A Lockheed Martin F-35 fighter jet performs during the International Aerospace Exhibition ILA on the opening day at Schoenefeld Airport in Berlin, Germany June 5, 2024.
Axel Schmidt | Reuters
Lockheed Martin reported a higher first-quarter profit on Tuesday and reaffirmed its forecasts for the year on the back of resilient demand for its missile systems and fighter jets.
Shares of Lockheed were up 3% in premarket trading on Tuesday as the company posted earnings per share of $7.28, beating Wall Street analyst expectations of $6.34.
U.S. President Donald Trump’s trade war has rattled markets and upset some allies. For example, Canada, which is hit by steep tariffs, has ordered a review of a C$19 billion contract for 88 of Lockheed Martin’s F-35 jets, with Prime Minister Mark Carney saying the country relies too much on the U.S. for security.
Still, defense contractors have benefited from a surge in demand for weapons against the backdrop of the war in Ukraine and conflicts in the Middle East.
Legacy companies in the sector are also expected to get a potential boost from U.S. President Donald Trump’s review of military equipment export rules that he is seeking to ease.
Lockheed’s aerospace business, which makes the F-35 fighter jet, posted a 3.1% rise in sales in the first quarter.
The F-35 program has been beset by delays in rolling out a technology upgrade to give the jet better displays and processing capabilities for its electronic systems.
Lockheed reported total revenue of $17.96 billion in the first quarter, up 4.5% from a year earlier. Sales during the quarter increased at all the company’s units, except its space division.
The company’s net income rose to $1.71 billion, or $7.28 per share, in the quarter, from about $1.55 billion, or $6.39 per share, a year earlier.
Despite an uncertain environment, some experts believe a higher U.S. defense budget will aid revenues at contractors by improving backlogs on key programs.
