Northrop Grumman profit falls 14% but beats target and lifts outlook

Northrop Grumman Corp.
NOC,
-0.01%
stock was up by 0.8% in premarket trades Thursday after the defense contractor beat its revenue and earnings target and raised the low end of its 2023 outlook. Northrop reported second-quarter profit of $812 million, or $5.34 a share, down 14% from $946 million, or $6.06 a share, in the year-ago quarter. The company beat the analyst forecast of $5.33 a share, according to estimates compiled by FactSet. The latest quarter also included $1.01 a share for a pension-related item. Northrop Grumman’s revenue increased by 9% to $9.6 billion, well ahead of the analyst view of $9.36 billion. Northrop boosted its 2023 sales outlook by $400 million to a range of $38.4 billion to $38.8 billion, compared to the analyst estimate of $38.4 billion. It also hiked the low end of its adjusted 2023 earnings to a range of $22.45 a share to $22.85 a share, from its earlier view of $22.25 to $22.85 a share. Analysts currently expect 2023 earnings of $22.64 a share. “Strong global demand for our products, increased supply chain deliveries and our continued success in hiring and retaining talent drove second quarter growth of nine percent,” said CEO Kathy Warden. “We expect margins to expand as macroeconomic headwinds stabilize and we shift our portfolio to more production and international volume.”