NEW YORK, July 23, 2026, 08:04 EDT
- Lockheed shares traded at $548.50, rising 6.6% in premarket activity.
- Quarterly revenue surpassed expectations by 3.7%, while earnings per share topped forecasts by 10.4%.
- Company data shows the book-to-bill ratio stayed near 1.5 times when THAAD was excluded.
Shares of Lockheed Martin NYSE:LMT surged ahead of Thursday’s opening bell following stronger-than-expected earnings. The company’s executives also lifted forecasts for 2026 revenue, earnings and free cash flow. U.S. core trading gets underway at 9:30 a.m. EDT.
Orders provided a stronger indicator for investors. Lockheed Martin received $65 billion in orders, while quarterly sales stood at $20.06 billion, resulting in a book-to-bill ratio of 3.2.
The $35 billion THAAD contract accounted for over half of the total bookings. Even excluding this, the book-to-bill ratio remained close to 1.5. Orders surpassed sales by almost $10 billion.
Backlog increased by $44.0 billion since March, reaching $230.4 billion. The THAAD contract accounts for around 80% of that gain. Excluding the THAAD deal offers a clearer view of underlying demand.
The company topped Wall Street expectations on both key metrics this quarter. Cash flow increased, moving higher after falling in the prior year.
| Metric | Q2 2026 | Q2 2025 | Wall Street consensus |
|---|---|---|---|
| Sales | $20.06bn | $18.16bn | $19.34bn |
| Diluted EPS | $7.94 | $1.46 | $7.19 |
| Free cash flow | $2.92bn | -$0.15bn | No data |
The quarter for 2025 reflected $1.6 billion in program losses along with $169 million in additional charges.
Lockheed increased its projected sales midpoint by $2.0 billion, now expecting $80.75 billion. The midpoint for EPS climbed by 50 cents to $30.30. Free cash flow midpoint also went up by $450 million to $7.10 billion.
Chief Executive Jim Taiclet stated that revenue is expected to rise approximately 8% this year. He added that free cash flow is “now projected to be over $7 billion.” Media – Lockheed Martin
Free cash flow for the second quarter totaled $2.92 billion, representing 14.5% of sales and 159% of net income. Lockheed attributed the result to the timing of customer receipts and reduced tax payments.
Missile manufacturing delivered the clearest operational momentum. Missiles and Fire Control revenue climbed 19% to $4.10 billion, with operating income up 24% at $594 million.
The increase was largely driven by higher production of PAC-3, THAAD, and Precision Strike Missiles. The seven-year THAAD contract is expected to sustain production rates well into the future. However, actual revenue realization remains linked to manufacturing capacity.
The updated guidance also exceeded expectations. The midpoint for sales is approximately 2% higher than the $79.14 billion consensus estimate, while the midpoint for EPS stands about 1.3% above the forecast.
The stock gained while the broader market weakened. S&P 500 futures slipped approximately 0.3% ahead of the opening bell.
Risks: The THAAD award is still classified as an undefinitized contract action, allowing for potential adjustments to final pricing. The increase in cash was further supported by timing factors. Execution risk continues regarding charges on fixed-price programs.
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