Northrop Grumman Stock Earnings Reports

Northrop Grumman reported a strong start to 2026 with Q1 sales of $9.9B (organic sales +5%), $9.8B of awards, and a $96B backlog. Demand across missile defense, weapons (including solid rocket motors), B-21, and Sentinel programs is robust driven by rising global defense budgets and U.S. budget/reconciliation funding flows. Management highlighted investments in capacity (20+ new facilities, >2M sq ft added) and over $1B invested in SRM/munition technologies; tactical SRM capacity has doubled with further expansion through 2027. Key program updates: agreement with the USAF to increase B-21 annual production rate by 25% (Lot 4 LRIP award received in Q1), Milestone B for Sentinel expected later in 2026 with first flight in 2027 and IOC in the early 2030s, and an award to accelerate Glide Phase Interceptor development (total GPI contract value $1.3B). Financials: segment operating income >$1B, consolidated segment margin ~10.8%, Q1 diluted EPS $6.14. Space had headwinds from prior NGI closeout and a $71M unfavorable adjustment on GEM 63XL, but other space work (SDA, restricted space) was strong and Artemis II success was highlighted. Management reaffirmed 2026 guidance: sales $43.5–44.0B, low-to-mid 11% segment margin rate, free cash flow target $3.1–3.5B, and increased 2026 CapEx to $1.85B (including an incremental $200M for B-21 capacity). Cash use in Q1 ~$1.8B; expect cash generation to ramp toward Q4. Management emphasized ability to scale further given contracts, customer alignment, and supplier engagement, while noting that higher growth beyond mid-single digits depends on converting international pipeline, securing additional contracts, and supplier scaling.