Defense giant RTX has reaffirmed its commitment to paying dividends despite President Donald Trump's criticism of defense contractors' financial practices. CEO Chris Calio stated that the company remains committed to issuing dividends, citing shareholder reliance and decades of quarterly payments.
The Pentagon has completed its initial review of defense contractors, but needs more time to assess before finalizing a list of noncompliant companies that could impact stock buybacks and investor dividends. Defense Secretary Pete Hegseth was directed to work with each company to remediate issues and initiate actions through legal and regulatory channels.
Breaking Defense reports that seven major defense contractors generated $21.2 billion in free cash flow in 2024, with RTX issuing the most in dividends at $3.2 billion. The data suggests that these companies are prioritizing shareholder returns over investments in production lines, which could impact the president's demands for increased production capacity.