AUDIT INFORMATION |
12 Months Ended |
|---|---|
Jan. 03, 2025 | |
| Audit Information [Abstract] | |
| Auditor Name | Ernst & Young LLP |
| Auditor Location | Orlando, Florida |
| Auditor Firm ID | 42 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Statement of Comprehensive Income [Abstract] | |||
| Net income | $ 1,512 | $ 1,198 | $ 1,061 |
| Other comprehensive income (loss): | |||
| Foreign currency translation, net of income taxes | (60) | 36 | (119) |
| Hedging derivatives, net of income taxes | (12) | 10 | (8) |
| Pension and other postretirement benefits, net of income taxes | 323 | 71 | (26) |
| Other comprehensive income (loss) recognized during the period | 251 | 117 | (153) |
| Reclassification adjustments for (gains) losses included in net income | (26) | (27) | 11 |
| Other comprehensive income (loss), net of income taxes | 225 | 90 | (142) |
| Total comprehensive income | 1,737 | 1,288 | 919 |
| Comprehensive (income) loss attributable to noncontrolling interest | (10) | 29 | 1 |
| Total comprehensive income attributable to L3Harris Technologies, Inc. | $ 1,727 | $ 1,317 | $ 920 |
CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Shareholders’ Equity: | ||
| Preferred shares, authorized (in shares) | 1,000,000 | 1,000,000 |
| Preferred shares, issued (in shares) | 0 | 0 |
| Common shares, par value (in dollars per share) | $ 1.00 | $ 1.00 |
| Common shares, authorized (in shares) | 500,000,000 | 500,000,000 |
| Common shares, issued (in shares) | 189,794,911 | 189,808,581 |
| Common shares, outstanding (in shares) | 189,794,911 | 189,808,581 |
SIGNIFICANT ACCOUNTING POLICIES |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SIGNIFICANT ACCOUNTING POLICIES | NOTE 1: SIGNIFICANT ACCOUNTING POLICIES Organization — L3Harris Technologies, Inc., together with its subsidiaries, is the Trusted Disruptor in the defense industry. With customers’ mission-critical needs in mind, we deliver end-to-end technology solutions connecting the space, air, land, sea and cyber domains in the interest of global security. We support government customers in more than 100 countries, with our largest customers being various departments and agencies of the U.S. Government, their prime contractors and international allies. Our products and services have defense and civil government applications, as well as commercial applications. As of January 3, 2025 we had approximately 47,000 employees. Principles of Consolidation — Our Consolidated Financial Statements include the accounts of L3Harris Technologies, Inc. and its consolidated subsidiaries. As used in these Notes to the Consolidated Financial Statements, the terms “L3Harris,” “Company,” “we,” “our” and “us” refer to L3Harris Technologies, Inc. and its consolidated subsidiaries. Intercompany transactions and accounts have been eliminated. Fiscal Year — Our fiscal year ends on the Friday nearest December 31. Fiscal 2024 included 53 weeks. Fiscal 2023 and fiscal 2022 each included 52 weeks. Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the accompanying Consolidated Financial Statements and these Notes and related disclosures. These estimates and assumptions are based on experience and other information available prior to issuance of the accompanying Consolidated Financial Statements and these Notes. Materially different results can occur as circumstances change and additional information becomes known. Reclassifications — The classification of certain prior year amounts have been adjusted in our Consolidated Financial Statements and these Notes to conform to current year classifications. Cash and Cash Equivalents — Cash and cash equivalents include cash at banks and temporary cash investments with a maturity of three or fewer months when purchased. These investments include accrued interest and are carried at the lower of cost or market. Fair Value Measurements — Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal market (or most advantageous market, in the absence of a principal market) for the asset or liability in an orderly transaction between market participants at the measurement date. Entities are required to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value, and to utilize a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted prices included within Level 1, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and inputs other than quoted prices that are observable or are derived principally from, or corroborated by, observable market data by correlation or other means. •Level 3 — Unobservable inputs that are supported by little or no market activity, are significant to the fair value of the assets or liabilities and reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability developed using the best information available in the circumstances. In certain instances, fair value is estimated using quoted market prices obtained from external pricing services. In obtaining such data from the pricing service, we have evaluated the methodologies used to develop the estimate of fair value in order to assess whether such valuations are representative of fair value, including net asset value (“NAV”). Additionally, in certain circumstances, the NAV reported by an asset manager may be adjusted when sufficient evidence indicates NAV is not representative of fair value. Financial instruments. The carrying amounts of certain of our financial instruments reflected in our Consolidated Balance Sheet, including cash and cash equivalents, accounts receivable, non-current receivables, notes receivable, accounts payable and short-term debt, approximate their fair values. Fair values for long-term fixed-rate debt are primarily based on quoted market prices for those or similar instruments. See Note 8: Debt and Credit Arrangements in these Notes for additional information regarding fair values for our long-term fixed-rate debt. A discussion of fair values for our derivative financial instruments is included under the caption “Financial Instruments and Risk Management” in this Note. Accounts Receivable — We record receivables derived from contracts with customers at net realizable value and they generally do not bear interest. This value includes an allowance for estimated uncollectible accounts to reflect any losses anticipated on the accounts receivable balances which is charged to the provision for doubtful accounts. We calculate this allowance at inception based on expected loss over the life of the receivable. We consider historical write-offs by customer, level of past due accounts and economic status of the customer. A receivable is considered delinquent if it is unpaid after the term of the related invoice has expired. Write-offs are recorded at the time a customer receivable is deemed uncollectible. At January 3, 2025 and December 29, 2023, our allowances for collection losses were $21 million and $15 million, respectively. Contract Assets and Liabilities — The timing of revenue recognition, customer billings and cash collections results in accounts receivable, contract assets and contract liabilities at the end of each reporting period. Contract assets mainly represent unbilled amounts typically resulting from revenue recognized exceeding amounts billed to customers for contracts utilizing the POC cost-to-cost revenue recognition method. Contract assets become receivables as we bill customers as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, upon achievement of contractual milestones or upon deliveries and, in certain arrangements, the customer may withhold payment of a portion of the contract price until contract completion. Contract liabilities include advance payments and billings in excess of revenue recognized, including deferred revenue. Contract assets and liabilities are reported on a contract-by-contract basis at the end of each reporting period. Contract assets related to amounts withheld by customers until contract completion are not considered a significant financing component of our contracts because the intent is to protect the customers from our failure to satisfactorily complete our performance obligations. Payments received from customers in advance of revenue recognition are not considered a significant financing component of our contracts because they are utilized to pay for contract costs within a one-year period or are requested by us to ensure the customers meet their payment obligations. Inventories — Inventories are valued at the lower of cost (determined by average and first-in, first-out methods) or net realizable value. We regularly review inventory quantities on hand and record a provision for excess and obsolete inventory primarily based on our estimated forecast of product demand, anticipated end of product life and production requirements. Property, Plant and Equipment — Property, plant and equipment, including software capitalized for internal use, is recorded at cost and depreciated on a reasonable and systematic basis, typically the straight-line method, over the estimated useful life of the asset. Estimated useful lives generally range as follows: buildings, including leasehold improvements, between and 45 years; machinery and equipment between and 10 years; and software capitalized for internal-use between and 10 years. We review property, plant and equipment for impairment whenever events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. Goodwill — We follow the acquisition method of accounting to record the assets and liabilities of acquired businesses at their estimated fair value at the date of acquisition. We initially record goodwill for the amount the consideration transferred exceeds the acquisition-date fair value of net identifiable assets acquired. We test goodwill for impairment at a level within the Company referred to as the reporting unit, which is our business segment level or one level below the business segment. Goodwill is tested for impairment annually as of the first business day of our fourth fiscal quarter, or under certain circumstances more frequently, such as when events or circumstances indicate there may be impairment. Such events or circumstances may include a significant deterioration in overall economic conditions, changes in the business climate of our industry, a decline in our market capitalization, operating performance indicators, competition, reorganizations of our business or the disposal of all or a portion of a reporting unit. To test goodwill for impairment, we may perform both qualitative and quantitative assessments. If we elect to perform a qualitative assessment for a certain reporting unit, we evaluate events and circumstances impacting the reporting unit to determine the probability that goodwill is impaired. If we perform a quantitative assessment for a certain reporting unit, we calculate the fair value of that reporting unit and compare the fair value to the reporting unit’s net book value. We estimate fair values of our reporting units based on projected cash flows, and sales and/or earnings multiples applied to the latest twelve months’ sales and earnings of our reporting units. Projected cash flows are based on our best estimate of future revenues, operating costs and balance sheet metrics reflecting our view of the financial and market conditions of the underlying business; and the resulting cash flows are discounted using an appropriate discount rate that reflects the risk in the forecasted cash flows. Revenue and earnings multiples are based on current multiples of revenues and earnings for similar businesses, and based on revenue and earnings multiples paid for recent acquisitions of similar businesses made in the marketplace. We then assess whether any implied control premium, based on a comparison of fair value based purely on our stock price and outstanding shares with fair value determined by using all of the above-described models, is reasonable. If we determine it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, we measure any impairment loss by comparing the fair value of each reporting unit to its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, goodwill is considered impaired, and an impairment loss is recognized in an amount equal to that excess. Intangible Assets — Our finite-lived intangible assets are amortized to expense over their applicable useful lives, either according to the underlying economic benefit as reflected by future net cash inflows or on a straight-line basis depending on the nature of the asset, generally ranging between to 20 years. We review finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. We evaluate the recoverability of such assets based on the expectations of undiscounted cash flows from such assets. If the sum of the expected future undiscounted cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and the carrying amount. Our most significant finite-lived intangible asset is customer relationships that are established through written customer contracts (i.e., revenue arrangements). The fair value for customer relationships is determined, as of the date of acquisition, based on estimates and judgments regarding expectations for the estimated future after-tax earnings and cash flows arising from the follow-on revenues expected from the customer relationships over the estimated lives, including the probability of expected future contract renewals and revenues, less a contributory assets charge, all of which is discounted to present value. Indefinite-lived intangible assets are tested annually for impairment, or under certain circumstances, more frequently, such as when events or circumstances indicate there may be an impairment. This testing compares the fair value of the asset to its carrying amount, and, when appropriate, the carrying amount of these assets is reduced to its fair value. Leases — We recognize right-of-use (“ROU”) assets and lease liabilities in our Consolidated Balance Sheet for operating and finance leases under which we are the lessee. As a practical expedient, leases with a term of twelve months or less (including reasonably certain extension periods) and leases with expected lease payments of less than $250 thousand are expensed as incurred in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations. ROU assets and lease liabilities are recognized based on the present value of future lease payments, which are primarily base rent. We have some lease payments that are based on an index and changes to the index are treated as variable lease payments and recognized in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations in the period in which the obligation for those payments is incurred. Our lease payments also include non-lease components such as real estate taxes and common-area maintenance costs. As a practical expedient, we account for lease and non-lease components as a single component. For certain leases, the non-lease components are variable and are therefore excluded from lease payments to determine the ROU asset. The present value of future lease payments is determined using our incremental borrowing rate at lease commencement over the expected lease term. We use our incremental borrowing rate because our leases do not provide an implicit lease rate. The expected lease term represents the number of years we expect to lease the property, including options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating lease cost and finance lease amortization are recognized on a straight-line basis over the expected lease term in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations. Interest on finance lease liabilities is recognized in the “Interest expense, net” line item in our Consolidated Statement of Operations. Income Taxes — We follow the asset and liability method of accounting for income taxes. We record deferred tax assets and liabilities for differences between the tax basis of assets and liabilities and amounts reported in our Consolidated Balance Sheet, as well as operating loss and tax credit carryforwards. We follow specific and detailed guidelines in each tax jurisdiction regarding the recoverability of any tax assets recorded on the balance sheet and provide necessary valuation allowances as required. We regularly review our deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. We have elected to account for tax on Global Intangible Low-Taxed Income as a current-period expense when incurred. Foreign Currency Translation — Assets and liabilities of international subsidiaries that use local currency as the functional currency, are translated at current rates of exchange and income and expense items are translated at the weighted average exchange rate for the year. The resulting translation adjustments are recorded as a component of the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet. Share-Based Compensation — We measure compensation cost for all share-based awards (including employee stock options) at fair value and recognize cost over the vesting period, with forfeitures recognized as they occur. It is our practice to issue shares when options are exercised. Share Repurchases — Repurchased common shares are permanently retired. As we repurchase our common shares, we reduce common stock for the par value and allocate any excess purchase price over par value to paid-in capital and retained earnings. During fiscal 2024, we repurchased 2.5 million shares of our common stock for $554 million under our repurchase program. At January 3, 2025, we had remaining unused authorization under our repurchase program of $3,381 million. Revenue Recognition — We account for a contract when it has approval and commitment from all parties, the rights and payment terms of the parties can be identified, the contract has commercial substance and the collectability of the consideration, or transaction price, is probable. Our contracts are often subsequently modified to include changes in specifications, requirements or price that may create new or change existing enforceable rights and obligations. We do not account for contract modifications (including unexercised options) or follow-on contracts until they meet the requirements noted above to account for a contract. We categorize revenue and costs for performance obligations to provide tangible goods as “product” and revenue and costs for performance obligations to provide services for which the principal result is not to produce anything tangible as “service.” In instances where a single performance obligation requires us to deliver products and perform services, we derive the product and service categories presented in our financial statements based upon the predominant nature of each performance. In these cases, we classify the revenue and costs from the entire performance obligation based on the nature of the overall promise made to the customer. At the inception of each contract, we evaluate the promised products and services to determine whether the contract should be accounted for as having one or more performance obligations. A performance obligation is a promise to transfer a distinct product or service to a customer and represents the unit of accounting for revenue recognition. A substantial majority of our revenue is derived from long-term development and production contracts involving the design, development, manufacture or modification of defense products and related services according to the customers’ specifications. Due to the highly interdependent and interrelated nature of the underlying products and services and the significant service of integration that we provide, which often results in the delivery of multiple units, we account for these contracts as one performance obligation. For contracts that include both development/production and follow-on support services (for example, operations and maintenance), we generally consider the follow-on services distinct in the context of the contract and account for them as separate performance obligations. Additionally, we recognize revenue from contracts to provide multiple distinct products to a customer for which the products can readily be sold to other customers based on their commercial nature and, accordingly, these products are accounted for as separate performance obligations. Shipping and handling costs incurred after control of a product has transferred to the customer (for example, in free on board shipping arrangements) are treated as fulfillment costs and, therefore, are not accounted for as separate performance obligations. Also, we record taxes collected from customers and remitted to governmental authorities on a net basis such that they are excluded from revenue. As noted above, our contracts are often subsequently modified to include changes in specifications, requirements or price. Depending on the nature of the modification, we consider whether to account for the modification as an adjustment to the existing contract or as a separate contract. Often, the deliverables in our contract modifications are not distinct from the existing contract due to the significant integration and interrelated tasks provided in the context of the contract. Therefore, such modifications are accounted for as if they are part of the existing contract, and we may be required to recognize a cumulative catch-up adjustment to revenue at the date of the contract modification. We determine the transaction price for each contract based on our best estimate of the consideration we expect to receive, which includes assumptions regarding variable consideration such as award and incentive fees. These variable amounts are generally awarded upon achievement of certain negotiated performance metrics, program milestones or cost targets and can be based upon customer discretion. We include such estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. We estimate variable consideration primarily using the most likely amount method. For contracts with multiple performance obligations, we allocate the transaction price to each performance obligation based on the relative standalone selling price of the product or service underlying each performance obligation. The standalone selling price represents the amount for which we would sell the product or service to a customer on a standalone basis (i.e., not sold as a bundle with any other products or services). Our contracts with the U.S. Government, including foreign military sales contracts, are subject to the FAR and the prices of our contract deliverables are typically based on our estimated or actual costs plus margin. As a result, the standalone selling prices of the products and services in these contracts are typically equal to the selling prices stated in the contract, thereby eliminating the need to allocate (or reallocate) the transaction price to the multiple performance obligations. In our non-U.S. Government contracts, we also generally use the expected cost plus margin approach to determine standalone selling price. In addition, we determine standalone selling price for certain contracts that are commercial in nature based on observable selling prices. We recognize revenue for each performance obligation when (or as) the performance obligation is satisfied by transferring control of the promised products or services underlying the performance obligation to the customer. The transfer of control can occur over-time or at a point in time. A significant portion of our business is derived from development and production contracts. Revenue and profit related to development and production contracts are generally recognized over-time, typically using the POC cost-to-cost method of revenue recognition, whereby we measure our progress towards completion of the performance obligation based on the ratio of costs incurred to date to estimated costs at completion under the contract. Because costs incurred represent work performed, we believe this method best depicts the transfer of control of the asset to the customer. Under the POC cost-to-cost method of revenue recognition, a single estimated profit margin is used to recognize profit for each performance obligation over its period of performance. To a lesser extent, we also recognize revenue from contracts to provide multiple distinct products to a customer that are commercial in nature and can readily be sold to other customers. These performance obligations do not meet the criteria listed below to recognize revenue over-time; therefore, we recognize revenue at a point in time, generally when the products are received and accepted by the customer. Point-in-Time Revenue Recognition. Our performance obligations are satisfied at a point in time unless they meet at least one of the following criteria, in which case they are satisfied over-time: •The customer simultaneously receives and consumes the benefits provided by our performance as we perform; •Our performance creates or enhances an asset (for example, work in process) that the customer controls as the asset is created or enhanced; or •Our performance does not create an asset with an alternative use to us and we have an enforceable right to payment for performance completed to date. Over-Time Revenue Recognition. For U.S. Government development and production contracts, there is generally a continuous transfer of control of the asset to the customer as it is being produced based on FAR clauses in the contract that provide the customer with lien rights to work in process and allow the customer to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. This also typically applies to our contracts with prime contractors for U.S. Government development and production contracts, when the above-described FAR clauses are flowed down to us by the prime contractors. Our non-U.S. Government development and production contracts, including international direct commercial contracts and U.S. contracts with state and local agencies, utilities, commercial and transportation organizations, often do not include the FAR clauses described above. However, over-time revenue recognition is typically supported either through our performance creating or enhancing an asset that the customer controls as it is created or enhanced or based on other contractual provisions or relevant laws that provide us with an enforceable right to payment for our work performed to date plus a reasonable profit if our customer were permitted to and did terminate the contract for reasons other than our failure to perform as promised. For performance obligations to provide services that are satisfied over-time, we recognize revenue either on a straight-line basis, the POC cost-to-cost method or based on the right-to-invoice method (i.e., based on our right to bill the customer), depending on which method best depicts transfer of control to the customer. Contract Estimates. Under the POC cost-to-cost method of revenue recognition, a single estimated profit margin is used to recognize profit for each performance obligation over its period of performance. Recognition of profit on a contract requires estimates of the total cost at completion and transaction price and the measurement of progress towards completion. Due to the long-term nature of many of our contracts, developing the estimated total cost at completion and total transaction price often requires judgment. Factors that must be considered in estimating the cost of the work to be completed include the nature and complexity of the work to be performed, subcontractor performance and the risk and impact of delayed performance. Factors that must be considered in estimating the total transaction price include contractual cost or performance incentives (such as incentive fees, award fees and penalties) and other forms of variable consideration, as well as our historical experience and our expectation for performance on the contract. At the outset of each contract, we gauge its complexity and perceived risks and establish an estimated total cost at completion in line with these expectations. We follow a standard EAC process in which we review the progress and performance on our ongoing contracts. If we successfully retire risks associated with the technical, schedule and cost aspects of a contract, we may lower our estimated total cost at completion commensurate with the retirement of these risks. Conversely, there are many reasons estimated contract costs can increase, including: (i) supply chain disruptions, inflation and labor issues; (ii) design or other development challenges; and (iii) program execution challenges (including from technical or quality issues and other performance concerns). Additionally, as the contract progresses, our estimates of total transaction price may increase or decrease if, for example, we receive incentive or award fees that are higher or lower than expected. When changes in estimated total costs at completion or in estimated total transaction price are determined, the related impact on operating income is recognized on a cumulative basis. EAC adjustments represent the cumulative effect of the changes from current and prior periods; revenue and operating margins in future periods are recognized as if the revised estimates had been used since contract inception. Any anticipated losses on these contracts are fully recognized in the period in which the losses become evident. Net EAC adjustments had the following impact to earnings for the periods presented:
Revenue recognized from performance obligations satisfied (or partially satisfied) in prior periods was $210 million, $118 million and $110 million in fiscal 2024, 2023 and 2022, respectively. Bill-and-Hold Arrangements. For certain contracts, the finished product may temporarily be stored at our location under a bill-and-hold arrangement. Revenue is recognized on bill-and-hold arrangements at the point in time when the customer obtains control of the product and all of the following criteria have been met: the arrangement is substantive (for example, the customer has requested the arrangement); the product is identified separately as belonging to the customer; the product is ready for physical transfer to the customer; and we do not have the ability to use the product or direct it to another customer. In determining when the customer obtains control of the product, we consider certain indicators, including whether we have a present right to payment from the customer, whether title and/or significant risks and rewards of ownership have transferred to the customer and whether customer acceptance has been received (in the case of arrangements with customer acceptance provisions). Backlog. Backlog, which is the equivalent of our remaining performance obligations, represents the future revenue we expect to recognize as we perform on our current contracts. Backlog comprises both funded backlog (i.e., firm orders for which funding is authorized or appropriated) and unfunded backlog (i.e., orders for which funds have not been appropriated and/or incrementally funded). Backlog excludes unexercised contract options and potential orders under ordering-type contracts, such as IDIQ contracts. At January 3, 2025, our ending backlog was $34.2 billion, of which $23.3 billion was funded backlog. We expect to recognize approximately 45% of the revenue associated with this backlog by the end of fiscal 2025 and approximately 75% by the end of fiscal 2026, with the remainder to be recognized thereafter. At December 29, 2023, our ending backlog was $32.7 billion, of which $22.0 billion was funded backlog. Retirement Benefits — We sponsor various pension and other postretirement defined benefit plans. The funded or unfunded position of each defined benefit plan is recorded in our Consolidated Balance Sheet. Funded status is derived by subtracting the respective year-end values of the PBO from the fair value of plan assets. Actuarial gains and losses and prior service credits and costs are recorded, net of income taxes, in the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet until they are amortized as a component of net periodic benefit income in the “Non-service FAS pension income and other, net” line item in our Consolidated Statement of Operations. The determination of the PBO and the recognition of net periodic benefit income related to defined benefit plans depend on various assumptions, including discount rates, expected return on plan assets, the rate of future compensation increases, mortality, termination and health care cost trend rates. We develop each assumption using relevant Company experience in conjunction with market-related data. Actuarial assumptions are reviewed annually with third-party consultants and adjusted as appropriate. For the recognition of net periodic benefit income, we use a market-related value of plan assets to calculate the expected return on plan assets. The market-related value of plan assets is based on yearly average asset values at the measurement date over the last five years, with investment gains or losses to be phased in over five years. Net actuarial gains and losses are amortized to the net periodic benefit income using the corridor approach, where the net gains and losses in excess of 10% of the greater of the PBO or the market-related value of plan assets are amortized for each plan over the estimated future life expectancy or, if applicable, the average remaining service period of the plan’s active participants. The fair value of plan assets is determined based on market prices or estimated fair value at the measurement date. The measurement date for valuing defined benefit plan assets and obligations is the end of the month closest to our fiscal year end. Environmental Expenditures — We generally capitalize environmental expenditures that increase the life or efficiency of property or that reduce or prevent environmental contamination. We accrue environmental expenses resulting from existing conditions that relate to past or current operations. Our accruals for environmental expenses are recorded on a site-by-site basis when it is probable a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies available to us. Our accruals for environmental expenses represent the best estimates related to the investigation and remediation of environmental media such as water, soil, soil vapor, air and structures, as well as related legal fees and regulatory agency oversight fees, and are reviewed periodically, at least annually at the year-end balance sheet date, and updated for progress of investigation and remediation efforts and changes in facts and legal circumstances. If the timing and amount of future cash payments for environmental liabilities are fixed or reliably determinable, we generally discount such cash flows in estimating our accrual. The relevant factors we considered in estimating our potential liabilities under applicable environmental statutes and regulations included some or all of the following as to each site: incomplete information regarding particular sites and other potentially responsible parties; uncertainty regarding the extent of investigation or remediation; our share, if any, of liability for such conditions; the selection of alternative remedial approaches; changes in environmental standards and regulatory requirements; probable insurance proceeds; cost-sharing agreements with other parties; and potential indemnification from successor and predecessor owners of these sites. Derivative Financial Instruments and Hedging Activities — We recognize all derivatives in our Consolidated Balance Sheet at fair value. These financial instruments are marked-to-market using forward prices and fair value quotes and are categorized in Level 2 of the fair value hierarchy. Derivatives that are not hedges are adjusted to fair value through income. If the derivative qualifies and is designated as a hedge, it must be documented as such at the inception of the hedge. Depending on the nature of the hedge, changes in the fair value of the derivative are either offset against the change in fair value of assets, liabilities or firm commitments through earnings or recognized in other comprehensive income (loss) until the hedged item is recognized in earnings. Gains and losses in accumulated other comprehensive income (loss) are reclassified to earnings when the related hedged item is recognized in earnings. The cash flow impact of our derivatives is included in the same category in our Consolidated Statement of Cash Flows as the cash flows of the related hedged items. We do not hold or issue derivatives for speculative trading purposes. EPS — EPS is calculated as net income per common share attributable to L3Harris Technologies, Inc. common shareholders divided by our weighted average number of basic or diluted shares outstanding. Potential dilutive common shares primarily consist of employee stock options and restricted and performance unit awards. Business Segments — We evaluate each of our business segments based on its operating income or loss. Intersegment revenues are generally transferred at cost to the buying segment, and the sourcing segment recognizes a profit that is eliminated. The elimination of intersegment revenues is included in the “other” line item in Note 14: Business Segments in these Notes. Corporate expenses are primarily allocated to our business segments using an allocation methodology prescribed by U.S. Government regulations for government contractors. The “Unallocated corporate department expense” line item in Note 14: Business Segments in these Notes represents the portion of corporate expenses that are not included in management’s evaluation of segment operating performance or elimination of intersegment profits. FAS/CAS Operating Adjustment. We calculate and allocate a portion of our defined benefit plan costs to our U.S. Government contracts in accordance with CAS. However, our Consolidated Financial Statements require we calculate our defined benefit plan costs (net periodic benefit income) in accordance with FAS requirements. The difference between CAS pension cost and the service cost component of net periodic benefit income (“FAS pension service cost”) is reflected in the “FAS/CAS operating adjustment,” which is included as a component of Unallocated corporate department expense line item in Note 14: Business Segments in these Notes.
The non-service cost component of net periodic benefit income is included in the “Non-service FAS pension income and other, net” line item in our Consolidated Statement of Operations. See Note 9: Retirement Benefits in these Notes for additional information regarding our defined benefit plans and composition of net periodic benefit income. R&D — Company-funded R&D costs are expensed as incurred and are included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. These costs were $515 million, $480 million and $603 million in fiscal 2024, 2023, and 2022, respectively. Customer-funded R&D costs are incurred pursuant to contractual arrangements, principally U.S. Government- sponsored contracts requiring us to provide a product or service meeting certain defined performance or other specifications (such as designs), and such contractual arrangements are accounted for principally by the POC cost- to-cost revenue recognition method. Customer-funded R&D is included in the “Revenue” and “Cost of revenue” line items in our Consolidated Statement of Operations. Recent Accounting Pronouncements — In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”) which requires additional segment disclosures on an annual and interim basis, including significant segment expenses that are regularly provided to the chief operating decision maker. The standard does not change how operating segments and reportable segments are determined. ASU 2023-07 is effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024 and is required to be applied retrospectively to all periods presented in the consolidated financial statements. We adopted this standard in fiscal 2024 and applied the provisions to our business segment disclosure. See Note 14: Business Segments in these Notes for further information. The adoption of 2023-07 did not have any impact on our operating results, financial position, or cash flows. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires disaggregated income tax disclosures on an annual basis, including information on our effective income tax rate reconciliation and income taxes paid. ASU 2023-09 is effective for annual reporting periods beginning after December 15, 2024, and may be applied prospectively or retrospectively. We are evaluating the impact of ASU 2023-09 and expect the standard will only impact our income taxes disclosures with no material impact on our operating results, financial position, or cash flows. In March 2024, the SEC issued SEC Release Nos. 33-11275 and 34-99678, The Enhancement and Standardization of Climate-Related Disclosures for Investors, which requires climate-related disclosures in annual reports and registration statements. In April 2024, the SEC released an order staying this final rule pending judicial review of all the petitions challenging the rule. If enacted, the rule would require disclosure of material climate- related risks, our governance and risk management of climate-related risks and any material climate-related targets or goals, greenhouse gas emissions as well as disclosure of the financial statement effects, such as costs and losses resulting from severe weather events and other natural conditions. We are evaluating the impact of the rule and related litigation on our disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income— Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) which requires disclosure, in the notes to financial statements, of specified information about certain costs and expenses included in each expense caption on the face of the income statement at interim and annual reporting periods. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, and should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. We are evaluating the impact of ASU 2024-03 and expect the standard will only impact our disclosures with no material impact on our operating results, financial position, or cash flows.
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EARNINGS PER SHARE |
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| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
| EARNINGS PER SHARE | NOTE 2: EARNINGS PER SHARE The weighted average number of shares outstanding used to compute basic and diluted EPS are as follows:
Diluted EPS excludes the antidilutive impact of 3.3 million, 3.7 million and 0.3 million weighted average share- based awards outstanding in fiscal 2024, 2023 and 2022, respectively.
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CONTRACT ASSETS AND CONTRACT LIABILITIES |
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| Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||
| CONTRACT ASSETS AND CONTRACT LIABILITIES | NOTE 3: CONTRACT ASSETS AND CONTRACT LIABILITIES Contract assets and contract liabilities are summarized below:
_______________ (1)The non-current portion of contract liabilities is included as a component of the “Other long-term liabilities” line item in our Consolidated Balance Sheet. Contract assets and liabilities as of January 3, 2025 and December 29, 2023 were impacted primarily by the timing of contractual billing milestones. In fiscal 2024, 2023 and 2022, we recognized $1,433 million, $1,247 million and $1,057 million, respectively, of revenue related to contract liabilities that were outstanding at the end of the respective prior fiscal year.
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INVENTORIES, NET |
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| Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||
| INVENTORIES, NET | NOTE 4: INVENTORIES, NET Inventories, net are summarized below:
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PROPERTY, PLANT AND EQUIPMENT, NET |
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| Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||
| PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 5: PROPERTY, PLANT AND EQUIPMENT, NET Property, plant and equipment, net, are summarized below:
Depreciation and amortization expense related to property, plant and equipment was $429 million, $389 million and $342 million in fiscal 2024, 2023 and 2022, respectively. There were no impairments of property, plant and equipment in fiscal 2024, 2023 or 2022.
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GOODWILL AND INTANGIBLE ASSETS |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| GOODWILL AND INTANGIBLE ASSETS | NOTE 6: GOODWILL AND INTANGIBLE ASSETS Goodwill Changes in the carrying amount of goodwill, by business segment, were as follows:
_______________ **Our AR segment, which is also the AR reporting unit, was established in connection with the AJRD acquisition and consists of assets, liabilities and operations assumed. As such, there is no comparable prior year information. See Note 13: Acquisitions and Divestitures in these Notes for further information. (1)CS: Goodwill recognized in connection with the TDL acquisition is included in our Broadband reporting unit within our CS segment. AR: Goodwill recognized in connection with the AJRD acquisition is included within the AR Reporting unit, which is also our AR segment. (2)SAS: Goodwill (net of impairment) derecognized in connection with the Antenna disposal group divestiture. See discussion under “Goodwill Impairments" below. AR: Goodwill derecognized in connection with the AOT disposal group divestiture. See Note 13: Acquisitions and Divestitures in these Notes for further information. At January 3, 2025 and December 29, 2023, accumulated goodwill impairment losses totaled $80 million, $1,126 million and $355 million in our SAS, IMS, and CS segments, respectively. There are no accumulated impairment losses in our AR segment. Reallocation of Goodwill in Business Realignments. To better align our businesses, we adjusted our reporting within our business segments and goodwill reporting units as follows: Fiscal 2024. We realigned our Electro Optical and Maritime sectors in our IMS segment, which are also reporting units, splitting Electro Optical into two sectors, Global Optical Systems and Defense Electronics, and moving one Electro Optical business to the Maritime sector. Global Optical Systems and Defense Electronics represent one reporting unit. Immediately before and after the realignment, we performed a quantitative impairment assessment under our former and new reporting unit structure. These assessments indicated no impairment existed either before or after the realignment. Fiscal 2023. We transferred our Agile Development Group (“ADG”) business (a reporting unit) from our IMS segment to our SAS segment (also a reporting unit). In connection with the realignment, we reduced our reporting units from nine to eight as the ADG reporting unit and all $327 million of associated goodwill was absorbed by our existing SAS reporting unit given the economic similarities of the two reporting units. Immediately before the realignment, we performed a qualitative impairment assessment over our SAS reporting unit and a quantitative impairment assessment over our ADG reporting unit. Immediately after the realignment, we performed a quantitative impairment assessment over the SAS reporting unit. These assessments indicated no impairment existed either before or after the realignment. Goodwill Impairments. We assess goodwill for impairment annually or under certain circumstances more frequently, such as when events or circumstances indicate there may be impairment. Fiscal 2024. As described in more detail in Note 13: Acquisitions and Divestitures in these Notes, during the quarter ended June 28, 2024, we completed the divestiture of Antenna disposal group. As the Antenna disposal group represents the disposal of a portion of the SAS reporting unit, which is also the SAS segment, we assigned $93 million of goodwill to the Antenna disposal group on a relative fair value basis. In connection with the preparation of our financial statements for the quarter and two quarters ended June 28, 2024, we performed a quantitative impairment assessment on goodwill assigned to the Antenna disposal group and a qualitative impairment assessment on the goodwill assigned to the retained businesses of the reporting unit. As a result of these tests, we determined that the fair value of the Antenna disposal group was below its carrying value and accordingly recorded a non-cash charge for impairment of $14 million included in the “” line item in our Consolidated Statement of Operations. Fiscal 2023. As described in more detail in Note 13: Acquisitions and Divestitures in these Notes, during the quarter ended December 29, 2023, we entered into a definitive agreement to sell our CAS disposal group, which includes both the CTS and Commercial Aviation reporting units. As of November 27, 2023, the date of the agreement, the fair value less costs to sell the CAS disposal group was $834 million, inclusive of considerations related to noncontrolling interest and accumulated other comprehensive income. In connection with the preparation of our financial statements for fiscal 2023, we evaluated the facts and circumstances which impacted the agreed upon selling price of the CAS disposal group and identified interim indicators of impairment within both reporting units subsequent to our annual impairment testing date of October 2, 2023. Specifically, supply chain-related operational challenges which negatively impact cash flows over the short- term forecast period were assessed in combination with our long-term portfolio shaping strategy to dispose of non- core businesses. As a result, we performed quantitative impairment tests for both reporting units as of November 27, 2023, utilizing an income approach aligned to market prices for the two reporting units, as specified in the definitive agreement. As a result of these tests, we determined that the fair value of the CTS reporting unit was above carrying value, while the fair value of the Commercial Avionics reporting unit was below its carrying value, and concluded goodwill related to the Commercial Aviation reporting unit was impaired. Therefore we recorded a non- cash charge for impairment of $296 million associated with the Commercial Aviation reporting unit in the “” line item in our Consolidated Statement of Operations. The carrying amounts of the CAS disposal group assets (including $534 million of goodwill) and liabilities were classified as held for sale in our Consolidated Balance Sheet at December 29, 2023. Fiscal 2022. During fiscal 2022, we determined that goodwill related to our Broadband, ADG and Electro Optical reporting units was impaired and we recorded non-cash impairment charges of $355 million, $313 million and $134 million, respectively, in the “” line item in our Consolidated Statement of Operations. See Note 9: Goodwill in our Fiscal 2022 Form 10-K for further information on our fiscal 2022 goodwill impairments. Intangible Assets Intangible assets, net, are summarized below:
Amortization expense for intangible assets was $853 million, $779 million and $605 million in fiscal 2024, 2023 and 2022, respectively. Future estimated amortization expense for intangible assets is as follows:
In-process R&D Impairment. During fiscal 2023, we closed a facility, which triggered an evaluation of the in- process R&D related to the operations of the closed facility for impairment. As a result, we recorded a $21 million non-cash charge for the impairment of in-process R&D intangible assets which is included in the “ goodwill and other assets” line item in our Consolidated Statement of Operations for fiscal 2023.
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INCOME TAXES |
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| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME TAXES | NOTE 7: INCOME TAXES Income Tax Provision Our provisions for current and deferred income taxes are as follows:
A reconciliation of the U.S. statutory income tax rate to our effective income tax rate is as follows:
_______________ (1)Includes non-deductible share-based compensation and excess tax benefits from share-based compensation. As of January 3, 2025, we estimate our outside basis difference in foreign subsidiaries that are considered indefinitely reinvested to be approximately $1.5 billion. The outside basis difference is comprised predominantly of purchase accounting adjustments and to a lesser extent, undistributed earnings and other equity adjustments. In the event of a disposition of the foreign subsidiaries or a distribution, we may be subject to incremental U.S. income taxes, subject to an adjustment for foreign tax credits, and withholding taxes or income taxes payable to the foreign jurisdictions. As of January 3, 2025, the determination of the amount of unrecognized deferred tax liability related to the outside basis difference is not practicable. Purchase of Tax Credits Section 6418 of the Internal Revenue Code permits, in certain circumstances, the sale of federal income tax credits generated from renewable and alternative energy sources. During the year ended January 3, 2025, we entered into a binding agreement for the purchase of tax credits totaling $200 million for the 2024 tax year for a net purchase price of $191 million, allowing us to reduce our 2024 federal income taxes payable by the $200 million. We have recorded a liability to the seller for the amount owed in the “Other current liabilities” line of the Consolidated Balance Sheet. We have recorded an income tax benefit of $9 million for the difference between the amount paid or to be paid to the seller and the reduction to our taxes payable in the “Income taxes” line of the Consolidated Statement of Operations. Deferred Income Tax Assets (Liabilities) The components of deferred income tax assets (liabilities) were as follows:
_______________ (1)At January 3, 2025, primarily includes operating loss and credit carryforwards of $81 million and $165 million, respectively, which have expiration dates ranging from less than one year to no expiration date. A significant portion of the carryforwards are either indefinite or begin expiring in 2035. (2)Valuation allowance established to offset certain domestic and foreign deferred tax assets due to the uncertainty regarding our ability to realize these assets in the future. The net change in our valuation allowance in fiscal 2024 and 2023 was a decrease of $2 million and $3 million, respectively. (3)Based on recent IRS guidance, we made a method change to defer taxable income for long-term contracts accounted for under the POC cost-to-cost method that include deferred R&D expenses, resulting in a $913 million reduction in our current income taxes (current payable) and corresponding increase to our deferred income taxes (deferred tax liability). Net deferred tax assets (liabilities) were classified as follows in our Consolidated Balance Sheet:
Income before income taxes of our international subsidiaries was $191 million, $205 million and $95 million in fiscal 2024, 2023 and 2022, respectively. We paid $102 million, $715 million and $309 million in income taxes, net of refunds received, in fiscal 2024, 2023 and 2022, respectively. Tax Uncertainties A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
_______________ (1)Includes unrecognized tax benefits that would favorably impact our future tax rates in the event that the tax benefits are eventually recognized of $666 million and $509 million at January 3, 2025 and December 29, 2023, respectively. We recognize accrued interest and penalties related to unrecognized tax benefits in our income tax provision. In fiscal 2024, 2023 and 2022, we recognized $29 million, $20 million and $12 million, respectively. At January 3, 2025 and December 29, 2023, accrued interest and penalties related to unrecognized tax benefits was $109 million and $80 million, respectively, which is included in the “Other long-term liabilities” line item in our Consolidated Balance Sheet. We file numerous separate and consolidated income tax returns reporting our financial results and, where appropriate, those of our subsidiaries and affiliates, in the U.S. federal jurisdiction and various state, local and foreign jurisdictions. Pursuant to the Compliance Assurance Process, the Internal Revenue Service (“IRS”) is examining our federal tax returns for fiscal 2021, 2022, and 2023. Legacy L3’s federal tax returns for calendar years 2017 and 2018 are currently under IRS examination and refund claims related to calendar years 2012, 2013, 2015 and 2016 have been filed with the IRS. In addition, legacy AJRD refund claims related to calendar year 2019 and 2020 have been filed with the IRS. We are currently under examination or contesting proposed adjustments by various state and international tax authorities for fiscal years ranging from 2013 through 2022. It is reasonably possible that there could be a significant change to our unrecognized tax benefit balance during the course of the next twelve months as these examinations continue, other tax examinations commence or various statutes of limitations expire. An estimate of the range of possible changes is not practicable for the remaining unrecognized tax benefits because of the significant number of jurisdictions in which we do business and the number of open tax periods under various stages of examination.
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DEBT AND CREDIT ARRANGEMENTS |
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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| DEBT AND CREDIT ARRANGEMENTS | NOTE 8: DEBT AND CREDIT ARRANGEMENTS Long-Term Debt Long-term debt, net, is summarized below:
_______________ (1)All fixed-rate notes and debentures rank equally in right of payment. (2)We may redeem these notes, in whole or in part, at our option, at a pre-determined redemption price pursuant to their terms prior to the applicable maturity date. (3)Upon change of control combined with a below-investment-grade rating event, we may be required to make an offer to repurchase these notes at a pre-determined price pursuant to their terms. (4)The debentures are not redeemable prior to maturity. (5)Collectively, the “AJRD Notes.” The maturities of long-term debt, including the current portion of long-term debt and excluding finance lease obligations, for the five years following the end of fiscal 2024 and, in total thereafter, are: $610 million in fiscal 2025; $659 million in fiscal 2026; $1,254 million in fiscal 2027; $1,880 million in fiscal 2028; $1,154 million in fiscal 2029; and $5,973 million thereafter. Long-Term Debt Issuances. On March 13, 2024, we closed the issuance and sale of March Issued 2024 Notes. The March Issued 2024 Notes were used to repay Term Loan 2025, including related fees and expenses, which had an outstanding balance of $2.25 billion at December 29, 2023. Interest on the March Issued 2024 Notes is payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2024. On August 2, 2024, we closed the issuance and sale of $600 million aggregate principal amount of the 5.50% 2054 Notes, and used the net proceeds to repay borrowings under our CP Program. Interest on the 5.50% 2054 Notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing on February 15, 2025. We incurred debt issuance costs of $20 million and $7 million for the March Issued 2024 Notes and 5.50% 2054 Notes, respectively, which are being amortized over the life of each respective note. Such amortization is included as a component of the “Interest expense, net” line item in our Consolidated Statement of Operations. Long-Term Debt Repayments. Fiscal 2024. On March 14, 2024, we repaid the entire outstanding $2.25 billion drawn on Term Loan 2025, which at time of repayment had a variable interest rate of 6.7%, with proceeds from the issuance of the March Issued 2024 Notes, which bear fixed interest rates between 5.05% and 5.35%. Additionally, during the quarter ended June 28, 2024, we repaid the $350 million aggregate principal amount of our 3.95% 2024 Notes. Fiscal 2023. On March 14, 2023, we repaid the entire outstanding $250 million aggregate principal amount of our Floating Rate Notes due March 2023 through a $250 million draw on Term Loan 2025. On June 15, 2023, we repaid the entire outstanding $800 million aggregate principal amount of our 3.85% 2023 Notes through cash on hand and the issuance of commercial paper during fiscal 2023. Commercial Paper Program On January 26, 2024, we lowered the maximum amount available under our CP Program to $3.0 billion from $3.9 billion in accordance with the terms of the CP Program. At January 3, 2025, our CP Program was supported by amounts available under the 2022 Credit Agreement and the 2024 Credit Agreement. The commercial paper notes are sold at par less a discount representing an interest factor or, if interest bearing, at par, and the maturities vary but may not exceed 397 days from the date of issue. The commercial paper notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness. At January 3, 2025 and December 29, 2023, we had $515 million and $1,599 million in outstanding notes under our CP Program, respectively, which is included as a component of the “Short-term debt” line item in our Consolidated Balance Sheet. The outstanding notes under our CP Program had a weighted-average interest rate of 4.70% and 5.95% at January 3, 2025 and December 29, 2023, respectively. Fair Value of Debt The following table presents the carrying amounts and estimated fair values of our long-term debt:
_______________ (1)The carrying value of Term Loan 2025 approximates fair value due to its variable interest rate. (2)The fair value was estimated using a market approach based on quoted market prices for our debt traded in the secondary market. If long- term debt were measured at fair value in our consolidated balance sheet, it would be categorized as Level 2 within the fair value hierarchy. The fair value of our short-term debt approximates the carrying value due to its short-term nature. If measured at fair value, the commercial paper would be classified as level 2 and other short-term debt would be classified as level 3 within the fair value hierarchy. Credit Agreements On January 26, 2024, we established a new $1.5 billion, 364-day senior unsecured revolving credit facility by entering into a 364-day credit agreement maturing no later than January 24, 2025 with a syndicate of lenders. The 2024 Credit Agreement, which matured on January 24, 2025, replaced the 2023 Credit Agreement. At our election, borrowings under the 2024 Credit Agreement, which were designated in U.S. Dollars, bore interest at the sum of the term secured overnight financing rate or the Base Rate (as defined in the 2024 Credit Agreement), plus an applicable margin that varied based on the ratings of our senior unsecured long-term debt securities (“Senior Debt Ratings”). In addition to interest payable on the principal amount of indebtedness outstanding, we were required to pay a quarterly unused commitment fee that varied based on our Senior Debt Ratings. The 2024 Credit Agreement contained representations, warranties, covenants and events of default that are substantially similar to the 2022 Credit Agreement which established a $2.0 billion, five-year senior unsecured revolving credit facility. At January 3, 2025, we had no outstanding borrowings under our credit facility, had available borrowing capacity of $2,985 million, net of outstanding notes under our CP Program, and were in compliance with all covenants under the 2024 Credit Agreement and the 2022 Credit Agreement. At December 29, 2023, we had no outstanding borrowings under our credit facility, had available borrowing capacity of $2,801 million, net of outstanding notes under our CP Program, and were in compliance with all covenants under the 2023 Credit Agreement and the 2022 Credit Agreement. Interest Paid Total interest paid was $654 million, $489 million and $296 million in fiscal 2024, 2023 and 2022, respectively.
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RETIREMENT BENEFITS |
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| Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RETIREMENT BENEFITS | NOTE 9: RETIREMENT BENEFITS Defined Contribution Plans We sponsor numerous defined contribution savings plans, which allow our eligible employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. The plans include several match contribution formulas which require us to match a percentage of the employee contributions up to certain limits, generally totaling 6.0% of employee eligible pay. Matching contributions, net of forfeitures, charged to expense were $276 million, $267 million and $226 million in fiscal 2024, 2023 and 2022, respectively. Deferred Compensation Plans We also sponsor certain non-qualified deferred compensation plans. The following table provides the fair value of our deferred compensation plan investments and liabilities by category and by fair value hierarchy level:
_______________ (1)Represents diversified assets held in rabbi trusts primarily associated with our non-qualified deferred compensation plans, which are measured at fair value and included in the “Other current assets” and “Other non-current assets” line items in our Consolidated Balance Sheet. In fiscal 2024, we contributed $100 million to our rabbi trust assets. (2)Primarily represents obligations to pay benefits under certain non-qualified deferred compensation plans, which we include in the “Compensation and benefits” and “Other long-term liabilities” line items in our Consolidated Balance Sheet. Under these plans, participants designate investment options (including stock and fixed-income funds), which serve as the basis for measurement of the notional value of their accounts. Defined Benefit Plans We sponsor various defined benefit pension plans for eligible employees in the U.S., Canada and United Kingdom. Our largest plans are generally closed to new entrants. Benefits for most participants under the terms of these plans are based on the employee’s years of service and compensation. We fund these plans as required by statutory regulations and through voluntary contributions. Some of our employees also participate in other postretirement defined benefit plans (“Other Benefits”) such as health care and life insurance plans. Our largest defined benefit plan is the Consolidated Pension Plan, with 85% and 86% of total plan assets and PBO, respectively, as of January 3, 2025. During fiscal 2024, we reduced our defined benefit pension plan benefit obligations by approximately $333 million by purchasing group annuity policies and transferring approximately $333 million of pension plan assets to an insurance company. There was no gain or loss as a result of this transaction. Funded Status. The following table summarizes the funded status of our defined benefit plans:
_______________ (1)Fiscal 2024 includes approximately $333 million associated with the purchase of group annuity policies and transfer of plan assets to an insurance company. The transaction is reflected in this caption as settlement accounting had not been met. (2)PBO assumed and plan assets acquired in the AJRD acquisition. Net defined benefit plan liability is included in our “Other long-term liabilities” and “Compensation and benefits” line items in “Acquisition of AJRD” section of Note 13: Acquisitions and Divestitures. Actuarial gains in the PBO as of January 3, 2025 were primarily the result of higher discount rates. Actuarial losses in the PBO as of December 29, 2023 were primarily the result of lower discount rates. The following table summarizes amounts recognized in our Consolidated Balance Sheet:
The following table summarizes pre-tax amounts recognized in the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet:
The following table provides information for our defined benefit plans with PBO in excess of plan assets:
Accumulated Benefit Obligation (“ABO”): The ABO for all defined benefit pension plans was $7,585 million and $8,563 million at January 3, 2025 and December 29, 2023, respectively. The following table provides information for our defined benefit plans with ABO in excess of plan assets:
Net Periodic Benefit Income. We record the service cost component of net periodic benefit income in the “Cost of revenue” and “General and administrative expenses” line items and the non-service cost components in the “Non-service FAS pension income and other, net” line item in our Consolidated Statement of Operations. The following table provides the components of net periodic benefit income and other amounts recognized in other comprehensive income:
Assumptions. The following table presents the weighted-average assumptions used to determine the benefit obligation:
_______________ (1)Key assumptions for our Consolidated Pension Plan include a discount rate of 5.49%, cash balance interest crediting rate of 4.50% and a 4.25% interest crediting rate for the frozen pension equity benefit. The following table presents the weighted-average assumptions used to determine net periodic benefit income:
_______________ (1)Key assumptions for our Consolidated Pension Plan include expected return on plan assets of 7.50%, which is being maintained at 7.50% for fiscal 2025. The expected long-term rate of return on plan assets reflects the expected returns for each major asset class in which the plans invest, the weight of each asset class in the strategic allocation, the correlations among asset classes and their expected volatilities. Our expected rate of return on plan assets is estimated by evaluating both historical returns and estimates of future returns. Specifically, the determination of the expected long-term rate of return takes into consideration: (1) the plan’s actual historical annual return on assets over the past 15-, 20- and 25- year time periods, (2) historical broad market returns over long-term timeframes weighted by the plan’s strategic allocation and (3) independent estimates of future long-term asset class returns, weighted by the plan’s strategic allocation. Based on this approach, the long-term expected annual rate of return on assets is estimated at 7.50% for fiscal 2025 for the U.S. defined benefit pension plans. The weighted average long-term expected annual rate of return on assets for all defined benefit pension plans is estimated to be 7.45% for fiscal 2025. The assumed composite rate of future increases in the per capita healthcare costs (the healthcare trend rate) is 8.23% for fiscal 2025, decreasing ratably to 4.53% by fiscal 2035. Investment Policy. The investment strategy for managing defined benefit plan assets is to seek an optimal rate of return relative to an appropriate level of risk. We manage substantially all defined benefit plan assets on a commingled basis in a master investment trust. In making these asset allocation decisions, we take into account recent and expected returns and volatility of returns for each asset class, the expected correlation of returns among the different investments, as well as anticipated funding and cash flows. To enhance returns and mitigate risk, we diversify our investments by strategy, asset class, geography and sector and engage a large number of managers to gain broad exposure to the markets. The following table provides the current strategic target asset allocation ranges by asset category:
Fair Value of Plan Assets. The following is a description of the valuation techniques and inputs used to measure fair value for major categories of investments as reflected in the table that follows such description: •Domestic and international equities, which include common and preferred shares, domestic listed and foreign listed equity securities, open-ended and closed-ended mutual funds, real estate investment trusts and exchange traded funds, are generally valued at the closing price reported on the major market exchanges on which the individual securities are traded at the measurement date. Because these assets are traded predominantly on liquid, widely traded public exchanges, equity securities are categorized as Level 1 assets. •Private equity funds are typically limited partnership investment structures. Private equity funds are valued using a market approach based on NAV calculated by the funds and are not publicly available. Private equity funds generally have liquidity restrictions that extend for or more years. At January 3, 2025 and December 29, 2023, our defined benefit plans had future unfunded commitments totaling $539 million and $550 million, respectively, related to private equity fund investments. •Real asset funds are typically limited partnership investment structures. Real asset funds are valued using a market approach based on NAV calculated by the funds and are not publicly available. Real asset funds generally permit redemption on a quarterly basis with 90 or fewer days-notice. At each of January 3, 2025 and December 29, 2023, our defined benefit plans had no future unfunded commitments related to real asset fund investments. •Hedge funds, which include equity long/short, event-driven, fixed-income arbitrage and global macro strategies, are typically limited partnership investment structures. Limited partnership interests in hedge funds are valued using a market approach based on NAV calculated by the funds and are not publicly available. Hedge funds generally permit redemption on a quarterly or more frequent basis with 90 or fewer days’ notice. At each of January 3, 2025 and December 29, 2023, our defined benefit plans had no future unfunded commitments related to hedge fund investments. •Fixed income investments, which include U.S. Government securities, investment and non-investment- grade corporate bonds and securitized bonds, are generally valued using pricing models that use verifiable, observable market data such as interest rates, benchmark yield curves and credit spreads, bids provided by brokers or dealers or quoted prices of securities with similar characteristics. Fixed income investments are generally categorized as Level 2 assets. Fixed income funds valued at the closing price reported on the major market exchanges on which the individual fund is traded are categorized as Level 1 assets. •Cash and cash equivalents are primarily comprised of short-term money market funds valued at cost, which approximates fair value, or valued at quoted market prices of identical instruments. Cash and cash equivalents currency are categorized as Level 1 assets; cash equivalents, such as money market funds or short-term commingled funds, are categorized as Level 2 assets. •Certain investments that are valued using the NAV per share (or its equivalent) as a practical expedient are not categorized in the fair value hierarchy and are included in the table to permit reconciliation of the fair value hierarchy to the aggregate defined benefit plan assets. The following tables provide the fair value of plan assets held by our defined benefit plans by asset category and by fair value hierarchy level:
Contributions. Funding requirements under IRS rules are a major consideration in making contributions to our defined benefit plans. With respect to U.S. qualified pension plans, we intend to contribute annually not less than the required minimum funding thresholds. The Employee Retirement Income Security Act of 1974, as amended by the Pension Protection Act of 2006 and further amended by the Worker, Retiree, and Employer Recovery Act of 2008, the Moving Ahead for Progress in the 21st Century Act (“MAP-21”) and applicable Internal Revenue Code regulations mandate minimum funding thresholds. The Highway and Transportation Funding Act of 2014, the Bipartisan Budget Act of 2015, the American Rescue Plan Act of 2021 and the Infrastructure Investment and Jobs Act further extended the interest rate stabilization provision of MAP-21. In fiscal 2024, we made approximately $30 million of contributions to our U.S. qualified defined benefit pension plans. As a result of prior voluntary contributions, we made no material contributions to our U.S. qualified defined benefit pension plans in fiscal 2023 or 2022. We expect to make contributions of approximately $23 million to these plans during fiscal 2025, and may consider voluntary contributions thereafter. Estimated Future Benefit Payments. The following table provides the projected timing of payments for benefits earned to date and benefits expected to be earned for future service by current active employees under our defined benefit plans:
_______________ (1)Projected payments for Other Benefits reflect net payments from the Company, which include subsidies that reduce the gross payments by less than 1%. Multi-employer Benefit Plans Certain of our businesses participate in multi-employer defined benefit pension plans. We make cash contributions to these plans under the terms of collective-bargaining agreements that cover union employees based on a fixed rate per hour of service worked by the covered employees. The risks of participating in these multi- employer plans are different from single-employer plans in the following aspects: (1) assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers, (2) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers and (3) if we choose to stop participating in some of our multi- employer plans, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. Cash contributed and expenses recorded for our multi-employer plans were not material in fiscal 2024, 2023 or 2022.
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SHARE-BASED COMPENSATION |
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| Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SHARE-BASED COMPENSATION | NOTE 10: SHARE-BASED COMPENSATION At January 3, 2025, we had stock options and other share-based compensation outstanding under our 2024 Equity Incentive Plan, which was approved by our shareholders on April 19, 2024, as well as under employee equity incentive plans assumed by L3Harris (collectively, the “L3Harris SIPs”). As part of our long-term incentive compensation program, we have made awards to employees in the form of RSUs, PSUs and non-qualified stock options under the L3Harris SIPs. We have also awarded RSUs in the form of deferred units to our non-employee directors. We believe that share-based awards more closely align the interests of participants with those of shareholders. The following table summarizes the share-based compensation expense recognized in the Consolidated Statement of Operations:
Share-Based Compensation Awards As of January 3, 2025, a total of 21.2 million shares of common stock remained available under our L3Harris SIPs for future issuance (excluding shares to be issued in respect of outstanding stock options, with each full-value award (e.g., RSUs and PSUs) counting as 4.6 shares against the total remaining for future issuance). During fiscal 2024, we issued an aggregate of 1.3 million shares of common stock under the terms of our L3Harris SIPs, which is net of shares withheld for tax purposes. RSUs. RSUs granted under our L3Harris SIPs are not transferable until vested and the restrictions generally lapse upon the achievement of continued employment (or board membership) over a specified time period. The grant-date fair value of these awards was based on the closing price of our common stock on the grant date and is amortized to compensation expense over the vesting period. At January 3, 2025, there were 582,326 RSUs outstanding which were payable in shares. The following table summarizes the activity of RSUs during fiscal 2024:
As of January 3, 2025, there was $57 million of total unrecognized compensation expense related to these awards under our L3Harris SIPs. This expense is expected to be recognized over a weighted-average period of 1.41 years. The weighted-average grant-date price per unit was $211.95, $199.33 and $225.58 for awards granted in fiscal 2024, 2023 and 2022, respectively. The total fair value of the awards that vested in fiscal 2024, 2023 and 2022 was $46 million, $44 million and $69 million, respectively. PSUs. At January 3, 2025, all outstanding PSUs granted under our L3Harris SIPs are subject to performance criteria, such as meeting predetermined operating income or earnings per share, return on invested capital targets and market conditions, such as total shareholder return, for a three-year performance period. These awards also generally vest after a three-year performance period. The final determination of the number of shares to be issued in respect of an award is made by our Board or a committee thereof. The grant-date fair value of awards with market conditions was determined based on a multifactor Monte Carlo valuation model that simulates our stock price and TSR relative to other companies in the S&P 500, less a discount to reflect the delay in payments of cash dividend-equivalents that are made only upon vesting. The fair value of these awards is amortized to compensation expense over the performance period if achievement of the performance measures is considered probable. The following table summarizes the activity of PSUs during fiscal 2024:
As of January 3, 2025, there was $35 million of total unrecognized compensation expense related to these awards under our L3Harris SIPs. This expense is expected to be recognized over a weighted-average period of 1.52 years. The weighted-average grant-date price per unit was $230.09, $223.09 and $258.83 for awards granted in fiscal 2024, 2023 and 2022, respectively. The total fair value of the awards that vested in fiscal 2024, 2023 and 2022 was $37 million, $42 million and $41 million, respectively. Stock Options. Exercise prices for stock options, including performance stock options, that have been granted under the L3Harris SIPs are equal to or greater than the fair market value of our common stock on the grant date, using the closing stock price of our common stock. Stock options may be exercised for a period of ten years after the date of grant, and stock options, other than performance stock options, generally become exercisable in installments, which are typically 33.3% one year from the grant date, 33.3% two years from the grant date and 33.3% three years from the grant date. In certain instances, vesting and exercisability are also subject to performance criteria. The grant-date fair value of each stock option award was determined using the Black-Scholes-Merton option- pricing model which used assumptions noted in the following table:
Expected volatility over the expected term of the stock options is based on implied volatility from traded stock options on our common stock and the historical volatility of our stock price. The expected term of the stock options is based on historical observations of our common stock, considering average years to exercise for all stock options exercised and average years to cancellation for all stock options canceled, as well as average years remaining for vested outstanding stock options, which is calculated based on the weighted-average of these three inputs. The risk-free interest rate for periods within the contractual life of the stock option is based on the U.S. Treasury yield curve in effect at the time of grant. The following table summarizes the stock option activity during fiscal 2024:
The weighted-average grant-date fair value per share was $50.99, $54.63 and $53.66 for stock options granted in fiscal 2024, 2023 and 2022, respectively. The total intrinsic value of stock options at the time of exercise was $100 million, $23 million and $56 million for stock options exercised in fiscal 2024, 2023 and 2022, respectively. The following table summarizes the unvested stock option activity during fiscal 2024:
As of January 3, 2025, there was $20 million of total unrecognized compensation expense related to unvested stock options granted under our L3Harris SIPs. This expense is expected to be recognized over a weighted-average period of 1.80 years. The total fair value of stock options that vested in fiscal 2024, 2023 and 2022 was $14 million, $14 million and $42 million, respectively.
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LEASES |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LEASES | NOTE 11: LEASES Our operating and finance leases primarily consist of real estate leases for office space, warehouses, manufacturing, R&D facilities, telecommunication tower space and land and equipment leases. Lease Costs. Components of lease costs included in our Consolidated Statement of Operations are as follows:
______________ (1) Consists of finance lease amortization and interest costs as well as sublease income. See “Leases” section in Note 1: Significant Accounting Policies in these Notes for the line items in our Consolidated Statement of Operations where our lease costs are presented. Balance Sheet Information. ROU assets and lease liabilities included in our Consolidated Balance Sheet are as follows:
Supplemental Lease Information: Other supplemental lease information is as follows:
Maturities of non-cancelable operating and finance lease liabilities at January 3, 2025 were as follows:
_______________ (1)On January 3, 2025, we had additional future payments on leases of $228 million that had not yet commenced. These leases will commence between 2025 and 2026, and have lease terms of to 15 years. These commitments do not contain any material rent escalations, rent holidays, contingent rent, rent concessions, leasehold improvement incentives or unusual provisions or conditions. We do not consider any individual lease material to our operations.
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| LEASES | NOTE 11: LEASES Our operating and finance leases primarily consist of real estate leases for office space, warehouses, manufacturing, R&D facilities, telecommunication tower space and land and equipment leases. Lease Costs. Components of lease costs included in our Consolidated Statement of Operations are as follows:
______________ (1) Consists of finance lease amortization and interest costs as well as sublease income. See “Leases” section in Note 1: Significant Accounting Policies in these Notes for the line items in our Consolidated Statement of Operations where our lease costs are presented. Balance Sheet Information. ROU assets and lease liabilities included in our Consolidated Balance Sheet are as follows:
Supplemental Lease Information: Other supplemental lease information is as follows:
Maturities of non-cancelable operating and finance lease liabilities at January 3, 2025 were as follows:
_______________ (1)On January 3, 2025, we had additional future payments on leases of $228 million that had not yet commenced. These leases will commence between 2025 and 2026, and have lease terms of to 15 years. These commitments do not contain any material rent escalations, rent holidays, contingent rent, rent concessions, leasehold improvement incentives or unusual provisions or conditions. We do not consider any individual lease material to our operations.
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ACCUMULATED OTHER COMPREHENSIVE INCOME LOSS ("AOCI") |
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| Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ACCUMULATED OTHER COMPREHENSIVE INCOME LOSS ("AOCI") | NOTE 12: ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (“AOCI”) The components of AOCI are summarized below:
_______________ (1)See Note 9: Retirement Benefits in these Notes for further information. (2)Losses (gains) reclassified to earnings are included in the “Revenue,” “Cost of revenue,” “Interest expense, net” and “Non-service FAS pension income and other, net” line items in our Consolidated Statement of Operations.
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ACQUISITIONS AND DIVESTITURES |
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| Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ACQUISITIONS AND DIVESTITURES | NOTE 13: ACQUISITIONS AND DIVESTITURESAcquisition of Viasat’s TDL On January 3, 2023, we completed the acquisition of TDL for a purchase price of $1,958 million. The acquisition enhances our networking capability and provides access to the ubiquitous Link 16 waveform, better positioning us to enable the DoD integrated architecture goal in JADC2. On November 22, 2022, we established Term Loan 2025 with a syndicate of lenders, in part, to finance the acquisition. Net assets and results of operations of TDL are reflected in our financial results commencing on January 3, 2023, the acquisition date, and are reported within our CS segment, with the exception of acquired intangible assets, which are recorded in our corporate headquarters. We accounted for the acquisition of TDL using the acquisition method of accounting, which required us to measure identifiable assets acquired and liabilities assumed in the acquiree at their fair values as of the acquisition date, with the excess of the consideration transferred over those fair values recorded as goodwill. As of the acquisition date, the fair value of consideration transferred consisted of the following:
_______________ (1)Prior to the acquisition, we had a preexisting relationship with Viasat’s TDL business in the normal course of business. As of the acquisition date, our CS segment had a receivable from Viasat’s TDL business with a fair value of $1 million that was settled in connection with the acquisition. We determined the fair value of assets acquired and liabilities assumed by using available market information and various valuation methods that require judgement related to estimates. Our preliminary fair value estimates and assumptions to measure the assets acquired and liabilities assumed were subject to change as we obtained additional information during the measurement period. We completed our accounting for the acquisition during the fiscal year ended December 29, 2023. The following table summarizes the allocation of the fair value of consideration transferred to assets acquired and liabilities assumed as of the acquisition date and the adjustments recognized during the measurement period:
_______________ (1)Fair value adjustments during the fiscal year ended December 29, 2023 primarily related to refined assumptions in the valuation of customer relationship intangible assets. (2)Assets acquired include $11 million of Contract assets that were reclassified from Inventories, net to Contract assets to conform TDL’s accounting policies with those of L3Harris, as required under ASC 805. As such, reclassified amounts will not be recognized as revenue in future periods. Intangible Assets. All intangible assets acquired in the TDL acquisition are subject to amortization. The fair value and weighted-average amortization period of identifiable intangible assets acquired as of the acquisition date is as follows:
The fair value of intangible assets is estimated using the relief from royalty method for the acquired developed technology and the multi-period excess earnings method for the acquired customer relationships. Both of these level 3 fair value methods are income-based valuation approaches, which require judgment to estimate appropriate discount rates, royalty rates related to the developed technology intangible assets, revenue growth attributable to the intangible assets and remaining useful lives. The fair value of inventory was estimated using the replacement cost approach and comparative sales method, which require estimates of replacement cost for raw materials and estimates of expected sales price less costs to complete and dispose of the inventory, plus a profit margin for efforts incurred for the work in progress and finished goods. Goodwill. The $1,143 million of goodwill recognized is attributable to the assembled workforce, in addition to synergies expected to be realized through integration with existing CS segment businesses and growth opportunities in the space domain. The acquired goodwill is tax deductible. See Note 6: Goodwill and Intangible Assets in these Notes for further information. Financial Results. The following table includes revenue and income before income taxes of TDL included in our Consolidated Statement of Operations for the acquisition date through December 29, 2023 and the comparable periods of calendar year 2022. The comparable period results do not include any integration synergies or accounting conformity adjustments and are not necessarily indicative of our results of operations that actually would have been obtained had the acquisition of TDL been completed for the period presented, or which may be realized in the future.
Acquisition-Related Costs. Acquisition-related costs have been expensed as incurred. In connection with the TDL acquisition, we recorded transaction and integration costs of $15 million and $78 million in fiscal 2024 and 2023, respectively, which were included in the General and administrative expenses line item in our Consolidated Statement of Operations. Acquisition of AJRDOn July 28, 2023, we acquired AJRD, a technology-based engineering and manufacturing company that develops and produces missile solutions with technologies for strategic defense, missile defense, and hypersonic and tactical systems, as well as space propulsion and power systems for national security space and exploration missions. The acquisition provides us access to a new market. We acquired 100% percent of AJRD for a total net purchase price of $4,715 million. The acquisition was financed through the issuance and sale of the AJRD Notes and a draw down under the 2023 Credit Agreement. Net assets and results of operations of AJRD are reflected in our financial results commencing on July 28, 2023, the acquisition date, and are reported in our AR segment, which is also the AR reporting unit, except for certain assets and liabilities recorded at corporate headquarters. We accounted for the acquisition of AJRD using the acquisition method of accounting, which required us to measure identifiable assets acquired and liabilities assumed in the acquiree at their fair values as of the acquisition date, with the excess of the consideration transferred over those fair values recorded as goodwill. As of the acquisition date, the fair value of consideration transferred consisted of the following:
We determined the fair value of assets acquired and liabilities assumed by using available market information and various valuation methods that require judgement related to estimates. Our preliminary fair value estimates and assumptions to measure the assets acquired and liabilities assumed were subject to change as we obtained additional information during the measurement period. We completed our accounting for the acquisition during the quarter ended September 27, 2024. The following table summarizes the allocation of the fair value of consideration transferred to assets acquired and liabilities assumed as of the acquisition date and the adjustments recognized during the measurement period:
_______________ (1)Fair value adjustments during the measurement period primarily related to EAC updates for circumstances existing at the acquisition date, including updates to the forward loss provision and off-market customer contract reserve described below, refinements to the fair value of fixed assets, as well as corresponding adjustments to the deferred tax liability account which was partially offset by the release of a portion of the uncertain tax position previously recorded by AJRD. Intangible Assets. All intangible assets acquired in the AJRD acquisition are subject to amortization. The fair value and weighted-average amortization period of identifiable intangible assets acquired as of the acquisition date are as follows:
The fair value of intangible assets is estimated using the relief from royalty method for the acquired trade names and the multi-period excess earnings method for the acquired customer relationships. Both of these level 3 fair value methods are income-based valuation approaches, which require judgment to estimate appropriate discount rates, royalty rates related to the trade names intangible assets, revenue growth attributable to the intangible assets and remaining useful lives. Forward Loss Provision. In connection with the acquisition, we recorded a forward loss provision of $363 million which was included in “Other current liabilities” line item in our Consolidated Balance Sheet. Since the completion of the acquisition of AJRD, we have undertaken significant operational efforts to further understand the root cause of identified preexisting manufacturing and supply chain challenges resulting in delivery delays, primarily related to certain Missile Solutions programs. We have identified operational activities necessary to remedy these challenges and inefficiencies and the incremental costs required as compared to its initial estimates and actual costs incurred. The incremental forward loss provisions relate to the increased cost estimates of labor and material to remedy the underlying preexisting technical and supply chain challenges. These cost increases impacted both cost-type and fixed-price contracts in proportions that are consistent with the ratio of the overall AJRD revenue by contract type. The forward loss provisions will be recognized as a reduction to cost of sales as we incur actual costs associated with these estimates in satisfying the associated performance obligations. There will be no net impact on our Consolidated Statement of Operations. We recognized $125 million and $8 million of amortization related to the forward loss provision in fiscal 2024 and 2023, respectively. Off-market Customer Contracts. In connection with the acquisition, we identified certain customer contractual obligations as of the acquisition date with economic returns that are higher or lower than could be realized in market transactions and have recorded assets or liabilities for the acquisition date fair value of the off-market components. The acquisition date fair value of the off-market components is a net liability of $183 million, consisting of $48 million and $135 million included in the “Other current liabilities” and “Other long-term liabilities” line items in our Consolidated Balance Sheet, respectively, and excludes any amounts already recognized in forward loss provisions (see discussion in the preceding paragraph). Provisions to off-market customer contracts relate to labor and material cost increases primarily associated with supply chain and manufacturing challenges and inefficiencies. These cost increases impacted both cost-type and fixed-price contracts in proportions that are consistent with the ratio of the overall AJRD revenue by contract type. We measured the fair value of these components as the amount by which the terms of the contract with the customer deviates from the terms that a market participant could have achieved at the acquisition date. The off-market components of these contracts will be recognized as an increase to revenue as we incur costs to satisfy the associated performance obligations. We recognized $58 million and $14 million of amortization related to off-market contract liabilities in fiscal 2024 and 2023, respectively. Goodwill. The $2,902 million of goodwill recognized is attributable to AJRD’s market presence as one of the two primary providers of advanced propulsion and power systems for nearly every major U.S. Government space and missile program, the assembled workforce and established operating infrastructure. The acquired goodwill is not tax deductible. See Note 6: Goodwill and Intangible Assets in these Notes for further information. Financial Results. See Note 14: Business Segments in these Notes for the AR segment financial results for fiscal 2024. Acquisition-Related Costs. Acquisition-related costs have been expensed as incurred and are included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. In connection with the AJRD acquisition, we recorded transaction and integration costs of $78 million and $83 million for fiscal 2024 and 2023, respectively. Pending Divestiture of CAS Disposal Group During the quarter ended December 29, 2023, we entered into a definitive agreement to sell our CAS disposal group (“CAS agreement”) for a cash purchase price of $700 million, with additional contingent consideration of up to $100 million, subject to customary purchase price adjustments and closing conditions as set forth in the agreement. On November 20, 2024, we entered into an amendment to the CAS agreement (“CAS amendment one”) that, among other matters, accelerated the contingent consideration so that it becomes payable at closing, resulting in an upfront cash purchase price of $800 million, subject to customary purchase price adjustments and closing conditions as set forth in the agreement, and revised certain purchase price adjustment provisions to remove a cap on working capital payments due to us upon closing. CAS amendment one expired on January 4, 2025, prior to us completing the sale. Subsequent to our fiscal 2024 year end, on January 8, 2025, we entered into a second amendment to the CAS agreement (“CAS amendment two”) that includes the same terms as CAS amendment one. The transaction is expected to close in fiscal 2025, subject to the satisfaction of closing conditions as set forth in the CAS agreement. The CAS disposal group, which is part of our IMS segment, provides integrated aircraft avionics, pilot training and data analytics services for the commercial aviation industry. Income or loss before income taxes attributable to L3Harris Technologies, Inc. was income of $121 million, loss of $208 million and income of $88 million for fiscal 2024, 2023 and 2022, respectively. The carrying amounts of the assets and liabilities of the CAS disposal group classified as held for sale in our Consolidated Balance Sheet were as follows:
In connection with the preparation of our financial statements for fiscal 2023, we concluded that goodwill related to the CAS disposal group was impaired and we recorded a non-cash impairment charge of $296 million, which is included in the “” line item in our Consolidated Statement of Operations. See Note 6: Goodwill and Intangible Assets in these Notes for additional information. Additionally, in fiscal 2023 we recognized a pre-tax loss of $77 million included in the “General and administrative expenses” and “Noncontrolling interests, net of income taxes” line items in our Consolidated Statement of Operations. During the three quarters ended September 27, 2024, we recorded an additional valuation allowance due to an increase in the carrying value of the CAS disposal group, and additional remaining estimated costs to sell which resulted in additional pre-tax losses of $44 million, inclusive of amounts attributable to noncontrolling interest. As of January 3, 2025, the fair value less costs to sell of the CAS disposal group was $896 million, inclusive of consideration related to noncontrolling interest and accumulated other comprehensive income. As a result, in the quarter ended January 3, 2025, we recorded a $15 million reversal of the previously recognized pre-tax losses in our Consolidated Statement of Operations to reduce the cumulative pre-tax losses associated with the CAS disposal group to $106 million. The pre-tax losses and the amount attributable to noncontrolling interest, after tax, are included in the “General and administrative expenses” and “Noncontrolling interests, net of income taxes” line items, in our Consolidated Statement of Operations. Completed Divestitures AOT Disposal Group. On January 3, 2025, we completed the divestiture of our AOT disposal group, which produces high performance specialty metal components for defense, aerospace, and commercial products, for cash proceeds of $103 million. The operating results of the AOT disposal group were reported in our AR segment through the date of divestiture. In connection with the sale, we recognized a pre-tax gain of $19 million included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. The carrying amounts of assets and liabilities included in the AOT disposal group sale on January 3, 2025 were $112 million and $28 million, respectively. Antenna Disposal Group. On May 31, 2024, we completed the divestiture of our Antenna disposal group, which provides a variety of airborne and ground-based antennas and test equipment for cash proceeds of $170 million and a $25 million note receivable, included in the “Other non-current assets” line item in our Consolidated Balance Sheet at January 3, 2025. The operating results of the Antenna disposal group were reported in our SAS segment through the date of divestiture. The carrying amounts of assets and liabilities included in the Antenna disposal group sale on May 31, 2024 were $265 million and $65 million, respectively. In connection with the sale, we recorded a non-cash charge for impairment of goodwill of $14 million and a pre-tax loss of $9 million included in the “ other assets” and “General and administrative expenses” line items, respectively, in our Consolidated Statement of Operations for fiscal 2024. See Note 6: Goodwill and Intangible Assets in these Notes for additional information related to goodwill allocated to the Antenna disposal group and related impairment. Visual Information Solutions (“VIS”). During fiscal 2023, we completed the divestiture of VIS for net cash proceeds of $71 million (after selling costs and purchase price adjustments) and recognized a pre-tax gain of $26 million included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. The operating results of VIS were reported in the SAS segment through the date of divestiture. Divestiture and Asset Sale. During fiscal 2022, we completed one business divestiture and one asset sale from our IMS segment for combined net cash proceeds of $23 million and recognized a pre-tax gain of $8 million associated with the asset sale included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. Fair Value of Businesses For purposes of allocating goodwill to the disposal groups that represent a portion of a reporting unit, we determine the fair value of each disposal group based on the respective negotiated selling price, and the fair value of the retained businesses of the respective reporting unit based on a combination of market-based and income based valuation techniques, utilizing quoted market prices, comparable publicly reported transactions and projected discounted cash flows. These fair value determinations are categorized as Level 3 in the fair value hierarchy due to their use of internal projections and unobservable measurement inputs. See Note 1: Significant Accounting Policies in these Notes for additional information regarding the fair value hierarchy and see Note 6: Goodwill and Intangible Assets in these Notes for additional information regarding the impairment of goodwill related to our business divestitures.
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| Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BUSINESS SEGMENTS | NOTE 14: BUSINESS SEGMENTS We structure our operations primarily around the products, systems and services we sell and the markets we serve and report our financial results in the following four reportable segments: SAS: including satellite space payloads, sensors and full-mission solutions; classified intelligence and cyber; airborne combat systems; and mission networks for air traffic management operations; and IMS: including multi-mission ISR systems; passive sensing and targeting; electronic attack platforms; autonomy; power and communications; networks; sensors; and the CAS disposal group, which includes aviation products and pilot training operations; and CS: including tactical communications with global communications solutions; broadband communications; integrated vision solutions; and public safety radios, system applications and equipment; and AR: including missile solutions with propulsion technologies for strategic defense, missile defense, and hypersonic and tactical systems; and space propulsion and power systems for national security space and exploration missions. Chief Operating Decision Maker (“CODM”) Our CODM is Christopher E. Kubasik, Chair and CEO. Each of our business segments are regularly reviewed by the CODM through periodic financial reporting packages to assess the segments performance, allocate resources and regularly communicate with segment management, who are part of the CODM’s executive staff. Business Segment Financial Information The following tables present revenue, expenses and operating income by segment:
_______________ ** Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. (1) Includes corporate headquarters and intersegment eliminations (2) Other segment costs include , company-funded R&D costs, selling and marketing costs, and other G&A expenses, which includes a portion of capital expenditure and depreciation and amortization costs that are disaggregated by segment under the “Disaggregation of Revenue” heading below in this Note. Unallocated Corporate Expense. Total unallocated corporate expense includes corporate items such as a portion of management and administration, legal, environmental, compensation, retiree benefits, other corporate expenses and eliminations and the FAS/CAS operating adjustment. Total unallocated corporate expense also includes the portion of corporate costs not included in management’s evaluation of segment operating performance, such as amortization of acquisition-related intangibles; additional cost of revenue related to the fair value step-up in inventory sold; merger, acquisition, and divestiture-related expenses; asset group and business divestiture-related (losses) gains, net and related impairment of goodwill; impairment of other assets; LHX NeXt implementation costs; and other items. LHX NeXt Initiative. LHX NeXt is our initiative to transform multiple functions, systems and processes to increase agility and competitiveness. The LHX NeXt effort is expected to continue for the next two years with one-time costs for workforce optimization, incremental IT expenses for implementation of new systems, third party consulting and other costs. Disaggregation of Revenue We disaggregate revenue for all four business segments by customer relationship, contract type and geographical region. We believe these categories best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
_______________ (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
_______________ (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
_______________ **Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
Our products are produced principally in the U.S. with international revenue derived primarily from exports. No revenue earned from any individual foreign country exceeded 5% of our total revenue in fiscal 2024, 2023 and 2022. Revenue from U.S. Government customers, including foreign military sales funded through the U.S. Government, whether directly or through prime contractors, by all segments as a percentage of total revenue were 76%, 76% and 74% in fiscal 2024, 2023 and 2022, respectively. Revenue from services in fiscal 2024 was 30%, 37%, 16% and 33% of total revenue in our SAS, IMS, CS and AR segments, respectively. Revenue from products and services where the end consumer is located outside the U.S., including foreign military sales funded through the U.S. Government, whether directly or through prime contractors, was $4,388 million (21% of our revenue), $4,173 million (21% of our revenue) and $3,908 million (23% of our revenue) in fiscal 2024, 2023 and 2022, respectively. Export revenue and revenue from international operations in fiscal 2024 was principally from the EMEA and APAC regions and Canada. Other selected financial information by business segment and geographical area is summarized below:
_______________ **Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. In addition to depreciation and amortization expense related to property, plant and equipment, “Depreciation and Amortization” in the table above also includes $860 million, $777 million and $596 million of amortization related to intangible assets, debt premium, debt discount, debt issuance costs and other items in fiscal 2024, 2023 and 2022, respectively. Assets by Business Segment Total assets by business segment are as follows:
_______________ (1)Identifiable intangible assets acquired in connection with business combinations were recorded as corporate assets because they benefit the entire Company. Intangible asset balances recorded as corporate assets were $7,639 million and $8,540 million at January 3, 2025 and December 29, 2023, respectively. Corporate assets also consisted of cash, income taxes receivable, deferred income taxes, deferred compensation plan assets, buildings and equipment, real estate held for development and leasing, investments, as well as any assets of businesses held for sale.
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LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES |
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| Legal Proceedings And Contingencies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
| LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES | NOTE 15: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES From time to time, as a normal incident of the nature and kind of businesses in which we are or were engaged, various claims or charges are asserted and litigation or arbitration is commenced by or against us arising from or related to matters, including but not limited to: product liability; personal injury; patents, trademarks, trade secrets or other intellectual property; labor and employment disputes; commercial or contractual disputes; strategic acquisitions or divestitures; the prior sale or use of former products allegedly containing asbestos or other restricted materials; breach of warranty; or environmental matters. Claimed amounts against us may be substantial, but may not bear any reasonable relationship to the merits of the claim or the extent of any real risk of court or arbitral awards. We record accruals for losses related to those matters against us that we consider to be probable and that can be reasonably estimated. Gain contingencies, if any, are recognized when they are realized and legal costs generally are expensed when incurred. At January 3, 2025, our accrual for the potential resolution of lawsuits, claims or proceedings that we consider probable of being decided unfavorably to us was not material. We cannot at this time estimate the reasonably possible loss or range of loss in excess of our accrual due to the inherent uncertainties and speculative nature of contested proceedings. Although it is not feasible to predict the outcome of these matters with certainty, based on available information, in the opinion of management, settlements, arbitration awards and final judgments, if any, that are considered probable of being rendered against us in litigation or arbitration in existence at January 3, 2025 were reserved against or would not have a material adverse effect on our financial condition, results of operations, cash flows or equity. Tax Audits Our tax filings are subject to audit by taxing authorities in jurisdictions where we conduct or conducted business. These audits may result in assessments of additional taxes that are subsequently resolved with the authorities or ultimately through legal proceedings. We believe we have adequately accrued for any ultimate amounts that are likely to result from these audits; however, final assessments, if any, could be different from the amounts recorded in our Consolidated Financial Statements. Additional information regarding audits and examinations by taxing authorities of our tax filings is set forth in Note 7: Income Taxes in these Notes. U.S. Government Business We are engaged in supplying products and services to various departments and agencies of the U.S. Government. We are therefore dependent on Congressional appropriations and administrative allotment of funds and may be affected by changes in U.S. Government policies. U.S. Government development and production contracts typically involve long lead times for design and development, are subject to significant changes in contract scheduling and may be unilaterally modified or canceled by the U.S. Government. Often these contracts call for successful design and production of complex and technologically advanced products or systems. We may participate in supplying products and services to the U.S. Government as either a prime contractor or as a subcontractor to a prime contractor. Disputes may arise between the prime contractor and the U.S. Government or between the prime contractor and its subcontractors and may result in litigation or arbitration between the contracting parties. Generally, U.S. Government contracts are subject to procurement laws and regulations, including the FAR, which outline uniform policies and procedures for acquiring products and services by the U.S. Government, and specific agency acquisition regulations that implement or supplement the FAR, such as the Defense Federal Acquisition Regulation Supplement. As a U.S. Government contractor, our contract costs are audited and reviewed on a continuing basis by the Defense Contract Audit Agency (“DCAA”). The DCAA also reviews the adequacy of, and a U.S. Government contractor’s compliance with, the contractor’s business systems and policies, including the contractor’s property, estimating, compensation and management information systems. In addition to these routine audits, from time to time, we may, either individually or in conjunction with other U.S. Government contractors, be the subject of audits and investigations by other agencies of the U.S. Government. These audits and investigations are conducted to determine if our performance and administration of our U.S. Government contracts are compliant with applicable contractual requirements and procurement and other applicable federal laws and regulations, including ITAR and FCPA. These investigations may be conducted with or without our knowledge or cooperation. We are unable to predict the outcome of such investigations or to estimate the amounts of resulting claims or other actions that could be instituted against us or our officers or employees. Under present U.S. Government procurement laws and regulations, if indicted or adjudged in violation of procurement or other federal laws, a contractor, such as us, or one or more of our operating divisions or subdivisions, could be subject to fines, penalties, repayments, or compensatory or treble damages. U.S. Government regulations also provide that certain findings against a contractor may lead to suspension or debarment from eligibility for awards of new U.S. Government contracts for a period of time to be determined by the U.S. Government. Suspension or debarment would have a material adverse effect on us because of our reliance on U.S. Government contracts. In addition, our export privileges could be suspended or revoked, which also would have a material adverse effect on us. For further discussion of risks relating to U.S. Government contracts, see “Item 1A. Risk Factors” of this Report. International As an international company, we are, from time to time, the subject of investigations relating to our international operations, including under U.S. export control laws (such as ITAR), the FCPA and other similar U.S. and international laws. Commercial Commitments In the normal course of business, we have entered into commercial commitments primarily relating to the guarantee of future performance on certain contracts to provide products and services to customers or to obtain insurance policies with our insurance carriers. At January 3, 2025, we had the following commercial commitments outstanding:
The surety bonds and standby letters of credit used for performance are primarily related to our Public Safety business sector. As is customary in bidding for and completing network infrastructure projects for public safety systems, contractors are required to procure surety bonds and/or standby letters of credit for bids, performance, warranty and other purposes (collectively, “Performance Bonds”). Such Performance Bonds normally have maturities of up to three years and are standard in the industry as a way to provide customers a mechanism to seek redress if a contractor does not satisfy performance requirements under a contract. Typically, a customer is permitted to draw on a Performance Bond if we do not fulfill all terms of a project contract. In such an event, we would be obligated to reimburse the financial institution that issued the Performance Bond for the amounts paid. Environmental Matters We are subject to numerous U.S. federal, state, local and international environmental laws and regulatory requirements and are involved from time to time in investigations or litigation of various potential environmental issues. We or companies we have acquired are responsible, or alleged to be responsible, for environmental investigation and/or remediation of multiple sites, including sites owned by us and third party sites. These sites are in various stages of investigation and/or remediation, and in some cases our liability is considered de minimis. Notices from the U.S. Environmental Protection Agency or equivalent state or international environmental agencies allege that several sites formerly or currently owned and/or operated by us or companies we have acquired, and other properties or water supplies that may be or have been impacted from those operations, contain disposed or recycled materials or wastes and require environmental investigation and/or remediation. These sites include instances of being identified as a potentially responsible party (“PRP”) under the Comprehensive Environmental Response, Compensation and Liability Act (commonly known as the “Superfund Act”), the Resource Conservation Recovery Act and/or equivalent state and international laws, and in some instances, our liability and proportionate share of costs that may be shared among other PRPs have not been determined largely due to uncertainties as to the nature and extent of site conditions and our involvement. As of January 3, 2025, we were named, and continue to be named, as a potentially responsible party at 111 sites where future liabilities could exist. These sites included 13 sites owned by us, 71 sites associated with our former and current locations or operations and 27 hazardous waste treatment, storage or disposal facility sites not owned by us that contain hazardous substances allegedly attributable to us from past operations. Based on an assessment of relevant factors, we estimated that our liability under applicable environmental statutes and regulations for identified sites was $637 million and $613 million, respectively, as of January 3, 2025 and December 29, 2023. The current portion of our estimated is included in the “Other current liabilities” line item and the non-current portion is included in the “Other long-term liabilities” line item in our Consolidated Balance Sheet. Some of these environmental costs are eligible for future recovery in the pricing of our products and services to the U.S. Government. We consider the recovery probable based on U.S. Government contracting regulations. As of January 3, 2025 and December 29, 2023, we had an asset for the recoverable portion of these reserves of $462 million and $432 million, respectively. The current and non-current portion of the recoverable costs are included as a component of the “Other current assets” and “Other non-current assets” line items, respectively, in our Consolidated Balance Sheet.
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Pay vs Performance Disclosure - USD ($) $ in Millions |
12 Months Ended | ||
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Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Pay vs Performance Disclosure | |||
| Net Income (Loss) | $ 1,502 | $ 1,227 | $ 1,062 |
Insider Trading Arrangements |
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| Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||
| Material Terms of Trading Arrangement | We require all executive officers and directors to effect purchase and sale transactions in L3Harris securities pursuant to a trading plan (each, a “10b5-1 Plan”) intended to satisfy the requirements of Rule 10b5-1 under the Exchange Act (“Rule 10b5-1”). We limit executive officers to a single 10b5-1 Plan in effect at any time, subject to limited exceptions in accordance with Rule 10b5-1. The following table includes the material terms (other than with respect to the price) of each 10b5-1 Plan adopted or terminated by our executive officers and directors during the quarter ended January 3, 2025:
_______________ (1) Transactions under each Rule 10b5-1 Plan commence no earlier than 90 days after adoption, or such later date as required by Rule 10b5-1. (2) Each Rule 10b5-1 Plan may expire on such earlier date as all transactions are completed. (3) Each Rule 10b5-1 Plan provides for shares to be sold on multiple predetermined dates.
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| Non-Rule 10b5-1 Arrangement Adopted | false | |||||||||||||||||||||||||||||||||||||||||||
| Rule 10b5-1 Arrangement Terminated | false | |||||||||||||||||||||||||||||||||||||||||||
| Non-Rule 10b5-1 Arrangement Terminated | false | |||||||||||||||||||||||||||||||||||||||||||
| Christopher E. Kubasik [Member] | ||||||||||||||||||||||||||||||||||||||||||||
| Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||
| Name | Christopher E. Kubasik | |||||||||||||||||||||||||||||||||||||||||||
| Title | Chair and CEO | |||||||||||||||||||||||||||||||||||||||||||
| Rule 10b5-1 Arrangement Adopted | true | |||||||||||||||||||||||||||||||||||||||||||
| Adoption Date | November 26, 2024 | |||||||||||||||||||||||||||||||||||||||||||
| Expiration Date | March 25, 2025 | |||||||||||||||||||||||||||||||||||||||||||
| Arrangement Duration | 119 days | |||||||||||||||||||||||||||||||||||||||||||
| Aggregate Available | 112,138 | 112,138 | ||||||||||||||||||||||||||||||||||||||||||
| Jonathan P. Rambeau [Member] | ||||||||||||||||||||||||||||||||||||||||||||
| Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||
| Name | Jonathan P. Rambeau | |||||||||||||||||||||||||||||||||||||||||||
| Title | President, IMS | |||||||||||||||||||||||||||||||||||||||||||
| Rule 10b5-1 Arrangement Adopted | true | |||||||||||||||||||||||||||||||||||||||||||
| Adoption Date | December 3, 2024 | |||||||||||||||||||||||||||||||||||||||||||
| Expiration Date | March 14, 2025 | |||||||||||||||||||||||||||||||||||||||||||
| Arrangement Duration | 101 days | |||||||||||||||||||||||||||||||||||||||||||
| Aggregate Available | 3,178 | 3,178 | ||||||||||||||||||||||||||||||||||||||||||
| Edward J. Zoiss [Member] | ||||||||||||||||||||||||||||||||||||||||||||
| Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||
| Name | Edward J. Zoiss | |||||||||||||||||||||||||||||||||||||||||||
| Title | President, SAS | |||||||||||||||||||||||||||||||||||||||||||
| Rule 10b5-1 Arrangement Adopted | true | |||||||||||||||||||||||||||||||||||||||||||
| Adoption Date | December 6, 2024 | |||||||||||||||||||||||||||||||||||||||||||
| Expiration Date | June 6, 2025 | |||||||||||||||||||||||||||||||||||||||||||
| Arrangement Duration | 182 days | |||||||||||||||||||||||||||||||||||||||||||
| Aggregate Available | 20,579 | 20,579 |
Insider Trading Policies and Procedures |
12 Months Ended |
|---|---|
Jan. 03, 2025 | |
| Insider Trading Policies and Procedures [Line Items] | |
| Insider Trading Policies and Procedures Adopted | true |
Cybersecurity Risk Management and Strategy Disclosure |
12 Months Ended |
|---|---|
Jan. 03, 2025 | |
| Cybersecurity Risk Management, Strategy, and Governance [Line Items] | |
| Cybersecurity Risk Management Processes for Assessing, Identifying, and Managing Threats [Text Block] | Risk Management and Strategy We assess and identify material risks from cybersecurity threats primarily through the work of our Information Security organization, which is fully integrated in our enterprise risk management (“ERM”) process in close partnership with other functions such as Engineering, Industrial Security, Internal Audit, and Legal. The ERM process, administered by management with input from each business segment and function, continuously monitors material risks facing L3Harris, including cybersecurity threats. Our Information Security organization, is led by our Chief Information Officer (“CIO”), who has extensive experience leading information technology for global organizations across aerospace, defense and industrials, and works directly with our Chief Executive Officer (“CEO”) and other members of senior management to assess cybersecurity threats as part of the ERM process. The CIO oversees the internal cybersecurity organization of more than 100 full-time employees headed by our Chief Information Security Officer (our “Cybersecurity Team”). Risks related to cybersecurity threats are reflected in an enterprise risk “heat map,” along with other material risks identified through the ERM process, and any mitigation plans developed to manage such risks are reported to our Board of Directors (“Board”). The “heat map” includes risks related to cybersecurity threats to L3Harris and our customers, suppliers, vendors, subcontractors or other third parties, and the possibility of a data breach of our confidential, personal and proprietary information through a cybersecurity incident impacting L3Harris or any third party. To actively manage cybersecurity risks identified as part of the ERM process or otherwise and to manage emerging cybersecurity threats in real time, management has implemented an ISO 27001 certified Information Security Management System. Our Cybersecurity Team operates a Security Operations Center that continuously monitors activity, frequently scans applications and systems for vulnerabilities to risk from cybersecurity threats and creates action plans to address and track identified cybersecurity threats until they have been remediated. Activities and cybersecurity incidents are reported to our CIO, who briefs senior management, including our CEO, as well as the Innovation and Cyber Committee and the Audit Committee of our Board (respectively, the “Innovation and Cyber Committee” and the “Audit Committee”), as appropriate. Our Cybersecurity Team also routinely engages with third parties, including government agencies focused on cyber resiliency, to manage risks from cybersecurity threats. For example, we are members of the DoD Defense Industrial Base Collaborative Information Sharing Environment, the National Defense Information Sharing and Analysis Center, and the National Security Agency Enduring Security Framework. These organizations share real-time cybersecurity threat information and best practices in protecting, detecting and recovering from cybersecurity threats. We are committed to safeguarding against both internal and external security threats through a robust counterintelligence and insider threat program that utilizes cutting-edge data analytics and machine learning. As a defense contractor, we are subject to the Department of Defense's cybersecurity regulations, including the Defense Federal Acquisition Regulation Supplement, ensuring the protection of Controlled Unclassified Information and prompt reporting of cybersecurity incidents. Our practices have been rigorously assessed by the Defense Contract Management Agency to meet the Level 2 Cybersecurity Maturity Model Certification requirements, reflecting our dedication to maintaining stringent security controls. To mitigate cybersecurity risks introduced from our supply chain, we have a dedicated Cybersecurity - Supply Chain Risk Management team. This team assesses new suppliers against best cybersecurity practices, ensures cybersecurity regulations are contractually flowed down and coordinates mitigation actions across the company if a supplier is impacted by a cybersecurity incident. The Supply Chain Risk Management team utilizes industry monitoring services to identify potential supply chain incidents and works closely with our Cybersecurity Team to understand the latest threats affecting our industry. Additionally, as part of our processes to manage risks related to a breach in our information systems, management requires employees to take annual cybersecurity training and shares regular awareness updates regarding cybersecurity threats. Our Cybersecurity Team regularly tests employees throughout the year to assess the effectiveness of the cybersecurity training. We also periodically conduct penetration testing of our network, hold tabletop exercises of cyber incidents, and undertake cybersecurity assessments led by Internal Audit to improve our risk mitigation and assist in the determination of a potential material impact caused by a cybersecurity incident. While we have implemented robust practices to mitigate cybersecurity risks, and prior cybersecurity threats have not materially affected our business strategy, results of operations or financial condition, we could be negatively impacted by a cybersecurity breach, through cyber-attack, cyber intrusion, insider threats, supply chain incidents, or otherwise, or other significant disruption of our IT networks and related systems or of those we operate for certain of our customers. See “Item 1A. Risk Factors” in this Report for further discussion of specific risks related to cybersecurity threats. |
| Cybersecurity Risk Management Processes Integrated [Flag] | true |
| Cybersecurity Risk Management Processes Integrated [Text Block] | We assess and identify material risks from cybersecurity threats primarily through the work of our Information Security organization, which is fully integrated in our enterprise risk management (“ERM”) process in close partnership with other functions such as Engineering, Industrial Security, Internal Audit, and Legal. The ERM process, administered by management with input from each business segment and function, continuously monitors material risks facing L3Harris, including cybersecurity threats.
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| Cybersecurity Risk Management Third Party Engaged [Flag] | true |
| Cybersecurity Risk Third Party Oversight and Identification Processes [Flag] | true |
| Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Flag] | false |
| Cybersecurity Risk Board of Directors Oversight [Text Block] | The Audit Committee provides regular oversight and review of our ERM process and other guidelines and policies governing the processes by which our CEO and senior management assess our exposure to risk, including risk from cybersecurity threats. The Innovation and Cyber Committee receives regular briefings from our CIO, Chief Information Security Officer and other members of senior management on cybersecurity threats and related matters and assists the Audit Committee in its oversight and review of our ERM process. The Innovation and Cyber Committee reviews our cybersecurity risk across the enterprise at least annually, including IT, supply chain and products and our cybersecurity strategy framework and operational posture. The Innovation and Cyber Committee also reviews our IT, data security and other systems, processes, policies, procedures and controls at least annually to (a) identify, assess, monitor and mitigate cybersecurity risks; (b) identify measures to protect and safeguard against cybersecurity threats and breaches of confidential information and data and IT infrastructure and our other assets or assets of our customers or other third parties in our possession or custody; (c) support the response and management of cybersecurity threats and data breach incidents; and (d) aid in compliance with legal and regulatory requirements governing cybersecurity or data security reporting requirements. The Innovation and Cyber Committee reports its activities to the full Board on a regular basis and makes such recommendations to the Board and management with respect to risks from cybersecurity threats and other matters as it deems necessary or appropriate.
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| Cybersecurity Risk Board Committee or Subcommittee Responsible for Oversight [Text Block] | The Audit Committee provides regular oversight and review of our ERM process and other guidelines and policies governing the processes by which our CEO and senior management assess our exposure to risk, including risk from cybersecurity threats.
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| Cybersecurity Risk Process for Informing Board Committee or Subcommittee Responsible for Oversight [Text Block] | The Innovation and Cyber Committee reports its activities to the full Board on a regular basis and makes such recommendations to the Board and management with respect to risks from cybersecurity threats and other matters as it deems necessary or appropriate.
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| Cybersecurity Risk Role of Management [Text Block] | The Audit Committee provides regular oversight and review of our ERM process and other guidelines and policies governing the processes by which our CEO and senior management assess our exposure to risk, including risk from cybersecurity threats. The Innovation and Cyber Committee receives regular briefings from our CIO, Chief Information Security Officer and other members of senior management on cybersecurity threats and related matters and assists the Audit Committee in its oversight and review of our ERM process. The Innovation and Cyber Committee reviews our cybersecurity risk across the enterprise at least annually, including IT, supply chain and products and our cybersecurity strategy framework and operational posture. The Innovation and Cyber Committee also reviews our IT, data security and other systems, processes, policies, procedures and controls at least annually to (a) identify, assess, monitor and mitigate cybersecurity risks; (b) identify measures to protect and safeguard against cybersecurity threats and breaches of confidential information and data and IT infrastructure and our other assets or assets of our customers or other third parties in our possession or custody; (c) support the response and management of cybersecurity threats and data breach incidents; and (d) aid in compliance with legal and regulatory requirements governing cybersecurity or data security reporting requirements. The Innovation and Cyber Committee reports its activities to the full Board on a regular basis and makes such recommendations to the Board and management with respect to risks from cybersecurity threats and other matters as it deems necessary or appropriate.
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| Cybersecurity Risk Management Positions or Committees Responsible [Flag] | true |
| Cybersecurity Risk Management Positions or Committees Responsible [Text Block] | The Audit Committee provides regular oversight and review of our ERM process and other guidelines and policies governing the processes by which our CEO and senior management assess our exposure to risk, including risk from cybersecurity threats. The Innovation and Cyber Committee receives regular briefings from our CIO, Chief Information Security Officer and other members of senior management on cybersecurity threats and related matters and assists the Audit Committee in its oversight and review of our ERM process. The Innovation and Cyber Committee reviews our cybersecurity risk across the enterprise at least annually, including IT, supply chain and products and our cybersecurity strategy framework and operational posture. The Innovation and Cyber Committee also reviews our IT, data security and other systems, processes, policies, procedures and controls at least annually to (a) identify, assess, monitor and mitigate cybersecurity risks; (b) identify measures to protect and safeguard against cybersecurity threats and breaches of confidential information and data and IT infrastructure and our other assets or assets of our customers or other third parties in our possession or custody; (c) support the response and management of cybersecurity threats and data breach incidents; and (d) aid in compliance with legal and regulatory requirements governing cybersecurity or data security reporting requirements. The Innovation and Cyber Committee reports its activities to the full Board on a regular basis and makes such recommendations to the Board and management with respect to risks from cybersecurity threats and other matters as it deems necessary or appropriate.
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| Cybersecurity Risk Management Expertise of Management Responsible [Text Block] | Our Information Security organization, is led by our Chief Information Officer (“CIO”), who has extensive experience leading information technology for global organizations across aerospace, defense and industrials, and works directly with our Chief Executive Officer (“CEO”) and other members of senior management to assess cybersecurity threats as part of the ERM process.
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| Cybersecurity Risk Process for Informing Management or Committees Responsible [Text Block] | Chief Information Security Officer and other members of senior management on cybersecurity threats and related matters and assists the Audit Committee in its oversight and review of our ERM process.
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| Cybersecurity Risk Management Positions or Committees Responsible Report to Board [Flag] | true |
SIGNIFICANT ACCOUNTING POLICIES (Policies) |
12 Months Ended |
|---|---|
Jan. 03, 2025 | |
| Accounting Policies [Abstract] | |
| Principles of Consolidation | Principles of Consolidation — Our Consolidated Financial Statements include the accounts of L3Harris Technologies, Inc. and its consolidated subsidiaries. As used in these Notes to the Consolidated Financial Statements, the terms “L3Harris,” “Company,” “we,” “our” and “us” refer to L3Harris Technologies, Inc. and its consolidated subsidiaries. Intercompany transactions and accounts have been eliminated.
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| Fiscal Year | Fiscal Year — Our fiscal year ends on the Friday nearest December 31. Fiscal 2024 included 53 weeks. Fiscal 2023 and fiscal 2022 each included 52 weeks.
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| Use of Estimates | Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the accompanying Consolidated Financial Statements and these Notes and related disclosures. These estimates and assumptions are based on experience and other information available prior to issuance of the accompanying Consolidated Financial Statements and these Notes. Materially different results can occur as circumstances change and additional information becomes known.
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| Reclassifications | Reclassifications — The classification of certain prior year amounts have been adjusted in our Consolidated Financial Statements and these Notes to conform to current year classifications.
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| Cash and Cash Equivalents | Cash and Cash Equivalents — Cash and cash equivalents include cash at banks and temporary cash investments with a maturity of three or fewer months when purchased. These investments include accrued interest and are carried at the lower of cost or market.
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| Fair Value Measurements | Fair Value Measurements — Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal market (or most advantageous market, in the absence of a principal market) for the asset or liability in an orderly transaction between market participants at the measurement date. Entities are required to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value, and to utilize a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted prices included within Level 1, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and inputs other than quoted prices that are observable or are derived principally from, or corroborated by, observable market data by correlation or other means. •Level 3 — Unobservable inputs that are supported by little or no market activity, are significant to the fair value of the assets or liabilities and reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability developed using the best information available in the circumstances. In certain instances, fair value is estimated using quoted market prices obtained from external pricing services. In obtaining such data from the pricing service, we have evaluated the methodologies used to develop the estimate of fair value in order to assess whether such valuations are representative of fair value, including net asset value (“NAV”). Additionally, in certain circumstances, the NAV reported by an asset manager may be adjusted when sufficient evidence indicates NAV is not representative of fair value. Financial instruments. The carrying amounts of certain of our financial instruments reflected in our Consolidated Balance Sheet, including cash and cash equivalents, accounts receivable, non-current receivables, notes receivable, accounts payable and short-term debt, approximate their fair values. Fair values for long-term fixed-rate debt are primarily based on quoted market prices for those or similar instruments. See Note 8: Debt and Credit Arrangements in these Notes for additional information regarding fair values for our long-term fixed-rate debt. A discussion of fair values for our derivative financial instruments is included under the caption “Financial Instruments and Risk Management” in this Note.
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| Accounts Receivable | Accounts Receivable — We record receivables derived from contracts with customers at net realizable value and they generally do not bear interest. This value includes an allowance for estimated uncollectible accounts to reflect any losses anticipated on the accounts receivable balances which is charged to the provision for doubtful accounts. We calculate this allowance at inception based on expected loss over the life of the receivable. We consider historical write-offs by customer, level of past due accounts and economic status of the customer. A receivable is considered delinquent if it is unpaid after the term of the related invoice has expired. Write-offs are recorded at the time a customer receivable is deemed uncollectible.
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| Contract Assets and Liabilities, Revenue Recognition, Bill-and-Hold Arrangements, and Backlog | Contract Assets and Liabilities — The timing of revenue recognition, customer billings and cash collections results in accounts receivable, contract assets and contract liabilities at the end of each reporting period. Contract assets mainly represent unbilled amounts typically resulting from revenue recognized exceeding amounts billed to customers for contracts utilizing the POC cost-to-cost revenue recognition method. Contract assets become receivables as we bill customers as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, upon achievement of contractual milestones or upon deliveries and, in certain arrangements, the customer may withhold payment of a portion of the contract price until contract completion. Contract liabilities include advance payments and billings in excess of revenue recognized, including deferred revenue. Contract assets and liabilities are reported on a contract-by-contract basis at the end of each reporting period. Contract assets related to amounts withheld by customers until contract completion are not considered a significant financing component of our contracts because the intent is to protect the customers from our failure to satisfactorily complete our performance obligations. Payments received from customers in advance of revenue recognition are not considered a significant financing component of our contracts because they are utilized to pay for contract costs within a one-year period or are requested by us to ensure the customers meet their payment obligations. Revenue Recognition — We account for a contract when it has approval and commitment from all parties, the rights and payment terms of the parties can be identified, the contract has commercial substance and the collectability of the consideration, or transaction price, is probable. Our contracts are often subsequently modified to include changes in specifications, requirements or price that may create new or change existing enforceable rights and obligations. We do not account for contract modifications (including unexercised options) or follow-on contracts until they meet the requirements noted above to account for a contract. We categorize revenue and costs for performance obligations to provide tangible goods as “product” and revenue and costs for performance obligations to provide services for which the principal result is not to produce anything tangible as “service.” In instances where a single performance obligation requires us to deliver products and perform services, we derive the product and service categories presented in our financial statements based upon the predominant nature of each performance. In these cases, we classify the revenue and costs from the entire performance obligation based on the nature of the overall promise made to the customer. At the inception of each contract, we evaluate the promised products and services to determine whether the contract should be accounted for as having one or more performance obligations. A performance obligation is a promise to transfer a distinct product or service to a customer and represents the unit of accounting for revenue recognition. A substantial majority of our revenue is derived from long-term development and production contracts involving the design, development, manufacture or modification of defense products and related services according to the customers’ specifications. Due to the highly interdependent and interrelated nature of the underlying products and services and the significant service of integration that we provide, which often results in the delivery of multiple units, we account for these contracts as one performance obligation. For contracts that include both development/production and follow-on support services (for example, operations and maintenance), we generally consider the follow-on services distinct in the context of the contract and account for them as separate performance obligations. Additionally, we recognize revenue from contracts to provide multiple distinct products to a customer for which the products can readily be sold to other customers based on their commercial nature and, accordingly, these products are accounted for as separate performance obligations. Shipping and handling costs incurred after control of a product has transferred to the customer (for example, in free on board shipping arrangements) are treated as fulfillment costs and, therefore, are not accounted for as separate performance obligations. Also, we record taxes collected from customers and remitted to governmental authorities on a net basis such that they are excluded from revenue. As noted above, our contracts are often subsequently modified to include changes in specifications, requirements or price. Depending on the nature of the modification, we consider whether to account for the modification as an adjustment to the existing contract or as a separate contract. Often, the deliverables in our contract modifications are not distinct from the existing contract due to the significant integration and interrelated tasks provided in the context of the contract. Therefore, such modifications are accounted for as if they are part of the existing contract, and we may be required to recognize a cumulative catch-up adjustment to revenue at the date of the contract modification. We determine the transaction price for each contract based on our best estimate of the consideration we expect to receive, which includes assumptions regarding variable consideration such as award and incentive fees. These variable amounts are generally awarded upon achievement of certain negotiated performance metrics, program milestones or cost targets and can be based upon customer discretion. We include such estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. We estimate variable consideration primarily using the most likely amount method. For contracts with multiple performance obligations, we allocate the transaction price to each performance obligation based on the relative standalone selling price of the product or service underlying each performance obligation. The standalone selling price represents the amount for which we would sell the product or service to a customer on a standalone basis (i.e., not sold as a bundle with any other products or services). Our contracts with the U.S. Government, including foreign military sales contracts, are subject to the FAR and the prices of our contract deliverables are typically based on our estimated or actual costs plus margin. As a result, the standalone selling prices of the products and services in these contracts are typically equal to the selling prices stated in the contract, thereby eliminating the need to allocate (or reallocate) the transaction price to the multiple performance obligations. In our non-U.S. Government contracts, we also generally use the expected cost plus margin approach to determine standalone selling price. In addition, we determine standalone selling price for certain contracts that are commercial in nature based on observable selling prices. We recognize revenue for each performance obligation when (or as) the performance obligation is satisfied by transferring control of the promised products or services underlying the performance obligation to the customer. The transfer of control can occur over-time or at a point in time. A significant portion of our business is derived from development and production contracts. Revenue and profit related to development and production contracts are generally recognized over-time, typically using the POC cost-to-cost method of revenue recognition, whereby we measure our progress towards completion of the performance obligation based on the ratio of costs incurred to date to estimated costs at completion under the contract. Because costs incurred represent work performed, we believe this method best depicts the transfer of control of the asset to the customer. Under the POC cost-to-cost method of revenue recognition, a single estimated profit margin is used to recognize profit for each performance obligation over its period of performance. To a lesser extent, we also recognize revenue from contracts to provide multiple distinct products to a customer that are commercial in nature and can readily be sold to other customers. These performance obligations do not meet the criteria listed below to recognize revenue over-time; therefore, we recognize revenue at a point in time, generally when the products are received and accepted by the customer. Point-in-Time Revenue Recognition. Our performance obligations are satisfied at a point in time unless they meet at least one of the following criteria, in which case they are satisfied over-time: •The customer simultaneously receives and consumes the benefits provided by our performance as we perform; •Our performance creates or enhances an asset (for example, work in process) that the customer controls as the asset is created or enhanced; or •Our performance does not create an asset with an alternative use to us and we have an enforceable right to payment for performance completed to date. Over-Time Revenue Recognition. For U.S. Government development and production contracts, there is generally a continuous transfer of control of the asset to the customer as it is being produced based on FAR clauses in the contract that provide the customer with lien rights to work in process and allow the customer to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. This also typically applies to our contracts with prime contractors for U.S. Government development and production contracts, when the above-described FAR clauses are flowed down to us by the prime contractors. Our non-U.S. Government development and production contracts, including international direct commercial contracts and U.S. contracts with state and local agencies, utilities, commercial and transportation organizations, often do not include the FAR clauses described above. However, over-time revenue recognition is typically supported either through our performance creating or enhancing an asset that the customer controls as it is created or enhanced or based on other contractual provisions or relevant laws that provide us with an enforceable right to payment for our work performed to date plus a reasonable profit if our customer were permitted to and did terminate the contract for reasons other than our failure to perform as promised. For performance obligations to provide services that are satisfied over-time, we recognize revenue either on a straight-line basis, the POC cost-to-cost method or based on the right-to-invoice method (i.e., based on our right to bill the customer), depending on which method best depicts transfer of control to the customer. Contract Estimates. Under the POC cost-to-cost method of revenue recognition, a single estimated profit margin is used to recognize profit for each performance obligation over its period of performance. Recognition of profit on a contract requires estimates of the total cost at completion and transaction price and the measurement of progress towards completion. Due to the long-term nature of many of our contracts, developing the estimated total cost at completion and total transaction price often requires judgment. Factors that must be considered in estimating the cost of the work to be completed include the nature and complexity of the work to be performed, subcontractor performance and the risk and impact of delayed performance. Factors that must be considered in estimating the total transaction price include contractual cost or performance incentives (such as incentive fees, award fees and penalties) and other forms of variable consideration, as well as our historical experience and our expectation for performance on the contract. At the outset of each contract, we gauge its complexity and perceived risks and establish an estimated total cost at completion in line with these expectations. We follow a standard EAC process in which we review the progress and performance on our ongoing contracts. If we successfully retire risks associated with the technical, schedule and cost aspects of a contract, we may lower our estimated total cost at completion commensurate with the retirement of these risks. Conversely, there are many reasons estimated contract costs can increase, including: (i) supply chain disruptions, inflation and labor issues; (ii) design or other development challenges; and (iii) program execution challenges (including from technical or quality issues and other performance concerns). Additionally, as the contract progresses, our estimates of total transaction price may increase or decrease if, for example, we receive incentive or award fees that are higher or lower than expected. When changes in estimated total costs at completion or in estimated total transaction price are determined, the related impact on operating income is recognized on a cumulative basis. EAC adjustments represent the cumulative effect of the changes from current and prior periods; revenue and operating margins in future periods are recognized as if the revised estimates had been used since contract inception. Any anticipated losses on these contracts are fully recognized in the period in which the losses become evident. Bill-and-Hold Arrangements. For certain contracts, the finished product may temporarily be stored at our location under a bill-and-hold arrangement. Revenue is recognized on bill-and-hold arrangements at the point in time when the customer obtains control of the product and all of the following criteria have been met: the arrangement is substantive (for example, the customer has requested the arrangement); the product is identified separately as belonging to the customer; the product is ready for physical transfer to the customer; and we do not have the ability to use the product or direct it to another customer. In determining when the customer obtains control of the product, we consider certain indicators, including whether we have a present right to payment from the customer, whether title and/or significant risks and rewards of ownership have transferred to the customer and whether customer acceptance has been received (in the case of arrangements with customer acceptance provisions). Backlog. Backlog, which is the equivalent of our remaining performance obligations, represents the future revenue we expect to recognize as we perform on our current contracts. Backlog comprises both funded backlog (i.e., firm orders for which funding is authorized or appropriated) and unfunded backlog (i.e., orders for which funds have not been appropriated and/or incrementally funded). Backlog excludes unexercised contract options and potential orders under ordering-type contracts, such as IDIQ contracts.
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| Inventories | Inventories — Inventories are valued at the lower of cost (determined by average and first-in, first-out methods) or net realizable value. We regularly review inventory quantities on hand and record a provision for excess and obsolete inventory primarily based on our estimated forecast of product demand, anticipated end of product life and production requirements.
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| Property, Plant and Equipment | Property, Plant and Equipment — Property, plant and equipment, including software capitalized for internal use, is recorded at cost and depreciated on a reasonable and systematic basis, typically the straight-line method, over the estimated useful life of the asset. Estimated useful lives generally range as follows: buildings, including leasehold improvements, between and 45 years; machinery and equipment between and 10 years; and software capitalized for internal-use between and 10 years. We review property, plant and equipment for impairment whenever events or changes in circumstances indicate the carrying amount of the asset may not be recoverable.
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| Goodwill | Goodwill — We follow the acquisition method of accounting to record the assets and liabilities of acquired businesses at their estimated fair value at the date of acquisition. We initially record goodwill for the amount the consideration transferred exceeds the acquisition-date fair value of net identifiable assets acquired. We test goodwill for impairment at a level within the Company referred to as the reporting unit, which is our business segment level or one level below the business segment. Goodwill is tested for impairment annually as of the first business day of our fourth fiscal quarter, or under certain circumstances more frequently, such as when events or circumstances indicate there may be impairment. Such events or circumstances may include a significant deterioration in overall economic conditions, changes in the business climate of our industry, a decline in our market capitalization, operating performance indicators, competition, reorganizations of our business or the disposal of all or a portion of a reporting unit. To test goodwill for impairment, we may perform both qualitative and quantitative assessments. If we elect to perform a qualitative assessment for a certain reporting unit, we evaluate events and circumstances impacting the reporting unit to determine the probability that goodwill is impaired. If we perform a quantitative assessment for a certain reporting unit, we calculate the fair value of that reporting unit and compare the fair value to the reporting unit’s net book value. We estimate fair values of our reporting units based on projected cash flows, and sales and/or earnings multiples applied to the latest twelve months’ sales and earnings of our reporting units. Projected cash flows are based on our best estimate of future revenues, operating costs and balance sheet metrics reflecting our view of the financial and market conditions of the underlying business; and the resulting cash flows are discounted using an appropriate discount rate that reflects the risk in the forecasted cash flows. Revenue and earnings multiples are based on current multiples of revenues and earnings for similar businesses, and based on revenue and earnings multiples paid for recent acquisitions of similar businesses made in the marketplace. We then assess whether any implied control premium, based on a comparison of fair value based purely on our stock price and outstanding shares with fair value determined by using all of the above-described models, is reasonable. If we determine it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, we measure any impairment loss by comparing the fair value of each reporting unit to its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, goodwill is considered impaired, and an impairment loss is recognized in an amount equal to that excess.
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| Intangible Assets | Intangible Assets — Our finite-lived intangible assets are amortized to expense over their applicable useful lives, either according to the underlying economic benefit as reflected by future net cash inflows or on a straight-line basis depending on the nature of the asset, generally ranging between to 20 years. We review finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. We evaluate the recoverability of such assets based on the expectations of undiscounted cash flows from such assets. If the sum of the expected future undiscounted cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and the carrying amount. Our most significant finite-lived intangible asset is customer relationships that are established through written customer contracts (i.e., revenue arrangements). The fair value for customer relationships is determined, as of the date of acquisition, based on estimates and judgments regarding expectations for the estimated future after-tax earnings and cash flows arising from the follow-on revenues expected from the customer relationships over the estimated lives, including the probability of expected future contract renewals and revenues, less a contributory assets charge, all of which is discounted to present value. Indefinite-lived intangible assets are tested annually for impairment, or under certain circumstances, more frequently, such as when events or circumstances indicate there may be an impairment. This testing compares the fair value of the asset to its carrying amount, and, when appropriate, the carrying amount of these assets is reduced to its fair value.
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| Leases | Leases — We recognize right-of-use (“ROU”) assets and lease liabilities in our Consolidated Balance Sheet for operating and finance leases under which we are the lessee. As a practical expedient, leases with a term of twelve months or less (including reasonably certain extension periods) and leases with expected lease payments of less than $250 thousand are expensed as incurred in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations. ROU assets and lease liabilities are recognized based on the present value of future lease payments, which are primarily base rent. We have some lease payments that are based on an index and changes to the index are treated as variable lease payments and recognized in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations in the period in which the obligation for those payments is incurred. Our lease payments also include non-lease components such as real estate taxes and common-area maintenance costs. As a practical expedient, we account for lease and non-lease components as a single component. For certain leases, the non-lease components are variable and are therefore excluded from lease payments to determine the ROU asset. The present value of future lease payments is determined using our incremental borrowing rate at lease commencement over the expected lease term. We use our incremental borrowing rate because our leases do not provide an implicit lease rate. The expected lease term represents the number of years we expect to lease the property, including options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating lease cost and finance lease amortization are recognized on a straight-line basis over the expected lease term in the “Cost of revenue” and “General and administrative expenses” line items in our Consolidated Statement of Operations. Interest on finance lease liabilities is recognized in the “Interest expense, net” line item in our Consolidated Statement of Operations.
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| Income Taxes | Income Taxes — We follow the asset and liability method of accounting for income taxes. We record deferred tax assets and liabilities for differences between the tax basis of assets and liabilities and amounts reported in our Consolidated Balance Sheet, as well as operating loss and tax credit carryforwards. We follow specific and detailed guidelines in each tax jurisdiction regarding the recoverability of any tax assets recorded on the balance sheet and provide necessary valuation allowances as required. We regularly review our deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. We have elected to account for tax on Global Intangible Low-Taxed Income as a current-period expense when incurred.
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| Foreign Currency Translation | Foreign Currency Translation — Assets and liabilities of international subsidiaries that use local currency as the functional currency, are translated at current rates of exchange and income and expense items are translated at the weighted average exchange rate for the year. The resulting translation adjustments are recorded as a component of the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet.
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| Share-Based Compensation | Share-Based Compensation — We measure compensation cost for all share-based awards (including employee stock options) at fair value and recognize cost over the vesting period, with forfeitures recognized as they occur. It is our practice to issue shares when options are exercised. RSUs. RSUs granted under our L3Harris SIPs are not transferable until vested and the restrictions generally lapse upon the achievement of continued employment (or board membership) over a specified time period. The grant-date fair value of these awards was based on the closing price of our common stock on the grant date and is amortized to compensation expense over the vesting period. PSUs. At January 3, 2025, all outstanding PSUs granted under our L3Harris SIPs are subject to performance criteria, such as meeting predetermined operating income or earnings per share, return on invested capital targets and market conditions, such as total shareholder return, for a three-year performance period. These awards also generally vest after a three-year performance period. The final determination of the number of shares to be issued in respect of an award is made by our Board or a committee thereof. The grant-date fair value of awards with market conditions was determined based on a multifactor Monte Carlo valuation model that simulates our stock price and TSR relative to other companies in the S&P 500, less a discount to reflect the delay in payments of cash dividend-equivalents that are made only upon vesting. The fair value of these awards is amortized to compensation expense over the performance period if achievement of the performance measures is considered probable.Stock Options. Exercise prices for stock options, including performance stock options, that have been granted under the L3Harris SIPs are equal to or greater than the fair market value of our common stock on the grant date, using the closing stock price of our common stock. Stock options may be exercised for a period of ten years after the date of grant, and stock options, other than performance stock options, generally become exercisable in installments, which are typically 33.3% one year from the grant date, 33.3% two years from the grant date and 33.3% three years from the grant date. In certain instances, vesting and exercisability are also subject to performance criteria.
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| Share Repurchases | Share Repurchases — Repurchased common shares are permanently retired. As we repurchase our common shares, we reduce common stock for the par value and allocate any excess purchase price over par value to paid-in capital and retained earnings.
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| Retirement Benefits | Retirement Benefits — We sponsor various pension and other postretirement defined benefit plans. The funded or unfunded position of each defined benefit plan is recorded in our Consolidated Balance Sheet. Funded status is derived by subtracting the respective year-end values of the PBO from the fair value of plan assets. Actuarial gains and losses and prior service credits and costs are recorded, net of income taxes, in the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet until they are amortized as a component of net periodic benefit income in the “Non-service FAS pension income and other, net” line item in our Consolidated Statement of Operations. The determination of the PBO and the recognition of net periodic benefit income related to defined benefit plans depend on various assumptions, including discount rates, expected return on plan assets, the rate of future compensation increases, mortality, termination and health care cost trend rates. We develop each assumption using relevant Company experience in conjunction with market-related data. Actuarial assumptions are reviewed annually with third-party consultants and adjusted as appropriate. For the recognition of net periodic benefit income, we use a market-related value of plan assets to calculate the expected return on plan assets. The market-related value of plan assets is based on yearly average asset values at the measurement date over the last five years, with investment gains or losses to be phased in over five years. Net actuarial gains and losses are amortized to the net periodic benefit income using the corridor approach, where the net gains and losses in excess of 10% of the greater of the PBO or the market-related value of plan assets are amortized for each plan over the estimated future life expectancy or, if applicable, the average remaining service period of the plan’s active participants. The fair value of plan assets is determined based on market prices or estimated fair value at the measurement date. The measurement date for valuing defined benefit plan assets and obligations is the end of the month closest to our fiscal year end.
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| Environmental Expenditures | Environmental Expenditures — We generally capitalize environmental expenditures that increase the life or efficiency of property or that reduce or prevent environmental contamination. We accrue environmental expenses resulting from existing conditions that relate to past or current operations. Our accruals for environmental expenses are recorded on a site-by-site basis when it is probable a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies available to us. Our accruals for environmental expenses represent the best estimates related to the investigation and remediation of environmental media such as water, soil, soil vapor, air and structures, as well as related legal fees and regulatory agency oversight fees, and are reviewed periodically, at least annually at the year-end balance sheet date, and updated for progress of investigation and remediation efforts and changes in facts and legal circumstances. If the timing and amount of future cash payments for environmental liabilities are fixed or reliably determinable, we generally discount such cash flows in estimating our accrual. The relevant factors we considered in estimating our potential liabilities under applicable environmental statutes and regulations included some or all of the following as to each site: incomplete information regarding particular sites and other potentially responsible parties; uncertainty regarding the extent of investigation or remediation; our share, if any, of liability for such conditions; the selection of alternative remedial approaches; changes in environmental standards and regulatory requirements; probable insurance proceeds; cost-sharing agreements with other parties; and potential indemnification from successor and predecessor owners of these sites.
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| Derivative Financial Instruments and Hedging Activities | Derivative Financial Instruments and Hedging Activities — We recognize all derivatives in our Consolidated Balance Sheet at fair value. These financial instruments are marked-to-market using forward prices and fair value quotes and are categorized in Level 2 of the fair value hierarchy. Derivatives that are not hedges are adjusted to fair value through income. If the derivative qualifies and is designated as a hedge, it must be documented as such at the inception of the hedge. Depending on the nature of the hedge, changes in the fair value of the derivative are either offset against the change in fair value of assets, liabilities or firm commitments through earnings or recognized in other comprehensive income (loss) until the hedged item is recognized in earnings. Gains and losses in accumulated other comprehensive income (loss) are reclassified to earnings when the related hedged item is recognized in earnings. The cash flow impact of our derivatives is included in the same category in our Consolidated Statement of Cash Flows as the cash flows of the related hedged items. We do not hold or issue derivatives for speculative trading purposes.
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| EPS | EPS — EPS is calculated as net income per common share attributable to L3Harris Technologies, Inc. common shareholders divided by our weighted average number of basic or diluted shares outstanding. Potential dilutive common shares primarily consist of employee stock options and restricted and performance unit awards.
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| Business Segments | Business Segments — We evaluate each of our business segments based on its operating income or loss. Intersegment revenues are generally transferred at cost to the buying segment, and the sourcing segment recognizes a profit that is eliminated. The elimination of intersegment revenues is included in the “other” line item in Note 14: Business Segments in these Notes. Corporate expenses are primarily allocated to our business segments using an allocation methodology prescribed by U.S. Government regulations for government contractors. The “Unallocated corporate department expense” line item in Note 14: Business Segments in these Notes represents the portion of corporate expenses that are not included in management’s evaluation of segment operating performance or elimination of intersegment profits. FAS/CAS Operating Adjustment. We calculate and allocate a portion of our defined benefit plan costs to our U.S. Government contracts in accordance with CAS. However, our Consolidated Financial Statements require we calculate our defined benefit plan costs (net periodic benefit income) in accordance with FAS requirements. The non-service cost component of net periodic benefit income is included in the “Non-service FAS pension income and other, net” line item in our Consolidated Statement of Operations. See Note 9: Retirement Benefits in these Notes for additional information regarding our defined benefit plans and composition of net periodic benefit income.
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| R&D | R&D — Company-funded R&D costs are expensed as incurred and are included in the “General and administrative expenses” line item in our Consolidated Statement of Operations. These costs were $515 million, $480 million and $603 million in fiscal 2024, 2023, and 2022, respectively. Customer-funded R&D costs are incurred pursuant to contractual arrangements, principally U.S. Government- sponsored contracts requiring us to provide a product or service meeting certain defined performance or other specifications (such as designs), and such contractual arrangements are accounted for principally by the POC cost- to-cost revenue recognition method. Customer-funded R&D is included in the “Revenue” and “Cost of revenue” line items in our Consolidated Statement of Operations.
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| Recent Accounting Pronouncements | Recent Accounting Pronouncements — In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”) which requires additional segment disclosures on an annual and interim basis, including significant segment expenses that are regularly provided to the chief operating decision maker. The standard does not change how operating segments and reportable segments are determined. ASU 2023-07 is effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024 and is required to be applied retrospectively to all periods presented in the consolidated financial statements. We adopted this standard in fiscal 2024 and applied the provisions to our business segment disclosure. See Note 14: Business Segments in these Notes for further information. The adoption of 2023-07 did not have any impact on our operating results, financial position, or cash flows. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires disaggregated income tax disclosures on an annual basis, including information on our effective income tax rate reconciliation and income taxes paid. ASU 2023-09 is effective for annual reporting periods beginning after December 15, 2024, and may be applied prospectively or retrospectively. We are evaluating the impact of ASU 2023-09 and expect the standard will only impact our income taxes disclosures with no material impact on our operating results, financial position, or cash flows. In March 2024, the SEC issued SEC Release Nos. 33-11275 and 34-99678, The Enhancement and Standardization of Climate-Related Disclosures for Investors, which requires climate-related disclosures in annual reports and registration statements. In April 2024, the SEC released an order staying this final rule pending judicial review of all the petitions challenging the rule. If enacted, the rule would require disclosure of material climate- related risks, our governance and risk management of climate-related risks and any material climate-related targets or goals, greenhouse gas emissions as well as disclosure of the financial statement effects, such as costs and losses resulting from severe weather events and other natural conditions. We are evaluating the impact of the rule and related litigation on our disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income— Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) which requires disclosure, in the notes to financial statements, of specified information about certain costs and expenses included in each expense caption on the face of the income statement at interim and annual reporting periods. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, and should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. We are evaluating the impact of ASU 2024-03 and expect the standard will only impact our disclosures with no material impact on our operating results, financial position, or cash flows.
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SIGNIFICANT ACCOUNTING POLICIES (Tables) |
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| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Net Estimated at Completion ("EAC") Adjustments | Net EAC adjustments had the following impact to earnings for the periods presented:
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| Schedule of Selected Financial Information by Business Segments | The difference between CAS pension cost and the service cost component of net periodic benefit income (“FAS pension service cost”) is reflected in the “FAS/CAS operating adjustment,” which is included as a component of Unallocated corporate department expense line item in Note 14: Business Segments in these Notes.
_______________ ** Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. (1) Includes corporate headquarters and intersegment eliminations (2) Other segment costs include , company-funded R&D costs, selling and marketing costs, and other G&A expenses, which includes a portion of capital expenditure and depreciation and amortization costs that are disaggregated by segment under the “Disaggregation of Revenue” heading below in this Note. Other selected financial information by business segment and geographical area is summarized below:
_______________ **Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information.
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EARNINGS PER SHARE (Tables) |
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| Schedule of Earnings Per Share, Basic and Diluted | The weighted average number of shares outstanding used to compute basic and diluted EPS are as follows:
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CONTRACT ASSETS AND CONTRACT LIABILITIES (Tables) |
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| Schedule of Contract Assets and Contract Liabilities | Contract assets and contract liabilities are summarized below:
_______________ (1)The non-current portion of contract liabilities is included as a component of the “Other long-term liabilities” line item in our Consolidated Balance Sheet.
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INVENTORIES, NET (Tables) |
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| Schedule of Inventories | Inventories, net are summarized below:
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PROPERTY, PLANT AND EQUIPMENT, NET (Tables) |
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| Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||
| Schedule of Property, Plant and Equipment | Property, plant and equipment, net, are summarized below:
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GOODWILL AND INTANGIBLE ASSETS (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Changes in Carrying Amounts of Goodwill | Changes in the carrying amount of goodwill, by business segment, were as follows:
_______________ **Our AR segment, which is also the AR reporting unit, was established in connection with the AJRD acquisition and consists of assets, liabilities and operations assumed. As such, there is no comparable prior year information. See Note 13: Acquisitions and Divestitures in these Notes for further information. (1)CS: Goodwill recognized in connection with the TDL acquisition is included in our Broadband reporting unit within our CS segment. AR: Goodwill recognized in connection with the AJRD acquisition is included within the AR Reporting unit, which is also our AR segment. (2)SAS: Goodwill (net of impairment) derecognized in connection with the Antenna disposal group divestiture. See discussion under “Goodwill Impairments" below. AR: Goodwill derecognized in connection with the AOT disposal group divestiture. See Note 13: Acquisitions and Divestitures in these Notes for further information.
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| Schedule of Indefinite-Lived Intangible Assets | Intangible assets, net, are summarized below:
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| Schedule of Finite-Lived Intangible Assets | Intangible assets, net, are summarized below:
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| Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Future estimated amortization expense for intangible assets is as follows:
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INCOME TAXES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Provision For Income Tax | Our provisions for current and deferred income taxes are as follows:
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| Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the U.S. statutory income tax rate to our effective income tax rate is as follows:
_______________ (1)Includes non-deductible share-based compensation and excess tax benefits from share-based compensation.
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| Schedule of Deferred Tax Assets, Net of Valuation Allowance | The components of deferred income tax assets (liabilities) were as follows:
_______________ (1)At January 3, 2025, primarily includes operating loss and credit carryforwards of $81 million and $165 million, respectively, which have expiration dates ranging from less than one year to no expiration date. A significant portion of the carryforwards are either indefinite or begin expiring in 2035. (2)Valuation allowance established to offset certain domestic and foreign deferred tax assets due to the uncertainty regarding our ability to realize these assets in the future. The net change in our valuation allowance in fiscal 2024 and 2023 was a decrease of $2 million and $3 million, respectively. (3)Based on recent IRS guidance, we made a method change to defer taxable income for long-term contracts accounted for under the POC cost-to-cost method that include deferred R&D expenses, resulting in a $913 million reduction in our current income taxes (current payable) and corresponding increase to our deferred income taxes (deferred tax liability). Net deferred tax assets (liabilities) were classified as follows in our Consolidated Balance Sheet:
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| Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
_______________ (1)Includes unrecognized tax benefits that would favorably impact our future tax rates in the event that the tax benefits are eventually recognized of $666 million and $509 million at January 3, 2025 and December 29, 2023, respectively.
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DEBT AND CREDIT ARRANGEMENTS (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Long-term Debt, Net | Long-term debt, net, is summarized below:
_______________ (1)All fixed-rate notes and debentures rank equally in right of payment. (2)We may redeem these notes, in whole or in part, at our option, at a pre-determined redemption price pursuant to their terms prior to the applicable maturity date. (3)Upon change of control combined with a below-investment-grade rating event, we may be required to make an offer to repurchase these notes at a pre-determined price pursuant to their terms. (4)The debentures are not redeemable prior to maturity. (5)Collectively, the “AJRD Notes.”
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| Schedule of Estimated Fair Values of Long-term Debt | The following table presents the carrying amounts and estimated fair values of our long-term debt:
_______________ (1)The carrying value of Term Loan 2025 approximates fair value due to its variable interest rate. (2)The fair value was estimated using a market approach based on quoted market prices for our debt traded in the secondary market. If long- term debt were measured at fair value in our consolidated balance sheet, it would be categorized as Level 2 within the fair value hierarchy.
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RETIREMENT BENEFITS (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Fair Value of Deferred Compensation Plan Investments and Liabilities by Category and Fair Value Hierarchy Level | The following table provides the fair value of our deferred compensation plan investments and liabilities by category and by fair value hierarchy level:
_______________ (1)Represents diversified assets held in rabbi trusts primarily associated with our non-qualified deferred compensation plans, which are measured at fair value and included in the “Other current assets” and “Other non-current assets” line items in our Consolidated Balance Sheet. In fiscal 2024, we contributed $100 million to our rabbi trust assets. (2)Primarily represents obligations to pay benefits under certain non-qualified deferred compensation plans, which we include in the “Compensation and benefits” and “Other long-term liabilities” line items in our Consolidated Balance Sheet. Under these plans, participants designate investment options (including stock and fixed-income funds), which serve as the basis for measurement of the notional value of their accounts.
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| Schedule of Roll-forward of Projected Benefit Obligation | The following table summarizes the funded status of our defined benefit plans:
_______________ (1)Fiscal 2024 includes approximately $333 million associated with the purchase of group annuity policies and transfer of plan assets to an insurance company. The transaction is reflected in this caption as settlement accounting had not been met. (2)PBO assumed and plan assets acquired in the AJRD acquisition. Net defined benefit plan liability is included in our “Other long-term liabilities” and “Compensation and benefits” line items in “Acquisition of AJRD” section of Note 13: Acquisitions and Divestitures.
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| Schedule of Roll-forward of Plan Assets | The following table summarizes the funded status of our defined benefit plans:
_______________ (1)Fiscal 2024 includes approximately $333 million associated with the purchase of group annuity policies and transfer of plan assets to an insurance company. The transaction is reflected in this caption as settlement accounting had not been met. (2)PBO assumed and plan assets acquired in the AJRD acquisition. Net defined benefit plan liability is included in our “Other long-term liabilities” and “Compensation and benefits” line items in “Acquisition of AJRD” section of Note 13: Acquisitions and Divestitures.
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| Schedule of Funded Status of Defined Benefit Plans and Balance Sheet Information | The following table summarizes amounts recognized in our Consolidated Balance Sheet:
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| Schedule of Pre-tax Amounts Recognized in Other Comprehensive Income (Loss) | The following table summarizes pre-tax amounts recognized in the “Accumulated other comprehensive income (loss)” line item in our Consolidated Balance Sheet:
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| Schedule of Accumulated Benefit Obligations | The following table provides information for our defined benefit plans with PBO in excess of plan assets:
for our defined benefit plans with ABO in excess of plan assets:
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| Schedule of Components of Net Benefit Income | The following table provides the components of net periodic benefit income and other amounts recognized in other comprehensive income:
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| Schedule of Weighted-average Assumptions Used | The following table presents the weighted-average assumptions used to determine the benefit obligation:
_______________ (1)Key assumptions for our Consolidated Pension Plan include a discount rate of 5.49%, cash balance interest crediting rate of 4.50% and a 4.25% interest crediting rate for the frozen pension equity benefit. The following table presents the weighted-average assumptions used to determine net periodic benefit income:
_______________ (1)Key assumptions for our Consolidated Pension Plan include expected return on plan assets of 7.50%, which is being maintained at 7.50% for fiscal 2025.
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| Schedule of Strategic Target Assets Allocation and Fair Value of Plan Assets | The following table provides the current strategic target asset allocation ranges by asset category:
and by fair value hierarchy level:
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| Schedule of Expected Benefit Payments | The following table provides the projected timing of payments for benefits earned to date and benefits expected to be earned for future service by current active employees under our defined benefit plans:
_______________ (1)Projected payments for Other Benefits reflect net payments from the Company, which include subsidies that reduce the gross payments by less than 1%.
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SHARE-BASED COMPENSATION (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Classification of Share-based Compensation Expense | The following table summarizes the share-based compensation expense recognized in the Consolidated Statement of Operations:
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| Schedule of Restricted Stock Units Activity | The following table summarizes the activity of RSUs during fiscal 2024:
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| Schedule of Performance Shares Activity | The following table summarizes the activity of PSUs during fiscal 2024:
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| Schedule of Assumptions Used In Calculating Fair Value of Stock Option Grants | The grant-date fair value of each stock option award was determined using the Black-Scholes-Merton option- pricing model which used assumptions noted in the following table:
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| Schedule of Stock Option Activity | The following table summarizes the stock option activity during fiscal 2024:
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| Schedule of Nonvested Stock Options Activity | The following table summarizes the unvested stock option activity during fiscal 2024:
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LEASES (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Lease Expense and Supplemental Lease Information | Components of lease costs included in our Consolidated Statement of Operations are as follows:
______________ (1) Consists of finance lease amortization and interest costs as well as sublease income. Other supplemental lease information is as follows:
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| Schedule of Supplemental Balance Sheet Information | ROU assets and lease liabilities included in our Consolidated Balance Sheet are as follows:
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| Schedule of Future Lease Payments Under Non-Cancelable Operating Leases | Maturities of non-cancelable operating and finance lease liabilities at January 3, 2025 were as follows:
_______________ (1)On January 3, 2025, we had additional future payments on leases of $228 million that had not yet commenced. These leases will commence between 2025 and 2026, and have lease terms of to 15 years.
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| Schedule of Future Lease Payments Under Non-Cancelable Finance Leases | Maturities of non-cancelable operating and finance lease liabilities at January 3, 2025 were as follows:
_______________ (1)On January 3, 2025, we had additional future payments on leases of $228 million that had not yet commenced. These leases will commence between 2025 and 2026, and have lease terms of to 15 years.
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ("AOCI") (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Components of AOCL | The components of AOCI are summarized below:
_______________ (1)See Note 9: Retirement Benefits in these Notes for further information. (2)Losses (gains) reclassified to earnings are included in the “Revenue,” “Cost of revenue,” “Interest expense, net” and “Non-service FAS pension income and other, net” line items in our Consolidated Statement of Operations.
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ACQUISITIONS AND DIVESTITURES (Tables) |
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Calculation of Consideration Transferred | As of the acquisition date, the fair value of consideration transferred consisted of the following:
_______________ (1)Prior to the acquisition, we had a preexisting relationship with Viasat’s TDL business in the normal course of business. As of the acquisition date, our CS segment had a receivable from Viasat’s TDL business with a fair value of $1 million that was settled in connection with the acquisition. As of the acquisition date, the fair value of consideration transferred consisted of the following:
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| Consideration Paid for Acquisition | The following table summarizes the allocation of the fair value of consideration transferred to assets acquired and liabilities assumed as of the acquisition date and the adjustments recognized during the measurement period:
_______________ (1)Fair value adjustments during the fiscal year ended December 29, 2023 primarily related to refined assumptions in the valuation of customer relationship intangible assets. (2)Assets acquired include $11 million of Contract assets that were reclassified from Inventories, net to Contract assets to conform TDL’s accounting policies with those of L3Harris, as required under ASC 805. As such, reclassified amounts will not be recognized as revenue in future periods. The following table summarizes the allocation of the fair value of consideration transferred to assets acquired and liabilities assumed as of the acquisition date and the adjustments recognized during the measurement period:
_______________ (1)Fair value adjustments during the measurement period primarily related to EAC updates for circumstances existing at the acquisition date, including updates to the forward loss provision and off-market customer contract reserve described below, refinements to the fair value of fixed assets, as well as corresponding adjustments to the deferred tax liability account which was partially offset by the release of a portion of the uncertain tax position previously recorded by AJRD.
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| Schedule of Identifiable Intangible Assets Acquired | The fair value and weighted-average amortization period of identifiable intangible assets acquired as of the acquisition date is as follows:
value and weighted-average amortization period of identifiable intangible assets acquired as of the acquisition date are as follows:
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| Schedule of Pro Forma Results | The following table includes revenue and income before income taxes of TDL included in our Consolidated Statement of Operations for the acquisition date through December 29, 2023 and the comparable periods of calendar year 2022. The comparable period results do not include any integration synergies or accounting conformity adjustments and are not necessarily indicative of our results of operations that actually would have been obtained had the acquisition of TDL been completed for the period presented, or which may be realized in the future.
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| Schedule of Business Divestitures and Asset Sales | The carrying amounts of the assets and liabilities of the CAS disposal group classified as held for sale in our Consolidated Balance Sheet were as follows:
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BUSINESS SEGMENTS (Tables) |
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| Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Selected Financial Information by Business Segments | The difference between CAS pension cost and the service cost component of net periodic benefit income (“FAS pension service cost”) is reflected in the “FAS/CAS operating adjustment,” which is included as a component of Unallocated corporate department expense line item in Note 14: Business Segments in these Notes.
_______________ ** Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. (1) Includes corporate headquarters and intersegment eliminations (2) Other segment costs include , company-funded R&D costs, selling and marketing costs, and other G&A expenses, which includes a portion of capital expenditure and depreciation and amortization costs that are disaggregated by segment under the “Disaggregation of Revenue” heading below in this Note. Other selected financial information by business segment and geographical area is summarized below:
_______________ **Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information.
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| Schedule of Disaggregation of Revenue by Segment | We disaggregate revenue for all four business segments by customer relationship, contract type and geographical region. We believe these categories best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
_______________ (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
_______________ (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
_______________ **Our AR segment was established in the quarter ended September 29, 2023 in connection with the AJRD acquisition. As such, there is no fiscal 2022 information. (1)Our subcontractor revenues includes products and services to contractors whose customers are the end user. (2)Includes revenue derived from time-and-materials contracts.
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| Schedule of Total Assets by Segment | Total assets by business segment are as follows:
_______________ (1)Identifiable intangible assets acquired in connection with business combinations were recorded as corporate assets because they benefit the entire Company. Intangible asset balances recorded as corporate assets were $7,639 million and $8,540 million at January 3, 2025 and December 29, 2023, respectively. Corporate assets also consisted of cash, income taxes receivable, deferred income taxes, deferred compensation plan assets, buildings and equipment, real estate held for development and leasing, investments, as well as any assets of businesses held for sale.
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LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Jan. 03, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Legal Proceedings And Contingencies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial Commitments | At January 3, 2025, we had the following commercial commitments outstanding:
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SIGNIFICANT ACCOUNTING POLICIES - Net Estimated at Completion ("EAC") Adjustments (Details) - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Change in Accounting Estimate [Line Items] | |||
| Net EAC adjustments, before income taxes | $ 1,918 | $ 1,426 | $ 1,127 |
| Contracts Accounted for under Percentage of Completion | |||
| Change in Accounting Estimate [Line Items] | |||
| Net EAC adjustments, before income taxes | 39 | (85) | 36 |
| Net EAC adjustments, net of income taxes | $ 29 | $ (63) | $ 27 |
| Net EAC adjustments, net of income taxes, per diluted share (in dollars per share) | $ 0.15 | $ (0.33) | $ 0.14 |
SIGNIFICANT ACCOUNTING POLICIES - FAS/CAS Operating Adjustments (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
| FAS pension service cost | $ (36) | $ (35) | |
| Pension Plan | |||
| Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
| FAS pension service cost | (34) | (33) | $ (44) |
| Plans Under US Government Contracts | Pension Plan | |||
| Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
| FAS pension service cost | (36) | (35) | (46) |
| Less: CAS pension cost | (64) | (145) | (141) |
| FAS/CAS operating adjustment | $ 28 | $ 110 | $ 95 |
EARNINGS PER SHARE (Details) - shares shares in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Earnings Per Share [Abstract] | |||
| Basic weighted average common shares outstanding (in shares) | 189.8 | 189.6 | 191.8 |
| Impact of dilutive share-based awards (in shares) | 0.9 | 1.0 | 1.7 |
| Diluted weighted average common shares outstanding (in shares) | 190.7 | 190.6 | 193.5 |
| Weighted average anti-dilutive employee stock options outstanding (in shares) | 3.3 | 3.7 | 0.3 |
CONTRACT ASSETS AND CONTRACT LIABILITIES (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Revenue from Contract with Customer [Abstract] | ||
| Contract assets | $ 3,230 | $ 3,196 |
| Contract liabilities, current | (2,142) | (1,900) |
| Contract liabilities, non-current | (91) | (94) |
| Net contract assets | $ 997 | $ 1,202 |
CONTRACT ASSETS AND CONTRACT LIABILITIES - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
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| Revenue from Contract with Customer [Abstract] | |||
| Recognized revenue related to contract liabilities outstanding at the end of the year | $ 1,433 | $ 1,247 | $ 1,057 |
INVENTORIES, NET (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Inventory Disclosure [Abstract] | ||
| Finished products | $ 211 | $ 217 |
| Work in process | 332 | 427 |
| Materials and supplies | 787 | 828 |
| Inventories, net | $ 1,330 | $ 1,472 |
PROPERTY, PLANT AND EQUIPMENT, NET - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Property, Plant and Equipment [Line Items] | ||
| Property, plant and equipment and finance lease right of use assets | $ 5,642 | $ 5,321 |
| Less: accumulated depreciation and amortization | (2,836) | (2,459) |
| Property, plant and equipment, net | 2,806 | 2,862 |
| Land | ||
| Property, Plant and Equipment [Line Items] | ||
| Property, plant and equipment and finance lease right of use assets | 182 | 184 |
| Software capitalized for internal use | ||
| Property, Plant and Equipment [Line Items] | ||
| Property, plant and equipment and finance lease right of use assets | 795 | 716 |
| Buildings | ||
| Property, Plant and Equipment [Line Items] | ||
| Property, plant and equipment and finance lease right of use assets | 1,633 | 1,605 |
| Machinery and equipment | ||
| Property, Plant and Equipment [Line Items] | ||
| Property, plant and equipment and finance lease right of use assets | $ 3,032 | $ 2,816 |
PROPERTY, PLANT AND EQUIPMENT, NET - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Property, Plant and Equipment [Abstract] | |||
| Depreciation and amortization expense related to property, plant and equipment | $ 429 | $ 389 | $ 342 |
GOODWILL AND INTANGIBLE ASSETS - Future Amortization Expense (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Goodwill and Intangible Assets Disclosure [Abstract] | ||
| 2025 | $ 768 | |
| 2026 | 671 | |
| 2027 | 562 | |
| 2028 | 489 | |
| 2029 | 433 | |
| Thereafter | 2,913 | |
| Net Carrying Amount | $ 5,836 | $ 6,737 |
INCOME TAXES - Provision for Current and Deferred Income Taxes (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Current: | |||
| United States | $ (166) | $ 328 | $ 633 |
| International | 72 | 50 | 82 |
| State and local | 5 | 66 | 98 |
| Current income taxes | (89) | 444 | 813 |
| Deferred: | |||
| United States | 244 | (380) | (523) |
| International | (34) | 10 | (61) |
| State and local | (36) | (51) | (17) |
| Total deferred income taxes | 174 | (421) | (601) |
| Total income taxes | $ 85 | $ 23 | $ 212 |
INCOME TAXES - Reconciliation of Income Tax Rates (Details) |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Income Tax Disclosure [Abstract] | |||
| U.S. statutory income tax rate | 21.00% | 21.00% | 21.00% |
| State taxes | 2.10% | 1.40% | 2.20% |
| International income | 0.40% | 0.00% | 0.00% |
| Non-deductible goodwill impairment | 0.00% | 3.60% | 14.20% |
| R&D tax credit | (10.40%) | (12.50%) | (13.00%) |
| FDII deduction | (2.10%) | (4.40%) | (5.10%) |
| Changes in valuation allowance | (2.30%) | 0.20% | 0.10% |
| Impact of divestitures and reorganizations | 1.20% | (8.50%) | (1.30%) |
| Share-based compensation | (0.60%) | 0.20% | (0.20%) |
| Settlement of tax audits | (3.40%) | (1.10%) | (0.70%) |
| Other items | (0.60%) | 2.00% | (0.50%) |
| Effective income tax rate | 5.30% | 1.90% | 16.70% |
INCOME TAXES - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Income Tax Disclosure [Abstract] | |||
| Outside basis difference in foreign subsidiaries that are considered indefinitely reinvested | $ 1,500 | ||
| Tax credits purchased | 200 | ||
| Tax credit carryforward, purchase price | 191 | ||
| Income tax rate reconciliation, purchase of tax credits | 9 | ||
| Income from continuing operations before income taxes of international subsidiaries | 191 | $ 205 | $ 95 |
| Income taxes paid, net of (refunds) received | 102 | 715 | 309 |
| Interest and penalties recognized related to unrecognized tax benefits | 29 | 20 | $ 12 |
| Accrued interest and penalties related to unrecognized tax benefits | $ 109 | $ 80 | |
INCOME TAXES - Components of Deferred Income Tax Assets (Liabilities) (Details) - USD ($) $ in Millions |
12 Months Ended | |
|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
|
| Deferred tax assets, net: | ||
| Accruals | $ 396 | $ 334 |
| Tax loss and credit carryforwards | 249 | 211 |
| Operating lease obligation | 212 | 243 |
| Capitalized research and experimental expenditures | 1,694 | 1,125 |
| Other | 461 | 380 |
| Valuation allowance | (238) | (240) |
| Deferred tax assets, net | 2,774 | 2,053 |
| Deferred tax liabilities: | ||
| Property, plant and equipment | (216) | (252) |
| Acquired intangibles | (1,974) | (2,143) |
| Operating lease ROU asset | (188) | (219) |
| Deferred revenue on long-term contracts | (913) | 0 |
| Other | (305) | (163) |
| Deferred tax liabilities | (3,596) | (2,777) |
| Net deferred tax liabilities | (822) | (724) |
| Deferred tax assets, operating loss carryforwards | 81 | |
| Deferred tax assets, tax credit carryforwards | 165 | |
| Net decrease in valuation allowance | $ 2 | $ 3 |
INCOME TAXES - Deferred Tax Assets, Net of Valuation Allowance (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Income Tax Disclosure [Abstract] | ||
| Deferred income tax assets | $ 120 | $ 91 |
| Deferred income tax liabilities | (942) | (815) |
| Net deferred tax liabilities | $ (822) | $ (724) |
INCOME TAXES - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Unrecognized Tax Benefits [Roll Forward] | |||
| Balance at beginning of fiscal year | $ 652 | $ 613 | $ 587 |
| Additions based on tax positions taken during current period | 120 | 99 | 124 |
| Additions based on tax positions taken during prior period | 23 | 8 | 4 |
| Additions from tax positions related to acquired entities | 92 | 86 | 0 |
| Decreases based on tax positions taken during prior period | (113) | (133) | (76) |
| Decreases from lapse in statutes of limitations | (9) | (11) | (6) |
| Decreases from settlements | (7) | (10) | (20) |
| Balance at end of fiscal year | 758 | 652 | $ 613 |
| Unrecognized tax benefits that would favorably impact future tax rates | $ 666 | $ 509 | |
DEBT AND CREDIT ARRANGEMENTS - Commercial Paper Program - Narrative (Details) - USD ($) $ in Millions |
Jan. 26, 2024 |
Jan. 03, 2025 |
Jan. 25, 2024 |
Dec. 29, 2023 |
|---|---|---|---|---|
| Debt Instrument [Line Items] | ||||
| Short-term debt | $ 515 | $ 1,602 | ||
| Commercial Paper | ||||
| Debt Instrument [Line Items] | ||||
| Line of credit facility, maximum borrowing capacity | $ 3,000 | $ 3,900 | ||
| Short-term debt | $ 515 | $ 1,599 | ||
| Debt, weighted average interest rate | 4.70% | 5.95% | ||
| Commercial Paper | Maximum | ||||
| Debt Instrument [Line Items] | ||||
| Debt instrument term | 397 days |
DEBT AND CREDIT ARRANGEMENTS - Credit Agreements (Details) - Revolving Credit Facility - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 26, 2024 |
Jan. 03, 2025 |
Dec. 29, 2023 |
|
| 2024 Credit Facility | Line of Credit | |||
| Line of Credit Facility [Line Items] | |||
| Line of credit facility, maximum borrowing capacity | $ 1,500 | ||
| Debt instrument term | 364 days | ||
| Credit Agreement 2024 | Line of Credit | |||
| Line of Credit Facility [Line Items] | |||
| Available borrowing capacity | $ 2,985 | ||
| Credit Agreement 2022 | Line of Credit | |||
| Line of Credit Facility [Line Items] | |||
| Line of credit facility, maximum borrowing capacity | $ 2,000 | ||
| Debt instrument term | 5 years | ||
| Line of credit, current | $ 0 | ||
| Available borrowing capacity | $ 2,985 | $ 2,801 | |
| Credit Agreement 2023 | Line of Credit | |||
| Line of Credit Facility [Line Items] | |||
| Line of credit, current | 0 | ||
| Available borrowing capacity | $ 2,801 |
DEBT AND CREDIT ARRANGEMENTS - Interest Paid (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Debt Disclosure [Abstract] | |||
| Interest paid | $ 654 | $ 489 | $ 296 |
RETIREMENT BENEFITS - Pre-tax Amounts Recorded in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Defined Benefit Plan Disclosure [Line Items] | ||
| Actuarial (gain) loss | $ (331) | $ 64 |
| Net prior service (credit) cost | (142) | (153) |
| Total recognized in accumulated other comprehensive income (loss), pre-tax | (473) | (89) |
| Pension | ||
| Defined Benefit Plan Disclosure [Line Items] | ||
| Actuarial (gain) loss | (245) | 162 |
| Net prior service (credit) cost | (144) | (157) |
| Total recognized in accumulated other comprehensive income (loss), pre-tax | (389) | 5 |
| Other Benefits | ||
| Defined Benefit Plan Disclosure [Line Items] | ||
| Actuarial (gain) loss | (86) | (98) |
| Net prior service (credit) cost | 2 | 4 |
| Total recognized in accumulated other comprehensive income (loss), pre-tax | $ (84) | $ (94) |
RETIREMENT BENEFITS - Accumulated Benefit Obligations in Excess of Plan Assets (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Pension | ||
| Defined Benefit Plan Disclosure [Line Items] | ||
| PBO | $ 154 | $ 226 |
| Fair value of plan assets | 3 | 60 |
| ABO | 153 | 225 |
| Fair value of plan assets | 3 | 60 |
| Other Benefits | ||
| Defined Benefit Plan Disclosure [Line Items] | ||
| PBO | 55 | 62 |
| Fair value of plan assets | $ 0 | $ 0 |
RETIREMENT BENEFITS - Estimated Future Benefit Payments (Details) $ in Millions |
Jan. 03, 2025
USD ($)
|
|---|---|
| Defined Benefit Plan Disclosure [Line Items] | |
| 2025 | $ 649 |
| 2026 | 634 |
| 2027 | 633 |
| 2028 | 628 |
| 2029 | 622 |
| 2030 — 2034 | 2,950 |
| Pension | |
| Defined Benefit Plan Disclosure [Line Items] | |
| 2025 | 627 |
| 2026 | 613 |
| 2027 | 612 |
| 2028 | 608 |
| 2029 | 603 |
| 2030 — 2034 | 2,867 |
| Other Benefits | |
| Defined Benefit Plan Disclosure [Line Items] | |
| 2025 | 22 |
| 2026 | 21 |
| 2027 | 21 |
| 2028 | 20 |
| 2029 | 19 |
| 2030 — 2034 | $ 83 |
| Expected future benefit percentage of gross payments, excluding subsidiaries | 1.00% |
SHARE-BASED COMPENSATION - Share-based Compensation Expense (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Amounts recognized in our Consolidated Statement of Operations include: | |||
| Share-based compensation expense | $ 97 | $ 89 | $ 109 |
| Income taxes on share-based compensation expense | (20) | (19) | (27) |
| Share-based compensation expense, net of income taxes | 77 | 70 | 82 |
| Cost of revenue | |||
| Amounts recognized in our Consolidated Statement of Operations include: | |||
| Share-based compensation expense | 14 | 16 | 19 |
| General and administrative expenses | |||
| Amounts recognized in our Consolidated Statement of Operations include: | |||
| Share-based compensation expense | 83 | 73 | 90 |
| Share-based compensation expense, before income taxes | |||
| Amounts recognized in our Consolidated Statement of Operations include: | |||
| Share-based compensation expense | $ 97 | $ 89 | $ 109 |
SHARE-BASED COMPENSATION - Restricted Stock and Restricted Stock Unit Awards Activity (Details) - Restricted Stock Units - $ / shares |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Units | |||
| Outstanding, beginning balance (in shares) | 728,000 | ||
| Granted (in shares) | 158,000 | ||
| Vested (in shares) | (227,000) | ||
| Forfeited (in shares) | (77,000) | ||
| Outstanding, ending balance (in shares) | 582,326 | 728,000 | |
| Weighted-Average Grant-Date Price Per Unit | |||
| Outstanding, beginning balance (in dollars per share) | $ 208.78 | ||
| Granted (in dollars per share) | 211.95 | $ 199.33 | $ 225.58 |
| Vested (in dollars per share) | 204.42 | ||
| Forfeited (in dollars per share) | 210.18 | ||
| Outstanding, ending balance (in dollars per share) | $ 210.28 | $ 208.78 | |
SHARE-BASED COMPENSATION - Performance Shares Unit Awards Activity (Details) - Performance Share Units - $ / shares shares in Thousands |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Units | |||
| Outstanding, beginning balance (in shares) | 480 | ||
| Granted (in shares) | 172 | ||
| Adjustment for achievement of performance measures (in shares) | 8 | ||
| Vested (in shares) | (190) | ||
| Forfeited (in shares) | (45) | ||
| Outstanding, ending balance (in shares) | 425 | 480 | |
| Weighted-Average Grant-Date Price Per Unit | |||
| Outstanding, beginning balance (in dollars per share) | $ 222.73 | ||
| Granted (in dollars per share) | 230.09 | $ 223.09 | $ 258.83 |
| Adjustment for achievement of performance measures (in dollars per share) | 195.07 | ||
| Vested (in dollars per share) | 194.99 | ||
| Forfeited (in dollars per share) | 233.38 | ||
| Outstanding, ending balance (in dollars per share) | $ 236.42 | $ 222.73 | |
SHARE-BASED COMPENSATION - Significant Fair Value Assumptions (Details) |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Share-Based Payment Arrangement [Abstract] | |||
| Expected dividends | 2.18% | 2.17% | 2.00% |
| Expected volatility | 25.29% | 28.60% | 29.09% |
| Risk-free interest rates | 3.80% | 3.48% | 1.63% |
| Risk-free interest rates | 4.64% | 4.27% | 4.27% |
| Expected term (years) | 5 years 21 days | 5 years 14 days | 5 years 7 days |
SHARE-BASED COMPENSATION - Nonvested Stock Options (Details) - $ / shares shares in Thousands |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Shares (In thousands) | |||
| Unvested stock options, beginning balance (in shares) | 582 | ||
| Granted (in shares) | 415 | ||
| Vested (in shares) | (362) | ||
| Unvested stock options, ending balance (in shares) | 635 | 582 | |
| Weighted-Average Grant-Date Fair Value Per Share | |||
| Nonvested stock options, beginning balance (in dollars per share) | $ 52.72 | ||
| Granted (in dollars per share) | 50.99 | $ 54.63 | $ 53.66 |
| Vested (in dollars per share) | 50.59 | ||
| Nonvested stock options, ending balance (in dollars per share) | $ 52.54 | $ 52.72 | |
LEASES - Lease Costs (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Leases [Abstract] | |||
| Operating lease cost | $ 164 | $ 163 | $ 151 |
| Short-term and equipment lease cost | 31 | 23 | 21 |
| Variable lease cost | 26 | 26 | 25 |
| Other, net | 18 | 11 | 6 |
| Total lease cost | $ 239 | $ 223 | $ 203 |
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions |
12 Months Ended | |
|---|---|---|
Jan. 03, 2025 |
Dec. 29, 2023 |
|
| Cash paid for amounts included in the measurement of lease liabilities | ||
| Net cash provided by operating activities - operating lease payments | $ 182 | $ 159 |
| Assets obtained in exchange for new lease obligations | ||
| ROU assets obtained with operating leases | 96 | 144 |
| Property, plant and equipment obtained with finance leases | $ 4 | $ 68 |
| Weighted average remaining lease term (in years) | ||
| Operating leases | 7 years 7 months 2 days | 8 years 3 months 18 days |
| Finance leases | 16 years 4 months 28 days | 17 years 8 months 8 days |
| Weighted average discount rate | ||
| Operating leases | 3.72% | 3.86% |
| Finance leases | 4.43% | 4.32% |
LEASES - Future Lease Payments Under Non-Cancelable Operating and Finance Leases (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Operating Leases | ||
| 2025 | $ 159 | |
| 2026 | 134 | |
| 2027 | 116 | |
| 2028 | 110 | |
| 2029 | 89 | |
| Thereafter | 314 | |
| Total future lease payments required | 922 | |
| Less: imputed interest | 122 | |
| Total | 800 | $ 886 |
| Finance Leases | ||
| 2025 | 40 | |
| 2026 | 18 | |
| 2027 | 17 | |
| 2028 | 19 | |
| 2029 | 18 | |
| Thereafter | 208 | |
| Total future lease payments required | 320 | |
| Less: imputed interest | 82 | |
| Total | 238 | $ 251 |
| Future lease payments for leases not yet commenced | $ 228 | |
| Minimum | ||
| Finance Leases | ||
| Term of contract for lease commitments not yet commenced | 3 years | |
| Maximum | ||
| Finance Leases | ||
| Term of contract for lease commitments not yet commenced | 15 years |
ACQUISITIONS AND DIVESTITURES - Acquisition of TDL - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Jan. 03, 2023 |
Jan. 03, 2025 |
Dec. 29, 2023 |
|
| Business Acquisition [Line Items] | |||
| Goodwill from acquisitions | $ 537 | $ 3,508 | |
| Acquisition related costs | 78 | 83 | |
| CS | |||
| Business Acquisition [Line Items] | |||
| Goodwill from acquisitions | 1,143 | 1,143 | |
| TDL | |||
| Business Acquisition [Line Items] | |||
| Purchase price | $ 1,958 | ||
| Acquisition related costs | $ 15 | $ 78 | |
ACQUISITIONS AND DIVESTITURES - Acquisition of TDL - Calculation of Consideration Transferred (Details) - TDL $ in Millions |
Jan. 03, 2023
USD ($)
|
|---|---|
| Business Acquisition [Line Items] | |
| Purchase price | $ 1,958 |
| Estimated net working capital and other adjustments | 15 |
| Cash consideration paid | 1,973 |
| Settlement of preexisting relationship | 1 |
| Fair value of consideration transferred | $ 1,974 |
ACQUISITIONS AND DIVESTITURES - Acquisition of TDL - Identifiable Intangible Assets Acquired (Details) - TDL - USD ($) $ in Millions |
Jan. 03, 2023 |
Dec. 29, 2023 |
|---|---|---|
| Business Acquisition [Line Items] | ||
| Total identifiable intangible assets acquired | $ 755 | $ 755 |
| Customer relationships | ||
| Business Acquisition [Line Items] | ||
| Identifiable finite-lived intangible assets acquired | 406 | |
| Backlog | ||
| Business Acquisition [Line Items] | ||
| Identifiable finite-lived intangible assets acquired | $ 83 | |
| Weighted average amortization period | 2 years | |
| Government programs | ||
| Business Acquisition [Line Items] | ||
| Identifiable finite-lived intangible assets acquired | $ 323 | |
| Weighted average amortization period | 16 years | |
| Developed technologies | ||
| Business Acquisition [Line Items] | ||
| Identifiable finite-lived intangible assets acquired | $ 349 | |
| Weighted average amortization period | 17 years |
ACQUISITIONS AND DIVESTITURES - Acquisition of TDL - Pro Forma Information (Details) - TDL - USD ($) $ in Millions |
12 Months Ended | |
|---|---|---|
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Business Acquisition [Line Items] | ||
| Revenue | $ 365 | $ 358 |
| Income before income taxes | $ 131 | $ 68 |
ACQUISITIONS AND DIVESTITURES - Acquisition of AJRD - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | 14 Months Ended | |||
|---|---|---|---|---|---|
Jul. 28, 2023 |
Jan. 03, 2025 |
Dec. 29, 2023 |
Sep. 27, 2024 |
Dec. 30, 2022 |
|
| Business Acquisition [Line Items] | |||||
| Goodwill | $ 20,325 | $ 19,979 | $ 17,283 | ||
| Acquisition related costs | 78 | 83 | |||
| Aerojet Rocketdyne Holdings, Inc. | |||||
| Business Acquisition [Line Items] | |||||
| Business acquisition, percentage of ownership | 100.00% | ||||
| Business combination, consideration transferred | $ 4,715 | ||||
| Provision for loss on customer contracts | 363 | ||||
| Loss provision amortization expense | 125 | 8 | |||
| Total liabilities assumed | 183 | $ 514 | |||
| Revenue from amortization of off-market contract liability | $ 58 | $ 14 | |||
| Goodwill | $ 2,902 | ||||
| Aerojet Rocketdyne Holdings, Inc. | Other Accrued Liabilities | |||||
| Business Acquisition [Line Items] | |||||
| Total liabilities assumed | 48 | ||||
| Aerojet Rocketdyne Holdings, Inc. | Other long-term liabilities | |||||
| Business Acquisition [Line Items] | |||||
| Total liabilities assumed | $ 135 | ||||
ACQUISITIONS AND DIVESTITURES - Acquisition of AJRD - Calculation of Consideration Transferred (Details) - USD ($) $ in Millions |
12 Months Ended | |||
|---|---|---|---|---|
Jul. 28, 2023 |
Jan. 03, 2025 |
Dec. 29, 2023 |
Dec. 30, 2022 |
|
| Business Acquisition [Line Items] | ||||
| Fair value of consideration transferred | $ 0 | $ 6,688 | $ 0 | |
| Aerojet Rocketdyne Holdings, Inc. | ||||
| Business Acquisition [Line Items] | ||||
| Cash consideration paid for AJRD outstanding common stock & equity awards | $ 4,748 | |||
| AJRD debt settled by L3Harris | 257 | |||
| Cash consideration paid | 5,005 | |||
| Less cash acquired | (290) | |||
| Fair value of consideration transferred | $ 4,715 | |||
BUSINESS SEGMENTS - Total Assets by Segment (Details) - USD ($) $ in Millions |
Jan. 03, 2025 |
Dec. 29, 2023 |
|---|---|---|
| Segment Reporting Information [Line Items] | ||
| Assets | $ 42,001 | $ 41,687 |
| Identifiable intangible assets acquired | 7,639 | 8,540 |
| Operating segments | SAS | ||
| Segment Reporting Information [Line Items] | ||
| Assets | 8,705 | 9,085 |
| Operating segments | IMS | ||
| Segment Reporting Information [Line Items] | ||
| Assets | 10,749 | 10,631 |
| Operating segments | CS | ||
| Segment Reporting Information [Line Items] | ||
| Assets | 7,060 | 7,084 |
| Operating segments | AR | ||
| Segment Reporting Information [Line Items] | ||
| Assets | 4,466 | 4,208 |
| Corporate non-segment | ||
| Segment Reporting Information [Line Items] | ||
| Assets | $ 11,021 | $ 10,679 |
LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES - Commercial Commitments (Details) $ in Millions |
Jan. 03, 2025
USD ($)
|
|---|---|
| Other Commitments [Line Items] | |
| Commercial Commitment Total | $ 1,208 |
| Commitments expiring within 1 Year | 857 |
| Surety bonds used for performance | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 506 |
| Commitments expiring within 1 Year | 386 |
| Standby Letters of Credit | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 702 |
| Commitments expiring within 1 Year | 471 |
| Advance payments | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 312 |
| Commitments expiring within 1 Year | 211 |
| Performance | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 327 |
| Commitments expiring within 1 Year | 198 |
| Financial | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 62 |
| Commitments expiring within 1 Year | 61 |
| Warranty | |
| Other Commitments [Line Items] | |
| Commercial Commitment Total | 1 |
| Commitments expiring within 1 Year | $ 1 |
LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions |
Jan. 03, 2025
USD ($)
site
|
Dec. 29, 2023
USD ($)
|
|---|---|---|
| Other Commitments [Line Items] | ||
| Number of sites with future environmental liabilities | 111 | |
| Number of sites owned | 13 | |
| Number of sites associated with former locations or current operation locations | 71 | |
| Number of treatment or disposal sites not owned | 27 | |
| Environmental Loss Contingency, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current, Other Liabilities, Noncurrent | Other Liabilities, Current, Other Liabilities, Noncurrent |
| Surety bonds used for performance | ||
| Other Commitments [Line Items] | ||
| Contractual obligation, maturity term | 3 years | |
| Various Environmental Matters | ||
| Other Commitments [Line Items] | ||
| Accrual for environmental loss contingencies | $ | $ 637 | $ 613 |
| Recoverable environmental remediation costs | $ | $ 462 | $ 432 |