Northrop Grumman (NYSE: NOC) raised its 2026 sales and adjusted-EPS outlook on July 21, 2026 after a Q2 that produced $20 billion in net awards, a record $105 billion backlog and revenue growth across all four segments. CEO Kathy Warden said the defense prime is now "fully aligned with U.S. government priorities" as demand accelerates for missiles, missile defense, autonomous aircraft and national-security space — the same day the company's Mission Robotic Vehicle launched on a SpaceX Falcon 9.
Record $105B Backlog, 1.84x Book-To-Bill
Second-quarter net awards of $20 billion produced a 1.84x book-to-bill ratio, pushing Northrop's backlog to a record $105 billion — up 17% year over year, CFO John Greene said. Q2 sales rose 5% to $10.9 billion, adjusted free cash flow was nearly $1 billion and diluted EPS came in at $7.68. Full-year 2026 sales guidance now spans $43.75 billion to $44.25 billion (midpoint $44 billion, ~5% organic growth), and mark-to-market adjusted EPS was raised $1.20 to $28.60–$29.10.
Sentinel Backlog Adds $7.6B, B-21 Ramp On The Table
Warden said the LGM-35A Sentinel ICBM program received an additional $7.6 billion in backlog after further contract definitization, and solid rocket motors for the first five flight tests are now in production ahead of a 2027 first flight. On the B-21 Raider, Northrop is working with the Air Force on whether to accelerate production into a larger program of record, with a decision expected by year-end. Aeronautics Systems sales rose 13% and operating margin climbed to 10.3%.
SiAW And GEM 63XL Charges Weigh On Two Segments
Two program-specific issues clipped segment margins. Defense Systems booked a $68 million unfavorable estimate-at-completion adjustment on the Stand-in Attack Weapon (SiAW), linked to schedule slippage from AARGM-Extended Range qualification testing; excluding SiAW, the rest of Defense Systems ran at 11% operating margin. Space Systems took a GEM 63XL adjustment tied to higher material costs and revised quantities after a Q1 launch anomaly, though Northrop said a redesigned static fire test succeeded and deliveries resume by year-end. Space full-year margin outlook was trimmed to the low 10% range.
International, MRV And Solid Rocket Motors Widen The Pipeline
Northrop reiterated its target of doubling annual international sales to $10 billion by 2031, citing NATO's Triton commitment, Kuwait's IBCS authorization and Australia's selection of Northrop as its in-country solid-rocket-motor supplier. The company reached a $2 billion framework agreement with the Department of Defense and Lockheed Martin to supply PAC-3 rocket motors, and Warden said Northrop now holds ten multi-year missile-acceleration agreements representing up to $10 billion of sales opportunity over the next seven years. The first Mission Robotic Vehicle is expected operational in 2027 after on-orbit checkout.
Reporting based on coverage from MarketBeat via Yahoo Finance and Northrop Grumman's Q2 2026 disclosures.