Lockheed Martin Sales Rise 11% as Backlog Reaches $292 Billion

Lockheed Martin reported double-digit sales and earnings growth on October 22, with a record order backlog putting defense demand in focus ahead of Thursday’s U.S. stock-market open.

The company’s third-quarter sales rose 11% to $20.711 billion from $18.609 billion a year earlier. Net earnings increased 14% to $1.845 billion, or $7.97 a diluted share, compared with $1.619 billion, or $6.95 a share, in the prior-year quarter.

For investors in NYSE-listed LMT, the release provides a fresh operating update. It does not establish a Thursday closing price or verify a particular pre-market share-price reaction.

Missile award helps lift the order book

Backlog reached $292.0 billion, a company record. The total included $52.5 billion associated with a multiyear award to produce PAC-3 Missile Segment Enhancement interceptors.

A large backlog offers visibility into contracted work, but it is not the same as revenue already earned or cash already received. Delivery schedules, government funding, contract terms and production execution determine how that work ultimately translates into financial results.

Missiles and Fire Control sales rose to $4.501 billion from $3.624 billion. The segment generated $631 million in operating profit, compared with $510 million a year earlier, while its operating margin edged down to 14.0% from 14.1%.

All four businesses increase sales

Aeronautics remained the largest segment, with sales of $8.214 billion compared with $7.256 billion in the year-earlier quarter. Its operating profit increased to $743 million, although margin declined to 9.0% from 9.4%.

Rotary and Mission Systems sales rose to $4.511 billion from $4.373 billion. Space sales increased to $3.485 billion from $3.356 billion, while Space operating profit was unchanged at $331 million.

The figures show why investors should look beyond top-line growth. Higher sales can coexist with flatter or lower margins if costs, program mix or execution conditions change.

Strong cash generation, but below last year’s quarter

Cash from operations totaled $3.438 billion, compared with $3.728 billion a year earlier. Free cash flow, which Lockheed defines as operating cash flow less capital expenditure, was $2.999 billion versus $3.347 billion.

Capital spending increased to $439 million from $381 million. Thus, even with stronger sales and earnings, quarterly free cash flow did not rise year over year. The measure is non-GAAP and should be considered alongside operating cash flow rather than as a substitute for it.

Lockheed also updated its 2026 financial outlook. As investors assess that forecast, the key operational questions are whether the company can convert its record backlog into profitable deliveries and manage the funding, supply-chain and complex-program risks highlighted in its release. A large order book does not remove those risks.

Main image: F-35 fighter jet file photograph by Rafael Minguet Delgado / Pexels, cropped to 16:9 under the Pexels License. Used to illustrate Lockheed Martin’s aerospace business, not the earnings announcement itself.

Sources

• Lockheed Martin: third-quarter 2026 financial results, October 22
• Rafael Minguet Delgado / Pexels: original F-35 photograph; Pexels License