By Pratyush Thakur and Mike Stone (Reuters) – U.S. defense company Northrop Grumman on Thursday raised its 2024 profit forecast for the second time, amid increased global defense spending prompted by conflicts in the Middle East and the protracted Russia-Ukraine war. Geopolitical tensions have benefited arms manufacturers like Lockheed Martin and RTX, both of which […]
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Northrop Grumman lifts 2024 profit forecast again as global defense spending climbs
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By Pratyush Thakur and Mike Stone
(Reuters) – U.S. defense company Northrop Grumman on Thursday raised its 2024 profit forecast for the second time, amid increased global defense spending prompted by conflicts in the Middle East and the protracted Russia-Ukraine war.
Geopolitical tensions have benefited arms manufacturers like Lockheed Martin and RTX, both of which also raised their 2024 earnings outlook.
Northrop now expects its adjusted profit per share between $25.65 and $26.05, compared with its previous forecast of $24.90 to $25.30 per share. The company kept its annual sales forecast unchanged, projecting it to reach up to $41.4 billion.
“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 CEO Kathy Warden.
The company posted earnings per share of $7.00 for the third quarter ended Sept. 30, up from $6.18 per share a year earlier. Sales rose 2% to around $10 billion.
For 2025, the company said it expects margin dollars to grow at a faster pace than sales. Northrop was facing cost challenges on some of its fixed-price contracts due to inflation, strained supply chains, and labor shortages.
The B-21 Raider program incurred losses on initial production contracts and Northrop-managed Sentinel program, aimed at replacing the aging intercontinental ballistic missile system, had significantly exceeded its initial budget estimate.
(Reporting by Pratyush Thakur in Bengaluru; Editing by Shailesh Kuber)