Raytheon Secures $299.7 Million DoD Contract Modification for Evolved SeaSparrow Missile Program
Summary
RTX Corporation's Raytheon unit has secured a $299.7 million contract modification from the U.S. Department of Defense for the Evolved SeaSparrow Missile (ESSM) Block 2 program. The firm-fixed-price contract, supporting procurement of test equipment, spares, and missile assemblies, is a key step in the multilateral ESSM initiative. Work will be performed globally across 23 locations and is expected to be completed by September 2030. This award strengthens Raytheon's role in naval defense and provides long-term revenue visibility for RTX.
Raytheon Secures $299.7 Million DoD Contract for Evolved SeaSparrow Missile Program
ARLINGTON, VA – Raytheon Co., now part of RTX Corporation (NYSE: RTX), has been awarded a significant $299.7 million contract modification by the U.S. Department of Defense (DoD). This modification is aimed at advancing the Evolved SeaSparrow Missile (ESSM) Block 2 program, further solidifying the defense contractor's role in enhancing naval defense capabilities for the United States and its allies.
The firm-fixed-price modification is designated to support the procurement of essential test equipment, spare parts, and Guided Missile Assemblies. This marks a crucial step in the ongoing multilateral ESSM initiative, which is designed to improve the self-defense capabilities of naval vessels against a wide array of modern threats, including anti-ship missiles, aircraft, and surface combatants.
Global Collaboration and Execution
The execution of this contract highlights the international nature of the ESSM program, involving work across numerous locations globally. Key sites contributing to the effort include:
- Tucson, Arizona, USA (12% of work)
- Edinburgh, Australia (11%)
- Mississauga, Canada (10%)
- San Jose, California, USA (9%)
- Raufoss, Norway (8%)
In addition to these primary locations, work will be performed at 18 other named sites and numerous smaller facilities. This distributed execution model underscores the collaborative partnership among the 12 NATO member nations and other allied countries participating in the ESSM consortium.
Timeline and Funding Details
The contract modification is scheduled for completion by September 2030. The funding for this phase is allocated from multiple sources across fiscal years:
- $283.7 million from fiscal year 2025 U.S. Navy weapons procurement funds.
- $7 million from fiscal year 2025 customer funds.
- $5.4 million from fiscal year 2024 U.S. Navy weapons procurement funds.
- $3.5 million from fiscal year 2024 customer funds.
The Naval Sea Systems Command, based in Washington, D.C., is the government entity responsible for overseeing this contract (Contract Number N00024-24-C-5408).
Strategic Implications for Raytheon (RTX)
This substantial contract award reinforces Raytheon's position as a leading provider of advanced missile systems within the global defense market. Amidst rising global defense expenditures driven by geopolitical tensions, multi-year contracts like this provide RTX with significant long-term revenue visibility and contribute to a robust backlog. The deal positions the company favorably to benefit from sustained international defense modernization efforts and the ongoing demand for sophisticated naval defense technologies.
Investors and analysts tracking the defense sector often monitor such contract awards as indicators of a company's operational health and future revenue streams. The ESSM program's continued funding reflects its importance in the defense strategies of participating nations.