Northrop Grumman Reports Mixed Q3 Earnings: The Details

Northrop Grumman Corp NOC reported third-quarter financial results before the open on Thursday. Here’s a look at the key highlights from the quarter.

What Happened: Northrop Grumman reported third-quarter revenue of $9.996 billion, missing the consensus estimate of $10.181 billion, according to Benzinga Pro. The company reported quarterly earnings of $7 per share, beating analyst estimates of $6.08 per share.

Aeronautics Systems sales increased 4% year-over-year primarily due to higher F-35 production. Defense Systems sales increased 2% year-over-year primarily due to higher volume on the Sentinel program, ramp-up on the Stand-in Attack Weapon program and higher volume on certain military ammunition programs. Mission Systems revenue increased 7% year-over-year and Space Systems revenue grew 3%.

Net awards in the third quarter totaled $11.7 billion. The company said it had a backlog of $84.8 billion at quarter’s end.

"Based on the strength of our year-to-date results and our positive outlook for the future, we are once again raising our 2024 guidance. Sales remain on target for 5% growth this year and the deliberate actions we are taking to improve margin rates have resulted in further expansion this quarter," said Kathy Warden, chair, president and CEO of Northrop Grumman.

"With our investments to create capacity and focus on performance, we continue to deliver value for our customers and our shareholders. As we look toward 2025, our outlook includes continued top line growth, margin rate expansion and greater than 20% free cash flow growth."

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Northrop Grumman expects 2024 sales to be in the range of $41 billion to $41.4 billion versus estimates of $41.36 billion. The company raised its full-year earnings outlook from a range of $24.90 to $25.30 to a new range of $25.65 to $26.05, versus estimates of $25.20. Northrop anticipates full-year free cash flow of $2.25 billion to $2.65 billion.

Management will hold a conference call to discuss these results at 9 a.m. ET.

NOC Price Action: Northrop Grumman shares were up 1.19% at $522.55 at the time of publication Thursday morning, according to Benzinga Pro.

Photo: courtesy of Northrop Grumman.