Lockheed Martin’s first quarter results reflected solid execution across its core business lines, with growth driven by demand for tactical missiles and continued strength in its aeronautics segment. Management attributed the quarter’s performance to increased production of F-35 fighter jets and higher volumes in missile programs such as JASM, LRASM, and HIMARS. CEO James Taiclet emphasized the company’s ability to “deliver strong all-around performance,” noting progress in integrating digital technologies and operational improvements that enabled Lockheed Martin to absorb tariff-related headwinds. The company also recorded significant new missile awards, supporting a backlog that now stands at $173 billion.
Is now the time to buy LMT? Find out in our full research report (it’s free).
Lockheed Martin (LMT) Q1 CY2025 Highlights:
- Revenue: $17.96 billion vs analyst estimates of $17.76 billion (4.5% year-on-year growth, 1.1% beat)
- EPS (GAAP): $7.28 vs analyst estimates of $6.35 (14.7% beat)
- The company reconfirmed its revenue guidance for the full year of $74.25 billion at the midpoint
- EPS (GAAP) guidance for the full year is $27.15 at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 13.2%, up from 11.8% in the same quarter last year
- Backlog: $173 billion at quarter end, up 8.5% year on year
- Market Capitalization: $109.4 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Lockheed Martin’s Q1 Earnings Call
- David Strauss (Barclays) asked about the Next Generation Air Dominance (NGAD) decision and whether Lockheed Martin would protest the award; CEO James Taiclet confirmed the company will not protest and will instead apply NGAD technologies to existing platforms like the F-35 and F-22.
- Jason Gursky (Citi) inquired about recent executive orders affecting federal defense procurement; Taiclet welcomed efforts to reduce regulatory red tape, noting it could speed up acquisition timelines and benefit both traditional and new industry entrants.
- Kristine Liwag (Morgan Stanley) focused on tariff risks and mitigation; CFO Evan Scott detailed the company’s contractual protections and timing strategies to manage tariff costs, and Ricciardone highlighted that 40% of contracts are cost-type, providing further insulation.
- Gautam Khanna (TD Cowen) questioned the readiness to maintain F-35 production if U.S. orders decline; Scott and Taiclet expressed confidence in strong international demand to sustain annual production rates above 150 aircraft.
- Douglas Harned (Bernstein) asked about missile backlog conversion and potential for sustained high growth; Scott and Taiclet pointed to ongoing production ramps in key missile programs, supported by long-term contracts and global demand.
Catalysts in Upcoming Quarters
In the coming quarters, StockStory analysts will monitor (1) the pace of missile production increases and backlog conversion, (2) F-35 contract finalizations and international order flow, and (3) the company’s ability to mitigate tariff and supply chain pressures without eroding margins. Progress on digital transformation initiatives and the rollout of new multi-mission products will also be important signposts for execution.
Lockheed Martin currently trades at $478.74, up from $458.22 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).
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