NORTHROP GRUMMAN CORP DE

For the period ended Mar 31, 2025. Filed Apr 22, 2025.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Mar 31, 2025 · Filed Apr 22, 2025

NOC$525.01-0.0%Stored close · as of Nov 6, 2026

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Contents

10. Segment Information

SEGMENT INFORMATION

The following table presents sales, operating costs and expenses, and operating income by segment:

	Three Months Ended March 31
$ in millions	2025	2024
Aeronautics Systems
Sales	$2,814	$3,044
Operating costs and expenses:
Product	2,358	2,059
Service	601	649
Intersegment	38	30
Aeronautics Systems operating (loss) income	(183)	306
Defense Systems
Sales	1,805	1,737
Operating costs and expenses:
Product	1,262	1,200
Service	324	345
Intersegment	40	36
Defense Systems operating income	179	156
Mission Systems
Sales	2,807	2,659
Operating costs and expenses:
Product	1,730	1,605
Service	434	446
Intersegment	282	230
Mission Systems operating income	361	378
Space Systems
Sales	2,568	3,149
Operating costs and expenses:
Product	1,829	2,375
Service	362	350
Intersegment	94	94
Space Systems operating income	283	330
Intersegment profit eliminations	(72)	(66)
Total segment operating income	568	1,104
FAS/CAS operating adjustment	63	6
Unallocated corporate expense	(58)	(39)
Total operating income	$573	$1,071
Other (expense) income
Interest expense	(156)	(146)
Non-operating FAS pension benefit	130	168
Other, net	31	38
Earnings before income taxes	$578	$1,131

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FAS/CAS Operating Adjustment

For financial statement purposes, we account for our employee pension plans in accordance with FAS. However, the cost of these plans is charged to our contracts in accordance with applicable Federal Acquisition Regulation (FAR) and CAS requirements. The FAS/CAS operating adjustment reflects the difference between CAS pension expense included as cost in segment operating income and the service cost component of FAS expense included in total operating income.

Unallocated Corporate Expense

Unallocated corporate expense includes the portion of corporate costs not considered allowable or allocable under applicable FAR and CAS requirements, and therefore not allocated to the segments, such as changes in deferred state income taxes and a portion of management and administration, legal, environmental, compensation, retiree benefits, advertising and other corporate unallowable costs. Unallocated corporate expense also includes costs not considered part of management’s evaluation of segment operating performance, such as amortization of purchased intangible assets and the additional depreciation expense related to the step-up in fair value of property, plant and equipment acquired through business combinations, as well as certain compensation and other costs.

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Disaggregation of Revenue

Sales by Customer Type	Three Months Ended March 31
2025 · 2024
$ in millions	$%(3)	$%(3)
Aeronautics Systems
U.S. government(1)	$2,290	83%	$2,584	86%
International(2)	478	17%	424	14%
Other customers	5	—%	4	—%
Intersegment sales	41		32
Aeronautics Systems sales	2,814		3,044
Defense Systems
U.S. government(1)	1,451	83%	1,455	86%
International(2)	289	16%	219	13%
Other customers	20	1%	21	1%
Intersegment sales	45		42
Defense Systems sales	1,805		1,737
Mission Systems
U.S. government(1)	1,973	80%	1,912	80%
International(2)	475	19%	454	19%
Other customers	24	1%	16	1%
Intersegment sales	335		277
Mission Systems sales	2,807		2,659
Space Systems
U.S. government(1)	2,309	94%	2,893	95%
International(2)	44	2%	65	2%
Other customers	110	4%	86	3%
Intersegment sales	105		105
Space Systems sales	2,568		3,149
Total
U.S. government(1)	8,023	84%	8,844	87%
International(2)	1,286	14%	1,162	12%
Other customers	159	2%	127	1%
Total Sales	$9,468		$10,133

(1)Sales to the U.S. government include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is the U.S. government. Each of the company’s segments derives a substantial percentage of its revenue from the U.S. government.

(2) International sales include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is an international customer. These sales include foreign military sales contracted through the U.S. government.

(3) Percentages calculated based on external customer sales.

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Sales by Contract Type	Three Months Ended March 31
2025 · 2024
$ in millions	$%(1)	$%(1)
Aeronautics Systems
Cost-type	$1,339	48%	$1,344	45%
Fixed-price	1,434	52%	1,668	55%
Intersegment sales	41		32
Aeronautics Systems sales	2,814		3,044
Defense Systems
Cost-type	965	55%	911	54%
Fixed-price	795	45%	784	46%
Intersegment sales	45		42
Defense Systems sales	1,805		1,737
Mission Systems
Cost-type	1,163	47%	1,067	45%
Fixed-price	1,309	53%	1,315	55%
Intersegment sales	335		277
Mission Systems sales	2,807		2,659
Space Systems
Cost-type	1,540	63%	1,875	62%
Fixed-price	923	37%	1,169	38%
Intersegment sales	105		105
Space Systems sales	2,568		3,149
Total
Cost-type	5,007	53%	5,197	51%
Fixed-price	4,461	47%	4,936	49%
Total Sales	$9,468		$10,133

(1)Percentages calculated based on external customer sales.

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Sales by Geographic Region	Three Months Ended March 31
2025 · 2024
$ in millions	$%(3)	$%(3)
Aeronautics Systems
United States(1)	$2,295	83%	$2,588	86%
Asia/Pacific	200	7%	170	6%
Europe	269	10%	247	8%
Other geographic regions(2)	9	—%	7	—%
Intersegment sales	41		32
Aeronautics Systems sales	2,814		3,044
Defense Systems
United States(1)	1,471	84%	1,476	87%
Asia/Pacific	81	5%	50	3%
Europe	170	9%	132	8%
Other geographic regions(2)	38	2%	37	2%
Intersegment sales	45		42
Defense Systems sales	1,805		1,737
Mission Systems
United States(1)	1,997	81%	1,928	81%
Asia/Pacific	128	5%	126	5%
Europe	239	10%	255	11%
Other geographic regions(2)	108	4%	73	3%
Intersegment sales	335		277
Mission Systems sales	2,807		2,659
Space Systems
United States(1)	2,419	98%	2,979	98%
Asia/Pacific	8	—%	13	—%
Europe	26	2%	42	2%
Other geographic regions(2)	10	—%	10	—%
Intersegment sales	105		105
Space Systems sales	2,568		3,149
Total
United States(1)	8,182	86%	8,971	88%
Asia/Pacific	417	4%	359	4%
Europe	704	8%	676	7%
Other geographic regions(2)	165	2%	127	1%
Total Sales	$9,468		$10,133

(1)No country other than the United States represents greater than 10% of total company sales.

(2)Other geographic regions are principally comprised of the Middle East.

(3)Percentages calculated based on external customer sales.

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Capital Expenditures and Depreciation and Amortization

The following table presents capital expenditures and depreciation and amortization for each of our reportable segments and for Corporate:

	Three Months Ended March 31
$ in millions	2025	2024
Capital Expenditures
Aeronautics Systems	$79	$84
Defense Systems	12	8
Mission Systems	39	43
Space Systems	110	127
Corporate (1)	16	8
Total	$256	$270
Depreciation and Amortization
Aeronautics Systems	$89	$75
Defense Systems	43	42
Mission Systems	67	62
Space Systems	79	79
Corporate (1)	59	41
Total	$337	$299

(1)Corporate amounts include the amortization of purchased intangible assets and the additional depreciation expense related to the step-up in fair value of PP&E acquired through business combinations as they are not considered part of management’s evaluation of segment operating performance.

Assets

Our chief operating decision maker (“CODM”) does not use assets by segment to evaluate segment performance or allocate resources. Therefore, we do not disclose assets by segment.

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ContentsView on SEC.gov

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