L3Harris corporate headquarters in Melbourne, Florida. Photo: L3Harris

L3Harris reported its full-year 2022 financial results on Jan. 26, reporting full year revenue of $17.1 billion, down 4% and 1% on an organic basis compared to 2021. 

Space & Airborne Systems (SAS) segment reported full year revenue of $6.1 billion, up 2% compared to 2021. The company highlighted recent key awards of more than $60 million for the Space Development Agency (SDA) to provide payload and sensor solutions for Tranche 1 of the National Defense Space Architecture Transport Layer and more than $35 million to provide deployable S-band reflector antennas for communication satellites.

L3Harris said the space pipeline is “robust” at over $25 billion.

Communication Systems, the segment that includes satellite terminals, reported full year revenue of $4.2 billion, down 2% compared to 2021. 

“Internally, we remain focused on addressing the impacts of ongoing global challenges to supply chain, labor mobility and inflation in order to improve performance, achieve commitments and position L3Harris to meet the increasing demand for defense systems,” CEO Christopher Kubasik said in a letter to investors. 

Kubasik also highlighted that many of the company’s offerings are supported in the recent Department of Defense budget, specifically responsive satellites, Intelligence, Surveillance and Reconnaissance (ISR) aircraft, tactical communications, networked maritime systems, and classified cyber solutions.

Kubasik highlighted an R&D investment related to space in Thursday’s investor call  —  new optics, called replicated composite optics. Kubasik called the technology a “replacement for glass mirrors in telescopes made out of carbon graphite.” 

“The exciting thing is it’s about half the weight. It takes about two-thirds of the time to manufacture, and it’s significantly less expensive. We’re going to be launching the first-ever replicated optics in the middle of the year. So I think this is going to reduce risk. We’ll see how it performs, but this could be a game-changer for a satellite business.”

The company shared guidance for 2023, expecting revenue of $17.4 billion to $17.8 billion. Space and Airborne Systems guidance is between $6.4 billion to $6.5 billion, driven by continued growth in responsive space. Communication Systems guidance is between $4.8 billion to $4.9 billion, from improvement in electronic component supply within Tactical Communications, along with continued recovery in Public Safety. 

The company reported total backlog growth of 5% versus the prior year. 

At the start of 2023, L3Harris closed on its acquisition of Viasat’s Tactical Data Link product line, commonly known as Link 16, for approximately $2 billion. The company said it has begun integrating TDL into the Broadband Communications sector within the Communication Systems segment, adding approximately 450 employees, with operations primarily focused in Carlsbad, California. The acquisition was initially funded by a variable rate three-year term loan.

The company is also in the midst of a deal to acquire engine and rocket maker Aerojet Rocketdyne for $4.7 billion. The deal is going through regulatory approval and L3Harris said it expects the acquisition to close in 2023. Defense News reported this week that Senator Elizabeth Warren is urging the Federal Trade Commission to oppose the merger.