Northrop Grumman expects strong 2023 revenue as weapon demand surges
By Mike Stone and Nathan Gomes
(Reuters) - U.S. defense contractor Northrop Grumman Corp on Thursday forecast full-year sales above Wall Street estimates, as it benefits from strong demand for weapons from countries ramping up their defense spend.
The United States and its allies have been buying more arms and ammunitions and supporting Ukraine with billions of dollar in military aid after Russia invaded the country last year.
During the quarter, Northrop rolled out its new B-21 "Raider" jet, the first of a new fleet of long-range stealth nuclear bombers for the United States Air Force.
"We're raising our sales outlook for 2023 and expect to deliver strong multi-year cash flow growth," Northrop Grumman Chief Executive Kathy Warden said.
The Falls Church, Virginia-based company expects 2023 sales between $38 billion and $38.4 billion, ahead of the average analyst estimate of $37.86 billion, and an adjusted profit of $21.85 to $22.45 per share, compared with estimates of $22.30, according to Refinitiv IBES data.
Meanwhile, rivals General Dynamics Corp and Lockheed Martin Corp forecast their annual profit below estimates, as the industry grapples with labor and supply shortages.
Northrop, which produces the fuselage for the F/A-18 Super Hornet fighter jet, posted sales of about $10.03 billion for the quarter ended Dec. 31, ahead of analysts' average estimate of $9.66 billion.
Sales in its space systems unit, which makes satellites and payloads, jumped 23% to $3.28 billion, helped by higher investments towards space exploration projects.
Sale in its defense unit, which makes integrated battle management systems, weapons systems, rose to $1.66 billion, from $1.38 billion.
Overall adjusted net income stood at $7.50 per share, ahead of analysts' average estimate of $6.57 per share.
(Reporting by Nathan Gomes in Bengaluru; Editing by Shinjini Ganguli)