Northrop Grumman (NOC) Q2 2026 earnings summary

Executive summary

• Achieved record backlog of $105 billion, driven by $20 billion in net awards and robust global demand, with ten new multi-year agreements in tactical weapons supply.

• Q2 2026 sales rose 5% year-over-year to $10.9 billion, with all four segments contributing and Aeronautics up 13%.

• Diluted EPS was $7.68, down 6% year-over-year, impacted by the absence of a prior year divestiture gain.

• Operating income was $1.1 billion, with a margin rate of 10.1%, down from 13.8% in Q2 2025.

• Accelerated investments in business and capacity to support customer needs and future growth.

Financial highlights

• Q2 2026 sales: $10.9 billion, up 5% year-over-year; operating income: $1.1 billion, down 23% due to prior year divestiture gain.

• Net earnings: $1.09 billion, down 7% year-over-year; diluted EPS: $7.68, down 6%.

• Adjusted free cash flow increased 54% year-over-year to $978 million.

• Capital expenditures for Q2 were $302 million; first half totaled $469 million.

• Net cash provided by operating activities rose 47% to $1.28 billion.

Outlook and guidance

• 2026 sales guidance raised to $43.75–$44.25 billion, up $250 million, with mid-to-high single-digit growth expected in Q3.

• MTM-adjusted EPS guidance increased to $28.60–$29.10, up $1.20.

• Segment sales guidance: Aeronautics $14B, Defense mid-to-high $8B, Mission high $12B, Space ~$11B.

• Adjusted free cash flow guidance for 2026: $3.1–$3.5 billion.

• International sales targeted to double to $10 billion by 2031.