⚠ The Titanium BillLow threat

RTX (RTX) — threat to the moat

In 2024 Collins paid $0.2 billion to replace titanium supply, an example of how supplier failures land on the parts maker.

Collins buys metals, electronics and castings from thousands of suppliers, and when a source fails it pays to replace it. In 2024 RTX took $0.2 billion of charges at Collins related to alternative titanium sources1. It is a small number against Collins's $4,923 million of 2025 operating profit2, and a clear example of how the cost of an unreliable supply chain falls on the supplier, not the airframer.

RTX purchase obligations, end of 2025 ($bn)about 29Payable in 2026about 18Later yearsRTX Form 10-K FY2025; total about 47bn, later years by difference
Most of the commitments fall due this year.

RTX also carries purchase obligations of about $47 billion, $29 billion of them payable in 20263. Those commitments protect supply; they also lock in prices.

The risk for Collins is that fixed-price original-equipment contracts meet rising input costs, from metals, from tariffs or from a supplier's failure, and the difference comes out of margin.

Supply matters more when demand is strong. With a backlog of $289 billion4, a supplier failure costs output as well as money.

Watch for charges named as supply-chain items in Collins's quarterly results. A repeat of the 2024 titanium charge, or a larger one, in a year of strong demand would show that the segment's margin depends on a supply base it does not control.

References
  1. ReportedIn 2024 RTX took $0.2 billion of charges at Collins related to alternative titanium sources.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  2. ReportedIt is a small number against Collins's $4,923 million of 2025 operating profit, and a clear example of how the cost of an unreliable supply chain falls on the supplier, not the airframer.
    RTX Form 10-K for fiscal 2025 - Item 7 segment review and Note 20: net sales and operating profit by segment for 2023-2025, organic sales drivers (commercial aftermarket, OEM, military), sales by customer type, products and services, segment assets, capital expenditure and research and development - Collins Aerospace: segment sales, operating profit, organic drivers, customer types, assets and capital expenditure. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  3. ReportedRTX also carries purchase obligations of about $47 billion, $29 billion of them payable in 2026.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  4. ReportedWith a backlog of $289 billion, a supplier failure costs output as well as money.
    RTX Form 10-Q for the quarter ended 30 June 2026 - backlog of $289 billion ($170 billion commercial, $119 billion defence), remaining performance obligations, the $0.4 billion powder-metal accrual, the Blue Canyon Technologies sale, Patriot awards and the remaining repurchase authority. — Q2 2026 · publ. 23 July 2026 · source ↗
Sources
Generated September 28, 2026