The mixed Q2 results with a significant EPS miss but raised guidance and record backlog create a tug-of-war. Traders should watch for further margin commentary on the earnings call and monitor Defense Systems and Space Systems margins in Q3 for confirmation of the second-half ramp thesis.
Price Chart
Executive Summary
Northrop Grumman reported Q2 2026 sales of $10.9B (+5% YoY), slightly above consensus, but GAAP EPS of $7.68 missed the $6.84 consensus estimate by 12.3%. The EPS miss was driven by lower segment operating income at Defense Systems and Space Systems, partially offset by a lower tax rate. The company raised its full-year 2026 sales guidance by $250M and MTM-adjusted EPS guidance by $1.20, signaling confidence in the second-half ramp, but margin compression at Defense Systems (7.5% vs 12.7%) and Space Systems (8.6% vs 10.6%) raises execution concerns.
Key Financial Metrics
Key Facts
- Q2 2026 sales of $10.9B (+5% YoY), slightly above consensus
- GAAP EPS of $7.68 missed consensus of $6.84 by 12.3%
- Full-year 2026 sales guidance raised by $250M
- MTM-adjusted EPS guidance raised by $1.20
- Record backlog of $104.7B (+9% YTD)
- $20B in net awards
- Defense Systems margin compressed to 7.5% from 12.7%
- Space Systems margin compressed to 8.6% from 10.6%
Financial Impact
EPS miss of 12.3% vs consensus; sales beat by ~0.8%
Risk Factors
- Margin compression at Defense Systems and Space Systems may persist
- Execution risk on second-half ramp despite raised guidance
- Historical calibration shows past neutral/long calls on NOC underperformed at T+20
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3330282 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 21, 2026 6w ago | 8-K | $549.28 $509.86 | ▼ −7.18% | ▼ −8.49% | $478.00 (−12.98%) |
Jul 21, 2026 10w ago | Press Release | $512.29 $589.14 | ▲ +15.00% | ▲ +12.44% | $478.00 (−6.69%) |
Jul 21, 2026 10w ago | 8-K | $512.29 $589.14 | ▲ +15.00% | ▲ +12.44% | $478.00 (−6.69%) |
Jun 18, 2026 15w ago | Press Release | $521.50 $518.65 | ▼ −0.55% | ▼ −1.08% | $478.00 (−8.34%) |
Apr 21, 2026 23w ago | S-3ASR | $589.05 $556.34 | ▼ −5.55% | ▼ −8.72% | $478.00 (−18.85%) |
Apr 21, 2026 23w ago | Press Release | $611.06 $550.00 | ▼ −9.99% | ▼ −14.91% | $478.00 (−21.78%) |
Apr 21, 2026 23w ago | 8-K | $611.06 $550.00 | ▼ −9.99% | ▼ −14.91% | $478.00 (−21.78%) |
Mar 19, 2026 28w ago | Press Release | $711.07 $664.52 | ▼ −6.55% | ▼ −14.17% | $478.00 (−32.78%) |
Feb 27, 2026 31w ago | Insider Cluster | $724.42 $676.67 | ▼ −6.59% | ▲ +0.96% | $478.00 (−34.02%) |
US Market Status
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