FAQ: Lockheed Martin's Q2 Earnings Drop and Program Losses

What caused Lockheed Martin’s share price to drop?

The drop was due to the announcement of significantly reduced second-quarter earnings, primarily attributed to over $1.6 billion in program-related charges.

How much did Lockheed Martin’s net earnings decrease in Q2?

Net earnings plummeted to $342 million, or $1.46 per share, from $1.6 billion, or $6.85 per share, a year ago.

What were the main programs responsible for the financial losses?

A $950 million pretax charge on a classified Aeronautics program, $570 million in losses from the Canadian Maritime Helicopter Program, and $95 million related to Turkey’s utility helicopter program were the main contributors.

Did Lockheed Martin maintain its full-year guidance despite the Q2 losses?

Yes, the company maintained its full-year 2025 sales guidance but sharply reduced its diluted earnings per share forecast.

How did Lockheed Martin’s cash generation perform in Q2?

Cash from operations declined sharply to $201 million, and free cash flow turned negative to -$150 million, compared to positive figures the previous year.

What was the CEO’s response to the Q2 performance?

CEO Jim Taiclet reassured investors by highlighting Lockheed’s role in global operations and its long-term growth prospects, despite the quarterly losses.

Which Lockheed Martin segments showed growth despite the overall losses?

Aeronautics revenue increased by 2%, and Missiles and Fire Control reported an 11% sales increase, while other segments like Rotary and Mission Systems saw declines.

What is the significance of the Next Generation Air Dominance (NGAD) program mentioned in the article?

The NGAD program was mentioned in relation to a $169 million asset write-off, indicating financial pressures from advanced technology developments.