Northrop Grumman Corporation reported its financial results for the second quarter and first half of 2026, revealing a total sales increase of 5% to $10.9 billion for the quarter, compared to $10.4 billion in the same period last year. Year-to-date sales also rose by 5%, reaching $20.8 billion, up from $19.8 billion in 2025. The company's operating income for the second quarter decreased by 23% to $1.1 billion, primarily due to a $231 million gain from the divestiture of its training services business in the previous year. Net earnings for the quarter were $1.1 billion, down 7% from $1.2 billion in 2025, while diluted earnings per share fell to $7.68 from $8.15.
The company experienced notable changes in its operational performance across its four sectors. Aeronautics Systems saw a 13% increase in sales, driven by higher volumes in programs such as the B-21 and E-130J TACAMO. Defense Systems reported a 5% sales increase, although its operating income decreased by 38% due to lower net estimated contract adjustments. Mission Systems achieved a 3% sales increase and a 14% rise in operating income, while Space Systems experienced a 4% sales increase but a 16% decline in operating income, attributed to unfavorable adjustments on the Graphite Epoxy Motor program.
Northrop Grumman's total backlog as of June 30, 2026, stood at $104.7 billion, reflecting a 9% increase from the previous year. The company secured $20 billion in new awards during the second quarter, including significant contracts for the Sentinel program and various restricted programs. The backlog indicates a strong pipeline of future revenue, with approximately 35% expected to be recognized as revenue over the next 12 months.
The company’s cash and cash equivalents decreased to $2.3 billion from $4.4 billion at the end of 2025, primarily due to cash used in operating activities and capital expenditures. Northrop Grumman reported net cash used in operating activities of $376 million for the first half of 2026, a significant improvement from $697 million in the same period last year. The company continues to focus on efficient cash management to support its operational needs and shareholder returns.
Looking ahead, Northrop Grumman remains optimistic about its growth prospects, driven by ongoing investments in advanced technologies and a favorable global security environment. The company is actively evaluating opportunities to enhance its capabilities and meet the evolving needs of its customers, particularly in defense and aerospace sectors. However, it acknowledges potential risks related to macroeconomic conditions, government spending priorities, and geopolitical tensions that could impact its operations and financial performance.
About NORTHROP GRUMMAN CORP /DE/
Northrop Grumman is a leading aerospace and defense technology company providing space systems, military aircraft, missile defense, mission systems, and advanced electronics. Serving primarily the U.S. government and international customers, it offers integrated solutions for national security, including stealth aircraft, satellites, missile interceptors, and cyber capabilities. Its business model focuses on long-term government contracts, innovation, and technological leadership in defense and space markets.
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