Navy awards Raytheon an SM-6 contract valued at up to $24.4 billion

The U.S. Navy awarded RTX's Raytheon a contract valued at up to $24.4 billion on Thursday for Standard Missile-6 interceptors. It runs five years, with two further years the Navy can add. That figure is the most the deal can be worth, and neither the Navy nor RTX has said how much is funded now, or how many missiles it covers.

A production award for the missile in January 2025 was $333 million. This April the Navy exercised options worth $335 million. The multiyear contract awarded in December 2019 was $1.03 billion.

In February, under agreements to expand munitions output, RTX said SM-6 production would rise to more than 500 missiles a year. The Navy's fiscal 2026 budget request was for 139 SM-6 missiles.

The missile is already in the fleet. RTX says it is the only combat-proven weapon that can hit aircraft, strike ships and stop ballistic missiles, and that crews have also fired it from land.

"This multi-year award locks in the magazine depth and lethal dominance our forces need to prevail, while demanding our industrial base produce at war-speed," said Michael P. Duffey, under secretary of war for acquisition and sustainment.

The award is the latest large munitions contract in a Pentagon push to refill stocks used in conflicts in the Middle East. In July an Army award brought Lockheed's Patriot interceptor contract to $58.6 billion. On September 28 RTX announced a separate contract, valued at up to $20.7 billion, for its AMRAAM air-to-air missile.

"By continuously investing in our operations and facilities, we are removing constraints and boosting capacity to ensure we deliver this critical capability our sailors depend on," said Phil Jasper, president of Raytheon.

RTX last reported a backlog of $289 billion at the end of June, before Thursday's award. Chris Calio, the company's chairman and chief executive, said in September that the figure still left out the munitions agreements from February.

In the iShares fund that holds U.S. aerospace and defense companies, AITA, RTX was 16.2% of assets as of September 30, the second-largest holding.

The State Street fund that holds the same industry in roughly equal weights, AXAR, had 50 holdings as of Thursday. The largest was 3.3%, and RTX was not in the top ten.

RTX shares closed Thursday at $185.01, down 0.34%. The announcement came after the closing bell.

RTX reports third-quarter results on Tuesday, October 20, before the market opens. The quarter ended on Wednesday, so the backlog in that report will not include the award.

The call that morning is the next time the company is scheduled to take questions on the contract.