Northrop Grumman Rallies on Record Backlog and Higher 2026 Outlook
Northrop Grumman shares rose about 5% after the contractor posted third-quarter earnings of $7.89 per share and revenue of $11.1 billion. It raised its 2026 profit forecast and reported a record $110 billion backlog after securing more than $16 billion in new awards. The company expects further growth in 2027 despite uncertainty over U.S. military spending.
Northrop’s quarterly profit of $7.89 a share topped the roughly $7.19 consensus, while revenue rose 7% to $11.1 billion. All four operating divisions grew, and free cash flow climbed more than 40% to about $1.8 billion, helped by working-capital gains and a B-21 test-asset sale.
New awards exceeded $16 billion, pushing backlog to a record $110 billion, about 20% above a year earlier. A 1.5 book-to-bill ratio signaled orders outpaced revenue. Management raised its 2026 profit forecast and expects further growth in 2027, even as U.S. military spending remains uncertain.
The results may reassure investors and workers tied to defense supply chains, since a large backlog can support production planning and employment across aircraft, missile, and space programs. Communities hosting Northrop facilities and subcontractors could see steadier demand, while taxpayers and policymakers may face continued scrutiny over how military budgets are allocated. Because spending decisions remain uncertain, the durability of these benefits may depend on future appropriations and program priorities.