Northrop Grumman (NOC) Q4 2025 earnings summary

Executive summary

• Achieved record backlog of $95.7 billion, driven by $46.3 billion in net awards in 2025 and robust global demand.

• 2025 sales reached $42.0 billion, up 3% organically, with international sales growth of 20%.

• Free cash flow for 2025 was $3.3 billion, up 26% year-over-year.

• 2025 financial results met or exceeded guidance, positioning for sustainable growth.

• Portfolio aligned with U.S. and international defense priorities, focusing on rapid fielding and scalable solutions.

Financial highlights

• Q4 2025 sales were $11.7 billion, up 10% year-over-year; full-year sales reached $42.0 billion, up 3% organically.

• Q4 segment operating income rose 10% to $1.3 billion; segment margin rate at 11.2%.

• Q4 adjusted/MTM-adjusted EPS was $7.23, up 13% year-over-year.

• 2025 diluted EPS was $29.08; MTM-adjusted EPS was $26.34.

• Operating cash flow for 2025 was $4.8 billion, up 8% year-over-year.

Outlook and guidance

• 2026 sales expected between $43.5–$44.0 billion, representing mid-single-digit growth.

• 2026 segment operating income projected at $4.85–$5.0 billion; operating margin in the low to mid 11% range.

• 2026 adjusted/MTM-adjusted EPS expected between $27.40–$27.90, up mid-single digits.

• Free cash flow guidance for 2026 is $3.1–$3.5 billion; capital expenditures projected at $1.65 billion.

• Growth expected to accelerate through 2026, with further upside in 2027 as backlog converts to revenue.