American defense contractor Lockheed Martin has raised its sales forecast for 2024 following the resumption of F-35 aircraft deliveries. The company now expects sales to range from $70.5 billion to $71.5 billion this year, up from its previous forecast of $68.5 billion to $70 billion.
The U.S. has resumed deliveries of the F-35 Lightning II fighters after a lengthy pause due to delays in software updates. Lockheed Martin has been upgrading the aircraft under the Technology Refresh 3 (TR-3) program, which provides fifth-generation fighters with improved displays and computational power. However, the resumption of deliveries includes incomplete software updates, and the Pentagon will withhold certain payments until the remaining enhancements are completed.
The F-35 is the largest defense program in the world and accounts for approximately 30% of Lockheed Martin’s revenue.
“F-35 remains our top priority, and we recently delivered the first aircraft with the TR-3 upgrade to the customer,” said CEO Jim Taiclet. “We expect deliveries to be completed by the end of 2024 and to reach our forecasted range of 75 to 110 F-35 aircraft.”
TR-3 involves both hardware and software upgrades and is considered the foundation for a broader modernization of the stealthy multirole fighter known as Block 4. According to Jim Taiclet, these enhancements are “important steps to ensure the F-35 remains the most advanced fighter in the world and a key node in the U.S. Department of Defense’s overall architecture.” However, the company does not expect the full technical upgrade package to be ready within the next few months.
Lockheed Martin’s net profit for Q2 was $6.85 per share, exceeding the LSEG forecast of $6.46 per share. Total quarterly sales increased by 8.5% to $18.12 billion, surpassing the expected $17.04 billion.
Three months ago, Congress approved an additional $95 billion in funding to support Ukraine and Israel, contributing to Lockheed Martin’s increased profits. The conflicts in Ukraine and Israel require a large quantity of munitions, including Lockheed’s Patriot air defense missiles, which are used to intercept enemy rockets.
Source: reuters
