Northrop Grumman Space Segment Posts 17% Sales Increase in Q3
Northrop Grumman reported a strong Third Quarter (Q3), led by double-digit sales increase in its Space Systems segment. Space Systems sales increased 17% from Q3 2019, to about $2.2 billion. Space sales have increased 13% Year to Date (YTD).
Northrop Grumman attributed the increase in Space Systems to higher sales in both Space and Launch & Strategic Missiles. Space sales were driven by higher volume on restricted programs, Next Generation Overhead Persistent Infrared (Next Gen OPIR) and NASA Artemis programs. Launch & Strategic Missiles sales reflect higher volume on launch vehicles and hypersonics programs, partially offset by lower volume on the Commercial Resupply Service (CRS) missions.
In a Thursday call with investors, Kathy Warden, chairman, CEO and president highlighted two contract awards in Q3 for Space Systems: a $13.3 billion contract for the engineering and manufacturing development (EMD) phase of the Ground Based Strategic Deterrent (GBSD) program; and a U.S. Space Force contract for the rapid prototyping phase of the Evolved Strategic SATCOM (ESS) program. Northrop Grumman is one of three companies to compete for this award, along with Boeing and Lockheed Martin. Warden said the ESS award is a multi-billion dollar program opportunity.
Overall, Northrop Grumman reported Q3 sales of $9.1 billion, a 7% increase over Q3 2019. The company increased its 2020 financial guidance, forecasting sales of between $35.7 billion to $36 billion, up from a range of $35.3 billion to $35.6 billion forecasted at the end of July.
Third quarter and YTD 2020 net awards totaled $20.3 billion and $43.0 billion, respectively, and backlog increased to $81.3 billion.