Latest news with #F35
Yahoo
15 hours ago
- Business
- Yahoo
Lockheed Martin Corp (LMT) Q2 2025 Earnings Call Highlights: Navigating Challenges with ...
Revenue: $18.2 billion for the second quarter, comparable year-over-year and up sequentially from the first quarter. Sales Growth: Excluding charges, sales increased in the mid-single-digit range. Segment Operating Profit: $570 million, impacted by $1.6 billion in charges related to Skunk Works and Sikorsky. Net Losses: $1.8 billion in total charges across several legacy programs. Earnings Per Share (EPS): $1.46, reduced by $5.83 due to program losses and tax items. Free Cash Flow: Usage of $150 million in the second quarter. Shareholder Returns: $1.3 billion returned through dividends and share repurchases. F-35 Deliveries: 50 aircraft delivered in the quarter, with a total of 97 so far this year. Guidance: 2025 sales guidance reaffirmed at $73.75 billion to $74.75 billion. Backlog: $167 billion, with significant awards expected in the second half of the year. Warning! GuruFocus has detected 2 Warning Signs with LMT. Release Date: July 22, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Lockheed Martin Corp (NYSE:LMT) reported $18 billion in sales for the second quarter, demonstrating strong revenue generation. The company invested $800 million in infrastructure and innovation, indicating a commitment to future growth. Lockheed Martin Corp (NYSE:LMT) returned $1.3 billion to shareholders, showcasing a strong commitment to shareholder value. The F-35 program remains on track with 97 deliveries so far this year, highlighting operational efficiency. Lockheed Martin Corp (NYSE:LMT) demonstrated the effectiveness of its systems in recent combat operations, reinforcing its role in national security. Negative Points Lockheed Martin Corp (NYSE:LMT) recognized $1.8 billion in losses across several legacy programs, impacting financial performance. The company faced significant charges related to the Aeronautics Classified Program and other legacy programs, indicating ongoing challenges. US government sanctions affected the Turkish Utility Helicopter Program, resulting in a $95 million loss. The Canadian Maritime Helicopter Program incurred a $570 million loss due to revised cost and sales estimates. The IRS asserts that Lockheed Martin Corp (NYSE:LMT) owes $4.6 billion in additional income tax, creating potential financial uncertainty. Q & A Highlights Q: Why should investors feel comfortable that Lockheed Martin has derisked the problem programs, particularly the Aero Classified one? What changes have been made? A: James Taiclet, CEO, explained that with Evan Scott's succession as CFO, a new program review team was formed with wider expertise and higher-level management scrutiny. This team reassessed cost trends and reevaluated program assumptions, leading to additional charges. The programs will continue to be monitored with robust oversight, and there is a policy in place to avoid must-win programs, ensuring no outsized future risks. Q: Why did it take a billion dollars of charges to change the way you're reviewing the Aero Classified program? How does the $1.8 billion in charges affect cash flow? A: James Taiclet noted that the charges were due to new discoveries of cost risks and anomalies in the development phase. Evan Scott added that $500 million of cash usage is expected this year, stepping down to $400 million next year, with a line of sight to when it turns positive. Q: Can you explain the reduction in the F-35 units in the administration's FY26 request and how easy it is to swap out relinquished DoD slots with export customers? A: James Taiclet stated that the House Appropriations Committee increased the number of F-35s from 47 to 69, and the Senate marked it up to 57. Historically, appropriations committees have the final say, and there is hope for greater demand by the end of the budget process. Evan Scott added that the backlog remains strong, allowing flexibility in production planning. Q: What is the $4.6 billion tax liability related to, and how will it impact free cash flow? A: Evan Scott explained that the IRS's position on a tax accounting method change is being contested, with Lockheed Martin standing by its approach. A $100 million P&L charge was taken for interest. For 2026, a $1 billion pension contribution is assumed, with various factors impacting cash flow, including reach-forward charges and tax benefits. Q: Can you discuss the F-35's role in modern warfare and its priority for the DoD today? A: James Taiclet emphasized the F-35's critical role in modern warfare, citing its orchestration capabilities and combat-proven status. Despite budget cuts, the F-35 remains essential, and Lockheed Martin is focused on bridging capabilities to the next generation while maintaining strong international demand. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Automotive
- Yahoo
Reworked F-35 Pitched As ‘Bridging Fighter' Ahead Of F-47
Taiclet then moved on to the company's proposal to provide the F-35 with a range of potential modifications to create what was previously referred to as a 'Ferrari' or 'NASCAR upgrade' to the F-35's core 'chassis.' The company is now increasingly describing this initiative as a 'fifth-generation-plus' development of the basic F-35. As to what comes next for the F-35, Taiclet said he was 'very, very confident that the F-35 is here to stay and here to stay for a long time,' recalling that fact that it is the 'only fifth-generation fighter aircraft in production today in the free world.' Taiclet noted that, as well as air-to-ground, the F-35 has, in recent campaigns in the Middle East, excelled in terms of its 'orchestration of numerous other platforms.' Those other platforms have included assets at sea, in space, as well as other aircraft, including fourth-generation ones. Talking about the F-35, Taiclet pointed to the aircraft's success in the U.S. attacks on nuclear facilities in Iran last month, Operation Midnight Hammer . The CEO describes that particular mission as being 'led by the F-22 and F-35.' Between them, the stealth fighters 'provided the air dominance and defense suppression required for the bombers to reach Iran's hardened nuclear sites,' Taiclet said. 'Our platforms operated essentially undetected in highly defended and contested airspace, underscoring the value of advanced stealth, superior electronic warfare, and broadband communications capability.' In the second quarter, Lockheed Martin delivered 50 F-35s, bringing the company's total deliveries for the year to 97. More significantly, the manufacturer has now handed over 207 F-35s since it resumed deliveries last year , having paused them for around a year due to problems with the vital Tech Refresh 3 suite, or TR-3. The company says it is now on track to deliver between 170 and 190 F-35s this year. These details and more were provided in a second-quarter earnings call earlier today that involved Taiclet as well as Lockheed Martin Chief Financial Officer Evan Scott, and Maria Ricciardone, the company's Vice-President, Treasurer and Investor Relations. Lockheed Martin envisages its F-35 stealth jet as the 'bridging fighter' that will allow the U.S. Air Force to transition to the sixth-generation F-47, from rival Boeing. Speaking today, Lockheed Martin CEO Jim Taiclet reiterated the goal of inserting technologies developed under the company's unsuccessful Next Generation Air Dominance (NGAD) bid into a future version of the F-35. At the same time, the company discussed 'a highly classified program' in the aeronautical sector on which it admits it has so far suffered significant financial losses. La historia continúa 'We did bid on NGAD, and we weren't selected,' Taiclet reflected, referring to Lockheed Martin's loss to Boeing, which is now building the F-47 crewed sixth-generation fighter to meet that requirement. An artist rendering of Boeing's F-47. U.S. Air Force 'But the pivot that we made is one we're taking very seriously, which is how we create a bridge from today's fifth generation to the sixth-generation NGAD, which might not be fielded for a lot of years,' Taiclet said. 'How do we bridge capability there?' Taiclet continued. 'We're going to port a lot of our own NGAD R&D over to the F-35 and potentially over to the F-22 as well.' The CEO again stated the aspiration to develop modifications to the F-35 that mean the company can offer 80 percent of the effectiveness of a sixth-generation fighter, at 50 percent of the cost per unit. Taiclet added that, in terms of matching capabilities, the 80 percent figure also referred to the degree of stealth, as well as 'other aspects.' The fifth-generation-plus version of the F-35 is, Taiclet contended, 'the best-value option for the U.S. government going forward; it will be only one I'm aware of that will make that bridge, for maybe 10 years.' Not immediately clear is whether Taiclet expects a major delay on the F-47 program that will make an interim fighter a more urgent priority, although that would be one interpretation of this. As it stands, the Air Force has not said when it expects the F-47 to achieve initial operating capability. An Air Force graphic that states the F-47 would become operational between 2025 and 2029 very likely refers to the planned first flight of the F-47 and some of its developmental testing, as you can read about here. U.S. Air Force Although not discussed today in the course of the earnings call, in the past, Lockheed Martin has raised the possibility of a pilot-optional F-35, as well as new infrared and radar coatings. This latter modification corresponds with secretive U.S. military testing in recent years of new mirror-like coatings on F-35s, as well as F-22 Raptor and F-117 Nighthawk stealth jets. A U.S. Navy F-35C test jet with a mirror-like coating. U.S. Navy Other F-35 modifications discussed by the company include electronic warfare improvements, networking improvements, and autonomy. Lockheed Martin has also previously discussed potential changes to the F-35's outer mold line, especially with regard to the engine inlets and exhaust nozzle. Meanwhile, the feasibility of the fifth-generation-plus proposal, as well as the huge claims around the capability/cost match of such an aircraft compared to a sixth-generation design, remains very much open to question. However, the company is confident that such advances are not only possible but can also be achieved rapidly, if required. Earlier this year, Taiclet said he thought that, in the space of two to three years, it would be possible to port enough of the NGAD technologies over into the F-35 to provide 'a meaningful increase in capability for the F-35.' That two-to-three-year timeline related to 'first flight and integration,' Taiclet added. A U.S. Air Force KC-135 Stratotanker refuels a U.S. Air Force F-35A off the coast of Greece in October 2024. U.S. Air Force photo by Senior Airman Edgar Grimaldo Senior Airman Edgar Grimaldo It's also worth noting that, earlier this year, U.S. President Donald Trump mentioned the so-called F-55, a purported development of the F-35. Trump described the F-55 as a twin-engined F-35 and also discussed an 'F-22 Super' that would be an upgraded version of the Raptor. The exact status of the F-55 remains unclear, if it ever existed. Taiclet also discussed a separate 'highly classified' aeronautical program being run by Lockheed Martin Skunk Works, as a part of that division's efforts to 'push the boundaries of science and technology to deliver highly advanced solutions that provide our customers a step-function advantage over potential adversaries.' It's notable that such a project would even be mentioned, although its discussion within the context of the earnings call was limited to the losses that it has accumulated for the company. There was no indication whether the platform is crewed or uncrewed, or what kind of mission it will fulfil, although there have been other reports of secretive Skunk Works projects going over budget. F-35s under construction. Lockheed Martin 'This particular program discovered new insights in the quarter that required us to adjust our expected future costs on that program and then recognized the charge for doing so,' Taiclet added. 'I acknowledge the losses on this classified program are significant. Again, we are taking these charges very seriously.' In response to the losses, Lockheed Martin has made changes to the program team management and assigned experts across the company to improve the performance and oversight of this program under what Taiclet said was 'a comprehensive risk-identification and corrective action plan.' 'This is a highly classified program that can only be described as a game-changing capability for our joint U.S. and international customers,' Taiclet added, 'and therefore it is critical that it be successfully fielded.' With the classified program now at least being publicly acknowledged for the benefit of company shareholders, it's possible that more information about it might begin to emerge. Clearly, however, Lockheed Martin's efforts to develop advanced new aerospace technologies encompass programs above and beyond its ongoing efforts to rework the F-35. Contact the author: thomas@
Bloomberg
a day ago
- Business
- Bloomberg
Stock Movers: Texas Instruments, GM, Lockheed Martin
On this episode of Stock Movers: Listen for comprehensive cross-platform coverage of the US market close as heard on Bloomberg Television, Bloomberg Radio, and YouTube with Romaine Bostick, Scarlet Fu, Carol Massar and Tim Stenovec. - Texas Instruments (TXI), a key chipmaker for producers of cars and factory equipment, declined in late trading after giving a revenue forecast that fell short of the most bullish estimates. Revenue will be $4.45 billion to $4.8 billion in the third quarter, the company said in a statement Tuesday. Though the average analyst estimate was $4.57 billion, some projections reached $4.8 billion. Profit in the period will be roughly $1.48, the company said, slightly below the average estimate. The outlook raises concern that a resurgence in spending, particularly among automotive and industrial customers, isn't arriving as quickly as hoped. Many buyers had been holding off on orders while they worked through a stockpile of existing inventory. Texas Instruments also said that its forecast 'does not include changes related to recently enacted US tax legislation.' Capital spending, meanwhile, grew more than expected last quarter. - Lockheed Martin (LMT) shares dropped after it caught investors off guard with $1.6 billion in charges and a possible tax hit that sent its stock tumbling, the latest setback for the defense giant whose popular F-35 jet faces criticism over cost overruns and delays. The company's shares plunged more than 9% on Tuesday - the biggest drop since January - after the world's largest defense contractor reported earnings that missed analyst estimates and lowered its outlook for the year. At issue, the company said, were program losses that included a classified aeronautics program, and separate helicopter development efforts for the Canadian and Turkish governments. It also flagged $169 million of charges related to losing out on the US Air Force's F-47 fighter jet contract that went to Boeing Co., and other newly identified risks. Lockheed also cautioned it faces a potential $4.6 billion in additional taxes owed after an accounting change, although it is contesting the matter with the Internal Revenue Service. - GM (GM) shares slid after it said it suffered a $1.1 billion profit hit from Donald Trump's tariffs and revealed no plan for a near-term fix to return to pre-tariff profit levels. The Detroit-based automaker said Tuesday it earned $2.53 per share on an adjusted basis, above the Bloomberg consensus forecast of $2.33 but short of the $3.06 it made a year ago. GM's profits also suffered from higher warranty costs and a buildup in inventory of electric vehicles, which are set to lose federal subsidies under Trump's recently passed budget bill. GM's results showcase the difficulty automakers face to maintain profits in an environment that newly penalizes globally integrated parts supply chains and cross-border vehicle sales. Even though the automaker beat profit expectations, earnings in its all-important US business suffered from import duties on vehicles made in China, Mexico and South Korea.
Yahoo
a day ago
- Business
- Yahoo
Belgium to add F-35s, spend billions on anti-air in defense catch-up
Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Generate Key Takeaways PARIS — Belgium will buy more F-35s, a third frigate and spend billions of euros on air defense as part of an updated strategic plan approved by the government on Friday, with the country seeking to fix capability gaps after decades of being one of NATO's lowest spenders on defense. Belgium's military requires a 'thorough transformation' to create a force fit to deter and for high-intensity warfare rather than expeditionary missions, Defence Minister Theo Francken wrote in a foreword to the 100-plus-page Strategic Vision 2025 report . In addition to more hardware, the plan calls for raising the number of military personnel by around a third by 2034. 'A country like Belgium can only remain free and sovereign by aligning itself with loyal and powerful partners,' Francken said. 'And we can only count on their loyalty if we are prepared to show solidarity in their defense.' The new Belgian government earlier this year agreed to lift defense spending to 2% of GDP, for a budget of €12.8 billion (US$14.9 billion) in 2025, breaking with decades lingering at the bottom of NATO's defense-spending tables. The country allocated an estimated 1.29% of GDP to defense in 2024, with only Spain doing worse. As part of the strategic plan published on Friday, Belgium is budgeting €34.8 billion in capacity commitments for 2026-2034, with €24.7 billion of the funds to be spent over the period. 'Through concrete commitments, the government aims to restore the country's diplomatic credibility,' Francken said. 'It's against this backdrop that this new strategic vision has been approved by the government.' The current defense budget can't patch all the gaps left by years of under-investment, and Belgium will focus on priority areas, according to the report. Those include making its medium motorized brigade fully operational, creating layered air defenses, building up ammo supplies to ensure readiness, adding air-combat capability and expanding maritime surface-combat capacity. Planned purchases include an additional 11 F-35 fighters for a budget of €1.67 billion, with orders planned next year. Belgium has already ordered 34 of the jets, with eight delivered so far and the entire fleet expected to be operational early 2031. High-intensity operations and new threats such as drones and hypersonic missiles make strengthening the air force component 'absolutely necessary,' while the war in Ukraine has demonstrated the need for air power to avoid a stalemate, according to the report. Belgium currently lacks any ground-based missile defense, and will buy 10 NASAMS systems from Kongsberg for €2 billion, with orders in 2026, as a first step to gradually building up an anti-air capability. The aim will be to defend the entire territory, with a focus on sensitive infrastructure, according to the plan – Belgium is home to Europe's second-busiest port in Antwerp as well as NATO headquarters in Brussels. The government also intends to buy three long-range air-defense systems, with a budget of €2 billion and a first commitment planned in 2029. For the long-range systems, full interoperability with the air-defense capacities of the Netherlands 'must absolutely be guaranteed.' While the report didn't go into details, Belgium's northern neighbor operates the U.S. Patriot system. The budget plans over the period also include €13.9 billion for the country's land motorized capability, of which €6 billion are for combat maneuver. Belgium says it's committed to providing NATO with a motorized medium brigade, a motorized light brigade and a joint motorized medium-combat reconnaissance battalion together with Luxembourg. The medium brigade will have around 7,800 troops and 2,700 vehicles of various types, with the goal of being able to field the completed brigade in 2030, particularly in a NATO context. To bolster the naval component of the armed forces, Belgium plans to buy a third anti-submarine warfare frigate, for a budget of €1.3 billion. Belgium and the Netherlands each ordered two ASW frigates from Damen in 2023, with the Netherlands saying last year it would double its order as part of increased defense spending . The country also plans to order a third MQ-9B SkyGuardian drone in 2027 for a budget of €254 million. The Belgian government in April agreed to increase defense spending to 2% of GDP in 2025 and maintain that level through to 2033, before an increase to 2.5%. After the NATO meeting in June, where allies agreed on core defense spending of 3.5%, the government will 'study the modalities' of a potential increase, Francken said. Based on the current plans and economic outlook, Belgian defense spending would rise gradually to €16.5 billion in 2033 before a jump to €21.3 billion in 2034, according to the strategy report. Belgium's strategic goals for 2035 are to prepare for a high-intensity military conflict in a context of collective defense, protect its territory and to anticipate future warfare, according to the report. The government goal is to increase military personnel to 29,000 by the end of 2029 and rising to 34,500 personnel by the end of 2034, from 26,200 troops at the start of this year, while also more than tripling the number of civilian defense staff. Belgium additionally plans to expand its reserve force five-fold to 12,800 by the end of the planning period, as well as introduce a voluntary military service year for young adults in 2026, following the example of the Dutch service-year program started in 2023. Francken said the threat of war is now greater than at any time during the Cold War, and Belgium lacks readiness in all areas, including a population that is insufficiently informed and aware of the reality of military threats. The U.S. pivot to Asia means Europe is forced to assume a certain level of strategic autonomy, and Belgium argues for developing a European defense pillar within NATO, according to Francken. An end to the war in Ukraine could prompt Russia to test the solidarity of NATO, for example by invading a Baltic country or through a targeted missile attack on an alliance member, the latter of which could include Belgium, the strategy report said.
Yahoo
a day ago
- Business
- Yahoo
Why Lockheed Martin Stock Is Falling Today
Key Points One-time charges led to a significant profit miss. Lockheed Martin still has a solid business, but there are few immediate catalysts. 10 stocks we like better than Lockheed Martin › Lockheed Martin's (NYSE: LMT) quarter was loaded with cost overruns and write-offs, causing the defense contractor to miss expectations. Investors were disappointed, sending Lockheed shares down more than 5% as of 10:30 ET Tuesday. Charges eat into results Lockheed Martin ranks as the world's largest defense contractor, but the company has come on hard times of late. The maker of the F-35 and a wide range of helicopters, missiles, and space systems has been shut out of recent high-profile awards, including the new fighter jet program that went to Boeing. Lockheed shares are down about 14% from their peak for the year. The company's latest results are not helping reverse the momentum. Lockheed earned $1.46 per share in the quarter on revenue of $18.2 billion, missing Wall Street's consensus estimate for $6.52 per share in earnings on revenue of $18.6 billion. There is a lot of noise in that earnings number. Quarterly results included $1.6 billion in program losses including $950 million on a classified aerospace project. Absent those charges, earnings would have come in at $7.29 per share. Free cash flow was also soft. Lockheed used $150 million in cash, compared to an estimate for $1.2 billion in positive free cash flow, thanks to slower-than-expected F-35 deliveries. Is Lockheed Martin stock a buy? The charges were mostly one-time items, but unfortunately for investors there is no reason to believe things will improve anytime soon. Lockheed's book-to-bill, a measure of future business compared to current-quarter revenue, was an anemic 0.8x, with none of the company's four segments booking more business in the quarter than what they billed out. Lockheed Martin remains a powerful franchise that should find new opportunities over time. But for now, investors are likely to have to be content with a 3% dividend yield as Lockheed works through these headwinds. Do the experts think Lockheed Martin is a buy right now? The Motley Fool's expert analyst team, drawing on years of investing experience and deep analysis of thousands of stocks, leverages our proprietary Moneyball AI investing database to uncover top opportunities. They've just revealed their to buy now — did Lockheed Martin make the list? When our Stock Advisor analyst team has a stock recommendation, it can pay to listen. After all, Stock Advisor's total average return is up 1,055% vs. just 180% for the S&P — that is beating the market by 874.27%!* Imagine if you were a Stock Advisor member when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,477!* The 10 stocks that made the cut could produce monster returns in the coming years. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Lou Whiteman has positions in Lockheed Martin. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy. Why Lockheed Martin Stock Is Falling Today was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
