The Aerospace Division, which specializes in the production and marketing of military and civil aircraft, recorded total quarterly sales of $7.2 billion, up 5.8% year-on-year. Operating income rose by 4.6%, with a stable operating margin of 10%. This performance can be attributed to the commercial dynamism of the F-16, and the ramp-up of the new F-35 Block 4, equipped with improved displays and greater processing power as part of the TR-3 (Technology Refresh 3) program. The aim of this program is to optimize the company's entire arsenal to new levels.

The division accounted for 40% of sales in these results. The F-35, known to date as the world's largest defense program, was delivered in its new Block 4 configuration to the Pentagon for the first time. The Group forecasts deliveries of between 75 and 110 aircraft by the end of the year. The stealth fighter alone now accounts for 30% of Group sales, reflecting its key importance both in the Group's business and in the defense architecture of the Atlantic alliance.

The Rotating and Mission Systems division (25% of sales), which specializes in the production and sale of electronic warfare systems, combat ships and helicopters, recorded the best sales performance, with sales up 17% on the same period in 2023. This was accompanied by a 9% rise in operating income and an operating margin of 11%. This performance is attributable to higher sales volumes on Canadian radar and surface combat ship programs, the ramp-up of laser systems programs, and higher production volumes for the Black Hawk and CH-53K.

The Missile and Fire Control division (18% of sales) was the most profitable, with operating income up 21% year-on-year. This was accompanied by an operating margin of 14.5%, up one point. Sales were up 13% on the same period in 2023. This performance is attributable to higher sales of tactical missiles, rocket launchers and anti-ship missiles.

The Space Division (17% of sales), which specializes in the production and sale of satellite systems, missile systems and space transportation, is treading water in terms of sales, with no notable changes.


Medium-term outlook

At a time when the wars in Ukraine and the Middle East are nearing a decisive conclusion, the Group seems well positioned to benefit from the surge in defense orders, expand its order book and optimize its margins. Moreover, the Group is not shy about innovation. It recently signed a contract with DARPA (Defense Advanced Research Projects Agency) to supply advanced modeling and simulation (M&S) solutions and AI agents for airborne, multi-ship missions, all beyond visual range.

With this in mind, Lockheed Martin Corporation is raising all its forecasts for 2024:

Market reaction was swift

The upward adjustment of forecasts, combined with robust results, sent the stock soaring by 3% in daily performance at the time of writing. This brings its annual gains to 7%, continuing the upward trend that has lasted for 10 years.