Lockheed Martin reported second-quarter sales of $20.1 billion on Thursday, up 11% from a year earlier, and raised its full-year financial guidance after beating expectations. The company's stock rose more than 5% in early trading.
Net earnings for the quarter reached $1.8 billion, or $7.94 per share. That compares to $342 million, or $1.46 per share, in the same period of 2025, a year that included $1.6 billion in program losses. Cash from operations climbed to $3.2 billion from $201 million a year earlier. Free cash flow was $2.9 billion, compared to negative $150 million in the prior-year quarter.
The company lifted its full-year 2026 sales outlook to approximately $79.75 billion to $81.75 billion, up from its prior guidance range of $77.5 billion to $80.0 billion. Full-year diluted earnings per share guidance was raised to $29.95 to $30.65. Projected free cash flow increased to $7.0 billion to $7.2 billion.
According to a report by Yahoo Business, Lockheed Martin Chairman, President and CEO Jim Taiclet said in a statement, "We now anticipate accelerated year-over-year sales growth of approximately 8%, driving 28% higher segment operating profit, and increased free cash flow, now projected to be over $7 billion."
The Missiles and Fire Control segment was the primary growth driver. Sales there rose 19% to $4.1 billion, driven by production ramps for PAC-3, THAAD, and Precision Strike Missile programs. Aeronautics posted sales of $8.1 billion, up 9%, led by higher F-35 production volume. Rotary and Mission Systems sales rose 9% to $4.4 billion. Space sales increased 6% to $3.5 billion.
The company reported a record backlog of $230.4 billion, up from $193.6 billion at year-end 2025. The jump was fueled by $65 billion in new orders during the quarter. The backlog for Missiles and Fire Control nearly doubled to $87.9 billion, reflecting a $35 billion multi-year contract with the Missile Defense Agency for THAAD interceptors signed during the quarter.
The strong quarter marks a reversal from earlier in the year. Lockheed posted weaker first-quarter results, when net earnings fell to $1.5 billion from $1.7 billion a year earlier, weighed down by $125 million in unfavorable profit adjustments on the F-16 program and $55 million in C-130 delivery delays. The company had reaffirmed its full-year outlook at that time without raising it.
Lockheed also has a pending acquisition underway. The company agreed earlier this month to acquire Ultra Maritime for $3.45 billion, a deal that would expand its undersea and anti-submarine warfare capabilities within the Rotary and Mission Systems segment. That transaction remains subject to regulatory approvals and is not incorporated into the company's current financial guidance.
