Key Takeaways:
Lockheed Martin Corp. (NYSE: LMT) reported first-quarter earnings and revenue that fell short of Wall Street expectations, driven by production delays in its key Aeronautics unit.
"Lockheed Martin’s superior capabilities in delivering advanced defense technology and systems and in space exploration have been proven again and again in 2026," Jim Taiclet, Chairman, President and CEO, said in a statement, highlighting successes like the Artemis II mission and the effectiveness of its fighter jets and missile defense systems.
The defense contractor posted adjusted earnings of $6.44 per share on revenue of $18.0 billion, missing analyst forecasts.
Shares of Lockheed Martin fell as much as 6.3% in premarket trading following the announcement. The company reaffirmed its full-year 2026 guidance, projecting sales between $77.5 billion and $80.0 billion, which suggests management expects performance to improve through the year.
The primary driver of the earnings miss was the Aeronautics segment, where operating profit dropped 14% to $619 million. The division recorded $125 million in unfavorable profit adjustments from performance issues and development delays on the F-16 fighter jet program. An additional $55 million hit came from delivery delays for the C-130 transport aircraft.
Weakness was also present in other divisions. Rotary and Mission Systems operating profit fell 19%, while the Space segment’s profit dropped 26%. The lone bright spot was the Missiles and Fire Control unit, which saw operating profit rise 8% to $500 million, boosted by higher sales of Patriot missile defense systems.
The company's free cash flow swung to a negative $291 million from a positive $955 million in the year-earlier period, a change the company attributed to the timing of billing activities. Lockheed's total backlog at the end of the quarter stood at $186.4 billion, down from $193.6 billion at the end of 2025.
The reaffirmed guidance indicates confidence in overcoming the quarter's production hurdles. Investors will be closely watching the company's ability to resolve its F-16 and C-130 delivery issues in the upcoming quarters to meet its annual targets.
This article is for informational purposes only and does not constitute investment advice.
