Pentagon’s No.1 weapons supplier, Lockheed Martin Corp., has reported its second quarter 2025 financial results, showing steady sales but a sharp drop in net earnings due to program-related charges.
The results highlight the company’s resilience amid operational challenges and sustained global demand for advanced defense systems.
According to a press release from the company, second quarter sales totaled $18.2 billion, slightly up from $18.1 billion in the same period of 2024. Net earnings, however, fell to $342 million, or $1.46 per share, compared to $1.6 billion, or $6.85 per share, a year earlier. Lockheed Martin cited $1.6 billion in program losses and $169 million in other charges as the primary drivers of the decline.
“Over the course of the past few months, Lockheed Martin systems and platforms once again proved highly effective in combat operations and in deterring further aggression,” said Jim Taiclet, Lockheed Martin’s chairman, president, and CEO. “At the same time, our ongoing program review process identified new developments that caused us to re-evaluate the financial position on a set of major legacy programs. We remain committed to delivering these critical capabilities that our customers are counting on and are fully focused on the growth inflection we expect as the result of heightened interest and demand for Lockheed Martin’s products and technologies.”
The company reported $201 million in cash from operations for the quarter, down from $1.9 billion in the second quarter of 2024. Free cash flow was negative $150 million, compared to $1.5 billion in the prior-year period. Lockheed Martin attributed the decrease to program losses, working capital changes, and supply chain challenges.
Key issues included a $950 million loss in its Aeronautics segment on a classified program, a $570 million loss in the Canadian Maritime Helicopter Program (CMHP), and a $95 million loss in Turkey’s Utility Helicopter Program (TUHP). The company also reported $66 million in charges tied to the U.S. Air Force’s Next Generation Air Dominance (NGAD) program.
Despite these setbacks, the Aeronautics segment posted $7.4 billion in sales, driven largely by the F-35 fighter jet program. Missiles and Fire Control revenue climbed to $3.4 billion on strong demand for tactical missile systems, while the Space division reported $3.3 billion in sales, supported by Next Generation Interceptor and Fleet Ballistic Missile programs.
Lockheed Martin reaffirmed its full-year 2025 guidance, projecting sales between $73.75 billion and $74.75 billion, with diluted earnings per share expected in the range of $21.70 to $22.00.
“Overall, the company’s foundation remains solid and resilient,” Taiclet said. “We’re investing in emerging technologies, and as a proven mission integrator, we remain well positioned to support critical programs like the Golden Dome for America. Our relentless focus on operational performance combined with disciplined capital allocation will enable us to deliver value to our shareholders while providing the advanced solutions that America and its allies need to maintain peace through strength.”
Lockheed Martin also returned capital to shareholders during the quarter, paying $771 million in dividends and repurchasing $500 million in shares. The defense contractor’s backlog stood at $166.5 billion at the end of June, reflecting continued robust demand for its platforms and technologies.
The results underline Lockheed Martin’s ongoing leadership in the global defense sector while also exposing the challenges of managing complex programs in an evolving geopolitical environment.