Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Revenue | $20.7 billion | up 11% year-over-year |
| Earnings per share | $7.97 | compared to $6.95 in the prior year period |
| Segment operating profit | $2.2 billion | Not stated |
| Free cash flow | $3 billion | Not stated |
| Backlog | $292 billion | up $113 billion compared to the third quarter of 2025 |
Guidance and outlook
- Full year 2026 sales: $80 billion to $82 billion
- Segment operating profit: $8.575 billion to $8.675 billion
- Cash from operations: $10 billion to $10.2 billion
- Free cash flow: $7.8 billion to $8 billion
How management sounded
Positive (+7 on our -10 to +10 scale). Management raised full-year expectations for sales, earnings, and cash flow, citing strong execution and a record backlog of $292 billion. Management sounded more upbeat than on 48% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
Growth drivers
Asked: How does management view the multiyear growth opportunity outside of the Missiles and Fire Control segment?
Answer: Management highlighted strength in radar, national security space, and F-35 sustainment, alongside new programs like Vectus that provide a clear line of sight to revenue growth.
Engineering culture
Asked: How is the company evolving its internal engineering culture?
Answer: The company is using mission technology road maps, model-based engineering, and increased R&D investment to build prototypes ahead of formal government requests.
Vectus and Skunkworks
Asked: What is the strategy for the Vectus initiative and Skunkworks?
Answer: Vectus is part of an air power strategy to optimize combat capability, focusing on air dominance and strike missions by integrating autonomous systems with manned aircraft.
Missile ramp contracting
Asked: How do the new framework agreements impact risk and cash flow?
Answer: The agreements provide long-term visibility and cash neutrality, allowing suppliers to invest in production capacity without the risks associated with annual repricing.
What to watch before the next call
- Finalization of profit terms and schedules for the new framework agreements.
- Impact of U.S. federal budget and continuing resolutions on new program starts.
- Integration of the Ultra Maritime acquisition in the fourth quarter.
