Key Highlights
- Northrop Grumman, a US defense contractor, forecasted higher-than-expected full-year sales above Wall Street.
- It benefits from increased demand for weapons from countries, increasing their defense spending.
A US defense contractor, Northrop Grumman, forecasted full-year sales above Wall Street estimates since it benefits from increased demand for weapons from countries increasing their defense spending.
The United States and its allies have been increasing their purchases of arms and ammunition and supporting Ukraine with billions of dollars in military aid following Russia’s invasion of the country last year.
Northrop rolled out its new B-21 “Raider” jet during the quarter. It is the first of a new fleet of long-range stealth nuclear bombers for the United States Air Force. Northrop Grumman Chief Executive Kathy Warden said they are raising their sales outlook for 2023 and expect to deliver multi-year solid cash flow growth.
According to Refinitiv IBES data, The Falls Church, a Virginia-based company, expects 2023 sales to range between $38 billion and $38.4 billion, ahead of the average analyst estimate of $37.86 billion, and an adjusted profit of $21.85 to $22.45 per share compared with estimates of $22.30.
Rival companies like General Dynamics and Lockheed Martin have forecast their annual profits to be below estimates due to labor and supply shortages in the industry.
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Sales Stats
Northrop Grumman, which manufactures the fuselage for the F/A-18 Super Hornet fighter jet, recorded sales of approximately $10.03 billion for the quarter ending December 31, surpassing analysts’ average estimate of $9.66 billion.
The company’s space systems division, which produces satellites and payloads, saw a 23% increase in sales to $3.28 billion due to increased investments in space exploration projects.
The defense division, which develops integrated battle management systems and weapons
systems saw a sales increase to $1.66 billion from $1.38 billion.
The company’s overall adjusted net income was $7.50 per share, surpassing the average analyst estimate of $6.57 per share.
