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May, 20
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    Northrop reports strong growth; still expects B-21 contract this year

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    WASHINGTON — Northrop Grumman on Thursday reported sales in its most recent quarter grew 9%, buoyed by increases in all four of its sectors.

    The company recorded nearly $9.8 billion in sales for the third quarter of 2023, up from nearly $9 billion during the same period a year earlier. That included 11% growth in its space division, 9% in aeronautics and 6% in its defense sector.

    Northrop Grumman chief executive Kathy Warden said in a call with analysts Thursday the company now has a record-high backlog of $84 billion.

    And Warden highlighted Northrop Grumman’s win of a $705 million Air Force contract to build a stand-in attack weapon, or SiAW, for the F-35. This missile will be an air-to-ground weapon intended to strike enemies’ mobile air defense targets.

    Northrop said it plans to build on its experience creating the Advanced Anti-Radiation Guided Missile-Extended Range, or AARGM-ER, and integrating it onto the F-35 as it develops the SiAW.

    Dave Keffer, Northrop Grumman’s chief financial officer, said on the call that aeronautics growth stemmed from higher volume in manned aircraft programs, such as a $1.3 billion award for the E-2 Hawkeye, and $3.6 billion in contracts for classified programs. Northrop’s defense growth was driven by higher volume in programs including the Hypersonic Attack Cruise Missile, the Integrated Air and Missile Defense Battle Command System and the Guided Multiple Launch Rocket System.

    Keffer said the company still anticipates receiving a low-rate initial production contract for the B-21 from the Air Force by the end of 2023. This contract would likely come after the bomber’s first flight this year, he said.

    Northrop Grumman’s comments came a day after the Air Force confirmed the first B-21 has begun taxi tests at the service’s Plant 42 facility in Palmdale, California, which is a key step before the first flight can take place.

    Air Force officials have not said whether they expect to award an LRIP contract this year. Warden said budget turmoil on Capitol Hill would not affect the B-21′s first flight or the timing of its LRIP contract.

    She cautioned the B-21 is not likely to be profitable at first, reiterating her previous warning in January that a loss of up to $1.2 billion on the LRIP contract is possible. But she said Northrop expects the B-21 to contribute to future growth.

    “We are planning at a zero profitability” on the B-21 for now, Warden said. “But we have to perform, and we are working hard to ensure that plan is what we achieve.”

    Stephen Losey is the air warfare reporter for Defense News. He previously covered leadership and personnel issues at Air Force Times, and the Pentagon, special operations and air warfare at Military.com. He has traveled to the Middle East to cover U.S. Air Force operations.



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