Live: Why Lockheed Martin Is Plunging After Q2 Earnings
Key Points
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Lockheed Martin shares are plummeting after releasing Q2 earnings.
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The company incurred several losses in Q2 and its revenue came in below analyst expectations. Lockheed affirmed full-year guidance for sales and free cash flow, but investors are still less than pleased with these earnings.
Live Updates
Lockheed Down 6.4%
Lockheed shares are down 6.4% in morning trading. Extra salt in the wounds of Lockheed investors comes compliments of Northrop Grumman, which is up more than 8% today after it raised full-year profitability targets.
One concerning issue for Lockheed is their Q2 charge is for cost overruns and performance issues on a classified aeronautics program.
That presented “one-time” charges for this quarter, but could also be an ominous sign for the future. It appears investors are betting that what we saw in Q2 speaks to more risk for Lockheed in the future.
More Details on Lockheed's Earnings
LMT | Lockheed Martin Corporation Q2’25 Earnings Highlights:
- Net EPS: $1.46 ❌; DOWN 79% YoY
- Revenue: $18.2B (Est. N/A) ➖; UP 0.6% YoY
- Net Income: $342M ❌; DOWN 79% YoY
- Adj. Gross Margin: N/A
- Free Cash Flow: $(150)M
- Returned Cash to Shareholders: $1.3B
Q2 Segment Performance:
- Aeronautics Revenue: $7.42B; UP 2% YoY
- Missiles and Fire Control Revenue: $3.43B; UP 11% YoY
- Rotary and Mission Systems Revenue: $3.99B; DOWN 12% YoY
- Space Revenue: $3.31B; UP 4% YoY
Other Key Q2 Metrics:
- Operating Income: $748M; DOWN 65% YoY
- Effective Tax Rate: 18.0% (vs. 15.8% YoY)
CEO Commentary:
- Jim Taiclet: “Our foundation remains solid and resilient, focused on delivering critical capabilities and driving growth.”
Strategic Updates:
- Lockheed Martin addressing challenges in Aeronautics and international helicopter programs.
Earnings Call Information
Lockheed Martin will host its earnings call on Tuesday, July 22 at 11:00 am ET. You can join the live webcast by visiting https://www.lockheedmartin.com/investor.
Key Financials Last Quarter
As a warning, this won’t be pretty! Here’s a summary of some of Lockheed’s key financials last quarter compared to last year’s second quarter.
| Metric | Q2 25 | Q2 24 | YoY Change |
|---|---|---|---|
| Revenue | $18.20B | $18.12B | 0.43% |
| Net Income | $342.00M | $1.64B | -79.16% |
| Operating Cash Flow | $201.00M | $1.88B | -89.29% |
| Free Cash Flow | $-150.00M | $1.51B | N/M |
Shares Now Down 8.15%
Shares of Lockheed trended down nearly 9% moments ago, but are now sitting at an 8.15% loss as of 7:45 a.m. ET.
Lockheed Martin (NYSE: LMT) just released Q2 earnings and shares are plunging.
That’s in stark contrast to peer Northrop Grumman (NYSE: NOC), which just reported and has seen shares gain in premarket trading. Let’s dig into Lockheed’s earnings and see why Wall Street is so disappointed.
Lockheed Earnings in Brief
Lockheed Martin reported Q2 2025 sales of $18.2 billion, a slight increase from $18.1 billion in Q2 2024.
The company faced significant challenges, recording pre-tax losses of $1.6 billion on various programs, impacting earnings per share by $5.83. Net earnings were $342 million, or $1.46 per share, down from $1.6 billion, or $6.85 per share, in the previous year.
Cash from operations decreased to $201 million from $1.9 billion, while free cash flow was negative at $(150) million. The company reaffirmed its 2025 guidance for sales and free cash flow.
CEO Jim Taiclet highlighted strong performance in combat operations and increased demand for key programs, despite the financial setbacks. The company returned $1.3 billion to shareholders through dividends and share repurchases. Lockheed Martin is investing in infrastructure and innovation, maintaining its focus on operational performance and capital allocation strategy.
What Doesn’t Wall Street Like?
Obviously, the results last quarter were a setback with numerous losses incurred. However, the company reaffirmed 2025 guidance for sales and free cash flow. So, while last quarter was bumpy, the overall “big picture” may not be as troubling.
Yet, Wall Street isn’t happy.
Here are a few ‘weak’ areas to watch. First, revenue was expected to come in at about $18.6 billion last quarter but only hit $18.2 billion. The company beat on adjusted EPS, but that figure might be concerning. Second, note that while Lockheed reaffirmed cash flow and revenue, there’s no reference to net income figures.
We’ll continue monitoring earnings, but for now, shares are selling off heavily.
Eric Bleeker has been investing for more than 20 years. He began his career working at Microsoft before joining Motley Fool, one of the largest publishers of financial research. In his 15 years at Motley Fool Eric served as the General Manager for Fool.com and led coverage in the Technology & Telecom sector. In addition, he was a featured columnist and has hosted dozens of investing seminars attended by more than a million total investors. Eric has more than 1,000 financial bylines to his name and has been featured in The Wall Street Journal, CNBC, Fox Business, and many other leading publications. He is currently focused on artificial intelligence investing and is a CFA Charterholoder.
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