Lockheed Martin Reports Q2 2025 Sales of $18.2 Billion, Net Earnings Decline

Lockheed Martin Corporation reported its financial results for the second quarter and first half of 2025, revealing total sales of $18.2 billion for the quarter, a slight increase from $18.1 billion in the same period last year. For the first six months, sales reached $36.1 billion, up from $35.3 billion in 2024. However, net earnings for the quarter fell to $342 million, or $1.46 per share, compared to $1.6 billion, or $6.85 per share, in the prior year. For the first half, net earnings were $2.1 billion, down from $3.2 billion in 2024, reflecting a significant decline in profitability.

The company's operating costs and expenses increased to $17.4 billion for the quarter, up from $16 billion a year earlier, driven by higher costs in both products and services. The Aeronautics segment, which includes the F-35 program, reported a loss of $98 million for the quarter, primarily due to a $950 million reach-forward loss on a classified contract. In contrast, the Missiles and Fire Control segment saw an operating profit of $479 million, benefiting from increased production on missile programs. The Rotary and Mission Systems segment experienced a loss of $172 million, largely due to losses on the Canadian Maritime Helicopter Program and the Turkish Utility Helicopter Program.

Lockheed Martin's strategic developments included the acquisition of Amentum’s Rapid Solutions business for $360 million, aimed at enhancing capabilities in radar and payload technology within its Space segment. This acquisition is expected to bolster Lockheed Martin's offerings in domain awareness and real-time missions. The company also reported a backlog of $166.5 billion, indicating strong future revenue potential, with approximately 38% expected to be recognized over the next 12 months.

Operationally, Lockheed Martin faced challenges related to supply chain disruptions and inflation, which have impacted production schedules and costs. The company reported an increase in contract assets, primarily due to the F-35 program, and a rise in inventories. Cash and cash equivalents at the end of the quarter stood at $1.3 billion, down from $2.5 billion at the beginning of the year, reflecting a decrease in cash flow from operations, which was significantly affected by working capital changes.

Looking ahead, Lockheed Martin anticipates continued demand for its products and services, particularly in defense and aerospace sectors, despite the ongoing geopolitical tensions and economic uncertainties. The company remains focused on enhancing operational efficiency and managing costs while navigating the complexities of government contracting and supply chain management.