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Mar 31, 2025
Northrop Grumman Q1 2025 Earnings Report
Northrop Grumman reported mixed results with reduced revenue and earnings due to the B-21 program impact, despite a strong backlog.
Key Takeaways
Northrop Grumman's Q1 2025 results showed a revenue decline and significantly lower EPS due to a one-time B-21 adjustment. However, the company maintains a record backlog and reaffirmed full-year sales guidance, highlighting strong demand in defense.
Revenue declined 7% YoY due to fewer working days and space program wind-down.
EPS dropped to $3.32 due to a $2.74 impact from the B-21 production ramp adjustment.
Backlog reached a record $92.8 billion, supporting future growth visibility.
Adjusted EPS estimated at $6.06 when excluding the B-21 impact.
Revenue by Segment
Forward Guidance
Northrop Grumman reaffirmed its sales expectations across segments but lowered full-year operating income and EPS guidance due to B-21 program cost increases.
Positive Outlook
- Record $92.8B backlog provides long-term growth visibility.
- Organic sales growth of 3–4% reaffirmed for 2025.
- Strong demand outlook driven by global defense budget increases.
- Capital deployment focus remains on shareholder returns and business investment.
- Mission Systems and Defense Systems segments maintained healthy margins.
Challenges Ahead
- Full-year EPS guidance reduced from $27.85–$28.25 to $24.95–$25.35.
- Segment operating income guidance lowered due to B-21 ramp-up costs.
- Aeronautics Systems margin guidance dropped to low-mid 6%.
- Free cash flow guidance includes expected heavy capital expenditures.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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