Northrop Grumman beats estimates as strong demand continues

Investing.com -- Northrop Grumman Corporation (NYSE: NOC) reported its first-quarter results before the open on Tuesday, exceeding analyst earnings and revenue expectations.

Earnings per share came in at $6.14, beating the consensus estimate of $6.05 by $0.09. Revenue reached $9.88 billion, surpassing the $9.76 billion analyst estimate and representing a 4% increase from $9.47 billion in the first quarter of 2025.

The defense contractor's strong performance was driven by a 17% sales increase at its Aeronautics Systems segment, which benefited from an agreement with the U.S. Air Force to expand B-21 production capacity and accelerate the Sentinel program's initial operating capability. Operating income surged 73% to $989 million, with operating margin expanding to 10.0% from 6.1% in the prior year period, primarily due to the absence of a $477 million B-21 loss provision recorded in the first quarter of 2025.

Shares declined 0.8% following the announcement.

"Northrop Grumman delivered strong first quarter results, with continued robust bookings, mid-single-digit organic sales growth, and solid operating performance, underscoring our ability to deliver in today's unprecedented global demand environment," said Kathy Warden, chair, chief executive officer and president.

The company reported net awards of $9.8 billion during the quarter and backlog of $95.6 billion. Organic sales increased 5% YoY. Segment operating income rose 89% to $1.07 billion, with segment operating margin rate improving to 10.8% from 6.0%.

Northrop Grumman reaffirmed its full-year 2026 guidance, projecting sales of $43.5 billion to $44.0 billion, segment operating income of $4.85 billion to $5.0 billion, MTM-adjusted EPS of $27.40 to $27.90, and free cash flow of $3.1 billion to $3.5 billion.

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