Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Lockheed Martin (LMT) delivered solid FY2025 revenue growth of 5.6% to $75.0B and strong operating cash flow of $8.6B, but net income declined 6.0% to $5.0B, partly offset by a 25% jump in R&D spending and higher interest costs on elevated long-term debt of $21.7B.
Revenue
$75.05B
+5.64% YoY
EPS (Diluted)
$21.49
-3.68% YoY
Gross Margin
10.2%
+0.4 pts YoY
Operating Income
$7.73B
+10.24% YoY
Source: SEC XBRL
Lockheed Martin (LMT) reported FY2025 revenue of $75.05B, up 5.6% year over year. Operating margin was 10.3%, up 0.4 points from 9.9% a year earlier. Operating cash flow was $8.56B, up 22.7% year over year.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 7.94 | 7.18 | Beat +10.5% |
| Mar 2026 | 6.44 | 6.79 | Miss -5.2% |
| Dec 2025This filing | 7.43 | 5.76 | Beat +29.0% |
| Sep 2025 | 6.95 | 6.42 | Beat +8.2% |
Reported EPS of $7.43 versus the $5.76 analyst consensus — a +29.0% beat for Dec 2025.
Compiled by AI from this SEC filing
Total revenue grew 5.6% year-over-year to $75.0B in FY2025 (from $71.0B in the prior year), reflecting sustained demand for defense programs across Lockheed Martin's business segments, consistent with elevated global defense budgets.
Source: 10-K Income Statement
Operating income rose 10.2% to $7.73B, with operating margin improving approximately 43 basis points to 10.3%, indicating better cost discipline and program execution relative to revenue growth.
Source: 10-K Income Statement
Net income fell 6.0% to $5.02B (from $5.34B), suggesting that below-the-line items such as higher interest expense on $21.7B in long-term debt and/or tax impacts offset strong operating performance.
Source: 10-K Income Statement & Balance Sheet
R&D expense surged 25.0% to $2.0B from $1.6B, signaling Lockheed Martin's commitment to next-generation defense technologies and future program competitiveness, though this pressures near-term margins.
Source: 10-K Income Statement
Operating cash flow jumped 22.7% to $8.56B, well above net income, reflecting favorable working capital dynamics and strong program billings; free cash flow (operating cash flow minus capex of ~$1.98B) was approximately $6.6B.
Source: 10-K Cash Flow Statement
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
Lockheed Martin carries $21.7B in long-term debt against stockholders' equity of only $6.7B, resulting in a debt-to-equity ratio of approximately 7.9x. This elevated leverage increases interest expense, which is a key contributor to the gap between operating income ($7.73B) and net income ($5.02B), and limits financial flexibility in a rising-rate environment.
Source: 10-K Balance Sheet
Despite 5.6% revenue growth and 10.2% operating income growth, net income declined 6.0% in FY2025. This divergence suggests material below-the-line headwinds — likely higher interest costs and/or tax charges — that could persist or worsen if interest rates remain elevated or debt levels increase further.
Source: 10-K Income Statement
R&D spending increased 25% to $2.0B in FY2025, reflecting investment in next-generation programs. While strategically necessary, this rapid cost escalation could compress margins if new programs face delays, cost overruns, or fail to win government contracts.
Source: 10-K Income Statement
Gross margin stands at approximately 10.2%, which is characteristic of defense contractors operating under cost-plus and fixed-price government contracts. Any unexpected cost inflation on fixed-price contracts — such as supply chain disruptions or labor cost increases — could rapidly erode profitability.
Source: 10-K Income Statement
Lockheed Martin's revenue is heavily dependent on U.S. government defense appropriations. Budget sequestration, continuing resolutions, or shifts in defense spending priorities could materially impact program funding and revenue visibility, particularly given the company's scale at $75.0B in annual revenue.
Source: 10-K Income Statement
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 75.05 $B | 71.04 $B | +5.64% |
Cost of Revenue $B | 67.43 $B | 64.11 $B | +5.17% |
Gross Profit $B | 7.62 $B | 6.93 $B | +9.94% |
Operating Income $B | 7.73 $B | 7.01 $B | +10.24% |
Net Income $B | 5.02 $B | 5.34 $B | -5.98% |
EPS (Basic) $ | 21.56 $ | 22.39 $ | -3.71% |
EPS (Diluted) $ | 21.49 $ | 22.31 $ | -3.68% |
R&D Expense $B | 2.00 $B | 1.60 $B | +25.00% |
Answers draw on this SEC filing and the data on this page
Lockheed Martin delivered sharply higher Q2 FY2026 profitability, with revenue up 10.5% year over year to $20.1B and net income up 436.8% to $1.8B, primarily reflecting the absence of major 2025 reach-forward losses and stronger missile-defense and F-35 production activity. Source: 10-Q Item 2 MD&A, pp.28-35.
Lockheed Martin's Q1 FY2026 revenue was nearly flat at $18.0B (+0.3% YoY), but profitability declined sharply with net income falling 13.1% to $1.49B and operating cash flow collapsing 84.4% to $220M, driven by rising costs and higher cost of revenue.
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