Key Highlights
- Lockheed Martin delivered Q2 earnings per share of $7.94 on sales of $20.1 billion, surpassing Wall Street projections of $7.23 EPS and $19.37 billion in sales.
- Sales increased 11% compared to the same quarter last year, with positive contributions from each of the company’s four operating divisions.
- The defense contractor’s backlog reached an all-time high of $230 billion, climbing from $186 billion at Q1’s close, bolstered by a $35 billion THAAD interceptor agreement with the Missile Defense Agency.
- Annual 2026 EPS forecast increased to a midpoint of $30.30, surpassing analyst expectations of $29.85; sales forecast elevated to a midpoint of $80.75 billion.
- LMT shares climbed approximately 7% in premarket trading after the earnings announcement.
Lockheed Martin delivered robust second-quarter performance on Thursday, exceeding Wall Street projections for both profit and sales while elevating its annual forecast. Shares rose about 7% in premarket activity to approximately $548.50.
Lockheed Martin Corporation, LMT
Second-quarter adjusted earnings per share reached $7.94, beating the consensus estimate of $7.23 by $0.71. Sales totaled $20.1 billion, representing an 11% year-over-year increase and exceeding the projected $19.37 billion.
In the comparable period last year, Lockheed posted adjusted earnings per share of approximately $7.30 on sales of $18.2 billion. The year-over-year comparison benefited from the prior period including $1.6 billion in losses tied to a classified initiative and rotorcraft agreements.
Adjusted operating earnings jumped to $2.2 billion in the second quarter, compared with $571 million during the same three-month span a year prior.
Free cash flow totaled $2.9 billion for the quarter. This compares favorably to a negative $150 million in the second quarter of 2025.
Historic Backlog and Elevated Annual Projections
The standout figure that grabbed investor attention: the order backlog expanded to an unprecedented $230 billion, jumping considerably from $186 billion at the conclusion of the first quarter. The aerospace and defense giant secured $65 billion in fresh orders throughout the quarter.
This historic backlog incorporates a multi-year $35 billion agreement with the Missile Defense Agency for THAAD interceptor systems.
Each of the company’s four operating divisions ā aeronautics, missiles and fire control, rotary and mission systems, and space ā posted increases in both revenue and operating earnings during the quarter. The Missiles and Fire Control segment proved particularly strong, benefiting from expanded munitions manufacturing.
For the complete year, Lockheed now projects EPS in the range of $29.95ā$30.65, with a midpoint of $30.30. This exceeds the previous guidance midpoint of approximately $29.80 and beats the Street consensus of $29.85.
Sales guidance was elevated to $79.75ā$81.75 billion, with a midpoint of $80.75 billion, compared with previous guidance of $78.8 billion and the analyst consensus of $79.1 billion.
Free cash flow projections were also increased, now anticipated at $7.0ā$7.2 billion versus the earlier range of $6.5ā$6.8 billion.
Defense Spending Worries Remain
Notwithstanding the impressive quarterly performance, the stock has faced headwinds recently. LMT entered Thursday trading down roughly 22% since conflict erupted in Iran, as market participants have speculated whether military spending has reached its zenith.
A Democratic-led House following the midterm elections has amplified these worries, with budgetary constraints a persistent talking point.
CFO Evan Scott countered this view on Thursday. “We continue to see support for defense to be bipartisan,” Scott stated. “If you look historically, I think that’s absolutely been the case.”
Operating profit across all business segments for the complete year is now projected in the range of $8.5ā$8.7 billion, increased from the previous range of $8.425ā$8.675 billion.
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