the percentage of revenue coming from production programs. I guess one of the things we've seen across the industry is, as programs move into early production, either because of the way that those early production lots were priced or because of the cost environment that we're in, that actually, you know, moving into production hasn't always been a driver of higher margin. When you think about the programs that are driving, you know, some of the major programs like LTAMDS, that are moving into production for you, do you have a line of sight that in early production, those programs are gonna deliver the type of, you know, production-type margins that we should think about, driving accretion to the overall margin rate? Yeah, no, I get your question there. Let me frame it maybe the way I think about that is, we've always known programs like LTAMDS and stuff are going to be transitioning to production in the latter half of the decade. We've not made any assumptions around having to perform extraordinarily on transition to production programs. What's driving our path to 2025 is the programs that we have already transitioned to production. It's, you know, we're on the F3R variant of AMRAAM. We're, you know, ramping to full rate production on that this year. It's ESSM Block 2, we're already at full rate production on that. It's APG-79 V4, we're now approaching full rate production on that. You know, SM-6 and SM-3, the newest variants of that, we are at full rate production. You know, that ramp is already happening. Those other transition to production programs are accounted for in our mix, so we don't have to see something out of the ordinary happen on those. Rob? Thanks so much. Wes, I was wondering if you could give us an update on labor, whether this is still proving to be a tight part of your business, particularly with regard to labor skills, and also, how your supply is faring with this? Thanks. You know, I think labor is one of those that, you know, more confident in material. We're still waiting to see all the material woes work their way through, labor seems to have really stabilized, both for us and our supply base. I'd say it's two aspects: It's availability of labor to hire, it's retention of labor that we have. We're seeing all of those things converge in a positive manner. Our attrition is way down from where it was in 2022, we are actually ahead of our hiring plans this year. We had an incredibly successful hiring of college grads, they are being integrated in. You know, as we think going forward, one of the biggest, you know, differentiators becomes how fast can you actually bring people on and make them productive? That's where, you know, where when we talk about process improvement, that we're focusing on. Same thing in our, in our supply base. That has been a little bit slower, but you know, we're not hearing our suppliers talk as much about labor now. That's another positive or green shoot that we see. David? Thanks. Wes, where are you in being able to price through higher levels of inflation into your fixed price contracts? You know, we really don't have the ability to adjust in our fixed price contracts. I mean, certainly, you know, about 50% of our business is cost plus, you know, whether it's, you know, material or labor inflation, you know, that gets priced into our rates on a go-forward basis. You know, that was, you know, 1 of the headwinds we talked about there, is where you've got fixed price options on things. We're pretty much at the tail end of that. You know, we talked about, you know, the 1 additional 1 here that we see coming through later on in the year, we're really kind of past most of that there. We're kind of past the big inflationary things, and we're able to price going forward. Great. Peter? Yeah, thanks. Thanks, Wes. Just quick comment on, just supply chain, specifically in microelectronics. I know that in the past has been a big kind of, source of a headwind. Just where are you on that? Are you still dealing with decommit rates, and when you think that might normalize? Thanks. Yeah, you know, we keep hearing, it out there from, you know, our peers and from our suppliers, that we expect to see an easing of the microelectronic stuff here in the third and Q4s of the year. We have every indication to believe that's true. We'll start to see that. You know, the way our business is set up, we actually build a lot of the circuit cards, so we need those microelectronics, and that factory that builds a lot of the circuit cards and stuff is at the front end of... It feeds all of our other factories. That really is key for us. I would say that we're, you know, cautiously optimistic, that the microelectronics will ease. You know, the other one is the rocket motors. As I said, that's gonna linger a while. I guess I'll say the good thing about the rocket motors is, you know, we basically bolt that on and test it at the very end. It doesn't stop us from doing the production build, whereas microelectronics, you know, kind of stops us at step one. That is really key to unlocking the flow of material and the productivity in our factories. All right, last question. Doug? Wes, I just want to actually kind of combine all the questions that have just happened. What I'm getting at is, you know, a lot of times when many of us look at a chart and it shows margins are here, here, and then all of a sudden they go way up in 2025, there's skepticism. When you think about that, I mean, you described a number of things that are a pretty compelling story on mix, but you've also got these issues with rocket motors, microelectronics. You're addressing labor problems. We don't know what inflation may do in a couple of years. What did you have to assume that you get to that attractive margin in 2025, and what could go wrong there? Well, certainly, nobody has a perfect crystal ball on the material, challenges throughout the global supply base. You know, that's one where we're trying to, you know, make sure we understand the best visibility that we have, but nothing's perfect on that. You know, that continues there. I think, you know, the one thing that maybe wasn't well understood and created a bigger challenge for us than maybe some of our competitors was that technology refresh cycle that we were going through. In 2021, we were refreshing the vast majority of our large production programs, during that time, as lead times were moving out to the right very rapidly, it wasn't like we could just order more material. We couldn't order anything, because we were updating drawings with new circuits, new components, and new suppliers. That is behind us. You know, we are now back to ramping up on all of those technology refresh programs, so, you know, that's what gives me a lot of confidence in that. If you look at the productivity numbers that we've built into our assessment for 2025, it's well within historical averages of Raytheon. If you go back and look at 2017, 2018, and 2019, it's not like the high end of that or that some other miracle has to occur. It's really kind of right in line with where we had performed pre-COVID. Great. Well, thank you, Wes. Thank you. With that, I'd like to welcome Neil Mitchill, our chief financial officer. Good afternoon, almost. We'll get you out to the air show, hopefully pretty soon. A lot of information coming at you this morning. Hopefully, you found it to be quite helpful. I think the presentations have been very good so far. What I'm going to try to do is bring it together financially, tell you what it means for us, sort of in the next few years, as well as, you know, laying the foundation for the years that follow after that. I'll also give you a quick update on 2023. You've heard a couple of folks allude to some things, so I'll get that clarified for you in a couple of minutes. Before I get into the details, let me share with you some of the significant highlights over the last couple of years as we've continued to execute on our strategy in this ever-changing environment. Clearly, you've heard all day long that this is a different world than it was 2 years ago. Some good, some not so good. All in all, we remain very, very confident, both in 2023 as well as 2025. Those puts and takes balance out, and we still see a clear path to what we laid out 2 years ago. I remember someone in the room here asking me, like, "How, Neil, are you confident in the 2025 goals that you're laying out here in the midst of COVID?" I said, "Well, it's a little unclear what's going to happen in the middle, but, you know, when we get back to 2025, we will have commercial aero back at its 2019 levels or above, and we'll also have strong defense growth." We didn't expect even more strength in the defense environment. We're seeing that today. All in all, it balances out. One of the key goals that we set out at the day of the merger was to return a significant amount of cash to share owners. I'm really happy to say that as of last week, we've exceeded $15 billion since the merger in the form of dividends and share buybacks, and we've had 3 annual dividend increases in that period. We expect that trend to continue in the future. More buyback, and certainly, we'll see the dividend growing with earnings. We haven't sat still. We've been continuing to attack cost. We're leveraging pricing. You've heard folks talk about that today. We're just about at the $1.5 billion mark on our synergies, and we've increased that by $500 million today. Up to $2 billion, that's twice the original goal we set, ahead of schedule and very confident in achieving that $2 billion. Frankly, there's a pipeline of ideas that exceeds that, and we're working that to offset what we'll probably see as additional headwinds that we can't forecast today. Frankly, we're focused on the things that we can control. You just heard Wes talk about some of the things we can't control, but we know there's a lot of things in our four walls that we can focus on. One of those is investing in the future. Over the last 3 years, we've invested over $30 billion in R&D, company and customer funded, and we're going to continue to invest at that level of about $10 billion or more a year over the next several years, and frankly, beyond. All of that has created a huge backlog, $180 billion. It's up 17% year-over-year, on a rolling four-quarter basis, our defense book-to-bill is 1.25. Clearly, the momentum is in the end markets there to help us deliver the 2025 path. We feel very, very confident in that. That momentum has continued into 2023. Before I get further into 2025, let me make a couple of remarks on 2023. As you all saw in the Q1, we had a very strong quarter, 10% organic sales growth on the top line, 15% adjusted segment operating profit, a very good margin expansion there. Today, we're not changing our RTX outlook. Very confident in the full year for 2023 at the RTX level. See $72 billion-$73 billion in sales. That translates to 7%-9% organic sales growth. Adjusted earnings per share of $4.90-$5.05 per share, and free cash flow still at $4.8 billion for the full year. Of course, that'll be second-half weighted. We talked about that a little on the Q1 earnings call, and we're still committed to $3 billion of share buyback. As Chris made the programming note earlier, we will continue to operate as four segments for the H1 of the year. We'll go to the three-segment characterization starting with July first in our Q3 earnings call. When we come on the call in July, we'll provide a segment update, and we'll include sort of a first-half results update for that, the realignment impacts, and a couple of minor financial reporting classification changes that Jennifer and the team can take you through. We did provide each of the last three years' recast for the segment, the new segment structure in the appendices, so you'll have time to study up on that, and then you'll see the 2023 H1 and the quarters as we get into the July timeframe. Just a couple more comments on the Q2. You heard Shane allude to the unfortunate and unexpected supplier escape, which is going to cause us to have a few engines, more than a few engines, slip out, rather, of to Q2 and into the Q3. That's going to cost us probably about $500 million in free cash flow during the quarter, so that's going to bring down the Q2 cash by about $500 million. That's obviously lower than what I said on the Q1 earnings call. We expect to fully make that up in the H2 of the year, confident in the full-year cash flow outlook. Wes alluded to some, you know, development programs. We've been talking about those at RIS, probably $40 million-$50 million a headwind we see in the Q2 related to those programs. Slightly lower margins. Confident that we'll continue to recover in the H2 of the year. All that said, I still see the Q2 sales up 9%-10% organically, pretty consistent with the Q1, and earnings per share, pretty comfortable where we see consensus sitting today. With all that out, behind me, let me transition back to why we're all here today, starting with the top line. I'm not going to go through all the puts and takes. I think Chris did a nice job talking about, you know, what has changed since we last sat here together. We still see the same 6%-7% 5-year CAGR growth trajectory that we laid out a couple of years ago, which will accelerate now to 8%-9% from 2022-2025. The key drivers there are the things we've been talking about all morning. The commercial aero recovery, that's trending towards the higher end of our expectations, clearly. Utilization is better of the fleet. The retirements are lower. You heard Greg talk about the V2500, 30% of those engines haven't seen their first shop visit. I think really importantly, the GTF is a major part of that growth story. You heard Shane lay out some of the margin trajectory there. Hopefully, you found that helpful. With Collins, huge installed base, that's going to contribute a lot of aftermarket over the next couple of years. You know, just to also put some data points out there for you, commercial OE today, when we end 2023, is probably going to be about 70% of where it was at 2019 levels for the Collins business. Even when we get to 2025, it'll be just below 90%. A lot of runway there in the Collins business as those commercial OE rates tick up over the next couple of years. Aligned with the OEM suppliers on the OEM ramp, clearly some supply chain stress there, but I think we've got a good handle on all those things. You've heard each of the presidents talk about that already this morning. Narrow-body has really been driving the recovery to date, and I think that's going to start to shift as we see the wide-body start to pick up as well. You've seen signs of that, both on the traffic side as well as orders that have been announced recently. Chris already mentioned $3 billion cumulatively of Russian commercial sales that evaporated last year, a headwind we've had to overcome, but we're confident that we can do that given this, you know, great strength that we've seen on the commercial aero recovery. really strong global demand on the defense side, I've already mentioned. All of that, in my view, very strong growing pipeline, a lot of it in the backlog. It sets us up very, very well for 2025 and even more importantly, for beyond that. I think all of this, combined with improved mix that you just heard Wes talk a lot about, and the benefit of cost reduction and productivity, is going to drive additional margin expansion over the next several years. We've already made a lot of good progress, 200 basis points of improvement on 30% segment operating profit growth over the last couple of years. I think we're, you know, well on our way to the 550 to 650 basis points. Let me just break that down a little bit. How do we get there? As I just said, it really is the momentum in our end markets. Chris threw out a couple of statistics. About 75% of the profit growth is going to come from Pratt and Collins, and over 75%, think about almost $3 billion, is going to come from aftermarket alone. We feel really confident in the demand signals there that are coming forward. In my view, as I think about, you know, how confident are we going to get that profit dropping through, it really is about that commercial aero recovery trajectory, and the OE platform expansion that we're all very aware of. As I just said, some more room to go in the narrow body, wide body's lagged a little bit. Again, I think that gives us more opportunity for runway here and more confidence that there's more gas in the tank going forward. Let's see here. You know, Shane touched on this. It was a good question around the military piece driving as well. We see F135 sustainment ramping through this period. As I think about, you know, profit over this period, defense is going to probably grow a few hundred million dollars at Pratt & Whitney, probably about $500 million or so at Collins Aerospace. The Raytheon business, a really impressive backlog. It really is about execution. You just heard Wes talk about the supply chain improvements, and I think that's going to be key to shortening the period of performance, which is going to give us the opportunity to drive productivity through our shops, and all of that should drop through in the form of higher margins, combined with the improved mix, both on the production side as well as the mix of domestic versus international. Then lastly, again, a lot of discussion by Wes on the refreshes, if you will, of the franchises that we already have. I think we've spent a lot of energy over the last couple of years putting new technology in there, and now that we've got those POs placed, we'll see that drag sort of disappear, and we'll have that as tailwind going forward. In addition, to this drop through on the volume, the benefit of better fixed cost production, cost reduction and productivity improvements are going to support even higher incrementals at Collins and Pratt in particular. Let me share a little bit more on our cost reduction activities. Since 2021, we've seen a lot of incremental cost headwinds, most notably in the form of higher material costs and higher labor cost. You know, cost reduction is in our DNA. We're focused on attacking this cost. We have not been sitting idle. Since 2021, we've identified an incremental $1.5 billion of additional gross cost reduction opportunities, and we're working even more opportunities as we speak. I'll break it down into kind of two buckets. About $800 million of that $1.5 billion comes from strategic procurement sourcing initiatives, you know, strengthening the supply chain, dual source, low source, longer-term agreements, a lot of activities that our operations team has been focused on to drive lean in the factories and align our supply chain to shore it up for the next couple of years as we go through this growth period. Very confident there, battling inflation each and every day, as we see those costs coming at us, as we renegotiate agreements. We've also identified, since we last spoke two years ago, $700 million in additional synergies. That's a $500 million increase from our latest target, about $200 million-$300 million of which is going to come from the realignment alone. As I break down that $500 million, about a third of it is going to come from people, about a third of it's going to come from indirect costs, and about a third of it, I think, will come from footprint and other activities as we lean out our factories. Only a portion of that will drop to the bottom line, but it is net $200 million additional tailwind from where we sat a couple of years ago. As you all know, we have to give a bunch of that back to our customers in the form of renegotiating new contracts, but all in all, I think we're headed in the right direction, and we're not done. There's plenty of gas left in this tank, and we've got a team that's focused on it on a weekly basis to continue to drive costs for the unanticipated issues that we know will come up over the next couple of years. How does all of this translate to cash flow? That's what ultimately matters, and that's ultimately why you're here today. We are very, very confident in our $9 billion target in 2025. Over the last couple of years, we have more than doubled. In fact, we've nearly tripled on an operational basis, our free cash flow, when you take into account the R&D legislation that went into effect last year. We feel really good about $4.8 billion in 2023, even with the $1.3 billion R&D headwind. Over the next couple of years, free cash flow will accelerate to get to $9 billion. Recall, when I stood here one year ago or two years ago rather, we thought that would be $1 billion higher. We have not seen the legislation with R&D repealed yet, so that is $9 billion, but all in all, it's the same number. First and foremost, this is going to come from segment operating profit growth. Let me just break this down a couple of different ways for you to think about it. There's going to be about $5 billion of after-tax segment operating profit growth. About two-thirds of that growth is going to come from momentum in the end markets. That's the volume in the mix that we have high confidence in because it's, one, either in our backlog, on, in the case of the defense companies, or two, it tracks to those commercial error recovery assumptions that we made. Two-thirds of the $5 billion is coming from things that we have very clear line of sight to. The other third is going to come from cost reduction and margin expansion initiatives. Let me break that down a little further as well. About 25% of that is going to come from the GTF aftermarket profitability improvement that you heard Shane talk about. Again, very clear path that we see to increase the ROS on those contracts over the next several years as we get more maturity in the engine and we get more confidence in the durability of the GTF fleet. Another 20% of that is going to come from getting the Raytheon businesses back to the typical levels of productivity that business is used to. As Wes Kremer just said, that's not at the peak level of what we've seen historically. It's a little bit below that, which reflects the mix of contracts that we see going forward. About 20% there is going to drive us to the levels that we've seen historically in the Raytheon business. The rest is going to come from Collins Aerospace. Stephen Timm laid out his $1 billion of incremental cost reduction and margin drop-through. A big piece of that, too, that I would add to what Stephen Timm said, is that in 2021 and early 2022, when the inflation started hitting us really hard, we were slower to react with pricing. Now that we've got pricing covering inflation, that will provide additional tailwind to the Collins business over the next several years as we have tailwind from the absence of not having had that inflation covered in the last couple of years. Let me make a comment on working capital. You know, certainly through this growth period, working capital is a real priority for us, and particularly inventory and receivables and contract assets, which is pretty much all of our working capital. Our goal is to maintain our inventory levels relatively flat as we go through this period, though we are expecting a little bit of improvement in turns. We're expecting about a full point of inventory turn improvement over the next three years, and we're working to keep our receivables in check as volumes grow. Keeping our DSO flat to declining over the period. I would also add that I see more opportunity as we get the supply chain shored up to bring that inventory down a little bit. It's probably about 10% or so of the $5 billion that we see on the walk here that's going to be driven by working capital. Just to recap, you start with $4.9 billion. We got $5 billion of segment operating profit growth and a little bit of tailwind from working capital. About $600 million of year-to-year lower R&D tax impact. We'll still have some headwind, obviously, in 2025, it will be less. We're dealing with about $1 billion of pension headwind, $800 million or so of which is due to the declining CAS recoveries, principally in our defense businesses. As we continue to invest in the future of the business, we'll increase our capital to deal with all of the investments that you heard everyone talk about earlier today, the automation, the operational modernization, and making sure that we're ready for next generation platforms as they come in, into focus for us. Given that strong cash flow, let me spend a couple of minutes on what we're going to do with the cash flow and our capital allocation priorities. For me, the capital allocation approach is very simple. It's very consistent with what we've done for a number of years in these companies. First, it's about investing in the business for the long term. Since 2020, as I said, $10 billion annually. We see that continuing. With regard to the portfolio, we like our portfolio. We think we have the best aerospace and defense portfolio in the business. We're always evaluating it. Nothing to say here. We're prepared to be opportunistic in M&A for bolt-on technology as it comes around. We like the portfolio. We don't need M&A to hit these 2025 targets. Even with these investments, we're well within reach of achieving our $20 billion commitment to return cash to shareowners in the 4 years following the merger. In fact, we should do that in the Q1 of 2024. Given the confidence that we have in our cash generation, we've increased that and extended it to get us through 2025, now at $33 billion-$35 billion. Tremendous amount of cash being returned to shareowners, and that's driven in part by our firm commitment to our dividend. We've maintained it, we've grown it, we continue to expect to do that in the future. Finally, we expect to manage the balance sheet to have a strong investment-grade credit rating. That's really important to us. All of this, as we sit back here today, we feel very confident in our path to this $9 billion that will generate significant cash that we can return to shareowners, all while keeping the business well positioned for the future. Let me just wrap up here. As I started, we're very confident in 2023 and in the drivers that underpin our 2025 commitments, and that's because we've got the best A&D portfolio in the business. As you've heard throughout the day, we have the leading franchises in the industry. There are strong long-term attributes to all the businesses that we have, long after-market tails, decades-long franchises. Through our focus on operational performance, cost reduction, investing in the future, I think we're very, very well positioned to deliver on these 2025 financial commitments, all while continuing to deliver that cash back to you, our shareholders, in 2025 and beyond. With that, I'm going to invite Greg, Chris, Jennifer, back on the stage, and we'll take some more questions. Gotcha. Click. Take it. There you go. All right, we're going to take about 15 minutes. Good. for some Q&A. Up here. Myles? Thanks. Myles Walton, Wolfe Research. Hey, Myles. Hey, Greg. Myles. Maybe Neil and/or Chris, Greg. Neil, on the linearity of cash flow in 24 to 25, you can comment on that, if it's more of a hockey stick or a linear profile. Then Chris or Greg, you laid out, Chris, the three pillars that you're getting asked about, GTF- Yep. incremental margins, defense margins. Yeah. Of those three, which do you find to be the most challenging in the outlook? I'll start. It's not going to be a complete hockey stick, just to get folks comfortable. I expect the growth rate of free cash flow to be the same through that period. Not a straight line, but the growth rate should be fairly consistent. Don't want to get ahead of 2024 at this point. We still got to get through 2023, but it is not a run for the roses. Chris, you want to take the next half? Sure. Myles, you're asking me to choose my favorite child, that's fine. Least favorite child, least favorite child. Look, I think Steve described the incremental margin story very well accounts. The demand is there, truly, the investments have been made in absorption and cost reduction, feel good there. Clearly, you know, the GTF story, and there's a lot of questions on that today, I'm sure there'll be more here in this session, is one that we've got to continue to power through. The fleet's not where it needs to be, and we need those investments that we're making in time on wing to continue to come home. I'm not saying we're not confident in that. We are confident in that, but that one takes the most work and the most engineering and getting those upgrades through MRO, through the shop and out into the fleet. There's just a lot of work to do there, both on the engineering front and on the MRO front. That's probably the place that I would say we're the most focused on. Of course, in Wes's business, I think, again, demand is there. Supply chain and labor are starting to feel better to us, and so if we can continue those production efficiencies that Wes talked about, start getting back to those productivity levels. I think the other things are just going to happen. They're more the macro in terms of those shifts. Great. Noah? Thank you. On the Raytheon defense top line, with 2023 about flat from 2020, to get to the midpoint of the five-year CAGR the 4%, all in 2024 and 2025, it implies each of 2024 and 2025 grows 10%. Just want to make sure that's the number. You know, obviously, you've had a lot of backlog growth, especially at RMD, but you continue to face this issue of the outlay cut, you know, not following the authorization. Is that getting better? Do you have any visibility into that getting better fast enough to accelerate? I'll take the first one. Yeah, take that, Neil. Yeah, I, we're very confident in the long-term trajectory of the Raytheon segment as a whole. It really comes back to the backlog. It's $50 billion. We have clear line of sight to incremental awards. We expect some of those even next week, Noah. It's clearly down to execution, and I think Wes and the team have a very good handle on what the outlook is for MRP and for placing POs for the material that needs to come in to support that backlog. We're very comfortable with the long-term trajectory for the business. I'd also say, as Wes said, he's got $50 billion of backlog as we sit here today. As we look forward, the defense budgets may only be going up 3%, 3.5%. Again, every one of Wes's key programs, whether it's AMRAAM, LRSO, Patriot, LTAMDS, all of them have been completely funded. There's some talk about some of the multi-years maybe not happening, but I think that's more of a one-off. I think all of the key programs that we look at least we've seen in the markup, Jeff, I think everything has been funded as we had expected. I don't, I don't view that as a, as a risk to Wes's plan. Ken? Yeah, the $500 million escape and the cash impact from Pratt, does that all capture to the Q3, some spill into the fourth? Then maybe just if you could comment on, you know, these things one-offs seem to crop up regularly, sort of what you're doing differently here with the Pratt. I know you're doing a lot different, obviously, but, you know, maybe just to address that from a recurrent standpoint? You want to start, Neil? I'll start. I mean, this is a very discrete issue that happened with one supplier on a block of, call it, 40 engines. You know, the team has already recovered, probably a quarter of that. We feel comfortable that the engine recovery happens in the Q3. The cash timing could be spread between Q3 and 4 a little bit, but, you know, all within the year. Maybe what I would add there, Ken, is you're right. I mean, in a supply chain as vast as the one that we have, there are days that you do play whack-a-mole on certain things that pop up. I will tell you, there's plenty of things that pop up that we beat back down very quickly, come up with mitigation strategies, and are able to continue to deliver on our commitments to customers. I think, you know, Shane and the team, the operations team at Pratt, have gone in and looked at this particular issue and said, "Let's do our root cause analysis using our core principles. How do we make sure this never happens again? How do you read that across your supply base?" This was a particularly, you know, painful escape on the part of the supplier, something that we're gonna make sure it never happens again. Great. Cai? Yes, Steve did a very good job of talking about the incremental margins, 30%, then 40%. As you look at Pratt, I mean, on the one hand, you have negative engine margin, what, $300 million negative incremental this year. Presumably, that abates as you go forward. You don't get the same kind of uptick in the GTF volume. Aftermarket continues strong, you know, you've got the biggest gain coming in Pratt, is that gonna be relatively linear, or is that gonna be heavily backloaded? Give us some color on that if you could. Neil? Yeah, it's a good question. Listen, I don't want to get into specifics about 2024, again, it's not a run for the roses. There's going to be a path that the Pratt team tracks to that incrementally expands margins over the next couple of years. I will tell you that the transformation activities, that element of it that Shane talked about, that takes more time. What we talk about? 1,200 projects, 25% of them complete, the pipeline growing every day. Definitely expect that to be, you know, more back half of 2024 and into 2025 sort of realized, but it is not going to be a hockey stick, you know, path to get to the margins for Pratt. Great. Any... She wanted it back there. Yep. I think, is it Jason? Hi, Jordan, Bank of America. Jordan. Do you guys have any expectations for the A220 stretch that it would be a Pratt & Whitney sole source? Sorry, say that. I missed it. A220 stretch. Stretch. Got it. Do we have any expectations of being sole source? Look, our number 1 focus right now is getting the A220 models that we're powering today in the right situation from a fleet health and configuration perspective, Jordan. That's number 1. As far as the stretch goes, we'll continue to have conversations with Airbus around that and what it would take if there's ultimately a platform there to launch. There's questions a little bit on what that volume might look like and how long that program might last, but we'll continue to have those conversations, but our focus right now is on the A220 that we power today. Doug? Thanks. You know, in talking through the outlook for the GTF and the aftermarket, if you look out in that 2025 range time period, before you've really got the Advantage ramped up, you're gonna have potentially more than 4,000 engines out there. You've got a lot that you're gonna need to deal with in terms of shop visits. I mean, how do you map out that plan to make sure you can really, you know, get the throughput that you need? I'll take this one. Yep. good question, Doug. A couple of things. One, from a capacity perspective, we're gonna go from, I think Shane said this, from 12 MRO sites to 19 by 2025. It's getting the capacity in place, you know, high-performing partners joining our aftermarket network. I would say, you know, that's number one. Number two is continuing to get the time on wing investments and upgrades into the fleet. To your point, the GTF Advantage, though, gonna be the configuration of record going forward, it's gonna be a fantastic program, that's gonna come in in that 25-ish timeframe, and it's gonna come in at a low rate of initial production. you know, you're gonna see the benefit of that a little bit later. The question is, those things that we're learning in the GTF Advantage program today, what can we potentially bring back as potential enhancements on what I'll call the base program, those 4,000 engines that you just talked about? Again, it's the capacity, which we feel like we've continued to find the right partners, to continue to ramp up the capacity, and two, it's the time on wing upgrades that Shane talked about and the path there. Great. Well, Greg, do you want to say some closing remarks? Yeah, well, first of all, I just wanted to thank everybody for taking the time to come and listen to the story. I hope the story was compelling in terms of our confidence in the future of RTX. I'll also thank the presenters. This is not easy to sit up here or stand up here and give these presentations. Special thanks to Jennifer, to you and your team, for pulling all this together. I know it's been a logistical nightmare. Thanks to you and Colleen and the whole staff, Alex, for everything that you guys have done. Bus is outside waiting to take you all out to Le Bourget. Enjoy the.