Raytheon CEO Hayes Tells Investors "Peace Not Going to Break Out" in Middle East, Sees Solid Growth

On January 28, 2021, during a quarterly earnings call just days after Joe Biden’s inauguration, Raytheon CEO Greg Hayes told investors that “peace is not going to break out in the Middle East anytime soon,” framing ongoing regional conflicts and violence as positive factors for company revenue. Hayes made the statement while discussing Raytheon’s financial outlook and expectations for continued weapons sales to Gulf states, particularly Saudi Arabia. The CEO’s explicit celebration of conflict as a business opportunity came amid the Biden administration’s review of Saudi arms sales due to Yemen war crimes, and while Raytheon faced potential loss of a $519 million Paveway bomb contract to Saudi Arabia. Hayes indicated that while the administration might temporarily block “offensive” weapons like Paveway bombs, Raytheon anticipated no issues selling “defensive” systems like Patriot missiles and expected “solid growth” in the region. The statement exemplified how defense contractor executives explicitly viewed war and violence as revenue opportunities rather than tragedies requiring diplomatic solutions.

Biden Arms Sales Review Threat

Hayes’s earnings call occurred during the first week of Biden’s presidency, as the new administration conducted a comprehensive review of Trump-era arms sales to Saudi Arabia. Biden had campaigned on promises to reassess the US-Saudi relationship due to Yemen atrocities and the Khashoggi murder. Raytheon faced potential cancellation of a $519 million contract to sell 7,500 Paveway precision-guided bombs to Saudi Arabia—weapons of the same type documented in multiple Yemen civilian-casualty incidents including the 2018 school bus massacre. Hayes acknowledged to investors that Raytheon had removed this sale from its financial projections, anticipating Biden would block the transfer. However, rather than expressing concern about Yemen civilian casualties or corporate accountability, Hayes framed the potential arms sale restriction as a minor, temporary obstacle that would not affect Raytheon’s overall Middle East revenue. He distinguished between “offensive” weapons like Paveway bombs and “defensive” systems like Patriot missiles, suggesting the latter would continue flowing to Saudi Arabia regardless of Yemen concerns—a distinction that critics noted was artificial since all weapons supported the Saudi military apparatus conducting Yemen operations.

Celebrating Conflict as Corporate Strategy

Hayes’s statement that “peace is not going to break out…anytime soon” represented an unusually explicit acknowledgment that Raytheon’s business model required ongoing Middle East conflicts and violence. While defense contractor CEOs typically couched similar sentiments in euphemisms about “regional instability” or “persistent threats,” Hayes stated plainly that he expected continued conflict and viewed this as positive for Raytheon’s financial performance. The comment drew sharp criticism from peace activists and congressional progressives, who viewed it as a CEO celebrating human suffering for profit. Hayes defended the comment by arguing Raytheon simply responded to legitimate defense needs rather than creating conflicts, but critics noted the company’s extensive lobbying on Middle East policy, its revolving door relationships with officials making military decisions, and its aggressive marketing of regional tensions as threats requiring weapons purchases all suggested Raytheon actively worked to perpetuate the conflicts from which it profited. The statement revealed the moral economy of defense contracting: company leadership explicitly celebrated violence as a revenue driver rather than a problem requiring solutions.

Saudi Arabia’s 5% of Raytheon Revenue

Hayes disclosed that Saudi Arabia accounted for approximately 5% of Raytheon’s total annual revenue—a significant customer representing billions in sales but not so large that losing Saudi contracts would threaten the company’s viability. This disclosure revealed the economics of Raytheon’s Saudi relationship: substantial revenue that justified aggressive lobbying to preserve, but distributed widely enough across Raytheon’s business that no single policy change could seriously threaten overall profitability. The 5% figure explained why Raytheon fought so hard to maintain Saudi arms sales during 2018-2020 controversies over Yemen and Khashoggi, while also showing why potential Biden restrictions on specific weapons like Paveway bombs represented manageable risks. For Hayes, the key was ensuring continued Saudi purchases of high-margin systems like Patriot missiles regardless of restrictions on specific weapons categories. The revenue diversification across products and customers insulated Raytheon from accountability for any particular weapons misuse—Yemen atrocities might temporarily threaten Paveway sales, but wouldn’t affect the broader Saudi relationship or Raytheon’s overall Middle East revenue.

Significance

Greg Hayes’s January 28, 2021 statement that “peace is not going to break out in the Middle East anytime soon” provided rare explicit acknowledgment from a defense contractor CEO that company profitability depended on ongoing conflicts and violence, revealing the fundamental misalignment between corporate incentives and public interest in peace. The comment came during a moment when Raytheon faced potential accountability through Biden administration arms sale restrictions, yet Hayes expressed confidence that regional violence would generate continued weapons demand regardless of specific policy changes. For critics of the military-industrial complex, Hayes’s statement validated decades of warnings that defense contractors had financial incentives to perpetuate warfare: Raytheon’s CEO explicitly told investors the company’s Middle East growth prospects depended on conflicts not being resolved. The earnings call demonstrated how defense contractors had captured policy through multiple mechanisms: Raytheon employed former Pentagon officials (including former Defense Secretary Mark Esper), lobbied extensively on Middle East policy, and profited from the resulting conflicts while facing minimal accountability for weapons misuse. Hayes’s frank discussion of conflict as revenue opportunity, while unusually explicit, simply stated openly what defense contractor business models required—a steady stream of military spending driven by violence and tensions. The statement revealed the structural corruption of privatized warfare: when corporations profit from conflicts, they gain incentives to lobby for military engagement over diplomatic solutions, to oppose arms sale restrictions even after documented war crimes, and to market regional tensions as permanent conditions requiring continuous weapons purchases. Hayes’s confidence that peace would not “break out”—his choice of “break out” framing peace as disease rather than desired outcome—captured the defense contractor worldview where violence represented business opportunity and peace represented revenue threat requiring prevention through political influence and military relationships.