** RTX RTX.N on Tuesday cautioned that U.S. President Donald Trump's tariffs could chip away $850 million from its 2025 profits, even as the aerospace and defense company beat expectations for quarterly results and reaffirmed its full-year forecasts.

TARIFF IMPACT COULD BE LESS SEVERE

** Citigroup ("buy," PT: $148) views the $850 million tariff headwind as likely a worst-case scenario as "the tariff regime could improve over time and management has several mitigating levers to pull, including continuing price increases, better supply chain management, and productivity"

** Brokerage says, "away from tariffs, the rest of the story seemed intact in 1Q – demand across both commercial aero and defense remains robust"

** RBC Capital Markets ("outperform," lowers PT to $140 from $150) confident that RTX can "outperform its potential ~$850M EBIT headwind" and views RTX's tariff analysis as representing more of the worst-case scenario

** RBC currently models a ~10% (~$0.05 in EPS) hit of the $850M warning to segment operating income in 2Q25 given the exposure already seen

** Morningstar (fair value: $134) sees the potential tariff impact as muted, and unlikely to materialize or remain in effect for long.

(Reporting by Sukriti Gupta in Bengaluru)