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1
PART I
ITEM 1. BUSINESS
General
Raytheon Company, together with its subsidiaries, is a technology and innovation leader specializing in defense, homeland
security and other government markets throughout the world. We provide state-of-the-art electronics, mission systems
integration and other capabilities in the areas of sensing, effects, and command, control, communications and intelligence
systems (C3I), as well as a wide range of mission support services. We serve both domestic and international customers,
principally as a prime contractor on a broad portfolio of defense and related programs for government customers.
We were founded in 1922 and have grown internally and through a number of acquisitions. We are incorporated in the state
of Delaware. Our principal executive offices are located at 870 Winter Street, Waltham, Massachusetts 02451.
In this section, we describe our business, including our business segments, product lines, customers, operations and other
considerations.
Business Segments
We operate in six business segments:
– Integrated Defense Systems;
– Intelligence and Information Systems;
– Missile Systems;
– Network Centric Systems;
– Space and Airborne Systems; and
– Technical Services.
The following is a description of each of our business segments. As part of the description, we include a discussion of some
of the segment’s notable initiatives and achievements in 2011, such as certain key contract awards, new product introductions
and acquisitions. For a discussion of the financial performance of our business segments and other financial information, see
pages 46-63 of this Form 10-K.
Integrated Defense Systems (IDS)—IDS, headquartered in Tewksbury, Massachusetts, is a leading provider of integrated
air and missile defense, radar solutions, and naval combat and ship electronic systems. Through world class mission systems
integration and technology expertise, IDS delivers combat-proven performance against the complete spectrum of airborne
and ballistic missile threats and is a world leader in large-scale radar development, technology and production. Key customers
include the U.S. Navy, Army, Air Force, and Missile Defense Agency (MDA) and numerous international customers.
In 2011, IDS received two significant contracts as the prime contractor for the Patriot Air and Missile Defense System: a
foreign military sales contract to build additional new Patriot fire units for Taiwan, and a direct commercial sales contract to
upgrade Saudi Arabia's Patriot Air and Missile Defense System to the latest Configuration-3. The Saudi award includes ground-
system hardware, a full training package and support equipment upgrades. IDS also received a contract for two Army Navy/
Transportable Radar Surveillance-Model 2 (AN/TPY-2) radars from the United Arab Emirates (UAE) as the radar component
of two Terminal High Altitude Area Defense (THAAD) air defense systems, marking the first international sale of the AN/
TPY-2. IDS was also awarded, in the second phase of a multiphase acquisition program, a strategic radar contract to further
develop the preliminary design for the U.S. Air Force Space Fence system. Also in 2011, IDS maintained its position as the
U.S. Navy's sole production supplier for lightweight torpedoes by winning a competitive contract for the MK 54 torpedo and
continued to serve as the prime mission systems integrator for all electronic and combat systems of the U.S. Navy's Zumwalt-
class destroyer program (DDG 1000). The DDG 1000 program continued to be impacted by the U.S. Navy's extension of the
program schedule in connection with the third ship of a three ship class.
IDS has the following principal product lines:
Integrated Air & Missile Defense (IAMD)—IAMD provides reliable and cost-effective missile defense systems that are
interoperable. IAMD provides the Patriot Air and Missile Defense System, which serves as the foundation for integrated air
and missile defense for the U.S. Army and international partners, including the Netherlands, Germany, Japan, Israel, Saudi