Lockheed Martin Surprises With Strong Q1 as Missiles Division Drives Growth
Lockheed Martin (NYSE:LMT) posted better-than-expected earnings for the first quarter of 2025, driven by growth in its Missiles division. The defense contractor reported $18 billion in sales, a 4% increase from a year earlier, exceeding analyst expectations of $17.8 billion.
Warning! GuruFocus has detected 4 Warning Signs with LMT.
Net earnings rose to $1.7 billion, or $7.28 per share, up from $1.5 billion, or $6.39 per share, in the same period last year. Analysts had anticipated $6.35 per share. The company's stock rose 3.5% in premarket trading following the announcement.
Cash from operations came in at $1.4 billion, down from $1.6 billion, while free cash flow fell to $955 million from $1.3 billion. The company invested over $850 million in research and capital projects during the quarter and returned $1.5 billion to shareholders through dividends and share repurchases.
Lockheed's order backlog rose to $173 billion. It secured new contracts for Precision Strike Missiles, THAAD, JASSM/LRASM, and the Trident II D5 Life Extension, totaling roughly $10 billion in future work.
The company maintained its full-year sales forecast of $73.75 billion to $74.75 billion, in line with consensus estimates.
This article first appeared on GuruFocus.
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UBS statement on regulatory proposals made by the Swiss government
ZURICH, June 06, 2025--(BUSINESS WIRE)--Regulatory News: UBS (NYSE:UBS) (SWX:UBSN): Ad hoc announcement pursuant to Article 53 of the SIX Exchange Regulation Listing Rules UBS supports in principle most of the regulatory proposals the Swiss Federal Council published today.1 However, UBS strongly disagrees with the extreme increase in capital requirements that has been proposed. These changes would result in capital requirements that are neither proportionate nor internationally aligned. The proposals would require UBS to fully deduct investments in foreign subsidiaries from its CET1 capital. UBS would also need to fully deduct deferred tax assets on temporary differences (TD DTAs) and capitalized software from its CET1 capital. Furthermore, the proposals would necessitate an increase in prudential valuation adjustments (PVAs). Based on published financial information from the first quarter of 2025, and given UBS AG's target CET1 capital ratio of between 12.5% and 13%, UBS AG would be required to hold additional estimated CET1 capital of around USD 24bn on a pro-forma basis, if the recommendations are implemented as proposed. This includes around USD 23bn related to the full deduction of UBS AG's investments in foreign subsidiaries. These pro-forma figures also reflect previously announced expected capital repatriations of around USD 5bn. The incremental CET1 capital of around USD 24bn required at UBS AG would result in a CET1 capital ratio at the UBS Group AG (consolidated) level of around 19%. At Group level, the proposed measures related to TD DTAs, capitalized software and PVAs would eliminate capital recognition for these items in a manner misaligned with international standards. This would reduce the CET1 capital ratio at UBS Group to around 17%, underrepresenting UBS's capital strength. Further information is available at The additional capital of USD 24bn would be in addition to the previously communicated incremental capital of around USD 18bn UBS will have to hold as a result of the acquisition of Credit Suisse in order to meet existing regulations. This includes about USD 9bn to remove the regulatory concessions granted to Credit Suisse and around USD 9bn to meet the current progressive requirements due to the enlarged size of the combined business. As a result, UBS would be required to hold about USD 42bn in additional CET1 capital in total. As none of the regulatory changes are expected to become effective before 2027, UBS Group AG maintains its target of achieving an underlying return on CET1 capital of around 15% and an underlying cost/income ratio of <70% by the end of 2026 (both on an exit rate basis). UBS will provide an update on its longer-term returns targets when there is more clarity on the timing of potential changes and when the likely final outcome becomes more visible. ________________________________ [1] The proposals are available on the website of the Swiss government at UBS also reaffirms its capital return intentions for 2025. These include accruing for an increase of around 10% in the ordinary dividend per share and repurchasing up to USD 2bn of shares in the second half of the year, for a total of up to USD 3bn. This plan continues to be subject to UBS Group maintaining a CET1 capital ratio target of around 14% and achieving its financial targets and is consistent with UBS's previously communicated plans and conservative approach. UBS will communicate its 2026 capital returns ambitions with its fourth quarter and full-year financial results for 2025. UBS will actively engage in the consultation process with all relevant stakeholders and contribute to evaluating alternatives and effective solutions that lead to regulatory change proposals with a reasonable cost/benefit outcome. UBS will also evaluate appropriate measures, if and where possible, to address the negative effects that extreme regulations would have on its shareholders. As the largest truly global wealth manager and leading bank in Switzerland, with competitive global investment bank and asset management capabilities, UBS brings financial stability, expertise, economic benefits and international know-how to its home country and to all its clients globally. UBS remains committed to its diversified business model and its unique regional footprint as well as successfully completing the integration of Credit Suisse in the best interest of all stakeholders. UBS is reviewing the substantial amount of information published today and will share its further assessment in due course. Cautionary Statement Regarding Forward-Looking Statements This news release contains statements that constitute "forward-looking statements," including but not limited to management's outlook for UBS's financial performance, statements relating to the anticipated effect of transactions and strategic initiatives on UBS's business and future development and goals or intentions to achieve climate, sustainability and other social objectives. While these forward-looking statements represent UBS's judgments, expectations and objectives concerning the matters described, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from UBS's expectations. In particular, the global economy may suffer significant adverse effects from increasing political tensions between world powers, changes to international trade policies, including those related to tariffs and trade barriers, and ongoing conflicts in the Middle East, as well as the continuing Russia–Ukraine war. UBS's acquisition of the Credit Suisse Group has materially changed its outlook and strategic direction and introduced new operational challenges. The integration of the Credit Suisse entities into the UBS structure is expected to continue through 2026 and presents significant operational and execution risk, including the risks that UBS may be unable to achieve the cost reductions and business benefits contemplated by the transaction, that it may incur higher costs to execute the integration of Credit Suisse and that the acquired business may have greater risks or liabilities than expected. Following the failure of Credit Suisse, Switzerland is considering significant changes to its capital, resolution and regulatory regime, which, if proposed and adopted, may significantly increase our capital requirements or impose other costs on UBS. These factors create greater uncertainty about forward-looking statements. Other factors that may affect UBS's performance and ability to achieve its plans, outlook and other objectives also include, but are not limited to: (i) the degree to which UBS is successful in the execution of its strategic plans, including its cost reduction and efficiency initiatives and its ability to manage its levels of risk-weighted assets (RWA) and leverage ratio denominator (LRD), liquidity coverage ratio and other financial resources, including changes in RWA assets and liabilities arising from higher market volatility and the size of the combined Group; (ii) the degree to which UBS is successful in implementing changes to its businesses to meet changing market, regulatory and other conditions; (iii) inflation and interest rate volatility in major markets; (iv) developments in the macroeconomic climate and in the markets in which UBS operates or to which it is exposed, including movements in securities prices or liquidity, credit spreads, currency exchange rates, residential and commercial real estate markets, general economic conditions, and changes to national trade policies on the financial position or creditworthiness of UBS's clients and counterparties, as well as on client sentiment and levels of activity; (v) changes in the availability of capital and funding, including any adverse changes in UBS's credit spreads and credit ratings of UBS, as well as availability and cost of funding to meet requirements for debt eligible for total loss-absorbing capacity (TLAC); (vi) changes in central bank policies or the implementation of financial legislation and regulation in Switzerland, the US, the UK, the EU and other financial centers that have imposed, or resulted in, or may do so in the future, more stringent or entity-specific capital, TLAC, leverage ratio, net stable funding ratio, liquidity and funding requirements, heightened operational resilience requirements, incremental tax requirements, additional levies, limitations on permitted activities, constraints on remuneration, constraints on transfers of capital and liquidity and sharing of operational costs across the Group or other measures, and the effect these will or would have on UBS's business activities; (vii) UBS's ability to successfully implement resolvability and related regulatory requirements and the potential need to make further changes to the legal structure or booking model of UBS in response to legal and regulatory requirements and any additional requirements due to its acquisition of the Credit Suisse Group, or other developments; (viii) UBS's ability to maintain and improve its systems and controls for complying with sanctions in a timely manner and for the detection and prevention of money laundering to meet evolving regulatory requirements and expectations, in particular in the current geopolitical turmoil; (ix) the uncertainty arising from domestic stresses in certain major economies; (x) changes in UBS's competitive position, including whether differences in regulatory capital and other requirements among the major financial centers adversely affect UBS's ability to compete in certain lines of business; (xi) changes in the standards of conduct applicable to its businesses that may result from new regulations or new enforcement of existing standards, including measures to impose new and enhanced duties when interacting with customers and in the execution and handling of customer transactions; (xii) the liability to which UBS may be exposed, or possible constraints or sanctions that regulatory authorities might impose on UBS, due to litigation, contractual claims and regulatory investigations, including the potential for disqualification from certain businesses, potentially large fines or monetary penalties, or the loss of licenses or privileges as a result of regulatory or other governmental sanctions, as well as the effect that litigation, regulatory and similar matters have on the operational risk component of its RWA; (xiii) UBS's ability to retain and attract the employees necessary to generate revenues and to manage, support and control its businesses, which may be affected by competitive factors; (xiv) changes in accounting or tax standards or policies, and determinations or interpretations affecting the recognition of gain or loss, the valuation of goodwill, the recognition of deferred tax assets and other matters; (xv) UBS's ability to implement new technologies and business methods, including digital services, artificial intelligence and other technologies, and ability to successfully compete with both existing and new financial service providers, some of which may not be regulated to the same extent; (xvi) limitations on the effectiveness of UBS's internal processes for risk management, risk control, measurement and modeling, and of financial models generally; (xvii) the occurrence of operational failures, such as fraud, misconduct, unauthorized trading, financial crime, cyberattacks, data leakage and systems failures, the risk of which is increased with persistently high levels of cyberattack threats; (xviii) restrictions on the ability of UBS Group AG, UBS AG and regulated subsidiaries of UBS AG to make payments or distributions, including due to restrictions on the ability of its subsidiaries to make loans or distributions, directly or indirectly, or, in the case of financial difficulties, due to the exercise by FINMA or the regulators of UBS's operations in other countries of their broad statutory powers in relation to protective measures, restructuring and liquidation proceedings; (xix) the degree to which changes in regulation, capital or legal structure, financial results or other factors may affect UBS's ability to maintain its stated capital return objective; (xx) uncertainty over the scope of actions that may be required by UBS, governments and others for UBS to achieve goals relating to climate, environmental and social matters, as well as the evolving nature of underlying science and industry and the possibility of conflict between different governmental standards and regulatory regimes; (xxi) the ability of UBS to access capital markets; (xxii) the ability of UBS to successfully recover from a disaster or other business continuity problem due to a hurricane, flood, earthquake, terrorist attack, war, conflict, pandemic, security breach, cyberattack, power loss, telecommunications failure or other natural or man-made event; and (xxiii) the effect that these or other factors or unanticipated events, including media reports and speculations, may have on its reputation and the additional consequences that this may have on its business and performance. The sequence in which the factors above are presented is not indicative of their likelihood of occurrence or the potential magnitude of their consequences. UBS's business and financial performance could be affected by other factors identified in its past and future filings and reports, including those filed with the US Securities and Exchange Commission (the SEC). More detailed information about those factors is set forth in documents furnished by UBS and filings made by UBS with the SEC, including the UBS Group AG and UBS AG Annual Reports on Form 20-F for the year ended 31 December 2024. UBS is not under any obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise. View source version on Contacts UBS Group AG and UBS AG Investor contactSwitzerland: +41-44-234 41 00Americas: +1 212 882 57 34 Media contactSwitzerland: +41-44-234 85 00UK: +44-207-567 47 14Americas:+1-212-882 58 58APAC: +852-297-1 82 00
