Northrop Grumman Corporation NOC reported third-quarter 2026 adjusted earnings of $7.89 per share, which beat the Zacks Consensus Estimate of $7.22 by 9.3%. The bottom line also increased 2.9% from the year-ago quarter’s level of $7.67.
NOC’s Total Sales
NOC’s total sales of $11.12 billion in the third quarter beat the Zacks Consensus Estimate of $11.06 billion by 0.6%. The top line also improved 6.7% from $10.42 billion reported in the year-ago quarter.
Northrop Grumman Corporation Price, Consensus and EPS Surprise
Northrop Grumman Corporation price-consensus-eps-surprise-chart | Northrop Grumman Corporation Quote
Northrop Grumman’s Backlog Count
The company’s total backlog was $109.60 billion at the end of the third quarter of 2026, up from $95.68 billion at the end of 2025. During the quarter, Northrop Grumman secured net awards of $16.4 billion, including $4.6 billion for restricted programs, $2.0 billion for Sentinel, $1.4 billion for Virginia-class submarines, $1.3 billion for F-35 and $1.0 billion for E-2.
NOC’s Segmental Details
Aeronautics Systems: This segment’s sales of $3.58 billion rose 14% year over year, driven by higher sales on the F-35 program, increased B-21 sales and higher B-2 sustainment volume.
The unit’s operating income increased 23.6% to $377 million compared with $305 million in the third quarter of 2025. Its operating profit margin expanded 80 basis points (bps) to 10.5% from 9.7%.
Mission Systems: Sales in this segment increased 2% to $3.16 billion. The improvement was driven by the ramp-up of restricted airborne radar programs and higher volume on marine systems programs, partially offset by lower volume on restricted advanced microelectronics programs.
The unit’s operating income decreased 2.9% to $500 million compared with $515 million in the prior-year quarter. The operating margin contracted 90 bps to 15.8% from 16.7%, partly due to a favorable $68 million estimate-at-completion adjustment in the restricted advanced microelectronics portfolio in the year-ago quarter.
Defense Systems: This segment’s sales rose 12% year over year to $2.31 billion. The improvement was driven by the continued ramp-up of the Sentinel program, higher volume on the Guided Multiple Launch Rocket System Extended Range (GMLRS ER) program and increased volume on various tactical solid rocket motor programs. These gains were partially offset by lower volume on certain military ammunition programs.
The unit’s operating income increased 6.8% year over year to $250 million. However, the operating margin contracted 60 bps to 10.8% from 11.4%, primarily due to changes in contract mix toward more cost-type content.
Space Systems: Sales in this segment rose 1.9% to $2.75 billion. The improvement was driven by the ramp-up of programs in the restricted space portfolio, partially offset by $136 million in lower sales on Commercial Resupply Service missions due to launch timing.
The segment’s operating income increased 4.7% year over year to $312 million. The operating margin expanded 30 bps to 11.3% from 11%, primarily due to changes in contract mix toward more fixed-price content.
Northrop Grumman’s Operational Update
Total operating income during the third quarter increased 2% year over year to $1.19 billion from $1.17 billion in the prior-year quarter. The operating margin rate declined to 11.4% from 11.9%, primarily due to a decrease in the FAS/CAS operating adjustment. Segment operating income increased 5% to $1.44 billion, while the segment operating margin rate was 12.1% compared with 12.3% in the prior-year quarter.
Northrop Grumman reported third-quarter 2026 sales of $11.12 billion, up 7% year over year from $10.42 billion. Net earnings increased 2% to $1.12 billion, while earnings per share (EPS) rose 2.9% to $7.89 from $7.67 in the year-ago quarter.
NOC’s Financial Condition
Northrop Grumman’s cash and cash equivalents as of Sept. 30, 2026, totaled $3.74 billion, down from $4.40 billion as of Dec. 31, 2025.
Long-term debt, net of the current portion, amounted to $14.43 billion compared with $15.16 billion as of Dec. 31, 2025.
Net cash provided by operating activities totaled $1.37 billion during the first nine months of 2026 compared with $860 million in the year-ago period. Adjusted free cash flow reached $965 million compared with $72 million in the first nine months of 2025.
Northrop Grumman’s 2026 Guidance
The company expects its revenues to be in the range of $43.75-$44.25 billion, unchanged from its previous guidance. The Zacks Consensus Estimate for sales is pegged at $44.02 billion, above the midpoint of the company’s guided range.
NOC expects segment operating income in the band of $4.94-$5.04 billion compared with its previous guidance of $4.85-$5.00 billion.
The company raised its adjusted earnings guidance to $29.35-$29.75 per share from its previous guidance of $28.60-$29.10. The Zacks Consensus Estimate for earnings is pegged at $28.84 billion, below the company’s guided range.
Northrop Grumman continues to project adjusted free cash flow in the band of $3.10-$3.50 billion.
NOC’s Zacks Rank
NOC currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Defense Releases
The Boeing Company BA is set to report third-quarter 2026 earnings on Oct. 27, 2026, before market open.
The Zacks Consensus Estimate for BA’s loss is pegged at 14 cents per share. The consensus estimate for its sales is pegged at $24.53 billion, indicating year-over-year growth of 5.4%.
Lockheed Martin LMT is set to report third-quarter 2026 earnings on Oct. 22, 2026, before market open.
The consensus estimate for LMT’s earnings is pegged at $7.49 per share. The consensus estimate for its sales is pegged at $20.43 billion, indicating year-over-year growth of 9.8%.
General Dynamics Corporation GD is set to report third-quarter 2026 results on Oct. 30, 2026, before the market opens.
The Zacks Consensus Estimate for GD’s earnings is pegged at $4.14 per share. The consensus estimate for its sales is pegged at $13.71 billion, indicating year-over-year growth of 6.2%.
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