Northrop Grumman Corp
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.06%.
Did NOC Beat Earnings? Q2 2025 Results
Northrop Grumman delivered a standout second quarter, posting earnings of $8.15 per diluted share against a consensus estimate of $6.80 — a 19.85% beat — as the defense giant's operational momentum and a $231 million gain from the divestiture of its training services business combined to drive results well ahead of expectations. Revenue came in at $10.35 billion, up 1.3% year-over-year, with Mission Systems emerging as the clear segment standout, surging 14% to $3.16 billion on the strength of a restricted program award and higher marine and radar volumes. Overall segment operating margin expanded 100 basis points to 11.8%, with all four business units posting improvement. <a href="https://247wallst.com/investing/2025/07/22/live-northrop-grumman-up-3-after-releasing-earnings/">Shares rallied on the results</a>, even as rival Lockheed Martin struggled with significant legacy program losses — underscoring the divergent fortunes across the sector. Looking ahead, Northrop raised its full-year MTM-adjusted EPS guidance to $25.00–$25.40 and lifted its free cash flow outlook to $3.05–$3.35 billion, signaling continued confidence in its portfolio despite Space Systems headwinds and ongoing B-21 cost pressures.
- 18% international sales growth in Q2
- Mission Systems sales growth of 14% driven by restricted award inventory liquidation, marine systems, international ground-based radar, and navigation systems
- Defense Systems margin expansion to 12.7% from 10.3% driven by $76 million favorable Sentinel EAC adjustment
- Higher net EAC adjustments across multiple segments from improved production efficiencies
- Training services divestiture contributed $1.04 per diluted share benefit
- Segment operating margin rate improved 100 basis points to 11.8%
“The Northrop Grumman team delivered a strong second quarter, with increased sales and outstanding operating performance. We are working with our customers to accelerate capability delivery to enable their vision of peace through strength. We continue to see growing demand globally for our broad range of product offerings, which resulted in 18% international sales growth in the quarter. With confidence in our team and our ability to deliver for our customers, we are increasing our full-year guidance for segment operating income, EPS and free cash flow.”
Northrop Grumman CEO, on the earnings call
Forward Guidance & Outlook
Northrop Grumman raised its 2025 full-year guidance: Sales narrowed to $42,050–$42,250 million (from $42,000–$42,500 million); Segment operating income increased to $4,275–$4,375 million (from $4,200–$4,350 million); MTM-adjusted EPS increased to $25.00–$25.40 (from $24.95–$25.35); Free cash flow increased to $3,050–$3,350 million (from $2,850–$3,250 million). Segment guidance: Aeronautics Systems sales of low $13 billion with low to mid 6% operating margin; Defense Systems sales of low $8 billion with mid 10% operating margin (raised from mid to high 9%); Mission Systems sales of low to mid $12 billion (raised from ~$12 billion) with mid 14% operating margin; Space Systems sales of mid to high $10 billion (lowered from ~$11 billion) with high 10% operating margin. The company sees growing global demand for its product offerings and is working to accelerate capability delivery.
NOC YoY Financials
NOC Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.