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Mar 31
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.
Northrop Grumman
Northrop Grumman
Northrop Grumman Revenue by Segment
Revenue by Segment
Aeronautics Systems Revenue
CapyFin.comDefense Systems Revenue
CapyFin.comMission Systems Revenue
CapyFin.comSpace Systems Revenue
CapyFin.com 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.
- Interest expense revised upward to approximately $675 million.
Revenue & Expenses
Visualization of income flow from segment revenue to net income