UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 2928, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number: 1-11437

LOCKHEED MARTIN CORPORATION

(Exact name of registrant as specified in its charter)

Maryland

52-1893632

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer Identification No.)

6801 Rockledge Drive,

Bethesda,

Maryland

20817

(Address of principal executive offices)

(Zip Code)

(301) 897-6000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $1 par value	LMT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non–accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b–2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non–accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 231,397,796 shares of our common stock, $1 par value per share, outstanding as of October 16, 2025.

Table of Contents

Lockheed Martin Corporation

Form 10-Q

For the Quarterly Period Ended ~~June~~September 2928, 2025

Table of Contents

			Page
PART I. FINANCIAL INFORMATION
	ITEM 1.	Financial Statements (Unaudited)
		Consolidated Statements of Earnings for the Quarters and Six Months Ended June 29, 2025 and June 30, 2024	3
		Consolidated Statements of Earnings for the Quarters and Nine Months Ended September 28, 2025 and September 29, 2024	3
		Consolidated Statements of Comprehensive Income for the Quarters and Six Months Ended June 29, 2025 and June 30, 2024	4
		Consolidated Statements of Comprehensive Income for the Quarters and Nine Months Ended September 28, 2025 and September 29, 2024	4
		Consolidated Balance Sheets as of June 29, 2025 and December 31, 2024	5
		Consolidated Balance Sheets as of September 28, 2025 and December 31, 2024	5
		Consolidated Statements of Cash Flows for the Six Months Ended June 29, 2025 and June 30, 2024	6
		Consolidated Statements of Cash Flows for the Nine Months Ended September 28, 2025 and September 29, 2024	6
		Consolidated Statements of Equity for the Quarters Ended June 29, 2025 and June 30, 2024	7
		Consolidated Statements of Equity for the Quarters Ended September 28, 2025 and September 29, 2024	7
		Consolidated Statements of Equity for the Six Months Ended June 29, 2025 and June 30, 2024	8
		Consolidated Statements of Equity for the Nine Months Ended September 28, 2025 and September 29, 2024	8
		Notes to Consolidated Financial Statements	9
		Report of Independent Registered Public Accounting Firm	2728
	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2829
	ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	44
	ITEM 4.	Controls and Procedures	44
PART II. OTHER INFORMATION
	ITEM 1.	Legal Proceedings	47
	ITEM 1A.	Risk Factors	47
	ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	48
	ITEM 5.	Other Information	48
	ITEM 6.	Exhibits	49
SIGNATURE			50

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Lockheed Martin Corporation

Consolidated Statements of Earnings

(unaudited; in millions, except per share data)

Quarters Ended

~~Six~~Nine Months Ended

June 29,2025

June 30,2024

June 29,2025

June 30,2024

September 28,2025

September 29,2024

September 28,2025

September 29,2024

Sales

Products

15,~~149~~311

1514,~~109~~472

3045,~~085~~396

2943,~~305~~777

Services

3,~~006~~298

32,~~013~~632

69,~~033~~331

68,~~012~~644

Total sales

18,~~155~~609

1817,~~122~~104

3654,~~118~~727

3552,~~317~~421

Operating costs and expenses

Products

(1413,~~469~~708)

(1312,~~520~~964)

(2741,~~753~~461)

(2639,~~404~~368)

Services

(32,~~130~~871)

(2,~~582~~272)

(58,~~770~~641)

(57,~~185~~457)

Impairment and other charges

~~(66)~~—

~~(87)~~—

(66)

(87)

Other unallocated, net

~~244~~210

~~197~~249

~~528~~738

~~482~~731

Total operating costs and expenses

(1716,~~421~~369)

(1514,~~992~~987)

(3349,~~061~~430)

(3146,~~194~~181)

Gross profit

~~734~~2,240

2,~~130~~117

35,~~057~~297

46,~~123~~240

Other income, net

1440

1823

63103

5477

Operating profit

~~748~~2,280

2,~~148~~140

35,~~120~~400

46,~~177~~317

Interest expense

(~~274~~286)

(~~261~~256)

(~~542~~828)

(~~516~~772)

Non-service FAS pension (expense) income

(99)

1516

(~~197~~296)

3147

Other non-operating income, net

4243

4618

72115

91109

Earnings before income taxes

~~417~~1,938

1,~~948~~918

24,~~453~~391

35,~~783~~701

Income tax expense

(75319)

(~~307~~295)

(~~399~~718)

(~~597~~892)

Net earnings

~~342~~1,619

1,~~641~~623

23,~~054~~673

34,~~186~~809

Earnings per common share

Basic

16.4698

6.8783

815.7874

1320.2912

Diluted

16.4695

6.8580

815.7569

1320.2405

Cash dividends paid per common share

3.30

3.15

69.6090

69.3045

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Consolidated Statements of Comprehensive Income

(unaudited; in millions)

	Quarters Ended				~~Six~~Nine Months Ended
	June 29,2025		June 30,2024		June 29,2025		June 30,2024
	September 28,2025		September 29,2024		September 28,2025		September 29,2024
Net earnings	$	~~342~~1,619	$	1,~~641~~623	$	23,~~054~~673	$	34,~~186~~809
Other comprehensive income, net of tax
Postretirement benefit plans
Amortization, net, net of tax of $18 million and $35 million in 2025 and $5 million and $10 million in 2024	64		19		128		38
Amortization, net of tax of $16 million and $51 million in 2025 and $6 million and $16 million in 2024	65		19		193		57
Other, net, net of tax of $9 million and $15 million in 2025 and $8 million in 2024	102		23		167		(4)
Other, net of tax of $1 million and $17 million in 2025 and $3 million and $5 million in 2024	(10)		57		157		53
Other comprehensive income, net of tax	~~166~~55		4276		~~295~~350		34110
Comprehensive income	$	~~508~~1,674	$	1,~~683~~699	$	24,~~349~~023	$	34,~~220~~919

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Consolidated Balance Sheets

(in millions, except par value)

June 29,2025

December 31,2024

September 28,2025

December 31,2024

(unaudited)

Assets

Current assets

Cash and cash equivalents

13,~~293~~470

2,483

Receivables, net

3,~~306~~844

2,351

Contract assets

1413,~~896~~949

12,957

Inventories

3,~~699~~749

3,474

Other current assets

~~794~~924

584

Total current assets

2325,~~988~~936

21,849

Property, plant and equipment, net

8,~~670~~722

8,726

Goodwill

11,~~309~~313

11,067

Intangible assets, net

21,~~013~~943

2,015

Deferred income taxes

43,~~070~~413

3,557

Other noncurrent assets

8,~~820~~949

8,403

Total assets

5860,~~870~~276

55,617

Liabilities and equity

Current liabilities

Accounts payable

3,~~653~~834

2,222

Salaries, benefits and payroll taxes

23,~~761~~065

3,125

Contract liabilities

910,~~861~~259

9,795

Current maturities of long-term debt and commercial paper

3,118

643

Current maturities of long-term debt

1,669

643

Other current liabilities

4,~~961~~147

3,635

Total current liabilities

2422,~~354~~974

19,420

Long-term debt, net

1820,520

19,627

Accrued pension liabilities

4,~~838~~861

4,791

Other noncurrent liabilities

5,~~824~~740

5,446

Total liabilities

5354,~~536~~095

49,284

Stockholders’ equity

Common stock, $1 par value per share

~~232~~230

234

Additional paid-in capital

—

Retained earnings

1314,~~259~~053

14,551

Accumulated other comprehensive loss

(8,~~157~~102)

(8,452)

Total stockholders’ equity

56,~~334~~181

6,333

Total liabilities and equity

5860,~~870~~276

55,617

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Consolidated Statements of Cash Flows

(unaudited; in millions)

Six Months Ended

Nine Months Ended

June 29,2025

June 30,2024

September 28,2025

September 29,2024

Operating activities

Net earnings

23,~~054~~673

34,~~186~~809

Adjustments to reconcile net earnings to net cash provided by operating activities

Depreciation and amortization

~~796~~1,224

~~710~~1,100

Stock-based compensation

~~141~~215

~~154~~229

Deferred income taxes

~~(561)~~72

(~~145~~174)

Impairment and other charges

Program losses

1,615

165

Select program losses

1,615

248

Changes in assets and liabilities

Receivables, net

(~~955~~1,493)

(~~798~~9)

Contract assets

(21,~~178~~231)

(~~724~~1,136)

Inventories

(~~461~~511)

35(155)

Accounts payable

1,~~500~~644

~~1,052~~970

Contract liabilities

~~(360)~~38

(9139)

Income taxes

~~251~~(100)

2166

Qualified defined benefit pension plans

~~223~~334

(12)

Other, net

(~~521~~208)

~~(222)~~55

Net cash provided by operating activities

15,~~610~~338

35,~~511~~949

Investing activities

Capital expenditures

(~~805~~1,186)

(~~748~~1,103)

Other, net

(~~340~~278)

4149

Net cash (used for) investing activities

(1,~~145~~464)

(~~744~~954)

Financing activities

Issuance of long-term debt, net of related costs

—1,985

1,980

Repayments of long-term debt

(142)

(168)

Proceeds from commercial paper, net

1,449

—

Repurchases of common stock

(2,250)

(2,700)

Repurchases of common stock

(1,250)

(1,850)

Dividends paid

(2,332)

(2,281)

Dividends paid

(1,567)

(1,532)

Other, net

(148)

(117)

Other, net

(145)

(116)

Net cash (used for) financing activities

(2,887)

(3,286)

Net cash (used for) financing activities

(1,655)

(1,686)

Net change in cash and cash equivalents

987

1,709

Net change in cash and cash equivalents

(1,190)

1,081

Cash and cash equivalents at beginning of period

2,483

1,442

Cash and cash equivalents at end of period

13,~~293~~470

23,~~523~~151

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Consolidated Statements of Equity

For the Quarters Ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024

(unaudited; in millions)

	CommonStock		AdditionalPaid-inCapital		RetainedEarnings		AccumulatedOtherComprehensiveLoss		TotalEquity
Balance at March 30, 2025	$	233	$	—	$	14,773	$	(8,323)		$	6,683
Net earnings	—		—		342		—			342
Other comprehensive income, net of tax	—		—		—		166			166
Dividends declared	—		—		(1,546)		—			(1,546)
Repurchases of common stock	(1)		(189)		(310)		—			(500)
Stock-based awards, ESOP activity and other	—		189		—		—			189
Balance at June 29, 2025	$	232	$	—	$	13,259	$	(8,157)		$	5,334
Balance at March 31, 2024	$	239	$	—	$	15,222	$	(8,811)		$	6,650
Net earnings	—		—		1,619		—			1,619
Net earnings	—		—		1,641		—			1,641
Other comprehensive income, net of tax	—		—		—		55			55
Other comprehensive income, net of tax	—		—		—		42			42
Dividends declared	—		—		—		—			—
Dividends declared	—		—		(1,514)		—			(1,514)
Repurchases of common stock	(2)		(173)		(825)		—			(1,000)
Repurchases of common stock	(2)		(206)		(642)		—			(850)
Stock-based awards, ESOP activity and other	—		173		—		—			173
Stock-based awards, ESOP activity and other	—		206		—		—			206
Balance at September 28, 2025	$	230	$	—	$	14,053	$	(8,102)		$	6,181
Balance at June 30, 2024	$	237	$	—	$	14,707	$	(8,769)		$	6,175
Net earnings	—		—		1,623		—			1,623
Other comprehensive income, net of tax	—		—		—		76			76
Dividends declared	—		—		4		—			4
Repurchases of common stock	(2)		(171)		(677)		—			(850)
Stock-based awards, ESOP activity and other	1		171		—		—			172
Balance at September 29, 2024	$	236	$	—	$	15,657	$	(8,693)		$	7,200

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Consolidated Statements of Equity

For the ~~Six~~Nine Months Ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024

(unaudited; in millions)

	CommonStock		AdditionalPaid-inCapital		RetainedEarnings		AccumulatedOtherComprehensiveLoss		TotalEquity
Balance at December 31, 2024	$	234	$	—	$	14,551	$	(8,452)		$	6,333
Net earnings	—		—		23,~~054~~673		—			23,~~054~~673
Other comprehensive income, net of tax	—		—		—		~~295~~350			~~295~~350
Dividends declared	—		—		(2,324)		—			(2,324)
Repurchases of common stock	(35)		(~~225~~398)		(1,~~022~~847)		—			(12,250)
Stock-based awards, ESOP activity and other	1		~~225~~398		—		—			~~226~~399
Balance at June 29, 2025	$	232	$	—	$	13,259	$	(8,157)		$	5,334
Balance at September 28, 2025	$	230	$	—	$	14,053	$	(8,102)		$	6,181
Balance at December 31, 2023	$	240	$	—	$	15,398	$	(8,803)		$	6,835
Net earnings	—		—		34,~~186~~809		—			34,~~186~~809
Other comprehensive income, net of tax	—		—		—		34110			34110
Dividends declared	—		—		(2,~~277~~273)		—			(2,~~277~~273)
Repurchases of common stock	(46)		(~~246~~417)		(12,~~600~~277)		—			(12,~~850~~700)
Stock-based awards, ESOP activity and other	12		~~246~~417		—		—			~~247~~419
Balance at June 30, 2024	$	237	$	—	$	14,707	$	(8,769)		$	6,175
Balance at September 29, 2024	$	236	$	—	$	15,657	$	(8,693)		$	7,200

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited)

NOTE 1 - BASIS OF PRESENTATION

We prepared these consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information, the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements.

In the opinion of management, these consolidated financial statements reflect all adjustments that are of a normal recurring nature necessary for a fair presentation of our results of operations, financial condition, and cash flows for the interim periods presented. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We base these estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates. Estimates inherent in the preparation of our consolidated financial statements include, but are not limited to, accounting for sales, ~~and~~ cost recognition and profit booking rates; postretirement benefit plans; environmental liabilities and assets for the portion of environmental costs that are probable of future recovery; evaluation of goodwill, intangible assets, investments and other assets for impairment; income taxes including deferred tax assets; fair value measurements; and contingencies. The consolidated financial statements include the accounts of subsidiaries we control and variable interest entities if we are the primary beneficiary. We eliminate intercompany balances and transactions in consolidation. Additionally, certain prior year amounts in the consolidated statements of cash flows have been reclassified within operating activities to conform to the current year’s presentation.

OnAs ~~June~~previously 26disclosed, during the second quarter of 2025, we paid $360 million, in cash, tofor ~~close~~the ~~our~~ acquisition of Amentum’s Rapid Solutions business (Rapid Solutions). ~~The acquisition of Rapid Solutions is expected to enhance our Space business segment′s capabilities, particularly in radar~~ and payload technology, and support our customers′ evolving needs for domain awareness and real- time missions. The purchase price was allocated to the estimated fair value of net tangible and intangible assets acquired, with any excess purchase price recorded as goodwill. ~~As a result, we recorded goodwill~~ of $195 million at our Space business segment. The final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the acquisition date. ~~Rapid Solutions operates within our Space business segment and the financial results of Rapid Solutions have been included within our operating results in the period post-acquisition.~~

We close our books and records on the last Sunday of each interim calendar quarter, which was on ~~June~~September 2928 for the ~~second~~third quarter of 2025 and ~~June~~September 3029 for the ~~second~~third quarter of 2024, to align our financial closing with our business processes. The consolidated financial statements and tables of financial information included herein are labeled based on that convention. This practice only affects interim periods; our fiscal year ends on December 31.

The results of operations for the interim periods presented are not necessarily indicative of results to be expected for the full year or future periods. Unless otherwise noted, we present all per share amounts cited in these consolidated financial statements on a “per diluted share” basis. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024 (2024 Form 10-K).

NOTE 2 - EARNINGS PER COMMON SHARE

The weighted average number of shares outstanding used to compute earnings per common share were as follows (in millions):


	Quarters Ended		Nine Months Ended
	September 28, 2025	September 29, 2024	September 28, 2025	September 29, 2024
Weighted average common shares outstanding for basic computations	231.9	237.5	233.3	239.0
Weighted average dilutive effect of equity awards	0.9	1.1	0.8	0.9
Weighted average common shares outstanding for diluted computations	232.8	238.6	234.1	239.9

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

~~NOTE~~common 2share also includes the dilutive effects for the assumed vesting of outstanding restricted stock units (RSUs) and performance stock units (PSUs) based on the treasury stock method. There were no significant anti-dilutive equity awards during the quarters and nine months ended September 28, 2025 and September 29, 2024. Basic and diluted weighted average common shares outstanding decreased in 2025 compared to 2024 due to share repurchases. See “Note 9 - Stockholders’ ~~EARNINGS~~Equity” ~~PER~~for ~~COMMON~~more ~~SHARE~~information.

The weighted average number of shares outstanding used to compute earnings per common share were as follows (in millions):

	Quarters Ended		Six Months Ended
	June 29,2025	June 30,2024	June 29,2025	June 30,2024
Weighted average common shares outstanding for basic computations	233.5	238.9	234.0	239.8
Weighted average dilutive effect of equity awards	0.8	0.7	0.8	0.8
Weighted average common shares outstanding for diluted computations	234.3	239.6	234.8	240.6

We compute basic and diluted earnings per common share by dividing net earnings by the respective weighted average number of common shares outstanding for the periods presented. Our calculation of diluted earnings per common share also includes the dilutive effects for the assumed vesting of outstanding restricted stock units (RSUs) and performance stock units (PSUs) based on the treasury stock method. There were no significant anti-dilutive equity awards during the quarters and six months ended June 29, 2025 and June 30, 2024. Basic and diluted weighted average common shares outstanding decreased in 2025 compared to 2024 due to share repurchases. See “Note 9 - Stockholders’ Equity” for more information.

NOTE 3 - INFORMATION ON BUSINESS SEGMENTS

Our operations are organized into four business segments, which also comprise our reportable segments: Aeronautics, Missiles and Fire Control (MFC), Rotary and Mission Systems (RMS) and Space. We generally organize our business segments based on the nature of products and services offered.

Our chief operating decision maker (CODM) consists of the Chairman, President and Chief Executive Officer and the Chief Operating Officer. The CODM is responsible for allocating resources and assessing the performance of our consolidated enterprise and business segments. The profitability measure the CODM uses to allocate resources and assess segment performance is segment operating profit (and related margin rate, calculated as segment operating profit divided by sales), which is compared to historical and forecasted amounts on a regular basis.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Summary operating results for each of our business segments were as follows (in millions):

Quarters Ended

~~Six~~Nine Months Ended

June 29,2025

June 30,2024

June 29,2025

June 30,2024

September 28,2025

September 29,2024

September 28,2025

September 29,2024

Sales

Aeronautics

7,~~420~~256

76,~~277~~487

1421,~~477~~733

1420,~~122~~609

Missiles and Fire Control

3,~~433~~624

3,~~102~~175

610,~~806~~430

69,~~095~~270

Rotary and Mission Systems

34,~~995~~373

4,~~548~~367

812,~~323~~696

813,~~636~~003

Space

3,~~307~~356

3,~~195~~075

69,~~512~~868

69,~~464~~539

Total sales

18,~~155~~609

1817,~~122~~104

3654,~~118~~727

3552,~~317~~421

Operating costs and expenses

Aeronautics

76,~~517~~571

65,~~526~~835

1320,~~854~~425

1218,~~696~~531

Missiles and Fire Control

23,~~955~~114

2,~~653~~718

58,~~863~~977

58,~~339~~057

Rotary and Mission Systems

43,~~170~~868

43,~~061~~879

811,~~028~~896

711,~~726~~605

Space

23,~~957~~026

2,~~862~~804

58,~~778~~804

58,~~828~~632

Total operating costs and expenses

1716,~~599~~579

1615,~~102~~236

3350,~~523~~102

3146,~~589~~825

Operating profit (loss) (a)

Operating profit (a)

Aeronautics

~~(98)~~682

~~751~~659

~~622~~1,304

12,~~430~~089

Missiles and Fire Control

~~479~~510

~~450~~456

~~944~~1,454

~~761~~1,217

Rotary and Mission Systems

~~(172)~~506

~~495~~483

~~349~~855

~~925~~1,408

Space

~~362~~331

~~346~~272

~~741~~1,072

~~671~~943

Total business segment operating profit

~~571~~2,029

21,~~042~~870

24,~~656~~685

35,~~787~~657

Unallocated items

FAS/CAS pension operating adjustment

~~379~~380

406

~~758~~1,138

~~812~~1,218

Impairment and other charges

~~(66)~~—

~~(87)~~—

(66)

(87)

Intangible asset amortization expense

(6370)

(61)

(~~127~~197)

(~~122~~183)

Other, net

(7359)

(~~152~~75)

(~~101~~160)

(~~213~~288)

Total unallocated items

~~177~~251

~~106~~270

~~464~~715

~~390~~660

Total consolidated operating profit

~~748~~2,280

2,~~148~~140

35,~~120~~400

46,~~177~~317

Intersegment sales

Aeronautics

9785

67125

~~186~~271

~~137~~262

Missiles and Fire Control

~~231~~218

~~204~~210

~~398~~616

~~406~~616

Rotary and Mission Systems

~~632~~580

~~574~~569

1,~~198~~778

1,~~160~~729

Space

8477

9994

~~167~~244

~~206~~300

Total intersegment sales

~~1,044~~960

~~944~~998

12,~~949~~909

12,~~909~~907

(a)Operating profit by segment includes certain immaterial items, such as other income (primarily equity earnings) that are not presented separately in the table. Accordingly, the difference between sales less operating costs and expenses may not equal operating profit by segment.

Segment results exclude intersegment transactions as these activities are eliminated in consolidation and are not considered in assessing the performance of each segment. As described below, segment operating profit also excludes other transactions that are not part of management’s evaluation of segment operating performance, which are included in “Unallocated items” to reconcile total segment operating profit to consolidated amounts. Business segment operating profit includes our share of earnings or losses from equity method investees as the operating activities of the equity method investees are closely aligned with the operations of our business segments.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Unallocated Items

Business segment operating profit excludes the FAS/CAS pension operating adjustment described below, a portion of corporate costs not considered allowable or allocable to contracts with the U.S. Government under the applicable U.S. Government Cost Accounting Standards (CAS) or Federal Acquisition Regulations (FAR), and other items not considered part of management’s evaluation of segment operating performance such as a portion of management and administration costs, legal fees and settlements, stock-based compensation expense, changes in the fair value of assets and liabilities for deferred compensation plans, retiree benefits, significant severance charges, significant asset impairments, gains or losses from divestitures, intangible asset amortization expense, and other miscellaneous corporate activities. Collectively these items are included in “Unallocated items” to reconcile total segment to consolidated operating profit. See “Note 10 - Other” for a discussion related to certain factors that may impact the comparability of sales and operating profit of our business segments.

FAS/CAS Pension Operating Adjustment

Our business segment results of operations include pension expense as calculated under CAS, which we refer to as CAS pension cost. We recover CAS pension and other postretirement benefit plan cost through the pricing of our products and services on U.S. Government contracts and, therefore, recognize CAS pension cost in each business segments’ sales and operating costs and expenses. Our consolidated financial statements must present pension and other postretirement benefit plan (expense) income calculated in accordance with Financial Accounting Standards (FAS) requirements under U.S. GAAP. The FAS/CAS pension operating adjustment represents the difference between CAS pension cost included in segment operating income and the service cost component of FAS pension (expense) income included in consolidated operating profit. To the extent that CAS pension cost exceeds the service cost component of FAS pension (expense) income we have a favorable FAS/CAS pension operating adjustment. The non-service FAS pension (expense) income components are included in non-service FAS pension (expense) income on our consolidated statements of earnings.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Disaggregation of Sales

Sales by products and services, contract type, customer, and geographic region were as follows (in millions):

Quarter Ended June 29, 2025

Quarter Ended September 28, 2025

Aeronautics

MFC

RMS

Space

Total

Sales

Products

5,~~960~~807

3,~~065~~256

3,~~332~~509

2,~~792~~739

15,~~149~~311

Services

1,~~460~~449

368

~~663~~864

~~515~~617

3,~~006~~298

Total sales

7,~~420~~256

3,~~433~~624

34,~~995~~373

3,~~307~~356

18,~~155~~609

Sales by contract type

Fixed-price

4,~~912~~758

2,~~447~~638

2,~~295~~733

~~912~~878

1011,~~566~~007

Cost-reimbursable

2,~~508~~498

986

1,~~700~~640

2,~~395~~478

7,~~589~~602

Total sales

7,~~420~~256

3,~~433~~624

34,~~995~~373

3,~~307~~356

18,~~155~~609

Sales by customer

U.S. Government

4,~~646~~681

2,~~440~~633

2,~~858~~764

3,~~227~~293

13,~~171~~371

International (a)

2,~~766~~571

~~990~~989

1,~~085~~564

7555

45,~~916~~179

U.S. commercial and other

5245

6859

Total sales

7,~~420~~256

3,~~433~~624

34,~~995~~373

3,~~307~~356

18,~~155~~609

Sales by geographic region

United States

4,~~654~~685

2,~~443~~635

2,~~910~~809

3,~~232~~301

13,~~239~~430

Europe

1,~~404~~245

~~381~~401

~~279~~343

2,~~086~~011

Asia Pacific

~~984~~926

~~223~~281

~~601~~764

4932

12,~~857~~003

Middle East

~~159~~138

~~375~~295

~~219~~199

~~757~~633

Other

~~219~~262

1112

~~(14)~~258

—

~~216~~532

Total sales

7,~~420~~256

3,~~433~~624

34,~~995~~373

3,~~307~~356

18,~~155~~609

Six Months Ended June 29, 2025

Nine Months Ended September 28, 2025

Aeronautics

MFC

RMS

Space

Total

Sales

Products

1117,~~706~~513

69,~~082~~338

610,~~828~~337

58,~~469~~208

3045,~~085~~396

Services

24,~~771~~220

~~724~~1,092

12,~~495~~359

1,~~043~~660

69,~~033~~331

Total sales

1421,~~477~~733

610,~~806~~430

812,~~323~~696

69,~~512~~868

3654,~~118~~727

Sales by contract type

Fixed-price

914,~~625~~383

47,~~887~~525

47,~~955~~688

12,~~854~~732

2132,~~321~~328

Cost-reimbursable

47,~~852~~350

12,~~919~~905

35,~~368~~008

47,~~658~~136

1422,~~797~~399

Total sales

1421,~~477~~733

610,~~806~~430

812,~~323~~696

69,~~512~~868

3654,~~118~~727

Sales by customer

U.S. Government

913,~~288~~969

47,~~831~~464

58,~~645~~409

69,~~356~~649

2639,~~120~~491

International (a)

57,~~171~~742

12,~~968~~957

24,~~553~~117

~~146~~201

915,~~838~~017

U.S. commercial and other

1822

~~125~~170

1018

~~160~~219

Total sales

1421,~~477~~733

610,~~806~~430

812,~~323~~696

69,~~512~~868

3654,~~118~~727

Sales by geographic region

United States

913,~~306~~991

47,~~838~~473

58,~~770~~579

69,~~366~~667

2639,~~280~~710

Europe

23,~~651~~896

~~776~~1,177

~~583~~926

4466

46,~~054~~065

Asia Pacific

12,~~824~~750

~~447~~728

1,~~234~~998

96128

35,~~601~~604

Middle East

~~307~~445

~~717~~1,012

~~431~~630

12,~~461~~094

Other

~~389~~651

2840

~~305~~563

—

~~722~~1,254

Total sales

1421,~~477~~733

610,~~806~~430

812,~~323~~696

69,~~512~~868

3654,~~118~~727

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Quarter Ended June 30, 2024

Quarter Ended September 29, 2024

Aeronautics

MFC

RMS

Space

Total

Sales

Products

5,~~971~~550

2,~~742~~811

3,~~705~~554

2,~~691~~557

1514,~~109~~472

Services

~~1,306~~937

~~360~~364

~~843~~813

~~504~~518

32,~~013~~632

Total sales

76,~~277~~487

3,~~102~~175

4,~~548~~367

3,~~195~~075

1817,~~122~~104

Sales by contract type

Fixed-price

4,~~945~~276

2,~~124~~211

2,~~812~~691

~~925~~865

10,~~806~~043

Cost-reimbursable

2,~~332~~211

~~978~~964

1,~~736~~676

2,~~270~~210

7,~~316~~061

Total sales

76,~~277~~487

3,~~102~~175

4,~~548~~367

3,~~195~~075

1817,~~122~~104

Sales by customer

U.S. Government

4,~~941~~465

2,~~241~~272

2,~~999~~867

3,~~107~~081

1312,~~288~~685

International (a)

21,~~297~~973

~~856~~901

1,~~470~~403

4561

4,~~668~~338

U.S. commercial and other

3949

7997

43(67)

~~166~~81

Total sales

76,~~277~~487

3,~~102~~175

4,~~548~~367

3,~~195~~075

1817,~~122~~104

Sales by geographic region

United States

4,~~980~~514

2,~~246~~274

32,~~078~~964

3,~~150~~014

1312,~~454~~766

Europe

1,~~270~~047

~~209~~334

~~282~~309

1918

1,~~780~~708

Asia Pacific

~~685~~612

~~180~~216

~~750~~632

2543

1,~~640~~503

Middle East

~~194~~206

~~450~~333

~~200~~190

1—

~~845~~729

Other

~~148~~108

1718

~~238~~272

—

~~403~~398

Total sales

76,~~277~~487

3,~~102~~175

4,~~548~~367

3,~~195~~075

1817,~~122~~104

Six Months Ended June 30, 2024

Nine Months Ended September 29, 2024

Aeronautics

MFC

RMS

Space

Total

Sales

Products

1117,~~563~~113

58,~~406~~217

610,~~946~~500

57,~~390~~947

2943,~~305~~777

Services

23,~~559~~496

~~689~~1,053

12,~~690~~503

1,~~074~~592

68,~~012~~644

Total sales

1420,~~122~~609

69,~~095~~270

813,~~636~~003

69,~~464~~539

3552,~~317~~421

Sales by contract type

Fixed-price

913,~~529~~805

46,~~120~~331

57,~~289~~980

12,~~825~~690

2030,~~763~~806

Cost-reimbursable

46,~~593~~804

12,~~975~~939

35,~~347~~023

46,~~639~~849

1421,~~554~~615

Total sales

1420,~~122~~609

69,~~095~~270

813,~~636~~003

69,~~464~~539

3552,~~317~~421

Sales by customer

U.S. Government

914,~~607~~072

46,~~408~~680

58,~~839~~706

69,~~269~~350

2638,~~123~~808

International (a)

46,~~449~~422

12,~~680~~581

24,~~632~~035

~~113~~174

813,~~874~~212

U.S. commercial and other

66115

~~165~~262

8215

~~320~~401

Total sales

1420,~~122~~609

69,~~095~~270

813,~~636~~003

69,~~464~~539

3552,~~317~~421

Sales by geographic region

United States

914,~~673~~187

46,~~415~~689

68,~~004~~968

69,~~351~~365

2639,~~443~~209

Europe

23,~~481~~528

~~454~~788

~~551~~860

3755

35,~~523~~231

Asia Pacific

1,~~321~~933

~~367~~583

1,~~290~~922

71114

34,~~049~~552

Middle East

~~397~~603

~~820~~1,153

~~362~~552

12,~~584~~313

Other

~~250~~358

3957

~~429~~701

—

~~718~~1,116

Total sales

1420,~~122~~609

69,~~095~~270

813,~~636~~003

69,~~464~~539

3552,~~317~~421

(a)International sales include foreign military sales (FMS) contracted through the U.S. Government and direct commercial sales to international governments and other international customers.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Our Aeronautics business segment includes our largest program, the F-35 Lightning II, an international multi-role, multi-variant, stealth fighter aircraft. Sales for the F-35 program represented approximately 2826% ~~and 27%~~ of our total consolidated sales for both the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025 and 2622% and 2524% of our total consolidated sales for the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024.

Assets

Total assets for each of our business segments were as follows (in millions):

June 29,2025

December 31,2024

September 28,2025

December 31,2024

Assets

Aeronautics

1514,~~224~~726

13,223

Missiles and Fire Control

6,~~524~~899

5,952

Rotary and Mission Systems

1716,~~199~~972

17,025

Space

87,~~051~~865

7,388

Total business segment assets

46,~~998~~462

43,588

Corporate assets (a)

1113,~~872~~814

12,029

Total assets

5860,~~870~~276

55,617

(a)Corporate assets primarily include cash and cash equivalents, deferred income taxes, assets for the portion of environmental costs that are probable of future recovery, property, plant and equipment used in our corporate operations, assets held in a trust for deferred compensation plans, and other marketable investments.

NOTE 4 - CONTRACT ASSETS AND LIABILITIES

Contract assets include unbilled amounts typically resulting from sales under contracts when the percentage-of-completion cost-to-cost method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer. Contract liabilities include advance payments and billings in excess of revenue recognized. Contract assets and contract liabilities were as follows (in millions):

June 29,2025

December 31,2024

September 28,2025

December 31,2024

Contract assets

1413,~~896~~949

12,957

Contract liabilities

910,~~861~~259

9,795

Contract assets are primarily driven by the recognition of revenue related to the satisfaction or partial satisfaction of performance obligations for which we have not yet billed our customers. During the ~~six~~nine months ended ~~June~~September 2928, 2025, contract assets increased $1.90 billion primarily due to the F-35 program at Aeronautics. There were no significant credit or impairment losses related to our contract assets during the quarters and ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024.

Contract liabilities increased $66464 million during the ~~six~~nine months ended ~~June~~September 2928, 2025, primarily due to payments received in excess of revenue recognized on performance obligations (primarily for international F-35 at Aeronautics and Sikorsky at RMS). During the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, we recognized $1.30 billion and $4.5.6 billion of our contract liabilities at December 31, 2024 as revenue. During the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024, we recognized $~~1.7~~866 ~~billion~~million and $4.19 billion of our contract liabilities at December 31, 2023 as revenue.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

NOTE 5 - INVENTORIES

Inventories consisted of the following (in millions):

	June 29,2025		December 31,2024
	September 28,2025		December 31,2024
Materials, spares and supplies	$	~~676~~670	$	661
Work-in-process	2,~~828~~882		2,617
Finished goods	~~195~~197		196
Total inventories	$	3,~~699~~749	$	3,474

Costs incurred to fulfill a contract in advance of the contract being awarded are included in inventories as work-in-process if we determine that those costs relate directly to a contract or to an anticipated contract that we can specifically identify and determine that the contract award is probable, the costs generate or enhance resources that will be used in satisfying performance obligations, and the costs are recoverable (referred to as pre-contract costs). These advance procurement costs are generally incurred in order to enhance our ability to achieve schedule and certain customer milestones. Pre-contract costs that are initially capitalized in inventory are eventually generally recognized as operating costs consistent with the transfer of products and services to the customer upon the receipt of the anticipated contract. All other pre-contract costs, including start-up costs, are expensed as incurred. As of ~~both June~~September 2928, 2025 and December 31, 2024, $1.7 billion and $1.5 billion of pre-contract costs (primarily F-35 and classified programs at Aeronautics and Sikorsky programs at RMS) were included in work-in-process inventories.

NOTE 6 - POSTRETIREMENT BENEFIT PLANS

The pretax FAS (expense) income related to our qualified defined benefit pension plans consisted of the following (in millions):

	Quarters Ended				~~Six~~Nine Months Ended
	June 29,2025		June 30,2024		June 29,2025		June 30,2024
	September 28,2025		September 29,2024		September 28,2025		September 29,2024
Qualified defined benefit pension plans
Operating:
Service cost	$	(1312)	$	(15)	$	(2638)	$	(3045)
Non-operating:
Interest cost	(368)		(~~350~~349)		(~~736~~1,104)		(~~699~~1,048)
Expected return on plan assets	~~360~~359		393		~~720~~1,079		~~786~~1,179
Amortization of actuarial losses	(7978)		(6564)		(~~157~~235)		(~~130~~194)
Amortization of prior service (costs) credits	(12)		3736		(2436)		74110
Non-service FAS pension (expense) income	(99)		1516		(~~197~~296)		3147
Total FAS pension (expense) income	$	(~~112~~111)	$	—1	$	(~~223~~334)	$	12

We record the service cost component of FAS (expense) income for our qualified defined benefit pension plans in consolidated operating profit and the non-service components in non-service FAS pension (expense) income on our consolidated statements of earnings.

Total FAS income for our other postretirement benefit plans was not material during the quarters and ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024 and is part of other non-operating income, net on our consolidated statements of earnings.

The required funding of our qualified defined benefit pension plans is determined in accordance with the Employee Retirement Income Security Act of 1974 (ERISA), as amended, along with consideration of CAS and Internal Revenue Code rules. We made no contributions to our qualified defined benefit pension plans during the quarters and ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

NOTE 7 - LEGAL PROCEEDINGS AND CONTINGENCIES

Legal Proceedings

We are a party to litigation and other proceedings that arise in the ordinary course of our business, including matters arising under provisions relating to the protection of the environment, and are subject to contingencies related to certain businesses we previously owned. These types of matters could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief. We believe the probability is remote that the outcome of each of these matters, including the legal proceedings described below, will have a material adverse effect on the company as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings and cash flows in the period in which it is recognized. Among the factors that we consider in this assessment are the nature of existing legal proceedings and claims, the asserted or possible damages or loss contingency (if estimable), the progress of the case, existing law and precedent, the opinions or views of legal counsel and other advisers, our experience in similar cases and the experience of other companies, the facts available to us at the time of assessment and how we intend to respond to the proceeding or claim. Our assessment of these factors may change over time as individual proceedings or claims progress.

Although we cannot predict the outcome of legal or other proceedings with certainty, where there is at least a reasonable possibility that a loss may be incurred, GAAP requires us to disclose an estimate of the reasonably possible loss or range of loss or make a statement that such an estimate cannot be made. We follow a thorough process in which we seek to estimate the reasonably possible loss or range of loss, and only if we are unable to make such an estimate do we conclude and disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below in our discussion of legal proceedings, a reasonably possible loss or range of loss associated with any individual legal proceeding cannot be estimated.

Securities-Related Actions

On July 28, 2025, a putative class action was filed in United States District Court for the Southern District of New York against us and certain current and former members of our senior management. The shareholder plaintiff asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (Exchange Act), on behalf of persons and entities that purchased or otherwise acquired our securities between January 23, 2024 and July 21, 2025. Plaintiff seeks unspecified losses allegedly caused by alleged misstatements about certain programs in the Aeronautics and MFC business segments, certain international helicopter programs in the Sikorsky business, and certain asset impairments and tax matters, which were allegedly revealed to be false when we announced estimated losses relating to those programs and matters. In addition, based on allegations substantially similar to the above-described securities class action, on September 11, 2025, a shareholder derivative complaint was filed in the United States District Court for the District of Maryland against current and former members of our Board of Directors and senior management. We are named as a nominal defendant. The derivative complaint asserts claims under Sections 14(a), 20(a), and 10(b) of the Exchange Act, as well as claims for breach of fiduciary duty, abuse of control, gross mismanagement, corporate waste, unjust enrichment, and contribution. Based on the information available to date, we do not believe that these matters will have a material adverse effect on our results of operations, financial condition, or liquidity.

Lockheed Martin v. Metropolitan Transportation Authority

On April 24, 2009, we filed a declaratory judgment action against the New York Metropolitan Transportation Authority and its Capital Construction Company (collectively, the MTA) asking the U.S. District Court for the Southern District of New York to find that the MTA is in material breach of our agreement based on the MTA’s failure to provide access to sites where work must be performed and the customer-furnished equipment necessary to complete the contract. The MTA filed an answer and counterclaim alleging that we breached the contract and subsequently terminated the contract for alleged default. The primary damages sought by the MTA are the costs to complete the contract and potential re-procurement costs. While we are unable to estimate the cost of another contractor to complete the contract and the costs of re-procurement, we note that our contract with the MTA had a total value of $323 million, of which $241 million was paid to us, and that the MTA is seeking damages of approximately $190 million. We dispute the MTA’s allegations and are defending against them. Additionally, following an investigation, our sureties on a performance bond related to this matter, who were represented by independent counsel, concluded that the MTA’s termination of the contract was improper. Finally, our declaratory judgment action was later amended to include claims for monetary damages against the MTA of approximately $95 million. This matter was taken under submission by the District Court in December 2014, after a five-week bench trial and the filing of post-trial pleadings by the parties. We continue to await a decision from the District Court. Although this matter relates to our former Information Systems & Global Solutions business (IS&GS), we retained responsibility for the litigation when we divested IS&GS in 2016.

Environmental Matters

We are involved in proceedings and potential proceedings relating to soil, sediment, surface water, and groundwater contamination, disposal of hazardous substances, and other environmental matters at several of our current or former facilities, other facilities for which we may have contractual responsibility, and at third-party sites where we have been designated as a potentially responsible party (PRP). These proceedings could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief.

Based on our estimates, at June 29, 2025 and December 31, 2024, the aggregate amount of liabilities recorded relative to environmental remediation matters was $669 million and $677 million, respectively, most of which are recorded in other noncurrent liabilities on our consolidated balance sheets. We have recorded assets for the portion of environmental costs that are probable of future recovery totaling $611 million and $619 million at June 29, 2025 and

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

~~December~~week ~~31,~~bench ~~2024,~~trial ~~respectively,~~and ~~most~~the filing of ~~which~~post-trial ~~are~~pleadings ~~recorded~~by inthe ~~other~~parties. ~~noncurrent~~We ~~assets~~continue onto await a decision from the District Court. Although this matter relates to our ~~consolidated~~former ~~balance~~Information ~~sheets~~Systems & Global Solutions business (IS&GS), we retained responsibility for the litigation when we divested IS&GS in 2016.

Environmental Matters

Based on our estimates, at September 28, 2025 and December 31, 2024, the aggregate amount of liabilities recorded relative to environmental remediation matters was $667 million and $677 million, respectively, most of which are recorded in other noncurrent liabilities on our consolidated balance sheets. We have recorded assets for the portion of environmental costs that are probable of future recovery totaling $610 million and $619 million at September 28, 2025 and December 31, 2024, respectively, most of which are recorded in other noncurrent assets on our consolidated balance sheets.

We are monitoring or investigating a number of former and presently operating facilities for potential future remediation. We perform quarterly reviews of the status of our environmental remediation sites and the related liabilities and receivables. Additionally, in our quarterly reviews, we consider various factors in estimating the timing and amount of any future costs that may be required for remediation activities, as we cannot reasonably determine the extent of our financial exposure in all cases. We project costs and recovery of costs over approximately 20 years.

We also pursue claims for recovery of costs incurred or for contribution to site remediation costs against other PRPs, including the U.S. Government, and are conducting remediation activities under various consent decrees, orders, and agreements relating to soil, groundwater, sediment, or surface water contamination at certain sites of former or current operations. Under agreements related to certain sites in California, New York, United States Virgin Islands and Washington, the U.S. Government and/or a private party reimburses us an amount equal to a percentage, specific to each site, of expenditures for certain remediation activities in their capacity as PRPs under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).

In addition to the proceedings and potential proceedings discussed above, potential new regulations concerning perchlorate and hexavalent chromium at the federal and state level could increase our cleanup costs. We also are evaluating the potential impact of new, existing, and contemplated requirements addressing a class of chemicals known generally as per- and polyfluoroalkyl substances (PFAS). PFAS are common and appear in products such as fire-fighting foams and stain- and stick-resistant products (e.g., Teflon, stain-resistant fabrics) and have been used in manufacturing processes. Regulations requiring very low PFAS contaminant levels in drinking water could eventually lead to increased cleanup costs at a number of our environmental remediation sites. If regulations require substantially more stringent clean-up levels of perchlorate or hexavalent chromium or increased cleanup costs at our sites associated with PFAS, we expect a ~~material~~corresponding increase in both our estimates for environmental liabilities and the related assets for the portion of costs that are probable of future recovery. The ~~amount~~portion ~~that~~of ~~would~~those becosts ~~allocable to our non-U.S. Government contracts or~~ that is ~~determined~~ not expected to be recoverable under U.S. Government contracts would be expensed, ~~which~~in ~~may~~the ~~have~~quarter ~~a material effect on our earnings~~ in ~~any~~which ~~particular~~the ~~reporting~~liability ~~period~~becomes probable.

WeLetters ~~also are evaluating the potential impact~~ of ~~new,~~Credit ~~existing,~~ and ~~contemplated~~Surety ~~requirements~~Bonds addressing a class of chemicals known generally as per- and polyfluoroalkyl substances (PFAS). PFAS are common and appear in products such as fire-fighting foams and stain- and stick-resistant products (e.g., Teflon, stain-resistant fabrics) and have been used in manufacturing processes. Regulations requiring very low PFAS contaminant levels in drinking water could eventually lead to increased cleanup costs at a number of our environmental remediation sites.

~~Letters~~We have entered into standby letters of ~~Credit~~credit and surety bonds issued on our behalf by financial institutions, ~~Surety~~and ~~Bonds~~we have directly issued guarantees to third parties primarily relating to advances received from customers and ~~Third-Party~~the ~~Guarantees~~guarantee of future performance on certain contracts. Letters of credit and surety bonds generally are available for draw down in the event we do not perform. We had total outstanding letters of credit and surety bonds aggregating $2.8 billion and $2.7 billion at September 28, 2025 and December 31, 2024.

We have entered into standby letters of credit and surety bonds issued on our behalf by financial institutions, and we have directly issued guarantees to third parties primarily relating to advances received from customers and the guarantee of future performance on certain contracts. Letters of credit and surety bonds generally are available for draw down in the event we do not perform. We had total outstanding letters of credit and surety bonds aggregating $2.6 billion and $2.7 billion at June 29, 2025 and December 31, 2024.

Additionally, we may guarantee the contractual performance of third parties such as joint venture partners. At June 29, 2025 and December 31, 2024, third-party guarantees totaled $105 million and $351 million, of which approximately 83% and 30% related to guarantees of contractual performance of joint ventures to which we currently are or previously were a party. These amounts represent our estimate of the maximum amounts we would expect to incur upon the contractual non-performance of the joint venture, joint venture partners or divested businesses. Generally, we also have cross-indemnities in place that may enable us to recover amounts that may be paid on behalf of a joint venture partner. Third-party guarantees do not include guarantees issued on behalf of subsidiaries and other consolidated entities.

In determining our exposures, we evaluate the reputation, performance on contractual obligations, technical capabilities and credit quality of our current and former joint venture partners and the transferee under novation agreements all of which include a guarantee as required by the FAR. At June 29, 2025 and December 31, 2024, there were no material amounts recorded in our financial statements related to third-party guarantees or novation agreements.

Other Contingencies

As a U.S. Government contractor, we are subject to various audits and investigations by the U.S. Government to determine whether our operations are being conducted in accordance with applicable regulatory requirements. U.S. Government investigations of us, whether relating to U.S. Government contracts or conducted for other reasons, could ~~result in civil or criminal penalties and administrative sanctions, including reductions of the value of contracts, contract~~

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

result in civil or criminal penalties and administrative sanctions, including reductions of the value of contracts, contract modifications or terminations, forfeiture of profits, suspension of payments, repayments, fines or penalties being imposed upon us, suspension, proposed debarment, debarment from eligibility for future U.S. Government contracting, or suspension of export privileges. Reductions of the value of contracts, contract modifications or terminations, forfeiture of profits, suspension of payments, repayments, fines and penalties could have a material impact on financial condition and results of operations in any particular reporting period, and suspension or debarment could have a material adverse effect on us because of our dependence on contracts with the U.S. Government. U.S. Government investigations often take years to complete and many result in no adverse action against us. We also provide products and services to customers outside of the United States, which are subject to U.S. and foreign laws and regulations and foreign procurement policies and practices. Our compliance with local regulations or applicable U.S. Government regulations also may be audited or investigated.

Additionally, in the normal course of business, we provide warranties to our customers associated with certain product sales. We record estimated warranty costs in the period in which the related products are delivered. The warranty liability is generally based on the number of months of warranty coverage remaining for the products delivered and the average historical monthly warranty payments. Warranty obligations incurred in connection with long-term production contracts are accounted for within the contract estimates at completion.

NOTE 8 - FAIR VALUE MEASUREMENTS

Assets and liabilities measured and recorded at fair value on a recurring basis consisted of the following (in millions):

	June 29, 2025						December 31, 2024
	September 28, 2025						December 31, 2024
	Total		Level 1		Level 2			Total		Level 1		Level 2
Assets
Mutual funds	$	1,~~081~~115	$	1,~~081~~115	$	—		$	1,072	$	1,072	$	—
U.S. Government securities	7785		—		7785			116		—		116
Other securities	~~705~~719		~~363~~375		~~342~~344			645		342		303
Derivatives	7135		—		7135			9		—		9
Liabilities
Derivatives	~~157~~134		—		~~157~~134			196		—		196

Substantially all assets measured at fair value, other than derivatives, represent assets held in a trust to fund certain of our non-qualified deferred compensation plans and are recorded in other noncurrent assets on our consolidated balance sheets. The fair values of mutual funds and certain other securities are determined by reference to the quoted market price per unit in active markets multiplied by the number of units held without consideration of transaction costs. The fair values of U.S. Government and certain other securities are determined using pricing models that use observable inputs (e.g., interest rates and yield curves observable at commonly quoted intervals), bids provided by brokers or dealers or quoted prices of securities with similar characteristics. The fair values of derivative instruments, which consist of foreign currency forward contracts, including embedded derivatives, and interest rate swap contracts, are primarily determined based on the present value of future cash flows using model-derived valuations that use observable inputs such as interest rates, credit spreads and foreign currency exchange rates.

We also make investments in companies that we believe are advancing or developing new technologies applicable to our business. These investments are primarily in early-stage companies and may be in the form of common or preferred stock, warrants, convertible debt securities, investments in funds or equity method investments. All of these investments are in securities without readily determinable fair values (privately held securities), which are measured initially at cost and are then adjusted to fair value only if there is an observable price change or reduced for impairment, if applicable. The carrying amounts of the investments were $~~601~~599 million and $600 million at ~~June~~September 2928, 2025 and December 31, 2024. ~~Due~~Net gains or losses recorded due to adjustments in valuation and/or sales of investments, wewere ~~recorded~~not ~~net~~material ~~gains~~for ~~of $19 million ($14 million, or $0.06 per share, after tax) and $20 million ($15 million, or $0.06 per share, after tax) during~~ the ~~quarter~~quarters and ~~six~~nine months ended ~~June~~September 2928, 2025. ~~We recorded net gains of $9 million ($7 million, or $0.03 per share, after-tax)~~ and ~~$14~~September ~~million ($11 million~~29, ~~or $0.04 per share, after-tax) during the quarter and six months ended June 30,~~ 2024.

We use derivative instruments principally to reduce our exposure to market risks from changes in foreign currency exchange rates and interest rates. We transact business globally and are subject to risks associated with changing foreign currency exchange rates. We do not enter into or hold derivative instruments for speculative trading purposes. These contracts hedge forecasted foreign currency transactions in order to minimize fluctuations in our earnings and cash flows

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

~~contracts hedge forecasted foreign currency transactions in order to minimize fluctuations in our earnings and cash flows~~ associated with changes in foreign currency exchange rates. We designate foreign currency hedges as cash flow hedges. We enter into foreign currency hedges such as forward and option contracts that change in value as foreign currency exchange rates change. Our most significant foreign currency exposures relate to the British pound sterling, the euro, the Canadian dollar, the Australian dollar, the Norwegian kroner and the Polish zloty. We also are exposed to the impact of interest rate changes primarily through our borrowing activities. For fixed rate borrowings, we may use variable interest rate swaps, effectively converting fixed rate borrowings to variable rate borrowings in order to hedge changes in the fair value of the debt. These swaps are designated as fair value hedges. For variable rate borrowings, we may use fixed interest rate swaps, effectively converting variable rate borrowings to fixed rate borrowings in order to minimize the impact of interest rate changes on earnings. These swaps are designated as cash flow hedges. We also may enter into derivative instruments that are not designated as hedges and do not qualify for hedge accounting, which are intended to minimize certain economic exposures.

The aggregate notional amount of our outstanding interest rate swaps was $1.3 billion at ~~June~~both September 2928, 2025 and December 31, 2024. The aggregate notional amount of our outstanding foreign currency hedges was $7.90 billion and $7.5 billion at ~~June~~September 2928, 2025 and December 31, 2024. The fair values of our outstanding interest rate swaps and foreign currency hedges at ~~June~~September 2928, 2025 and December 31, 2024 were not significant. Derivative instruments did not have a material impact on net earnings and comprehensive income during the quarters and ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024. The impact of derivative instruments on our consolidated statements of cash flows is included in net cash provided by operating activities. Substantially all of our derivatives are designated for hedge accounting.

In addition to the financial instruments listed in the table above, we hold other financial instruments, including cash and cash equivalents, receivables, accounts payable, commercial paper and debt. The carrying amounts for cash and cash equivalents, receivables and accounts payable approximated their fair values. The estimated fair value of our outstanding debt ~~and commercial paper~~ was $2122.65 billion and $20.2 billion at ~~June~~September 2928, 2025 and December 31, 2024. The outstanding principal amount of debt ~~and commercial paper~~, including short-term and long-term debt, was $2223.94 billion and $21.6 billion at ~~June~~September 2928, 2025 and December 31, 2024, excluding $1.2 billion and $1.3 billion of unamortized discounts and issuance costs at ~~June~~September 2928, 2025 and December 31, 2024. The estimated fair values of our outstanding debt were determined based on the present value of future cash flows using model-derived valuations that use observable inputs such as interest rates and credit spreads (Level 2).

NOTE 9 - STOCKHOLDERS’ EQUITY

Repurchases of Common Stock

During the ~~six~~nine months ended ~~June~~September 2928, 2025, we repurchased 25.70 million shares of our common stock in open market purchases for $12.3 ~~billion. The total remaining authorization for future common stock repurchases under our share repurchase program was $8.1~~ billion ~~as of June 29, 2025~~. As we repurchase our common shares, we reduce common stock for the $1 of par value of the shares repurchased, with the excess purchase price over par value recorded as a reduction of additional paid-in capital. If additional paid-in capital is reduced to zero, we record the remainder of the excess purchase price over par value as a reduction of retained earnings.

~~Dividends~~The total remaining authorization for future common stock repurchases under our share repurchase program was $7.1 billion as of September 28, 2025. In October 2025, subsequent to our third quarter, our Board of Directors authorized an increase of $2.0 billion to our share repurchase program, increasing our total authorization of the current program to $9.1 billion for future purchases. As we repurchase our common shares, we reduce common stock for the $1 of par value of the shares repurchased, with the excess purchase price over par value recorded as a reduction of additional paid-in capital. If additional paid-in capital is reduced to zero, we record the remainder of the excess purchase price over par value as a reduction of retained earnings.

We paid cash dividends of $1.6 billion ($6.60 per share) during the six months ended June 29, 2025. Additionally, we declared a third quarter 2025 dividend totaling approximately $770 million ($3.30 per share), which will be paid in September 2025. The total amount of dividends declared may differ from the total amount of dividends paid during a period due to the timing of dividend-equivalents paid on RSUs and PSUs. These dividend-equivalents are accrued during the vesting period and are paid upon the vesting of the RSUs and PSUs, which primarily occurs in the first quarter each year.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Dividends

We paid cash dividends of $2.3 billion ($9.90 per share) during the nine months ended September 28, 2025. In October 2025, subsequent to our third quarter, we authorized a fourth quarter 2025 dividend payment of $3.45 per share, an increase of $0.15 per share over our third quarter 2025 dividend of $3.30 per share. The total amount of dividends declared may differ from the total amount of dividends paid during a period due to the timing of dividend-equivalents paid on RSUs and PSUs. These dividend-equivalents are accrued during the vesting period and are paid upon the vesting of the RSUs and PSUs, which primarily occurs in the first quarter each year.

Accumulated Other Comprehensive Loss

Changes in the balance of AOCL, net of tax, consisted of the following (in millions):

	PostretirementBenefit Plans		Other, net		AOCL
Balance at December 31, 2024	$	(8,288)	$	(164)	$	(8,452)
Other comprehensive income before reclassifications	—		~~142~~116		~~142~~116
Amounts reclassified from AOCL
Amortization of net actuarial losses (a)	~~110~~165		—		~~110~~165
Amortization of net prior service costs (a)	1828		—		1828
Other	—		2541		2541
Total reclassified from AOCL	~~128~~193		2541		~~153~~234
Total other comprehensive income	~~128~~193		~~167~~157		~~295~~350
Balance at June 29, 2025	$	(8,160)	$	3	$	(8,157)
Balance at September 28, 2025	$	(8,095)	$	(7)	$	(8,102)
Balance at December 31, 2023	$	(8,704)	$	(99)	$	(8,803)
Other comprehensive (loss) before reclassifications	—		(32)		(32)
Other comprehensive income before reclassifications	—		23		23
Amounts reclassified from AOCL
Amortization of net actuarial losses (a)	94141		—		94141
Amortization of net prior service credits (a)	(5684)		—		(5684)
Other	—		2830		2830
Total reclassified from AOCL	3857		2830		6687
Total other comprehensive income (loss)	38		(4)		34
Total other comprehensive income	57		53		110
Balance at June 30, 2024	$	(8,666)	$	(103)	$	(8,769)
Balance at September 29, 2024	$	(8,647)	$	(46)	$	(8,693)

(a)Reclassifications from AOCL related to postretirement benefit plans were recorded as a component of FAS (expense) income for each period presented. These amounts include $6465 million and $19 million, net of tax, for the quarters ended ~~June 29~~September 28, 2025 and ~~June 30~~September 29, 2024, which are comprised of the amortization of net actuarial losses of $55 million and $47 million, and the amortization of net prior service costs (credits) of $910 million and $(28) million, for the quarters ended ~~June 29~~September 28, 2025 and ~~June 30~~September 29, 2024. See “Note 6 - Postretirement Benefit Plans”.

NOTE 10 - OTHER

Contract Estimates

We generate sales from long-term contracts for the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. Substantially all of our sales are recognized over time using the percentage-of-completion cost-to-cost measure of progress. Under the percentage-of-completion cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the product or service. Certain sales are recognized at a point in time, which typically occurs upon customer acceptance or receipt of the product or service.

Significant judgments and assumptions are made in estimating contract sales, costs, and profit. We estimate profit as the difference between total estimated sales and total estimated costs to complete the contract and recognize that profit as costs are incurred (over time sales recognition) or when the customer accepts the product or service (point in time sales recognition). Contract sales may include estimates of variable consideration, including cost or performance incentives (such as award and incentive fees), un-priced change orders, requests for equitable adjustment (REAs), and contract claims. Variable consideration is included in total estimated sales to the extent it is probable that a significant reversal in the amount of cumulative sales recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. We estimate variable consideration as the most likely amount to which we expect to be entitled. Contract costs include significant estimates related to labor, subcontractors, materials, overhead, general and administrative expenses, and costs to fulfill our industrial cooperation agreements, sometimes referred to as offset or localization agreements, required under certain contracts with international customers. Significant estimates related to

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

profit as costs are incurred (over time sales recognition) or when the customer accepts the product or service (point in time sales recognition). Contract sales may include estimates of variable consideration, including cost or performance incentives (such as award and incentive fees), un-priced change orders, requests for equitable adjustment (REAs), and contract claims. Variable consideration is included in total estimated sales to the extent it is probable that a significant reversal in the amount of cumulative sales recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. We estimate variable consideration as the most likely amount to which we expect to be entitled. Contract costs include significant estimates related to labor, subcontractors, materials, overhead, general and administrative expenses, and costs to fulfill our industrial cooperation agreements, sometimes referred to as offset or localization agreements, required under certain contracts with international customers. Significant estimates related to costs include the complexity and scope of the work to be performed, labor productivity and availability, labor rates including terms of collective bargaining arrangements, execution by our subcontractors, the availability and cost of materials including any impact from changing costs or inflation, the length of time to complete the performance obligation, overhead and general and administrative cost rates, and estimated useful lives of components and assets, among others. In particular, fixed-price development programs involve significant management judgment, as development contracts by nature have elements that have not been done before and thus, are highly subject to future unexpected changes in estimates as described below.

At the outset of a long-term contract, we identify and monitor risks to the achievement of the technical, schedule and cost aspects of the contract, as well as our ability to earn variable consideration, and assess the effects of those risks on our estimates of sales and total costs to complete the contract. The estimates consider the technical requirements (e.g., a newly developed product versus a mature product), the schedule and associated tasks (e.g., the number and type of milestone events) and costs (e.g., labor, subcontractors, materials, overhead, general and administrative expenses, and offset or localization agreements). The initial profit booking rate of each contract considers risks surrounding the ability to achieve the technical requirements, schedule and costs in the initial estimated total costs to complete the contract. We review our estimates related to sales, cost, and profit for each contract at least annually or when a change in circumstances warrants a modification to a previous estimate. For significant contracts, we review our estimates more frequently. As part of this process, management reviews information including, but not limited to, any outstanding key contract matters, progress towards completion and the related program schedule, identified risks and opportunities, and the related changes in estimates of revenues and costs. Profit booking rates may increase during the performance of the contract if we successfully retire risks related to earning variable consideration and/or the technical, schedule and cost aspects of the contract, which decreases the estimated total costs to complete the contract or may increase the variable consideration we expect to receive on the contract, which we refer to as favorable profit booking rate adjustments. Conversely, our profit booking rates may decrease if the estimated total costs to complete the contract increase or our estimates of variable consideration we expect to receive decrease, which we refer to as unfavorable profit booking rate adjustments.

We recognize changes in estimated contract sales or costs and the resulting changes in contract profit on a cumulative basis. Cumulative profit booking rate adjustments represent the cumulative effect of the changes on current and prior periods; sales and operating margins in future periods are recognized as if the revised estimates had been used since contract inception. Profit booking rate adjustments can have a significant effect on our financial statements and affect the comparability of our segment sales, operating profit and operating margin. Segment operating profit and margin can also be impacted favorably or unfavorably by, for example, certain items such as the positive resolution of contractual matters, cost recoveries on severance and restructuring, insurance recoveries and gains on sales of assets, as well as unfavorable items including the adverse resolution of contractual matters, supply chain disruptions, restructuring charges (except for significant severance actions, which are excluded from segment operating results), reserves for disputes, certain asset impairments, and losses on sales of certain assets. When estimates of total costs to be incurred on a contract exceed total estimates of the transaction price, a provision for the entire loss is determined at the contract level and is recorded in the period in which the loss is evident, which we refer to as a reach-forward loss.

The following table presents the effect of profit booking rate adjustments on our financial results (in millions, except per share data):

	Quarters Ended						Six Months Ended
	June 29,2025			June 30,2024			June 29,2025			June 30,2024
Sales	$	(361)		$	383		$	142		$	655
Segment operating profit	(1,045)			420			(565)			615
% of segment operating profit	(183)		%	21		%	(21)		%	16		%
Net earnings	(826)			332			(446)			486
Diluted earnings per share	(3.53)			1.39			(1.90)			2.02

During the quarter ended June 29, 2025, we recorded losses of $950 million on an ongoing classified program at our Aeronautics business segment, and $570 million on Canadian Maritime Helicopter Program (CMHP) and $95 million on Türkish Utility Helicopter Program (TUHP) at our RMS business segment. During the six months ended June 29, 2025, in

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

~~addition~~The tofollowing ~~the~~table ~~losses~~presents ~~above,~~the weeffect ~~recorded $125 million~~ of ~~adjustments~~profit ~~resulting~~booking ~~from~~rate ~~favorable~~adjustments ~~performance upon completion~~ on ~~certain~~our ~~commercial~~financial ~~civil~~results ~~space~~(in ~~programs at Space and an $80 million favorable adjustment upon completion of a classified program at Aeronautics. During the six months ended June 30~~millions, ~~2024~~except weper ~~recognized~~share ~~a reach-forward loss of $100 million on a classified program at our MFC business segment.~~data):

We have various development programs for new and upgraded products, services, and related technologies which have complex design and technical challenges. This development work is inherently uncertain and subject to significant variability in estimates of the cost and time required to complete the work by us and our suppliers. Many of these programs have cost-type contracting arrangements (e.g. cost-reimbursable or cost-plus-fee). In such cases, the associated financial risks are primarily in reduced fees, lower profit rates, or program cancellation if cost, schedule, or technical performance issues arise. However, some of our existing development programs are contracted on a fixed-price basis or include cost-type contracting for the development phase with fixed-price production options and our customers continue to implement procurement strategies such as these that shift risk to contractors. Competitively bid programs with fixed-price development work or fixed-price production options increase the risk of a reach-forward loss upon contract award and during the period of contract performance. Due to the complex and often experimental nature of development programs, we may experience (and have experienced in the past) technical and quality issues during the development of new products or technologies for a variety of reasons. Our development programs are ongoing, and while we believe the cost and fee estimates incorporated in the financial statements are appropriate, the technical complexity of these programs and fixed-price contract structure creates financial risk as estimated completion costs may exceed the current contract value, which could trigger earnings charges, termination provisions, or other financially significant exposures. These programs have risk for reach-forward losses if our estimated costs exceed our estimated contract revenues, and such losses could be significant to our financial condition and operating results in any period that they are recognized. Any such losses are recognized in the period in which the loss is evident.


	Quarters Ended						Nine Months Ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024
Sales	$	371		$	358		$	681		$	1,013
Segment operating profit	365			375			(200)			990
% of segment operating profit	18		%	20		%	(4)		%	18		%
Net earnings	288			296			(158)			782
Diluted earnings per share	1.24			1.24			(0.67)			3.26

WeDuring ~~have~~the ~~experienced~~nine ~~significant~~months ~~performance~~ended ~~issues~~September 28, 2025, we recorded losses of $950 million on an ~~existing~~ongoing classified program at our Aeronautics business segment., The initial phase is on a fixed-price incentive fee contract with fixed-price incentive fee options for additional phases. Phases within the program involve highly complex design and systems integration and we had previously recognized reach-forward losses amounting to $~~730~~570 million on ~~the~~Canadian ~~initial~~Maritime ~~phase~~Helicopter Program (CMHP) and $95 million on ~~the~~Türkish ~~additional~~Utility ~~phases.~~Helicopter ~~Challenges~~Program ~~and~~(TUHP) ~~performance~~at ~~issues~~our ~~continued~~RMS ~~into~~business ~~2025~~segment ~~and~~(see ~~had~~discussions athat ~~greater~~follows ~~impact~~within onthis ~~schedule and costs than previously estimated. As a result~~footnote), ~~Aeronautics performed a comprehensive review of its design, integration, test,~~ and ~~other~~$105 million ~~processes to achieve the technical requirements~~ of ~~the~~unfavorable ~~program,~~profit ~~which~~adjustments ~~was completed in the second quarter of 2025. Based~~ on ~~this~~C-130 ~~review~~programs ~~and~~at ~~ongoing~~our ~~discussions with the customer and suppliers,~~ Aeronautics ~~made~~business ~~significant~~segment. ~~changes~~In toaddition ~~its processes and testing approach, resulting in significant updates~~ to ~~the~~these ~~program’s~~losses ~~schedule~~ and ~~cost~~unfavorable ~~estimates.~~profit ~~As a result~~adjustments, ~~during the second quarter of 2025,~~ we ~~recognized~~also ~~additional~~recorded ~~reach-forward losses on the initial phase of~~ $~~690~~130 million ~~and on additional phases~~ of ~~$260 million.~~favorable ~~The~~adjustments ~~drivers~~upon ~~that~~completion ~~gave rise to the growth recognized~~ on ~~the~~certain ~~initial~~commercial ~~phase~~civil ~~and~~space downstream impacts on estimates of cost and profitability in additional phases include: (1) observed software development performance degradation and integration findings; (2) learnings in recent software and build experience on other programs; ~~(3)~~at ~~significant~~Space, ~~changes in test plan; (4) safety-critical~~ and ~~other~~$80 million ~~necessary~~favorable ~~design~~adjustments ~~and~~upon ~~engineering~~completion ~~changes;~~of ~~and~~a ~~(5)~~classified ~~complete~~program ~~schedule~~at ~~realignment~~Aeronautics. AsDuring ofthe ~~June~~nine months ended September 29, ~~2025~~2024, ~~cumulative~~we ~~losses~~ recognized toreach-forward ~~date~~losses onof ~~this program were approximately~~ $~~1.4~~145 ~~billion~~million on the ~~initial~~same ~~phase~~ongoing ~~and~~classified ~~$355 million~~program onat ~~the~~our ~~additional~~Aeronautics ~~phases. As~~business ofsegment ~~June 29, 2025,~~ ($~~583~~80 million ~~remained~~was ~~accrued~~recognized induring ~~other current liabilities in our consolidated balance sheet. We will continue to proactively manage~~ the ~~technical~~quarter ~~requirements~~ended ~~and our performance~~September 29, the remaining work and any future changes in scope or schedule, and estimated costs to complete the program, including future phases. We may need to record additional losses in future periods if we experience further performance issues, increases in scope, or cost growth. Any such losses could be material to our financial results in any period that they are recognized. We and our industry team will continue to incur advanced procurement costs (also referred to as pre-contract costs2024) ~~to enhance our ability to achieve the schedule~~ and ~~certain milestones which could be significant. We will monitor the recoverability~~ of ~~pre-contract~~$100 million ~~costs,~~on ~~which~~a ~~could~~classified beprogram ~~impacted~~at by our ~~assessment~~MFC ofbusiness ~~the customer’s decision regarding the funding of future phases of the program~~segment.

~~Our~~We ~~MFC~~have ~~business~~various ~~segment~~development ~~has~~programs ~~been~~for ~~performing~~new ~~under~~and aupgraded ~~competitively~~products, ~~bid~~services, ~~classified~~and ~~contract,~~related technologies which ~~includes~~have acomplex ~~cost-reimbursable~~design ~~base~~and ~~contract~~technical ~~for~~challenges. ~~the~~This ~~initial~~development ~~phase~~work is inherently uncertain and subject to significant variability in estimates of the ~~program~~cost and ~~multiple~~time ~~fixed-price~~required ~~options~~to ~~for~~complete ~~additional~~the ~~phases~~work by us and our suppliers. WeMany ~~previously~~of ~~disclosed~~these ~~that~~programs ~~the~~have ~~options~~cost-type ~~may~~contracting bearrangements ~~exercised~~(e.g. ~~over~~cost-reimbursable or cost-plus-fee). In such cases, the ~~next~~associated ~~several~~financial ~~years~~risks ~~and~~are primarily in reduced fees, lower profit rates, or program cancellation if ~~performed~~cost, ~~expect~~schedule, ~~they~~or ~~would~~technical ~~each~~performance beissues atarise. However, some of our existing development programs are contracted on a ~~loss.~~fixed-price ~~During~~basis or include cost-type contracting for the ~~first~~development ~~quarter~~phase ofwith ~~2024,~~fixed-price weproduction ~~concluded~~options itand ~~was~~our ~~probable~~customers continue to implement procurement strategies such as these that ~~the~~shift ~~first~~risk ~~option~~to ~~would~~contractors. beCompetitively ~~exercised~~bid ~~and~~programs ~~recognized~~with fixed-price development work or fixed-price production options increase the risk of a reach-forward loss upon contract award and during the period of ~~approximately~~contract ~~$100 million~~performance. ~~During~~Due to the ~~fourth~~complex ~~quarter~~and often experimental nature of ~~2024~~development programs, we ~~again~~may ~~assessed~~experience ~~the~~(and ~~likelihood~~have ~~that~~experienced ~~additional~~in ~~options~~the ~~may~~past) betechnical ~~exercised~~ and ~~concluded~~quality ~~then~~issues ~~that~~during itthe isdevelopment ~~probable~~of ~~that~~new ~~all~~products ~~options~~or ~~will~~technologies befor ~~exercised~~a ~~based~~variety onof ~~performance~~reasons. toOur ~~date~~development programs are ongoing, ~~future~~and ~~requirements~~while ofwe believe the ~~program,~~cost ~~discussions~~and ~~with~~fee estimates incorporated in the ~~customer~~financial ~~and~~statements ~~suppliers~~are appropriate, the technical complexity of these programs and ~~anticipated~~fixed-price ~~customer~~contract ~~funding~~structure creates financial risk as estimated completion costs may exceed the current contract value, ~~among~~which ~~other~~could ~~factors~~trigger earnings charges, ~~resulting~~termination inprovisions, ~~the~~or ~~recognition~~other offinancially ~~additional~~significant exposures. These programs have risk for reach-forward losses if our estimated costs exceed our estimated contract revenues, and such losses could be significant to our financial results in any period that they are recognized. Any such losses are recognized in the period in which the loss is evident.

Aeronautics Classified Program

We have experienced significant performance issues on an existing classified program at our Aeronautics business segment. The initial phase is on a fixed-price incentive fee contract with fixed-price incentive fee options for additional phases. Phases within the program involve highly complex design and systems integration. Challenges and performance issues continued into 2025 and had a greater impact on schedule and costs than previously estimated. There were also new, unanticipated events that occurred in 2025 that impacted the program’s performance, as described below. As a result of performance issues with the program, Aeronautics performed a comprehensive review of its design, integration, test, and other processes to achieve the technical requirements of the program, which was completed in the second quarter of 2025. The events that occurred in 2025, and the comprehensive review completed in the second quarter of 2025, resulted in significant changes in the program’s processes and testing approach and led to an extension of the program’s schedule, which drove a substantial increase in cost estimates. As a result, during the second quarter of 2025, we recognized additional reach-forward losses of $950 million across both phases of the program. The primary drivers of the

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

additional reach-forward losses recognized in the second quarter of ~~approximately~~2025 $included: (1~~.31 billion.~~) Assoftware ofdevelopment ~~June 29,~~performance ~~2025,~~degradation ~~cumulative~~and ~~losses~~integration ~~recognized~~findings observed over a continued period; (2) learnings in recent software and build experience on ~~the~~another program ~~remained~~specifically atrelevant ~~approximately~~to ~~$1.46 billion~~the program; (3) significant changes in ~~total,~~test ofplan ~~which,~~resulting ~~$1.30 billion~~from ~~remained~~customer ~~accrued~~discussions and changes in test execution strategy; (4) safety-critical and other ~~current~~necessary ~~liabilities~~design and engineering changes in ~~our~~response ~~consolidated~~to ~~balance~~certain ~~sheet~~observed performance degradation and a discrete event; and (5) complete schedule realignment, including as a result of items (1) through (4).

WeAs ~~have~~of ~~contracted~~September 28, ~~with~~2025, ~~the~~cumulative ~~Canadian~~losses ~~government~~recognized ~~for~~to ~~the~~date ~~Canadian~~on ~~Maritime~~this ~~Helicopter~~program ~~Program~~remained ~~(CMHP)~~ at ~~our~~approximately ~~RMS business segment~~$1.8 billion ~~The~~across ~~program~~both ~~provides~~phases. ~~for~~As ~~design,~~of ~~development~~September 28, ~~and production of CH-148 aircraft (the Original Equipment contract)~~2025, ~~which~~$530 million ~~is a military variant~~ of the ~~S-92~~losses ~~helicopter,~~remained ~~and~~accrued ~~for~~in ~~logistical~~other ~~support~~current toliabilities ~~the~~in ~~fleet~~our ~~(the~~consolidated Inbalance ~~Service Support contract) over an extended time period~~sheet. ~~While~~We we continue to beproactively inmanage ~~discussions with~~ the ~~Canadian~~technical ~~government~~requirements toand ~~potentially~~our ~~restructure~~performance, ~~certain~~the ~~contractual~~remaining ~~terms~~work and ~~conditions~~any ~~that~~future ~~may~~changes bein ~~beneficial~~scope toor ~~both parties~~schedule, and ~~entered~~estimated ~~into~~costs ~~a contract modification in 2024~~ to ~~better~~complete ~~align contract scope with~~ the ~~Canadian government’s need~~program, ~~which~~including ~~resulted~~future inphases. aDue ~~reduction~~to inthe ~~our~~nature ~~contract~~of ~~assets in~~ the ~~fourth~~highly ~~quarter~~complex ofdesign ~~2024~~ and ~~first~~systems ~~quarter~~integration ofon ~~2025~~this program, ~~any~~we ~~restructuring discussions~~ may beneed ~~prolonged~~to orrecord ~~unsuccessful,~~additional ~~and~~losses ~~could~~in ~~result~~future inperiods aif ~~contract~~performance ~~termination~~issues, ~~and~~increases ~~are~~in ~~dependent~~scope, ~~upon~~or ~~Canadian~~increases ~~government~~in ~~resources~~cost ~~and~~from ~~priorities~~prior ~~and~~estimates ~~other~~indicate ~~factors~~that ~~outside~~further oflosses ~~our~~are ~~control,~~evident. ~~such~~Our asestimates ~~trade~~may ~~relations~~change, ~~with~~in ~~the~~particular, ~~United~~as ~~States.~~we ~~Communications~~conduct ~~with~~further ~~the~~development ~~customer~~and ~~during~~testing on the ~~second~~program, ~~quarter~~which ofmay ~~2025~~lead ~~led~~ to ~~subsequent~~new ~~decisions~~findings ~~made~~or bycause us to ~~focus~~modify onour ~~providing additional mission capabilities, enhanced logistical support, fleet life extension, and revised~~ expectations ~~regarding~~or ~~flight~~understandings ~~hours.~~of ~~Based on~~ the ~~ongoing~~risks ~~discussions~~inherent ~~with~~in the ~~customer~~program. ~~and~~Any ~~decisions~~such ~~made~~losses bycould ~~management,~~be wematerial ~~revised~~to our ~~cost~~financial ~~and~~results ~~sales~~in ~~estimates~~any ~~for~~period ~~this~~that ~~program.~~they Asare arecognized. ~~result,~~We ~~during~~and ~~the~~our ~~second~~industry ~~quarter~~team ofwill ~~2025~~continue weto ~~recognized~~incur ~~additional~~advanced ~~losses~~procurement ofcosts ~~$570 million~~(also onreferred ~~the~~to ~~program.~~as Aspre-contract ofcosts) ~~June~~to ~~29,~~enhance ~~2025,~~our ~~cumulative~~ability ~~losses~~to ~~recognized~~achieve on the ~~program~~schedule ~~were approximately $670 million~~ and ~~approximately~~certain ~~$680 million~~milestones ofwhich ~~contract~~could ~~assets~~be ~~remained on the balance sheet~~significant. ~~Future~~We ~~performance~~will ~~issues~~monitor orthe ~~changes~~recoverability inof ~~our~~pre-contract ~~estimates~~costs, ~~may~~which ~~affect~~could ~~our~~be ~~ability~~impacted toby ~~recover~~ our ~~costs,~~assessment ~~including recovery~~ of the ~~contract~~customer’s ~~assets~~decision ~~recognized~~regarding on the ~~balance~~funding ~~sheet~~of ~~and~~future ~~our~~phases ~~assessment~~ of the ~~reach-forward loss, and potential damages, which could be material to our financial results in any period that they are recognized~~program.

WeMFC ~~also~~Classified ~~have a number of contracts with Türkish industry for the Türkish Utility Helicopter~~ Program (TUHP), which anticipates co-production with Türkish industry for production of T70 helicopters for use in Türkiye, as well as the related provision of Türkish goods and services under buy-back or offset obligations, to include the future sales of helicopters built in Türkiye for sale globally. In 2020, the U.S. Government imposed certain sanctions on Türkish entities and persons that have affected our ability to perform under the TUHP contracts. We have provided force majeure notices under the affected contracts and partially stopped work on TUHP effective October 5, 2024. We have been in discussions with our prime contract customer regarding the path forward for the program in light of the continued impact of the sanctions on our ability to perform under the TUHP contracts and our decision to partially stop work, including recent discussions of a potential mutually agreeable framework to restructure the program, including changing the scope of work. Our customer has asserted that it is entitled to penalties and damages, that we do not have the contractual right to stop work and that our decision to stop work may lead to a termination for default and additional penalties and damages. In light of the status of the continuing discussions with our prime contract customer and the current status of the TUHP program, we recognized a loss of $95 million in the second quarter of 2025. As of June 29, 2025, cumulative losses recognized to date on the program were approximately $130 million and the program remains in a contract liability position on the balance sheet. Additionally, if we are unable to finalize an agreement on mutually agreeable terms, we or our customer could elect to pursue other relief or remedies, which could result in a further reduction in sales, the imposition of penalties or assessment of damages, including the drawdown by the customer of letters of credit and performance bonds, and increased unrecoverable costs, which could be material to our financial results in any period that they are recognized.

~~Commercial~~Our ~~Paper~~MFC business segment has been performing under a competitively bid classified contract, which includes a cost-reimbursable base contract for the initial phase of the program and multiple fixed-price options for additional phases. We previously disclosed that the options may be exercised over the next several years and if performed expect they would each be at a loss. During the first quarter of 2024, we concluded it was probable that the first option would be exercised and recognized a reach-forward loss of approximately $100 million. During the fourth quarter of 2024, we again assessed the likelihood that additional options may be exercised and concluded then that it is probable that all options will be exercised based on performance to date, future requirements of the program, discussions with the customer and suppliers, and anticipated customer funding, among other factors, resulting in the recognition of additional reach-forward losses of approximately $1.31 billion. As of September 28, 2025, cumulative losses recognized on the program remained at approximately $1.46 billion in total, of which, $1.25 billion remained accrued in other current liabilities in our consolidated balance sheet.

WeCanadian ~~have~~Maritime ~~agreements~~Helicopter in place with financial institutions to provide for the issuance of commercial paper. The outstanding balance of commercial paper can fluctuate daily and the amount outstanding during the period may be greater or less than the amount reported at the end of the period. As of June 29, 2025, we had $1.4 billion of commercial paper borrowings with a weighted-average rate of 4.55%. As of December 31, 2024 we had no commercial paper borrowings outstanding. All of our commercial paper borrowings had maturities of up to three months or less from the date of issuance. We may, as conditions warrant, continue to issue commercial paper backed by our revolving credit facility to manage the timing of cash flows.Program

Our RMS business segment has been performing the Canadian Maritime Helicopter Program (CMHP) under contracts with the Canadian government. The program provides for design, development, and production of CH-148 aircraft (the Original Equipment contract), which is a military variant of the S-92 helicopter, and for logistical support to the fleet (the In Service Support contract) over an extended time period. The program has experienced performance issues and we have been in discussions with the Canadian government to potentially restructure certain contractual terms and conditions that may be beneficial to both parties. We entered into a contract modification in 2024 to better align contract scope with the Canadian government’s need, which resulted in a reduction in our contract assets in the fourth quarter of 2024 and first quarter of 2025. Communications with the customer during the second quarter of 2025 led to subsequent decisions made by us to focus on providing additional mission capabilities, enhanced logistical support, fleet life extension, and revised expectations regarding flight hours. Based on these discussions with the customer and decisions made by management, we revised our cost and sales estimates for this program and recognized additional losses of $570 million on the program during the second quarter of 2025. As of September 28, 2025, cumulative losses recognized on the program remained at approximately $670 million and approximately $655 million of contract assets remained on the balance sheet. The final aircraft under the program was delivered to Canada during the third quarter of 2025 and has been subsequently accepted. Any restructuring discussions may be prolonged or unsuccessful, and could result in a contract termination, and are dependent upon Canadian government resources and priorities and other factors outside of our control, such as trade relations with the United States. These items in addition to future performance issues or changes in our estimates may affect our ability to recover our costs, including recovery of the contract assets recognized on the balance sheet and our assessment of the reach-forward loss, and potential damages, which could be material to our financial results in any period that they are recognized.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Türkish Utility Helicopter Program

We also have a number of contracts with Türkish industry for the Türkish Utility Helicopter Program (TUHP), which anticipates co-production with Türkish industry for production of T70 helicopters for use in Türkiye, as well as the related provision of Türkish goods and services under buy-back or offset obligations, to include the future sales of helicopters built in Türkiye for sale globally. In 2020, the U.S. Government imposed certain sanctions on Türkish entities and persons that have affected our ability to perform under the TUHP contracts. We have provided force majeure notices under the affected contracts and partially stopped work on TUHP effective October 5, 2024. We have been in discussions with our prime contract customer regarding the path forward for the program in light of the continued impact of the sanctions on our ability to perform under the TUHP contracts and our decision to partially stop work, including the potential to restructure the program, including changing the scope of work. However, any restructuring discussions may be unsuccessful or may result in changes in our estimates. Our customer has asserted that it is entitled to penalties and damages, that we do not have the contractual right to stop work and that our decision to stop work may lead to a termination for default and additional penalties and damages. In light of the status of discussions with our prime contract customer and the current status of the TUHP program, we recognized a loss of $95 million in the second quarter of 2025. As of September 28, 2025, cumulative losses recognized to date on the program remained at approximately $130 million and the program remains in a contract liability position on the balance sheet. Additionally, if we are unable to reach an agreement on mutually agreeable terms, we or our customer could at any time elect to pursue other relief or remedies, which could result in a further reduction in sales, the imposition of penalties or assessment of damages, including the drawdown by the customer of letters of credit and performance bonds, and increased unrecoverable costs, which could be material to our financial results in any period that they are recognized.

Backlog

Backlog (i.e., unfulfilled or remaining performance obligations) represents the sales we expect to recognize for our products and services for which control has not yet transferred to the customer. It is converted into sales in future periods as work is performed or deliveries are made. For our cost-reimbursable and fixed-priced-incentive contracts, the estimated consideration we expect to receive pursuant to the terms of the contract may exceed the contractual award amount. The estimated consideration is determined at the outset of the contract and is continuously reviewed throughout the contract period. In determining the estimated consideration, we consider the risks related to the technical, schedule and cost impacts to complete the contract and an estimate of any variable consideration. Periodically, we review these risks and may increase or decrease backlog accordingly. As the risks on such contracts are successfully retired, the estimated consideration from customers may be reduced, resulting in a reduction of backlog without a corresponding recognition of sales. As of ~~June~~September 2928, 2025, our ending backlog was $~~166~~179.51 billion. We expect to recognize approximately 3836% of our backlog over the next 12 months and a total of approximately 6461% over the next 24 months as revenue with the remainder recognized thereafter.

Impairment and Other Charges

During the second quarter of 2025, we recorded charges totaling $66 million ($52 million, or $0.22 per share, after-tax) primarily for the write-off of fixed assets resulting from the U.S. Air Force’s Next Generation Air Dominance (NGAD) competition and down-select decision.

During the second quarter of 2024, we recorded charges totaling $87 million ($69 million, or $0.29 per share, after-tax) for trademark and fixed asset impairments as well as severance costs resulting from the strategic review of our Sikorsky business during the second quarter of 2024 due, in part, to the impacts of the U.S. Army announcement to cancel the Future Attack Reconnaissance Aircraft (FARA) program at the conclusion of fiscal year 2024, for which our Sikorsky business was competing.

~~Income~~Debt ~~Taxes~~Issuance and Commercial Paper

~~Our~~On ~~effective~~July ~~income~~23, ~~tax~~2025, ~~rates~~we ~~were~~issued 18a total of $2.0% billion ~~and~~of 16senior unsecured notes, consisting of $500 million aggregate principal amount of 4.315% ~~for~~Notes ~~the~~due ~~quarter~~2028 ~~and~~(2028 ~~six~~Notes), ~~months~~$750 million ~~ended~~aggregate ~~June 29,~~principal ~~2025~~amount ~~and~~of 154.840% ~~for~~Notes ~~both~~due ~~the~~2030 ~~quarter~~(2030 Notes) and ~~six~~$750 million ~~months~~aggregate ~~ended~~principal ~~June 30,~~amount ~~2024~~of 5.00% ~~The~~Notes ~~higher~~due ~~effective~~2035 ~~income~~(2028 ~~tax~~Notes ~~rates~~and, ~~for~~together with the ~~quarter~~2030 Notes and ~~six~~2035 ~~months~~Notes, ~~ended~~the ~~June~~Notes). ~~29,~~Net ~~2025~~proceeds of $1,985 million were ~~primarily~~received ~~attributable~~from tothe ~~increased~~offering ~~interest~~after ~~expense~~deducting onpricing ~~our~~discounts ~~uncertain~~and ~~tax~~debt ~~position~~issuance ~~partially~~costs, ~~offset~~which byare ~~changes~~being inamortized ~~pre-tax~~and ~~earnings~~recorded ~~due~~as tointerest ~~program~~expense ~~losses~~over ~~previously~~the ~~described.~~term ~~The~~of ~~rates~~the ~~for~~Notes. ~~all~~We ~~periods~~will ~~benefited~~pay ~~from~~interest ~~tax~~on ~~deductions~~the ~~for~~Notes ~~foreign~~semi-annually ~~derived~~in ~~intangible~~arrears ~~income,~~on ~~research~~February 15 and ~~development~~August ~~tax~~15 ~~credits,~~of ~~dividends~~each ~~paid~~year with the first payment to ~~our~~be ~~defined~~made ~~contribution~~on ~~plans~~February ~~with~~15, an2026. ~~employee~~We ~~stock~~may, ~~ownership~~at ~~plan~~our ~~feature~~option, ~~and~~redeem ~~employee~~the ~~equity~~Notes ~~awards.~~of any series in

In our Annual Report on Form 10-K for the year ended December 31, 2018, we described our adoption of Accounting Standards Codification (ASC) 606 for certain manufacturing contracts. In connection with that change and the associated changes to the income recognition rules enacted in the 2017 Tax Cuts and Jobs Act, we correspondingly changed our method of accounting for U.S. federal income tax purposes with the Internal Revenue Service (IRS). As part of the IRS Compliance Assurance Process (CAP) program, the IRS initially approved that accounting method change for 2018 and 2019 without any adjustments, stating in writing that our new tax accounting method was an acceptable method that clearly reflected income.

After an additional review of the accounting method change in subsequent years, the IRS issued to us a Revenue Agent’s Report (RAR) for 2018-2019 on May 20, 2025 with an accompanying Notice of Proposed Adjustment (NOPA) for 2018-2020 in relation to our accounting method change (the Proposed Adjustments). The Proposed Adjustments, which seek approximately $4.6 billion of additional federal income tax (excluding interest), are based on the premise that we must recognize revenue as performance obligations on a contract are satisfied and as advance payments are received but must defer costs until delivery of the finished product. The Proposed Adjustments create a mismatch between revenue and costs, effectively disallow recognition of cost of goods sold for impacted contracts, and result in gross receipts taxation for each year at issue.

We strongly disagree with the IRS’s claims and are pursuing applicable administrative remedies with the IRS Independent Office of Appeals and, if necessary, judicial remedies if an acceptable administrative resolution cannot be reached. We do not expect resolution of this matter within twelve months and cannot predict with certainty the timing of such resolution. We believe our reserves for tax contingencies are adequate; however, if this matter is resolved unfavorably, there could be a material impact on our profitability and future cash flows.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Aswhole ofor ~~December~~in ~~31,~~part ~~2024,~~at ~~our~~any ~~liabilities~~time ~~associated~~and ~~with~~from ~~uncertain~~time ~~tax~~to ~~positions~~time ~~were~~at ~~not~~a ~~material.~~redemption Asprice ofequal to the ~~quarter~~greater ~~ended~~of ~~June~~100% ~~29,~~of ~~2025,~~the ~~our~~principal ~~liabilities~~amount ~~associated~~of ~~with~~the ~~uncertain~~Notes ~~tax positions increased~~ to ~~$512 million~~be ~~with~~redeemed aor ~~corresponding~~an ~~increase~~applicable tomake-whole ~~net~~amount, ~~deferred~~plus ~~tax~~accrued ~~assets~~and ~~primarily~~unpaid ~~attributable~~interest to the ~~Proposed~~date ~~Adjustments. As~~ of ~~the~~redemption. ~~quarter~~The ~~ended~~Notes ~~June~~rank ~~29,~~equally ~~2025, interest and penalties related to uncertain tax positions, which are included~~ in ~~income~~right ~~tax~~of ~~expense,~~payment ~~increased to $129 million~~ with ~~$103 million~~all ~~representing~~of ~~the~~our ~~cumulative~~existing ~~amount~~unsecured ~~related~~and tounsubordinated ~~the Proposed Adjustments~~indebtedness.

Additionally, we have agreements in place with financial institutions to provide for the issuance of commercial paper. The outstanding balance of commercial paper can fluctuate daily and the amount outstanding during the period may be greater or less than the amount reported at the end of the period. There were no commercial paper borrowings outstanding at September 28, 2025 and December 31, 2024. All of our commercial paper borrowings had maturities less than three months from the date of issuance. We may, as conditions warrant, issue commercial paper backed by our revolving credit facility to manage the timing of cash flows.

Revolving Credit Facility

At September 28, 2025, we had a $3.0 billion Revolving Credit Facility with various banks, with the option to increase the commitments under the Revolving Credit Facility by an additional amount of up to $500 million (for an aggregate amount of up to $3.5 billion), subject to the existing lender approval per the terms and conditions of the agreement. Effective August 28, 2025, we amended the agreement for the Revolving Credit Facility (Revolving Credit Agreement) to extend the expiration date of the Revolving Credit Agreement from August 24, 2029 to August 24, 2030. The Revolving Credit Agreement is available for any of our lawful corporate purposes, including supporting commercial paper borrowings. Borrowings under the Revolving Credit Agreement are unsecured and bear interest at rates set forth in the Revolving Credit Agreement. There were no borrowings under the Revolving Credit Agreement at September 28, 2025.

Income Taxes

Our effective income tax rates were 16.5% and 16.4% for the quarter and nine months ended September 28, 2025 and 15.4% and 15.6% for the quarter and nine months ended September 29, 2024. The higher effective income tax rates for the quarter and nine months ended September 28, 2025 were attributable to the One Big Beautiful Bill Act (the Tax Act) primarily driven by lower tax deductions for foreign derived intangible income partially offset by the favorable resolution of certain federal income tax audit items with the Internal Revenue Service (IRS). The rates for all periods benefited from research and development tax credits, dividends paid to our defined contribution plans with an employee stock ownership plan feature, tax deductions for foreign derived intangible income and employee equity awards.

On July 4, 2025, the President signed into law the Tax Act. Key provisions include the permanent reinstatement of immediate expensing for domestic research expenditures, the restoration of full expensing for qualified machinery, equipment and other short-lived assets, and several modifications to existing international tax provisions. The enactment of the Tax Act resulted in an increase of $132 million to income tax expense for the quarter ended September 28, 2025. We are still awaiting further IRS and Treasury guidance on the Tax Act, but based upon our interpretation of the recently enacted law, we estimate an increase of $175 million to income tax expense and a decrease of $600 million to cash taxes in 2025 as compared to prior year. As a result of the Tax Act, we expect to be subject to the corporate alternative minimum tax starting in 2025.

In our Annual Report on Form 10-K for the year ended December 31, 2018, we described our adoption of Accounting Standards Codification (ASC) 606 for certain manufacturing contracts. In connection with that change and the associated changes to the income recognition rules enacted in the 2017 Tax Cuts and Jobs Act, we correspondingly changed our method of accounting for U.S. federal income tax purposes with the IRS. As part of the IRS Compliance Assurance Process (CAP) program, the IRS initially approved that tax accounting method change for 2018 and 2019 without any adjustments, stating in writing that our new tax accounting method was an acceptable method that clearly reflected income.

After an additional review of the tax accounting method change in subsequent years, the IRS issued to us a Revenue Agent’s Report (RAR) for 2018-2019 on May 20, 2025 with an accompanying Notice of Proposed Adjustment (NOPA) for 2018-2020 in relation to our tax accounting method change (the Proposed Adjustments). The Proposed Adjustments sought approximately $4.6 billion of additional federal income tax (excluding interest). We are in ongoing discussions with the IRS in an effort to resolve the matter.

As of December 31, 2024, our liabilities associated with uncertain tax positions were not material. As of the quarter ended September 28, 2025, our liabilities associated with uncertain tax positions increased to $366 million, primarily attributable to the Proposed Adjustments partially offset by the favorable resolution of certain other federal income tax audit items with the IRS. As of the quarter ended September 28, 2025, interest and penalties related to uncertain tax

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

positions, which are included in income tax expense, increased to $112 million with $109 million representing the cumulative amount related to the Proposed Adjustments.

NOTE 11 - RECENT ACCOUNTING PRONOUNCEMENTS

In ~~November~~September ~~2024~~2025, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. ~~2024~~2025-0306, ~~Income~~Intangibles ~~Statement~~ – ~~Reporting~~Goodwill ~~Comprehensive~~and ~~Income~~Other – ~~Expense~~Internal-Use ~~Disaggregation~~Software ~~Disclosures~~ (Subtopic ~~220~~350-40): ~~Disaggregation~~Targeted ofImprovements ~~Income~~to ~~Statement~~the ~~Expenses~~Accounting for Internal-Use Software. This ~~ASU~~guidance ~~requires~~removes ~~entities~~all references to ~~disclose~~project ~~certain~~stages ~~expenses,~~throughout ~~including~~ASC ~~purchases~~350-40 ofand ~~inventory,~~clarifies ~~employee~~the ~~compensation,~~threshold ~~depreciation,~~entities ~~and~~apply ~~intangible~~to ~~asset~~begin ~~amortization,~~capitalizing ~~by caption~~costs. ~~Additionally~~Under the new standard, ~~entities~~cost ~~must~~capitalization ~~provide~~should only commence when an entity has committed to funding a ~~qualitative~~software ~~description~~project ofand it is probable the ~~amounts~~project ~~remaining~~will inbe ~~relevant~~completed ~~expense~~and ~~captions~~the ~~that~~software ~~are~~will ~~not~~be ~~separately~~used ~~disaggregated~~for ~~quantitatively~~its intended function. The amendments are effective for annual reporting periods beginning after December 15, ~~2026~~2027 and interim reporting periods ~~beginning~~within ~~after~~those ~~December~~annual ~~15,~~reporting ~~2027,~~periods. ~~with~~Entities ~~early~~may ~~adoption~~apply ~~permitted.~~the ~~The~~guidance ~~ASU~~using ~~will~~a ~~impact~~prospective, ~~only~~retrospective ~~our~~or ~~disclosures~~modified ~~and~~transition ~~not~~approach. ~~our~~Early ~~financial~~adoption ~~condition~~is orpermitted ~~results~~as of ~~operations~~the beginning of an annual reporting period. We are currently ~~evaluating~~determining ~~when~~the wepreferred ~~will~~transition ~~adopt~~approach and assessing the impact of the ASU on our disclosures and financial statements, including the timing of adoption.

In November 2024, the FASB issued Accounting Standard Update (ASU) No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This ASU requires entities to disclose certain expenses, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization, by caption. Additionally, entities must provide a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. The amendments are effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The ASU will impact only our disclosures and not our results of operations, financial condition or cash flows. We are currently evaluating when we will adopt the ASU.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which focuses on the rate reconciliation and income taxes paid. ASU No. 2023-09 requires public business entities to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, ASU 2023-09 requires companies to disclose additional information about income taxes paid. The new standard is effective for annual periods beginning after December 15, 2024, and may be applied prospectively or retrospectively. We will adopt this ASU prospectively for the period ending December 31, 2025, and it will impact only our disclosures, with no impacts to our financial condition or results of operations.

2627

Table of Contents

Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders

Lockheed Martin Corporation

Results of Review of Interim Financial Statements

We have reviewed the accompanying consolidated balance sheet of Lockheed Martin Corporation (the Company) as of ~~June~~September 2928, 2025, the related consolidated statements of earnings, comprehensive income and equity for the quarters and ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024, and consolidated statements of cash flows for the ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024, and the related notes (collectively referred to as the “consolidated interim financial statements”). Based on our reviews, we are not aware of any material modifications that should be made to the consolidated interim financial statements for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2024, the related consolidated statements of earnings, comprehensive income, cash flows and equity for the year then ended, and the related notes (not presented herein); and in our report dated January 28, 2025, we expressed an unqualified audit opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2024, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

These financial statements are the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the SEC and the PCAOB. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial statements consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ Ernst & Young LLP

Tysons, Virginia

~~July~~October 2221, 2025

2728

Table of Contents

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to help the reader understand our results of operations and financial condition. The MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and notes to consolidated financial statements herein and with our Annual Report on Form 10-K for the year ended December 31, 2024 (2024 Form 10-K).

BUSINESS OVERVIEW

We are a global aerospace and defense company principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. We also provide a broad range of management, engineering, technical, scientific, logistics, system integration and cybersecurity services. Our main areas of focus are in defense, space, intelligence, homeland security and information technology, including cybersecurity. We serve both U.S. and international customers with products and services that have defense, civil and commercial applications, with our principal customers being agencies of the U.S. Government. During the ~~six~~nine months ended ~~June~~September 2928, 2025, 7372% of our $3654.17 billion in sales were from the U.S. Government, either as a prime contractor or as a subcontractor (including 63% from U.S. Department of War (DoW), also known as the Department of Defense under 10 U.S.C. § 111(~~DoD~~a)), 27and 28% were from international customers (including foreign military sales (FMS) contracted through the U.S. Government).

Global Security

We operate in a complex and evolving global security environment. Conflicts or tensions in areas such as Europe, the Middle East, and the Pacific region have heightened tensions and highlighted security requirements globally, including in these regions as well as the U.S. Although these tensions and conflicts may drive interest in specific products or services as countries seek to improve their security posture, our business primarily operates on a long-cycle basis. As a result, the U.S. Government has been broadly focused on increasing industry capacity to meet long-term demand. We continue to work with the U.S. Government, international partners, and our supply chain to increase capacity and enhance our ability to scale our operations to anticipate potential demand, deliver critical capabilities, and replenish depleted U.S. and allied stockpiles of products that have been ~~used~~consumed over the past several years.

Global Economic and Geopolitical Environment

Our business and financial performance are impacted by general economic conditions including inflationary pressures, delays and disruptions in supply chains, business slowdowns or shutdowns, workforce challenges and labor shortfalls, impacts from technological change, and market volatility. These macroeconomic factors have contributed, and may continue to contribute, to increased costs, delays, disruptions and other performance challenges, as well as competing demands for limited resources to address such increased costs and other challenges, for our company, our suppliers and partners, and our customers.

We have experienced, and continue to experience, supply chain challenges, including supplier shortages and performance issues. ~~These~~While ~~issues~~on-time ~~have~~deliveries ~~delayed~~are ~~certain customer deliveries~~improving, ~~limited~~pressures ~~our~~remain ~~ability to ramp up production~~ in ~~response to customer demand for~~ certain ~~products~~areas, and ~~have~~we ~~caused~~are ~~out-of-sequence~~proactively ~~manufacturing,~~working ~~which~~with ~~increases~~our ~~costs~~suppliers ~~and~~to ~~decreases~~meet ~~operational~~our ~~efficiency~~contract commitments. In addition, macroeconomic conditions including elevated levels of inflation ~~and macroeconomic conditions~~ present risks for us, our suppliers and the stability of the broader defense industrial base. Certain costs, including rising labor rates and supplier costs, have increased as a result of inflation, and have adversely affected our margins on certain programs. In addition, some suppliers are reducing the duration of pricing validity of their proposals to us or seeking to reopen pricing on existing agreements, which is operationally challenging and increases the risk of cost volatility. Supply chain challenges, including both the availability and cost of goods, may be further impacted due to the imposition of tariffs and the availability of raw materials including rare earth minerals, as discussed below under “Recent Developments in Trade and Regulatory Policies.” We continue to work to mitigate challenges caused by the supply chain or current macroeconomic environment on our business, including by supporting small business and at-risk suppliers, deploying resources to work with our supply chain, securing materials and support by executing long-term contracts, enforcing existing contract terms, identifying alternative sources, collaborating with our customers to address industry-wide challenges, and optimizing our supply chain organization through digital transformation and workforce development. If we experience significant supply chain issues or high rates of inflation, and are unable to successfully mitigate the impact, our future profits, margins and cash flows, particularly for existing fixed-price contracts, may be adversely affected. ~~Inflation~~We ~~and~~remain ~~higher~~committed ~~interest~~to ~~rates~~our ~~can~~ongoing ~~also~~efforts ~~constrain~~to increase the ~~overall~~efficiency ~~purchasing power~~ of our ~~customers~~operations ~~for our products~~ and ~~services~~improve ~~potentially~~the ~~impacting~~cost ~~future~~competitiveness ~~orders,~~and ~~especially~~affordability inof ~~a budget constrained environment. We remain committed to~~ our ~~ongoing~~products ~~efforts~~and toservices, ~~increase~~which ~~the~~may, ~~efficiency~~in ofpart, ~~our~~offset ~~operations~~cost ~~and~~increases from inflation.

Table of Contents

improve the cost competitiveness and affordability of our products and services, which may, in part, offset cost increases from inflation.

For additional risks to the company related to the supply chain and availability of materials, see Part I, Item 1A, “Risk Factors” of our 2024 Form 10-K.

Table of Contents

Recent Developments in Trade and Regulatory Policies

Certain materials and component parts that go into making our products are imported into the U.S. and are subject to tariffs, sanctions, embargoes, export and import controls, and other trade restrictions. The U.S. Government ~~under the Trump Administration~~ has increased, ~~tariffs~~expanded, or imposed ~~additional~~new tariffs, ~~and expanded tariffs~~ on goods imported from various countries. We also export certain products to other countries, and several countries have increased ~~tariffs~~ or imposed additional tariffs in response to U.S. tariffs. The tariff environment has been dynamic ~~over~~in ~~the last several months~~2025, with changes occurring on an ongoing basis, and it is ~~likely~~possible that additional developments will occur ~~over~~in the ~~next several months~~future, ~~particularly~~including as a result of negotiations between the U.S. ~~negotiates~~and ~~with~~ trade partners and legal challenges to the tariffs.

The ~~tariffs~~actual ~~that~~impact ~~have~~of ~~been~~the ~~enacted~~tariffs oris ~~expanded~~subject byto ~~the~~a ~~U.S.~~number orof ~~other~~factors ~~countries~~including ~~did~~the ~~not~~effective ~~materially~~date ~~impact~~and ~~our~~duration ~~business~~of orsuch ~~financial~~tariffs, ~~results~~changes ~~for~~in the ~~six~~amount, ~~months~~scope ~~ended~~and ~~June~~nature ~~29,~~of ~~2025.~~the Wetariffs, ~~are~~any ~~currently~~countermeasures ~~evaluating~~that the ~~potential~~target ~~future~~countries ~~impacts~~may oftake, the ~~imposition~~result of negotiations between the ~~announced~~U.S. ~~tariffs~~and totrade partners, how our ~~business~~Tier 1 and ~~financial~~Tier ~~condition.~~2 Atsuppliers ~~this~~react, ~~time~~possible substitution effects, wepossible doduty-free ~~not~~entry ~~believe~~entitlements, the outcome of any legal challenges, and any mitigating actions that ~~the~~may ~~tariffs~~become ~~announced~~available. Tariffs that have been enacted or expanded by the U.S. or ~~actions~~other ~~taken~~countries inhad ~~response~~an toimpact ~~these~~of ~~tariffs~~approximately by$350 ~~other~~million ~~countries~~on ~~will~~our ~~have~~cash aflows ~~material~~for ~~adverse~~the ~~effect~~nine ~~upon~~months ~~our~~ended ~~results~~September ~~of operations~~28, ~~financial~~2025. ~~condition~~However, orwe ~~cash~~expect ~~flows.~~a ~~However,~~substantial ~~the~~portion ~~actual~~of this impact ofto ~~the~~be ~~new~~recoverable ~~tariffs~~over istime. ~~subject~~We toare aclosely ~~number~~monitoring ofthe ~~factors~~situation ~~including~~and evaluating the ~~effective~~potential ~~date~~future ~~and~~impacts ~~duration~~of the imposition of ~~such~~the announced tariffs, ~~changes~~to inour ~~the~~business ~~amount,~~and ~~scope~~financial ~~and~~condition. ~~nature~~At ofthis time, excluding the ~~tariffs~~near-term incash ~~the~~flow ~~future~~impact, ~~any~~we ~~countermeasures~~do not believe that the ~~target~~tariffs ~~countries~~announced ~~may~~by ~~take,~~the ~~how~~U.S. ~~our~~or ~~Tier~~actions 1taken ~~and~~in ~~Tier~~response 2to ~~suppliers~~these ~~react,~~tariffs ~~possible~~by ~~substitution~~other ~~effects,~~countries ~~possible~~will ~~duty~~have ~~drawbacks,~~a ~~and~~material ~~any~~adverse ~~mitigating~~effect ~~actions~~upon ~~that~~our ~~may~~results ~~become~~of ~~available~~operation or financial condition over the long term.

Significant changes in tax, trade, or other policies either in the U.S. or other countries, as well as any fluctuation in foreign exchange rates as a result of such activity, could materially increase our tax burden, the price we pay for materials and component parts, the price our customers pay, and result in delays in products received or non-delivery from our vendors as well as impact the availability of materials (including rare earth minerals), which could materially impact our business and financial results. We are pursuing available options to fully or substantially mitigate the impact of the increased tariffs or any future tariffs, including seeking exclusions, through drawbacks, refunds, recovering the costs in the pricing of our products, securing alternative sources of materials or products, or, in certain cases, qualifying for duty-free treatment. However, these actions may not be successful in fully or substantially mitigating the impact of tariffs, and, even if successful, there could continue to be a near -term ~~impact~~volatility onin cash flows due to the timing of when tariffs are paid compared to when such costs may be refunded or recovered.

In addition, recent government actions relating to rare earth minerals that are used in certain of our products, including U.S. Government sourcing prohibitions on the import of such minerals and the imposition of export controls on such minerals by China, ~~had~~have raised concerns about supply availability. ~~earlier~~We ~~this~~are ~~year.~~monitoring ~~Although~~the rare earth ~~shipments~~minerals ~~have~~supply ~~resumed~~chain ~~under~~and amaintaining ~~new~~active ~~U.S.-China~~engagement ~~framework~~with ~~agreement,~~our ~~exports~~suppliers ~~remain~~as ~~subject~~the toregulatory ~~selective~~landscape ~~licensing~~evolves. ~~and~~The ~~review by Chinese authorities, and the~~ rare earth supply chain continues to be vulnerable to ~~further~~ disruption due to increasing scarcity and constrained capacity, and we are developing and executing mitigation plans designed to safeguard supply and meet future delivery commitments. We believe we will continue to meet our 2025 production and delivery commitments. However, if we are unable to successfully mitigate disruptions to the availability of rare earth minerals, our future profits, margins and cash flows may be adversely affected.

Lastly, the President has issued multiple Executive Orders, including two that are intended to (i) simplify and accelerate the procurement process through an overhaul of the Federal Acquisition Regulation (FAR), and its supplements and (ii) modernize the defense acquisition process by promoting commercial solutions, use of innovative acquisition authorities, and other existing streamlined processes. As the modernization of the FAR progresses, we continue to monitor any changes to the Defense Acquisition Regulation Supplement. Among the actions directed by the President is a review of major defense acquisition programs that are more than 15% behind schedule or over budget, or not aligned with the Administration’s priorities, including identifying ~~any~~ programs for potential cancellation. While the full impact of these reforms on our business is uncertain, ~~they~~we ~~could~~are ~~potentially~~adapting ~~lead~~ to ~~changes~~meet in the ~~way~~changes wein ~~interact with~~ the ~~U.S.~~ Government, ~~and~~buying webehaviors. ~~will~~We continue to monitor and assess their effects on our business and financial results. ~~Should~~As the U.S. Government ~~review~~continues ~~one~~to orreview ~~more major~~ defense programs in which we provide products and/or services, and if this review leads to a full or partial cancellation of one or more of these programs, this could have an adverse effect on our business, financial condition, results of operations and cash flows.

For additional risks to the company related to the geopolitical and economic environment, see Part I, Item 1A, “Risk Factors” of our 2024 Form 10-K.

U.S. Government Budget Environment

Our primary customer is the U.S. Government, from which we derived 7372% of our sales during the ~~six~~nine months ended ~~June 29~~September 28, 2025, including 63% from the UDoW.S. ~~DoD.~~ Funding for U.S. Government programs is subject to a variety ~~of factors~~

2930

Table of Contents

of factors that can affect our business, including the administration’s budget requests and procurement priorities and policies, annual congressional budget authorization and appropriation processes, and other U.S. Government domestic and international priorities. U.S. Government spending levels, particularly defense spending, and timely funding thereof can affect our financial performance over the short and long term.

OnThe ~~March~~Administration ~~15,~~published ~~2025,~~its ~~the~~Fiscal ~~President signed into law the Full-~~Year ~~Continuing Appropriations and Extensions Act, 2025~~ (~~the Act~~FY), ~~which~~2026 ~~funds~~budget ~~the~~request ~~U.S.~~in ~~Government~~June ~~under a continuing resolution through September 30,~~ 2025,. ~~its~~The ~~fiscal~~budget ~~year~~request ~~(FY)~~includes ~~end~~$848.3 Inbillion ~~total,~~in the FYbase ~~2025~~budget ~~continuing~~(discretionary) ~~resolution~~ funding, isand ~~roughly equivalent to the U~~$113.S.3 ~~Government’s~~billion ~~FY 2024 funding with a few anomalies and other smaller shifts~~ in ~~funding~~reconciliation ~~between~~(mandatory) ~~appropriations titles~~funding. The ~~Act~~One ~~increases~~Big ~~the~~Beautiful ~~DoD~~Bill FYAct ~~2025~~was ~~base~~signed ~~budget~~ by $6the ~~billion~~President toon aJuly ~~total of $831.5 billion~~4, ~~while reducing nondefense spending~~2025. ~~Unlike~~The ~~other~~bill ~~continuing resolution funding measures, the Act~~ provides ~~the~~more ~~DoD~~than ~~conditional~~$150 ~~authority~~billion toin ~~permit~~mandatory ~~new~~funding ~~program~~(inclusive ~~starts~~of ~~as long as they were included in~~ the ~~FY 2025 House or FY 2025 Senate appropriation bills and~~ $8113.3 billion inreconciliation ~~flexible~~ funding,) ~~furthering~~for the ~~flexibility~~DoW ofavailable ~~DoD~~until ~~operating~~September ~~under~~30, ~~a continuing resolution~~2029.

The ~~Administration~~start ~~published~~of ~~its~~the FYnew ~~2026~~fiscal ~~budget~~year ~~request~~began inOctober ~~June~~1, 2025., ~~The~~without ~~budget~~the ~~request~~passage ~~includes~~of ~~$848.3~~Appropriation ~~billion~~Acts inor ~~the~~a ~~base~~Continuing ~~budget~~Resolution (~~discretionary~~CR) ~~funding~~and the Government began its shutdown procedures, ~~and~~to ~~$113~~include furloughing government civilian employees.3 ~~billion~~It inis ~~reconciliation~~unclear ~~(mandatory)~~at ~~funding.~~this ~~The~~time ~~One~~when ~~Big~~either ~~Beautiful~~a ~~Bill~~CR or Appropriations Act ~~passed~~will ~~the~~be ~~Senate~~enacted. ~~and~~Federal ~~House~~agencies, including DoW, have published guidance for identifying those missions and ~~was~~functions ~~signed~~that bymay ~~the~~continue ~~President~~to onbe ~~July~~carried 4,out ~~2025~~in the absence of available appropriations. The ~~bill~~DoW ~~provides~~published ~~more~~“Contingency ~~than~~Plan ~~$150~~Guidance ~~billion~~for inContinuation ~~mandatory~~of ~~funding~~Operations ~~(inclusive~~in the Absence of Available Appropriations” stated the ~~$113~~Department’s priorities include: Operations to secure the U.3S. ~~billion)~~Southern Border, Middle East Operations, Golden Dome for ~~DoD~~America, ~~available~~Depot ~~until~~Maintenance, ~~September~~Shipbuilding, 30and Critical Munitions. We are closely monitoring the known and potential impact and if the shutdown extends for a prolonged period of time, ~~2029~~we expect our cash flows to be negatively impacted.

~~The~~With ~~legislative~~respect ~~process has been delayed due~~ to the ~~late~~Appropriations ~~release~~Acts, of the ~~FY 2026 budget request. The~~ House Appropriations Subcommittee on Defense (HAC-D) released its FY 2026 congressional marks using the FY 2025 enacted amounts as its baseline on June 12, 2025. The bill recommends $831.5 billion in discretionary funding for the ~~DoD~~DoW. The Senate Armed Services Committee marked up its version of the FY 2026 National Defense Authorization Act (FY 2026 NDAA) on July 10, 2025 and included a topline increase of $32.1 billion. The House Armed Services Committee (HASC) also completed their markup of the FY 2026 NDAA on July 15, 2025 and held at the topline of the FY 2026 President’s budget request.

We anticipate the federal budget, ~~debt ceiling,~~ additional potential tax law changes, and regulatory environment will continue to be subject to debate and compromise shaped by, among other things, the new Administration and Congress, heightened political tensions, the global security environment, inflationary pressures, and macroeconomic conditions. The result may be shifting funding priorities, which could have material impacts on defense spending broadly and our programs. Additionally, the administration continues to take steps to evaluate government-wide and defense-specific staffing and procurement, which includes assessing mission priorities, procurement methods, program performance, and other factors and then potentially taking action based on those assessments. Those actions remain uncertain and could result in impacts to both our current and future business prospects and financial performance.

See also the discussion of U.S. Government funding risks, in Part I, Item 1A, “Risk Factors” of our 2024 Form 10-K.

~~Portfolio Shaping Activities~~31

On June 26, 2025, we paid $360 million, in cash, to close our acquisition of Amentum’s Rapid Solutions business (Rapid Solutions). This acquisition integrates Rapid Solutions’ advanced space and airborne mission capabilities, including intelligence, surveillance and reconnaissance technologies, into Lockheed Martin’s portfolio. The financial results of Rapid Solutions have been included within our operating results in the period post-acquisition. See “Note 1 – Basis of Presentation” included in our Notes to Consolidated Financial Statements for further information regarding the acquisition of Rapid Solutions.

Table of Contents

CONSOLIDATED RESULTS OF OPERATIONS

Our operating cycle is primarily long-term and involves many types of contracts for the design, development and manufacture, integration, and sustainment of products and related activities with varying delivery schedules. Additionally, we close our books and records on the last Sunday of each month, except for the month of December, as our fiscal year ends on December 31, to align our financial closing with our business processes. Because of this, the number of weeks in a reporting quarter may vary slightly during the year and for comparable prior year periods. Consequently, the results of operations of a particular year, or year-to-year comparisons of sales and profits, may not be indicative of future operating results. The following discussions of comparative results should be reviewed in this context. All per share amounts cited in these discussions are presented on a “per diluted share” basis, unless otherwise noted.

Our consolidated results of operations were as follows (in millions, except per share data):

Quarters Ended

~~Six~~Nine Months Ended

June 29,2025

June 30,2024

June 29,2025

June 30,2024

September 28,2025

September 29,2024

September 28,2025

September 29,2024

Sales

18,~~155~~609

1817,~~122~~104

3654,~~118~~727

3552,~~317~~421

Operating costs and expenses

(1716,~~421~~369)

(1514,~~992~~987)

(3349,~~061~~430)

(3146,~~194~~181)

Gross profit

~~734~~2,240

2,~~130~~117

35,~~057~~297

46,~~123~~240

Other income, net

1440

1823

63103

5477

Operating profit

~~748~~2,280

2,~~148~~140

35,~~120~~400

46,~~177~~317

Interest expense

(~~274~~286)

(~~261~~256)

(~~542~~828)

(~~516~~772)

Non-service FAS pension (expense) income

(99)

1516

(~~197~~296)

3147

Other non-operating income, net

4243

4618

72115

91109

Earnings before income taxes

~~417~~1,938

1,~~948~~918

24,~~453~~391

35,~~783~~701

Income tax expense

(75319)

(~~307~~295)

(~~399~~718)

(~~597~~892)

Net earnings

~~342~~1,619

1,~~641~~623

23,~~054~~673

34,~~186~~809

Diluted earnings per common share

16.4695

6.8580

815.7569

1320.2405

Certain amounts reported in other income, net, including our share of earnings or losses from equity method investees, are included in the operating profit of our business segments. Accordingly, such amounts are included in the discussion of our business segment results of operations.

Sales

WeSubstantially ~~generate~~all ~~sales~~of ~~from~~our ~~the~~contracts ~~delivery~~are accounted for using the percentage-of-completion ~~products~~cost-to-cost ~~and~~method. ~~services~~Under the percentage-of-completion cost-to-cost method, we record sales on contracts over time based upon our ~~customers~~progress towards completion on a particular contract, as well as our estimate of the profit to be earned at completion. The ~~Our~~following discussion of material changes in our consolidated sales ~~were~~should asbe ~~follows~~read (in ~~millions):~~ tandem with the subsequent discussion of changes in our consolidated operating costs and expenses and our business segment results of operations because changes in our sales are typically accompanied by a corresponding change in our operating costs and expenses due to the nature of the percentage-of-completion cost-to-cost method.

	Quarters Ended						Six Months Ended
	June 29,2025			June 30,2024			June 29,2025			June 30,2024
Products	$	15,149		$	15,109		$	30,085		$	29,305
% of total sales	83.4		%	83.4		%	83.3		%	83.0		%
Services	3,006			3,013			6,033			6,012
% of total sales	16.6		%	16.6		%	16.7		%	17.0		%
Total sales	$	18,155		$	18,122		$	36,118		$	35,317

Substantially all of our contracts are accounted for using the percentage-of-completion cost-to-cost method. Under the percentage-of-completion cost-to-cost method, we record sales on contracts over time based upon our progress towards completion on a particular contract, as well as our estimate of the profit to be earned at completion. The following discussion of material changes in our consolidated sales should be read in tandem with the subsequent discussion of changes in our consolidated operating costs and expenses and our business segment results of operations because

Table of Contents

~~changes~~We ingenerate ~~our~~ sales ~~are~~from ~~typically~~the ~~accompanied~~delivery byof aproducts ~~corresponding~~and ~~change~~services into our ~~operating~~customers. ~~costs~~Our ~~and~~consolidated ~~expenses~~sales ~~due~~were toas ~~the~~follows ~~nature of the percentage-of-completion cost-to-cost method.~~(in millions):


	Quarters Ended						Nine Months Ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024
Products	$	15,311		$	14,472		$	45,396		$	43,777
% of total sales	82.3		%	84.6		%	82.9		%	83.5		%
Services	3,298			2,632			9,331			8,644
% of total sales	17.7		%	15.4		%	17.1		%	16.5		%
Total sales	$	18,609		$	17,104		$	54,727		$	52,421

Product Sales

Product sales increased $839 million, or 6%, during the quarter ended ~~June~~September 2928, 2025, ~~were~~compared ~~comparable~~ to the same period in 2024. Higher product sales of approximately $~~325~~445 million at MFC, ~~and~~ $~~100~~255 million at ~~Space~~Aeronautics ~~were~~and ~~offset by lower product sales of~~ $~~375~~180 million at ~~RMS~~Space. Higher product sales at MFC were due to production ramp-up on PAC-3, Joint Air-to-Surface Standoff Missile (JASSM), and Long Range Anti-Ship Missile (LRASM), ~~and precision fires~~ programs. Higher product sales at ~~Space~~Aeronautics were due to higher volume on ~~Orion~~F-35 ~~and~~production ~~Next~~contracts ~~Generation~~and ~~Interceptor~~the ~~(NGI)~~delays ~~programs~~in ~~partially~~receiving ~~offset~~additional bycontractual ~~lower~~authorization ~~product~~and ~~sales~~funding ~~due~~under tothe ~~program~~Lots ~~lifecycle~~18-19 oncontract in the ~~Next~~third ~~Generation~~quarter ~~Overhead~~of ~~Persistent~~2024, ~~Infrared~~partially ~~(Next~~offset ~~Gen~~by ~~OPIR)~~lower ~~system~~volume on classified contracts. ~~Lower~~Higher product sales at ~~RMS~~Space were due to ~~lower~~higher volume on ~~radar~~Fleet ~~and~~Ballistic ~~the~~Missile ~~Canadian Surface Combatant~~ (~~CSC~~FBM) ~~programs~~, Orion and ~~the~~Next ~~unfavorable~~Generation ~~cumulative~~Interceptor ~~adjustments to sales driven by recognizing a loss on Türkish Utility Helicopter Program~~ (~~TUHP~~NGI) ~~as previously described~~programs. Product sales for Aeronautics were comparable as higher volume on F-35 production contracts was mostly offset by the unfavorable cumulative adjustment to sales driven by recognizing a loss on a classified contract in the second quarter of 2025. See “Note 10 – Other” included in our Notes to Consolidated Financial Statements for further details about program losses incurred at Aeronautics and RMS.

Product sales increased $~~780~~1.6 ~~million~~billion, or 34%, during the ~~six~~nine months ended ~~June~~September 2928, 2025, compared to the same period in 2024. The increase was primarily attributable to higher product sales of approximately $~~675~~1.1 ~~million~~billion at MFC, ~~$145 million at Aeronautics~~ and $80 400 million at ~~Space offset by lower product sales of $120 million at RMS~~Aeronautics. Higher product sales at MFC were due to production ramp-up on JASSM, LRASM, ~~and~~ precision fires and PAC-3 programs. Higher product sales at Aeronautics were due to higher volume on F-35 production contracts, ~~partially~~and ~~offset by~~ the ~~unfavorable~~delays ~~cumulative adjustment to sales driven by recognizing a loss on a classified contract~~ in the ~~second~~third quarter of ~~2025.~~2024 ~~Higher~~as ~~product~~described ~~sales~~above, ~~at Space were due to higher volume on NGI and Orion programs~~ partially offset by ~~lower product sales due to program lifecycle on~~ the ~~Next Gen OPIR system. Lower product sales at RMS were due to the~~ unfavorable cumulative adjustment to sales driven by recognizing a loss on ~~TUHP~~a asclassified ~~previously~~contract ~~described~~in ~~and~~the ~~lower~~second ~~production~~quarter ~~volume~~of ~~on Seahawk programs~~2025.

Service Sales

Service sales increased $666 million, or 25%, during the quarter ended ~~June~~September 2928, 2025, ~~were~~compared ~~comparable~~ to the same period in 2024. ~~Lower~~due ~~service~~to ~~sales of approximately $180 million at RMS were offset by~~ higher service sales of approximately $~~155~~510 million at Aeronautics. ~~Lower~~as ~~service sales at RMS were due to the unfavorable cumulative adjustment to sales driven by recognizing~~ a ~~loss~~result onof ~~Canadian Maritime Helicopter Program (CMHP) as previously described. Higher service sales at Aeronautics were due to~~ higher volume on F-35 sustainment contracts.

Service sales increased $687 million, or 8%, during the ~~six~~nine months ended ~~June~~September 2928, 2025, ~~were~~compared ~~comparable~~ to the same period in 2024. ~~Higher~~due ~~service~~to ~~sales~~higher ~~of approximately $210 million at Aeronautics were offset by lower~~ service sales of approximately $~~195~~725 million at ~~RMS. Higher service sales at~~ Aeronautics ~~were~~as ~~due~~a toresult of higher volume on F-35 sustainment contracts. ~~Lower service sales at RMS were due to the unfavorable cumulative adjustment to sales driven by recognizing a loss on CMHP as previously described.~~

3233

Table of Contents

Operating Costs and Expenses

Operating costs and expenses, for both products and services, consist of materials, labor, subcontracting costs and an allocation of indirect costs (overhead and general and administrative), as well as the costs to fulfill our industrial cooperation agreements, sometimes referred to as offset agreements, required under certain contracts with international customers. For each of our contracts, we monitor the nature and amount of costs at the contract level, which form the basis for estimating our total costs to complete the contract.

Our consolidated operating costs and expenses were as follows (in millions):

	Quarters Ended						~~Six~~Nine Months Ended
	June 29,2025			June 30,2024			June 29,2025			June 30,2024
	September 28,2025			September 29,2024			September 28,2025			September 29,2024
Operating costs and expenses – products	$	(1413,~~469~~708)		$	(1312,~~520~~964)		$	(2741,~~753~~461)		$	(2639,~~404~~368)
% of product sales	9589.5		%	89.56		%	9291.23		%	9089.19		%
Operating costs and expenses – services	(32,~~130~~871)			(2,~~582~~272)			(58,~~770~~641)			(57,~~185~~457)
% of service sales	~~104~~87.1		%	8586.73		%	9592.6		%	86.23		%
Impairment and other charges	~~(66)~~—			~~(87)~~—			(66)			(87)
Other unallocated, net	~~244~~210			~~197~~249			~~528~~738			~~482~~731
Total operating costs and expenses	$	(1716,~~421~~369)		$	(1514,~~992~~987)		$	(3349,~~061~~430)		$	(3146,~~194~~181)

The following discussion of material changes in our consolidated operating costs and expenses for products and services should be read in tandem with the preceding discussion of changes in our consolidated sales and our business segment results of operations. Except for potential impacts to our programs resulting from supply chain disruptions, inflation, and tariffs, we have not identified any additional developing trends in operating costs and expenses for products and services that could have a material impact on our future operations.

Product Costs

Product costs increased $~~949~~744 million, or 76%, during the quarter ended ~~June~~September 2928, 2025, compared to the same period in 2024. The increase was primarily attributable to higher product costs of approximately $~~880~~395 million at ~~Aeronautics~~MFC, ~~and~~ $~~285~~260 million at ~~MFC,~~Aeronautics ~~partially~~and ~~offset by lower product costs of approximately~~ $~~290~~130 million at ~~RMS~~Space. Higher product costs at MFC, Aeronautics ~~were due to the impact of recognizing a loss on a classified contract in the second quarter of 2025~~ and ~~higher~~Space ~~volume as described above in “Product Sales”. Higher product costs at MFC~~ were due to production ramp -up asand ~~described~~higher ~~above in “Product Sales”. Lower product costs at RMS were due to lower~~ volume as described above in “Product Sales”.

Product costs increased $12.31 billion, or 5%, during the ~~six~~nine months ended ~~June~~September 2928, 2025, compared to the same period in 2024. The increase was primarily attributable to higher product costs of approximately $~~995~~1.3 ~~million~~billion at Aeronautics and $~~485~~880 million at MFC~~, partially offset by lower product costs of approximately $95 million at RMS~~. Higher product costs at Aeronautics were due to higher volume and the impact of recognizing a loss on a classified contract as described above ~~and higher volume as described above~~ in “Product Sales”. Higher product costs at MFC were due to production ramp -up as described above in “Product Sales”. ~~Lower product costs at RMS were due to lower production volume as described above in “Product Sales”.~~

Service Costs

Service costs increased $~~548~~599 million, or 2126%, during the quarter ended ~~June~~September 2928, 2025, compared to the same period in 2024. ~~The increase was~~ primarily attributable to higher service costs of approximately $~~400~~475 million at ~~RMS and $110 million at~~ Aeronautics. ~~Higher~~driven ~~service~~by ~~costs at RMS were due to the impact of recognizing losses on CMHP as previously described. Higher service costs at Aeronautics were due to~~ higher volume as described above in “Service Sales”.

Service costs increased $~~585~~1.2 ~~million~~billion, or 1116%, during the ~~six~~nine months ended ~~June~~September 2928, 2025, compared to the same period in 2024. The increase was primarily attributable to higher service costs of approximately $~~400~~ 640 million at ~~RMS~~Aeronautics and $~~165~~ 430 million at ~~Aeronautics~~RMS. Higher service costs at ~~RMS~~Aeronautics were due to ~~the~~higher ~~impact~~volume ofas ~~recognizing~~described ~~losses~~above onin ~~CMHP~~“Service ~~as previously described~~Sales”. Higher service costs at ~~Aeronautics~~RMS were due to ~~higher~~the ~~volume~~impact asof ~~described~~recognizing ~~above~~a inloss ~~“Service~~on ~~Sales”~~CMHP as previously described.

3334

Table of Contents

Impairment and Other Charges

We recorded charges totaling $66 million ($52 million, or $0.22 per share, after-tax) during the quarter ended June 29, 2025 and $87 million ($69 million, or $0.29 per share, after-tax) during the same period in 2024. See “Note 10 - Other” included in our Notes to Consolidated Financial Statements for additional information.

Other Unallocated, Net

Other unallocated, net primarily includes the FAS/CAS pension operating adjustment (which represents the difference between total CAS pension cost recorded in our business segments’ results of operations and the service cost component of FAS pension (expense) income), stock-based compensation expense, changes in the fair value of assets and liabilities for deferred compensation plans, intangible asset amortization expense and other corporate costs. These items are not allocated to the business segments and, therefore, are not allocated to operating costs and expenses for products or services. Other unallocated, net reduced operating expenses by $~~244~~210 million and $~~528~~738 million during the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, compared to $~~197~~249 million and $~~482~~731 million during the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. The ~~increase~~fluctuations in other unallocated, net ~~was~~for ~~primarily~~all ~~due~~periods towere ~~higher~~due ~~gains from the changes in the fair value of assets and liabilities related~~ to ~~deferred compensation plans during the quarter and six months ended June 29, 2025 compared to the same periods in 2024 and fluctuations in~~ costs associated with various corporate items, none of which were individually significant.

Other Income, Net

Other income, net ~~during~~was ~~the~~$40 ~~quarter~~million ~~ended~~and ~~June 29,~~$103 ~~2025~~million ~~was~~during ~~comparable~~the toquarter ~~the~~and ~~same~~nine ~~period~~months inended ~~2024~~September 28, 2025. Other income, net was $6323 million and $5477 million during the ~~six~~quarter and nine months ended ~~June~~September 29, ~~2025 and June 30,~~ 2024. Other income, net, primarily includes earnings generated by equity method investees, as well as gains or losses for acquisitions, divestitures, and other items, none of which are individually significant. The increase in other income, net during the ~~six~~quarter and nine months ended ~~June~~September 2928, 2025 resulted primarily from an intellectual property license arrangement and the Commercial Engine Solutions divestiture net working capital true-up.

Interest Expense

Interest expense was $~~274~~286 million and $~~542~~828 million during the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, compared to $~~261~~256 million and $~~516~~772 million during the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. The increase in interest expense in 2025 resulted primarily from ~~the~~a ~~issuance~~higher intra-period outstanding balance of commercial paper and issuance of senior unsecured notes in July 2025 and December 2024.

Non-service FAS Pension (Expense) Income

Non-service FAS pension expense was $99 million and $~~197~~296 million during the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, compared to non-service FAS pension income of $1516 million and $3147 million during the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. The increase in expense was primarily due to higher prior service cost amortization and a reduced asset base as detailed in “Note 6 - Postretirement Benefit Plans” included in our Notes to Consolidated Financial Statements.

Other Non-operating Income, net

Other non-operating income, net primarily includes gains or losses related to adjustments in valuation of early-stage company investments or gains or losses upon the sale of these investments and interest income earned on cash and cash equivalents. Other non-operating income, net was $4243 million and $72115 million during the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, compared to $4618 million and $91109 million during the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. See “Note 8 - Fair Value Measurements” included in our Notes to Consolidated Financial Statements for additional information.

Income Tax Expense

Our effective income tax rates were 1816.05% and 16.34% for the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025 and 15.84% ~~for~~and ~~both~~15.6% for the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. The higher effective income tax rates for the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025 were ~~primarily~~ attributable to ~~increased~~the ~~interest~~One ~~expense~~Big onBeautiful ~~our~~Bill ~~uncertain~~Act ~~tax~~(the ~~position~~Tax ~~partially~~Act) ~~offset~~primarily driven by ~~changes~~lower ~~in pre-~~tax ~~earnings due to program losses previously described. The rates for all periods benefited from tax~~ deductions for foreign derived intangible income, ~~research~~partially ~~and~~offset ~~development~~by ~~tax~~the ~~credits,~~favorable ~~dividends~~resolution ~~paid~~of tocertain ~~our~~federal ~~defined~~income ~~contribution~~tax ~~plans~~audit items with anthe ~~employee~~Internal ~~stock~~Revenue ~~ownership~~Service ~~plan~~(IRS). ~~feature~~The ~~and~~rates ~~employee~~for ~~equity~~all ~~awards.~~periods benefited from

3435

Table of Contents

research and development tax credits, dividends paid to our defined contribution plans with an employee stock ownership plan feature, tax deductions for foreign derived intangible income and employee equity awards.

Changes in U.S. (federal or state) or foreign tax laws and regulations, or their interpretation and application (including those with retroactive effect), could significantly impact our provision for income taxes, the amount of taxes payable, our deferred tax asset and liability balances, and stockholders’ equity. In addition to future changes in tax laws, the amount of net deferred tax assets will change periodically based on several factors, including the measurement of our postretirement benefit plan obligations, actual cash contributions to our postretirement benefit plans and the change in the amount or reevaluation of uncertain tax positions.

As a result of an IRS tax audit related to our adoption of Accounting Standards Codification (ASC) 606 for certain manufacturing contracts and the associated changes to the income recognition rules enacted in the 2017 Tax Cuts and Jobs Act, the IRS has proposed adjustments that could result in significant additional federal income tax. We are ~~pursuing~~in ~~administrative~~ongoing ~~and~~discussions ~~potentially~~with ~~judicial~~the ~~remedies~~IRS toin ~~resolve~~an ~~this~~effort ~~matter.~~to Weresolve ~~believe our reserves for tax contingencies are adequate; however,~~ the ~~outcome of this~~ matter ~~is uncertain, and if this matter is resolved unfavorably, there could be a material impact on our profitability and future cash flows~~. See “Note 10 - Other” included in our Notes to Consolidated Financial Statements for additional information.

We are regularly under audit or examination by tax authorities, including U.S. and foreign tax authorities (Australia, Canada, India, Italy, Japan, Poland, the United Kingdom, and other countries). The final resolution of tax audits and any related administrative reviews or litigation could result in unanticipated increases in our tax expense and changes to the timing of required tax payments, which could affect profitability and cash flows for any particular reporting period. These increases or changes could have a material impact on financial condition and results of operations in such period.

Beginning in 2022, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development (R&D) expenditures immediately in the year incurred and requires taxpayers to amortize such expenditures over five years for tax purposes. On July 4, 2025, the President signed into law the One Big Beautiful Bill Act (the Tax Act). The Tax Act, among other things, reinstates full deduction of R&D expenditures starting in 2025. We are in the process of evaluating the impact of the Tax Act on our consolidated financial statements. However, we expect the Tax Act to decrease our cash tax liability for 2025.

The Organisation for Economic Co-operation and Development (OECD) has established a framework for a global minimum corporate tax of 15%, known as Pillar 2, which will be applied on a country-by-country basis to companies with global revenues and profits above certain thresholds. The implementation of Pillar 2 is phased, with certain aspects effective on January 1, 2024, and others on January 1, 2025. Although the United States has not enacted legislation to adopt Pillar 2, and its future adoption is uncertain, several countries where we operate have enacted such legislation, and others are in the process of doing so. We do not expect Pillar 2 to have a material impact on our effective tax rate or our financial condition and results of operations.

Net Earnings

We reported net earnings of $~~342~~1.6 ~~million~~billion ($16.4695 per share) and $23.17 billion ($815.7569 per share) during the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025 and $1.6 billion ($6.8580 per share) and $34.28 billion ($1320.2405 per share) during the quarter and ~~six~~nine months ended ~~June~~September 3029, 2024. Net earnings and earnings per share for the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025 were affected by the factors mentioned above. Earnings per share also benefited from a net decrease of approximately 5.~~3 million and 5.~~8 million weighted average common shares outstanding during both the quarter and ~~six~~nine months ended ~~June~~September 2928, 2025, compared to the same periods in 2024. The reduction in weighted average common shares was a result of share repurchases, partially offset by share issuances under our stock-based awards and certain defined contribution plans.

Table of Contents

BUSINESS SEGMENT RESULTS OF OPERATIONS

Business segment operating profit excludes the FAS/CAS pension operating adjustment ~~described~~detailed below, a portion of corporate costs not considered allowable or allocable to contracts with the U.S. Government under the applicable U.S. Government Cost Accounting Standards (CAS) or federal acquisition regulations (FAR), and other items not considered part of management’s evaluation of segment operating performance. See “Note 3 - Information on Business Segments – Unallocated Items” included in our Notes to Consolidated Financial Statements for additional information.

	Quarters Ended				Six Months Ended
	June 29,2025		June 30,2024		June 29,2025		June 30,2024
Sales
Aeronautics	$	7,420	$	7,277	$	14,477	$	14,122
Missiles and Fire Control	3,433		3,102		6,806		6,095
Rotary and Mission Systems	3,995		4,548		8,323		8,636
Space	3,307		3,195		6,512		6,464
Total sales	$	18,155	$	18,122	$	36,118	$	35,317
Operating profit (loss)
Aeronautics	$	(98)	$	751	$	622	$	1,430
Missiles and Fire Control	479		450		944		761
Rotary and Mission Systems	(172)		495		349		925
Space	362		346		741		671
Total business segment operating profit	571		2,042		2,656		3,787
Unallocated items
FAS/CAS pension operating adjustment	379		406		758		812
Impairment and other charges (a)	(66)		(87)		(66)		(87)
Intangible asset amortization expense	(63)		(61)		(127)		(122)
Other, net	(73)		(152)		(101)		(213)
Total unallocated items	177		106		464		390
Total consolidated operating profit	$	748	$	2,148	$	3,120	$	4,177

(a)See “Note 10 - Other” included in our Notes to Consolidated Financial Statements for additional information.

Segment results exclude intersegment transactions as these activities are eliminated in consolidation and are not considered in assessing the performance of each segment. Business segment operating profit includes our share of earnings or losses from equity method investees as the operating activities of the equity method investees are closely aligned with the operations of our business segments.

Table of Contents

Sales and operating profit for each of our business segments were as follows (in millions):


	Quarters Ended				Nine Months Ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
Sales
Aeronautics	$	7,256	$	6,487	$	21,733	$	20,609
Missiles and Fire Control	3,624		3,175		10,430		9,270
Rotary and Mission Systems	4,373		4,367		12,696		13,003
Space	3,356		3,075		9,868		9,539
Total sales	$	18,609	$	17,104	$	54,727	$	52,421






Operating profit
Aeronautics	$	682	$	659	$	1,304	$	2,089
Missiles and Fire Control	510		456		1,454		1,217
Rotary and Mission Systems	506		483		855		1,408
Space	331		272		1,072		943
Total business segment operating profit	2,029		1,870		4,685		5,657
Unallocated items
FAS/CAS pension operating adjustment	380		406		1,138		1,218
Impairment and other charges (a)	—		—		(66)		(87)
Intangible asset amortization expense	(70)		(61)		(197)		(183)
Other, net	(59)		(75)		(160)		(288)
Total unallocated items	251		270		715		660
Total consolidated operating profit	$	2,280	$	2,140	$	5,400	$	6,317

(a)See “Note 10 - Other” included in our Notes to Consolidated Financial Statements for additional information.

The total FAS/CAS pension adjustments, including the service and non-service cost components of FAS pension (expense) income for our qualified defined benefit pension plans, were as follows (in millions):

	Quarters Ended				~~Six~~Nine Months Ended
	June 29,2025		June 30,2024		June 29,2025		June 30,2024
	September 28,2025		September 29,2024		September 28,2025		September 29,2024
Total FAS (expense) income and CAS cost
FAS pension (expense) income	$	(~~112~~111)	$	—1	$	(~~223~~334)	$	12
Less: CAS pension cost	392		421		~~784~~1,176		~~842~~1,263
Total FAS/CAS pension adjustment	$	~~280~~281	$	~~421~~422	$	~~561~~842	$	~~843~~1,265
Service and non-service cost reconciliation
FAS pension service cost	$	(1312)	$	(15)	$	(2638)	$	(3045)
Less: CAS pension cost	392		421		~~784~~1,176		~~842~~1,263
Total FAS/CAS pension operating adjustment	~~379~~380		406		~~758~~1,138		~~812~~1,218
Non-service FAS pension (expense) income	(99)		1516		(~~197~~296)		3147
Total FAS/CAS pension adjustment	$	~~280~~281	$	~~421~~422	$	~~561~~842	$	~~843~~1,265

Management evaluates performance on our contracts by focusing on sales and operating profit and not by type or amount of operating expense. Consequently, our discussion of business segment performance focuses on sales and operating profit, consistent with our approach for managing the business. This approach is consistent throughout the life cycle of our contracts, as management assesses the bidding of each contract by focusing on sales and operating profit and monitors performance on our contracts in a similar manner through their completion. This method and assumptions used to evaluate contracts and recognize revenue, including the use of percentage-of-completion accounting for contracts with continuous transfer of control to the customer, are consistent with those described in our 2024 Form 10-K under

We regularly provide customers with reports of our costs as the contract progresses. The cost information in the reports is accumulated in a manner specified by the requirements of each contract. For example, cost data provided to a customer for a product would typically align to the subcomponents of that product (such as a wing-box on an aircraft) and for services would align to the type of work being performed (such as aircraft sustainment). Our contracts generally allow for the recovery of costs in the pricing of our products and services. Most of our contracts are bid and negotiated with our customers under circumstances in which we are required to disclose our estimated total costs to provide the product or service. This approach for negotiating contracts with our U.S. Government customers generally allows for recovery of our actual costs plus a reasonable profit margin. We also may enter into long-term supply contracts for certain materials or components to coincide with the production schedule of certain products and to ensure their availability at known unit prices.

We have a number of programs that are designated as classified by the U.S. Government, and that cannot be specifically described. The operating results of these classified programs are included in our consolidated and business segment results and are subject to the same oversight and internal controls as our other programs.

Our sales are primarily derived from long-term contracts for products and services provided to the U.S. Government as well as FMS contracted through the U.S. Government. We recognize revenue as performance obligations are satisfied and the customer obtains control of the products and services. For performance obligations to deliver products with continuous transfer of control to the customer, revenue is recognized based on the extent of progress towards completion of the performance obligation, generally using the percentage-of-completion cost-to-cost measure of progress for our contracts because it best depicts the transfer of control to the customer as we incur costs on our contracts. For performance obligations in which control does not continuously transfer to the customer, we recognize revenue at the point in time in which each performance obligation is fully satisfied.

Many of our contracts span several years and include highly complex technical requirements. At the outset of a contract accounted for under the percentage-of-completion cost-to-cost method, we identify and monitor risks to the achievement of the technical, schedule and cost aspects of the contract, as well as our ability to earn variable consideration, and assess the effects of those risks on our estimates of sales and total costs to complete the contract. The estimates consider the technical requirements (e.g., a newly developed product versus a mature product), the schedule and associated tasks (e.g., the number and type of milestone events) and costs (e.g., material, labor, subcontractor, overhead and the estimated costs to fulfill our industrial cooperation agreements, sometimes referred to as offset or localization agreements, required under certain contracts with international customers). The initial profit booking rate of each contract considers risks surrounding the ability to achieve the technical requirements, schedule and costs in the

Table of Contents

~~initial~~“Management’s ~~estimated~~Discussion ~~total costs to complete the contract~~ and ~~variable~~Analysis ~~considerations. Profit booking rates may increase during the performance~~ of ~~the~~Financial ~~contract~~Condition ~~if we successfully retire risks related to the technical, schedule~~ and ~~cost~~Results ~~aspects~~ of ~~the contract, which decreases the estimated total costs to complete the contract or may increase the variable consideration we expect to receive on the contract~~Operations”. ~~Conversely~~Additionally, ~~our~~for ~~profit~~updates ~~booking~~related ~~rates may decrease if the estimated total costs~~ to complete the contract increase or our estimates of variable consideration we expect to receive decrease. The profit booking rate may also be adjusted if the total estimated value of the contract changes or there is a contract modification. All of the estimates are subject to change during the performance of the contract and may affect the profit booking rate. For further discussion on fixed-price contracts, see “Note 10 - Other” included in our Notes to Consolidated Financial Statements.

Changes in sales and operating profit generally are expressed in terms of volume, contract mix, and/or performance (referred to as profit booking rate adjustments). Changes in volume refer to increases or decreases in sales or operating profit resulting from varying production activity levels, deliveries or service levels on individual contracts. Volume changes in segment operating profit are typically based on the current profit booking rate for a particular contract. Contract mix primarily refers to changes in the ratio of contract type or life cycle (e.g., cost-type, fixed-price, development, production and/or sustainment) and other cost recoveries.

Comparability of our segment sales, operating profit and operating margin may be impacted favorably or unfavorably by changes in profit booking rates on our contracts.

The following table presents the effect of our consolidated net profit booking rate adjustments on segment operating profit (loss) (in millions):

	Quarters Ended				~~Six~~Nine Months Ended
	June 29,2025		June 30,2024		June 29,2025		June 30,2024
	September 28,2025		September 29,2024		September 28,2025		September 29,2024
Aeronautics	$	~~(730)~~60	$	~~120~~105	$	(~~620~~560)	$	~~210~~315
Missiles and Fire Control	130		~~155~~135		~~260~~390		~~150~~285
Rotary and Mission Systems	~~(550)~~105		60110		(~~465~~360)		~~100~~210
Space	~~105~~70		8525		~~260~~330		~~155~~180
Total business segment operating profit	$	(1,045)	$	420	$	(565)	$	615
Total net adjustments to segment operating profit	$	365	$	375	$	(200)	$	990

During the ~~quarter~~nine months ended ~~June~~September 2928, 2025, we recorded losses of $950 million on an ongoing classified program at our Aeronautics business segment, ~~and~~ $570 million on Canadian Maritime Helicopter Program (CMHP) and $95 million on Türkish Utility Helicopter Program (TUHP) at our RMS business segment., ~~During~~and ~~the~~$105 million ~~six~~of ~~months~~unfavorable ~~ended~~profit ~~June 29,~~adjustments ~~2025,~~on inC-130 programs at our Aeronautics business segment. In addition to ~~the~~these losses ~~above~~and unfavorable profit adjustments, we also recorded $~~125~~130 million of ~~adjustments resulting from~~ favorable ~~performance~~adjustments upon completion on certain commercial civil space programs at Space, and an $80 million favorable ~~adjustment~~adjustments upon completion of a classified program at Aeronautics. During the ~~six~~nine months ended ~~June 30~~September 29, 2024, we recognized a reach-forward ~~loss~~losses of $145 million on the same ongoing classified program at our Aeronautics business segment ($80 million was recognized during the quarter ended September 29, 2024) and of $100 million on a classified program at our MFC business segment.

With respect to the classified program at our Aeronautics business segment, we continue to monitor this program, and we may need to record additional losses in future periods if we experience further performance issues, increases in scope, or increases in costs from prior estimates. Our estimates may change, in particular, as we conduct further development and testing on the program, which may lead to new findings or cause us to modify our expectations or understanding of the risks inherent in the program. Similarly, we may need to record additional losses in future periods for the programs at our MFC and RMS business segments referenced above. Any such losses could be material to our financial results in any period that they are recognized. For further discussion regarding the losses recognized on these programs, see ““Note 10 - Other” included in our Notes to Consolidated Financial Statements.

Aeronautics

Summary operating results for our Aeronautics business segment were as follows (in millions):

	Quarters Ended						~~Six~~Nine Months Ended
	June 29,2025			June 30,2024			June 29,2025			June 30,2024
	September 28,2025			September 29,2024			September 28,2025			September 29,2024
Sales	$	7,~~420~~256		$	76,~~277~~487		$	1421,~~477~~733		$	1420,~~122~~609
Operating (loss) profit	(98)			751			622			1,430
Operating profit	682			659			1,304			2,089
Operating margin	(19.34		%)	10.32		%	46.30		%	10.1		%

Aeronautics’ sales during the quarter ended ~~June~~September 2928, 2025 increased $~~143~~769 million, or 212%, compared to the same period in 2024. This increase was primarily attributable to higher sales of $~~470~~965 million on the F-35 program due to higher volume on production contracts. This increase was partially offset by a $360 million unfavorable cumulative adjustment to sales driven by the loss on a classified contract as previously described.

Table of Contents

~~Aeronautics’~~higher ~~operating~~volume ~~profit~~on ~~during~~production ~~the~~and ~~quarter~~sustainment ~~ended~~contracts ~~June 29,~~and ~~2025 decreased $849 million, or 113%, compared to~~ the ~~same~~delays ~~period~~ in ~~2024.~~receiving ~~The~~additional ~~decrease~~contractual ~~was~~authorization ~~attributable~~and tofunding under the ~~previously~~Lots ~~described~~18-19 ~~$950~~contract ~~million~~in ~~reach~~the ~~forward~~third ~~loss~~quarter ~~recognized~~of on2024. aThis ~~classified~~increase ~~contract, which~~ was partially offset by alower sales of $90140 million ~~increase~~ on ~~the~~classified ~~F-35~~contracts ~~program~~ due to ~~higher~~lower ~~profit booking rate adjustments and~~ volume ~~as described above~~.

Aeronautics’ ~~sales~~operating profit during the ~~six~~quarter ~~months~~ ended ~~June~~September 2928, 2025 increased $~~355~~23 million, or 3%, compared to the same period in 2024. This increase was ~~primarily~~ attributable to a $70 million increase from higher ~~sales~~volume, ofas described above, partially offset by a $~~685~~45 million ondecrease ~~the~~in ~~F-35~~profit ~~program~~booking rate adjustments. The decrease in profit booking rate adjustments was primarily due to ~~higher~~$40 ~~volume~~million of unfavorable profit adjustments on ~~production~~C-130 ~~contracts~~programs. ~~This~~In ~~increase~~addition, ~~was~~profit ~~partially~~booking ~~offset~~rate byadjustments from 2024 that did not recur include a ~~$360~~favorable ~~million~~profit ~~unfavorable~~rate ~~cumulative~~adjustments ~~adjustment~~of to$85 ~~sales~~million ~~driven~~for bya ~~the~~claim ~~loss~~associated onwith a ~~classified~~C-5 Galaxy contract asand ~~previously~~an ~~described~~unfavorable profit rate adjustment of $80 million on a classified program.

Aeronautics’ ~~operating~~sales ~~profit~~ during the ~~six~~nine months ended ~~June~~September 2928, 2025 ~~decreased~~increased $~~808~~1.1 ~~million~~billion, or 575%, compared to the same period in 2024. ~~The~~This ~~decrease~~increase was primarily attributable to ~~the~~higher ~~previously~~sales ~~described~~of $~~950~~1.6 ~~million~~billion ~~reach~~on ~~forward~~the ~~loss~~F-35 ~~recognized~~program due to higher volume on aproduction ~~classified~~and ~~contract.~~sustainment ~~This~~contracts ~~decrease~~and ~~was~~the ~~partially~~delays ~~offset~~in byreceiving aadditional ~~$110~~contractual ~~million~~authorization ~~increase~~and onfunding under the FLots 18-3519 ~~program~~contract ~~due~~in tothe ~~higher~~third ~~volume~~quarter asof ~~described~~2024. ~~above~~This ~~and~~increase ~~higher~~was ~~profit~~partially ~~booking~~offset ~~rate~~by ~~adjustments~~a ~~and~~decrease anof $80515 million ~~profit~~on ~~booking~~classified ~~rate~~programs ~~adjustment~~due into ~~the~~an ~~first~~unfavorable ~~quarter~~cumulative ofadjustment ~~2025~~to ~~resulting~~sales ~~from~~driven ~~favorable~~by ~~performance~~the atloss ~~completion~~ on a classified ~~program~~contract recorded in the second quarter of 2025 and lower volume.

Aeronautics’ operating profit during the nine months ended September 28, 2025 decreased $785 million, or 38%, compared to the same period in 2024. The decrease was attributable to $875 million of lower profit rate adjustments partially offset by $175 million of higher volume as described above. The lower profit rate adjustments were primarily driven by a net impact of $805 million of reach-forward losses recognized on a classified contract ($950 million recognized in 2025 and $145 million recognized in 2024), partially offset by $105 million of unfavorable profit adjustments on C-130 programs, in addition to the items mentioned above.

Missiles and Fire Control

Summary operating results for our MFC business segment were as follows (in millions):

Quarters Ended

~~Six~~Nine Months Ended

June 29,2025

June 30,2024

June 29,2025

June 30,2024

September 28,2025

September 29,2024

September 28,2025

September 29,2024

Sales

3,~~433~~624

3,~~102~~175

610,~~806~~430

69,~~095~~270

Operating profit

~~479~~510

~~450~~456

~~944~~1,454

~~761~~1,217

Operating margin

14.01

14.54

13.9

1213.51

MFC’s sales during the quarter ended ~~June~~September 2928, 2025 increased $~~331~~449 million, or 1114%, compared to the same period in 2024. This increase was primarily attributable to higher sales of $~~330~~280 million on tactical and ~~strike missile programs due to production ramp-up on JASSM, LRASM and precision fires programs.~~

~~MFC’s~~strike ~~operating~~missile ~~profit~~programs ~~during~~due ~~the quarter ended June 29, 2025 increased $29 million, or 6%, compared~~ to ~~the same period in 2024. This increase was attributable to three primary factors: a $35 million increase from~~ production ramp -up ason ~~described above~~JASSM, LRASM and aprecision ~~$25~~fires ~~million increase from favorable contract mix~~programs; ~~partially~~and ~~offset by a~~ $25235 million ~~decrease~~for inintegrated ~~profit~~air ~~booking~~and ~~rate~~missile ~~adjustments.~~defense ~~The~~programs ~~decrease in profit booking rate adjustments was~~ primarily due to ~~lower~~production ~~favorable~~ramp-up ~~profit adjustments~~ on ~~Patriot Advanced Capability-3 (~~PAC-3).

MFC’s ~~sales~~operating profit during the ~~six~~quarter ~~months~~ ended ~~June~~September 2928, 2025 increased $~~711~~54 million, or 12%, compared to the same period in 2024. This increase was primarily attributable to ~~higher~~a ~~sales of~~ $~~700~~45 million onincrease ~~tactical~~from ~~and strike missile programs due to~~ production ramp-up onas ~~JASSM,~~described ~~LRASM, and precision fires programs~~above.

MFC’s ~~operating~~sales ~~profit~~ during the ~~six~~nine months ended ~~June~~September 2928, 2025 increased $~~183~~1.2 ~~million~~billion, or 2413%, compared to the same period in 2024. This increase was primarily attributable to ~~two~~higher ~~primary~~sales ~~factors:~~of a $~~110~~980 million ~~increase~~on intactical ~~profit booking rate adjustments~~ and astrike ~~$60~~missile ~~million~~programs ~~volume~~due ~~increase~~to ~~driven by~~ production ramp-up ason ~~described~~JASSM, ~~above.~~LRASM ~~The~~and ~~increase~~precision infires ~~profit~~programs; ~~booking~~and ~~rate adjustments was primarily due to a~~ $~~100~~270 million ~~loss~~for ~~recognized~~integrated onair ~~a classified program~~ and anmissile ~~unfavorable~~defense ~~profit~~programs ~~adjustment~~due onto ~~Hellfire~~production inramp-up ~~the first quarter of 2024 that did not recur, partially offset by lower favorable profit adjustments~~ on PAC-3 ~~in 2025~~.

~~Rotary~~MFC’s operating profit during the nine months ended September 28, 2025 increased $237 million, or 19%, compared to the same period in 2024. This increase was attributable to two primary factors: a $105 million increase in profit booking rate adjustments and ~~Mission~~a ~~Systems~~$105 million volume increase driven by production ramp-up as described above. The increase in profit booking rate adjustments was primarily due to a $100 million loss recognized on a classified program in 2024 that did not recur and an unfavorable profit adjustment on Hellfire in the first quarter of 2024 that did not recur, partially offset by lower favorable profit adjustments on PAC-3 in 2025.

Summary operating results for our RMS business segment were as follows (in millions):

	Quarters Ended						Six Months Ended
	June 29,2025			June 30,2024			June 29,2025			June 30,2024
Sales	$	3,995		$	4,548		$	8,323		$	8,636
Operating (loss) profit	(172)			495			349			925
Operating margin	(4.3		%)	10.9		%	4.2		%	10.7		%

RMS’ sales during the quarter ended June 29, 2025 decreased $553 million, or 12%, compared to the same period in

Table of Contents

~~2024.~~Rotary ~~The decrease was primarily attributable to lower net sales of $370 million on Sikorsky helicopter programs due to the unfavorable cumulative adjustments to sales driven by recognizing losses on CMHP~~ and ~~TUHP~~Mission as previously described, and lower production volume on Seahawk programs; and a $145 million decrease on integrated warfare systems and sensors (IWSS) programs due to lower volume on radar and the CSC programs.Systems

~~RMS’~~Summary operating ~~profit~~results ~~during~~for ~~the~~our ~~quarter~~RMS ~~ended~~business ~~June 29,~~segment ~~2025~~were ~~decreased~~as ~~$667~~follows ~~million, or 135%, compared to the same period~~ (in 2024. This decrease was attributable to a $610 million decrease in profit booking rate adjustments primarily due to a $570 million loss recognized on CMHP and a $95 million loss recognized on TUHP as previously described.millions):

RMS’ sales during the six months ended June 29, 2025 decreased $313 million, or 4%, compared to the same period in 2024. The decrease was primarily attributable to lower net sales of $245 million on Sikorsky helicopter programs due to the unfavorable cumulative adjustments to sales driven by recognizing losses on CMHP and TUHP as previously described.


	Quarters Ended						Nine Months Ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024
Sales	$	4,373		$	4,367		$	12,696		$	13,003
Operating profit	506			483			855			1,408
Operating margin	11.6		%	11.1		%	6.7		%	10.8		%

RMS’ ~~operating~~sales ~~profit~~ during the ~~six~~quarter ~~months~~ ended ~~June~~September 2928, 2025 ~~decreased~~were ~~$576~~comparable ~~million, or 62%, compared~~ to the same period in 2024. ~~This~~Sales ~~decrease~~increased ~~was~~$190 ~~attributable~~million on Sikorsky helicopter programs due to ahigher ~~$565~~production ~~million~~volume ~~decrease~~on inBlack ~~profit~~Hawk ~~booking~~programs ~~rate~~and ~~adjustments~~$40 ~~primarily~~million on various C6ISR programs due to ahigher ~~$570~~volume. ~~million~~These ~~loss~~increases ~~recognized~~were onoffset ~~CMHP~~by ~~and~~lower asales of $95155 million ~~loss recognized~~ on ~~TUHP~~integrated aswarfare ~~previously~~systems ~~described,~~and ~~partially~~sensors ~~offset~~(IWSS) byprograms ~~unfavorable~~due ~~profit~~to ~~adjustments~~lower volume on ~~Seahawk~~the Aegis and CSC programs, inand ~~the~~$75 ~~first~~million ~~quarter~~for ofvarious ~~2024~~training, ~~that~~logistics ~~did~~and ~~not~~simulation ~~recur~~(TLS) programs due to lower volume.

RMS’ operating profit during the quarter ended September 28, 2025 increased $23 million, or 5%, compared to the same period in 2024. This increase was primarily attributable to favorable contract mix at Sikorsky.

RMS’ sales during the nine months ended September 28, 2025 decreased $307 million, or 2%, compared to the same period in 2024. The decrease was primarily attributable to lower sales of $150 million on IWSS programs due to lower volume within the laser systems portfolio and Littoral Combat Ship (LCS); $100 million for various TLS programs due to lower volume; and $50 million on Sikorsky helicopter programs primarily due to the unfavorable cumulative adjustments to sales driven by recognizing losses on CMHP and TUHP in the second quarter of 2025, as previously disclosed, and lower production volume on Seahawk programs, partially offset by higher production volume on Black Hawk programs.

RMS’ operating profit during the nine months ended September 28, 2025 decreased $553 million, or 39%, compared to the same period in 2024. This decrease was attributable to a $570 million decrease in profit booking rate adjustments primarily due to the losses recognized on CMHP and TUHP in the second quarter of 2025, as previously disclosed, partially offset by unfavorable profit adjustments on Seahawk programs in the first quarter of 2024 that did not recur.

Space

Summary operating results for our Space business segment were as follows (in millions):

Quarters Ended

~~Six~~Nine Months Ended

June 29,2025

June 30,2024

June 29,2025

June 30,2024

September 28,2025

September 29,2024

September 28,2025

September 29,2024

Sales

3,~~307~~356

3,~~195~~075

69,~~512~~868

69,~~464~~539

Operating profit

~~362~~331

~~346~~272

~~741~~1,072

~~671~~943

Operating margin

109.9

108.8

1110.49

109.49

Space’s sales during the quarter ended ~~June~~September 2928, 2025 increased $~~112~~281 million, or 49%, compared to the same period in 2024. This increase was primarily attributable to higher sales of $~~115~~160 million for ~~commercial civil space programs primarily due to higher volume on the Orion program; and $80 million for~~ strategic and missile defense programs due to higher volume on ~~NGI~~the FBM and ~~Fleet~~NGI ~~Ballistic Missile (FBM)~~ programs.; ~~These~~and ~~increases were partially offset by a decrease of~~ $9570 million on national security space programs due to ~~program~~classified ~~lifecycle on Next Gen OPIR system~~volume.

Space’s operating profit during the quarter ended ~~June~~September 2928, 2025 increased $1659 million, or 522%, compared to the same period in 2024. This increase was attributable to two primary factors: a $45 million increase in profit booking rate adjustments and a $20 million increase in volume, as described above. The increase in profit booking rate adjustments was primarily due to ~~favorable~~higher ~~performance~~net atfavorable ~~completion~~profit adjustments on ~~certain~~the ~~commercial~~FBM ~~civil space programs~~program.

Space’s sales during the ~~six~~nine months ended ~~June~~September 2928, 2025 increased $48329 million, or 13%, compared to the same period in 2024. This increase was primarily attributable to higher sales of $~~190~~250 million for ~~commercial civil space programs primarily due to favorable performance at completion on certain commercial civil space programs and higher volume on the Orion program; and $90 million for~~ strategic and missile defense programs due to higher volume on the NGI ~~program.~~and ~~These~~FBM ~~increases~~programs; ~~were~~and ~~partially offset by a decrease of~~ $~~250~~225 million onfor ~~national~~commercial ~~security~~civil space ~~programs due to program lifecycle on Next Gen OPIR system.~~

Space’s operating profit during the six months ended June 29, 2025 increased $70 million, or 10%, compared to the same period in 2024. This increase was attributable to an $105 million increase in profit booking rate adjustments partially offset by $20 million of lower equity earnings driven by lower launch volume from our investment in United Launch Alliance (ULA). The increase in profit booking rate adjustments was primarily due to favorable performance at completion on certain commercial civil space programs.

Total equity earnings (ULA) represented approximately $10 million, or 3%, and $5 million, or 1%, of Space's operating profit during the quarter and six months ended June 29, 2025, compared to approximately $10 million, or 3%, and $25 million, or 4% for the same periods in 2024.

Table of Contents

programs primarily due to higher volume on the Orion program. These increases were partially offset by a decrease of $180 million on national security space programs due to program lifecycle on Next Gen OPIR system.

Space’s operating profit during the nine months ended September 28, 2025 increased $129 million, or 14%, compared to the same period in 2024. This increase was attributable to an $150 million increase in profit booking rate adjustments partially offset by $20 million of lower equity earnings driven by lower launch volume from our investment in United Launch Alliance (ULA). The increase in profit booking rate adjustments was primarily due to favorable performance at completion on certain commercial civil space programs.

Total equity earnings (ULA) represented approximately $5 million, or 2%, and $10 million, or 1%, of Space's operating profit during the quarter and nine months ended September 28, 2025, compared to approximately $5 million, or 2%, and $30 million, or 3% for the same periods in 2024.

FINANCIAL CONDITION

Liquidity and Capital Resources

At ~~June~~September 2928, 2025, we had cash and cash equivalents of $1.3.5 billion that was generally available to fund ordinary business operations without significant legal, regulatory or other restrictions. Our principal source of liquidity is our cash from operations and access to credit markets. Access to credit markets includes our $3.0 billion revolving credit facility, including the ability to issue commercial paper. AsThe ofoutstanding ~~June 29,~~balance ~~2025,~~of wecommercial ~~had~~paper nocan ~~borrowings~~fluctuate ~~outstanding~~daily ~~under~~and the ~~revolving~~amount ~~credit~~outstanding ~~facility~~during ~~and~~the ~~$1.4~~period ~~billion~~may inbe ~~commercial~~greater ~~paper~~or ~~borrowings~~less atthan athe ~~weighted~~amount ~~average~~reported ~~rate~~at ofthe ~~4.55%.~~end As of ~~December~~the ~~31,~~period. ~~2024,~~There ~~there~~ were no borrowings outstanding under the revolving credit facility or the commercial paper program at both September 28, 2025 and December 31, 2024. We may, as conditions warrant, continue to issue commercial paper backed by our revolving credit facility to manage the timing of cash flows.

Cash received from customers is our primary source of cash from operations. However, from time to time, we fund customer programs ourselves pending government appropriations or prior to contract award. If we incur costs in excess of funds obligated on the contract or in advance of a contract award, this negatively affects our cash flows, and we may be at risk for reimbursement of the excess costs. In addition, when estimates of total costs to be incurred on a contract exceed total estimates of the transaction price, a provision for the entire loss is determined at the contract level and is recorded in the period in which the loss is evident, which we refer to as a reach-forward loss. These reach-forward losses do not have an immediate cash flow impact, but as future costs are incurred on these contracts, these losses will negatively impact cash flows over the remaining period of performance.

The start of the new fiscal year began October 1, 2025, without the passage of Appropriation Acts or a Continuing Resolution (CR) and the Government began its shutdown procedures, to include furloughing government civilian employees. We are closely monitoring the known and potential impact and if the shutdown extends for a prolonged period of time, we expect our cash flows to be negatively impacted. See “U.S. Government Budget Environment” included within the “Business Overview” discussion above.

Additionally, increases in costs due to tariffs may impact our cash flows, as we may not be able to fully recover these costs, and even if recovery is possible, it may not occur in the same period as the incurred costs. See “Recent Developments in Trade and Regulatory Policies” included within the “Business Overview” discussion above.

Billing timetables and payment terms on our contracts vary based on a number of factors, including the contract type. We generally bill and collect cash more frequently under cost-reimbursable contracts, which represented approximately 41% of the sales we recorded during the ~~six~~nine months ended ~~June~~September 2928, 2025, as we are authorized to bill as the costs are incurred. A number of our fixed-price contracts may provide for performance-based payments, which allow us to bill and collect cash as we perform on the contract as we hit milestones. The amounts of performance-based payments and the related milestones are determined in the negotiation of each contract. The timing of such payments may differ from the timing of the costs incurred related to our contract performance, thereby affecting our cash flows.

The U.S. Government has indicated that it would consider progress payments as the baseline for negotiating payment terms on fixed-price contracts, rather than performance-based payments. In contrast to negotiated performance-based payment terms, progress payment provisions correspond to a percentage of the amount of costs incurred during the performance of the contract and are invoiced regularly as costs are incurred. Our cash flows may be affected if the U.S. Government changes its payment policies. The U.S. Government from time to time withholds payments on certain of our billings based on contract terms or regulatory provisions. Ultimately, the impact of policy changes or withholding payments may delay the receipt of cash, but the cumulative amount of cash collected during the life of the contract should not vary.

We seek to maintain a disciplined and dynamic cash deployment strategy to invest in our business and key technologies to provide our customers with enhanced capabilities, enhance stockholder value, and position ourselves to take advantage of new business opportunities when they arise. Consistent with that strategy, we have continued to invest in our business and technologies through capital expenditures, independent research and development, and selective business acquisitions and investments.

We continue to return cash to stockholders through dividends and share repurchases. The remaining authorization under our share repurchase program was $8.1 billion as of June 29, 2025. The share repurchase program does not have an expiration date and may be amended or terminated by the Board of Directors at any time. The amount of shares ultimately purchased and the timing of purchases are at the discretion of management and subject to compliance with applicable law and regulation.

We continue to actively manage our debt levels, including maturities and interest rates. We seek to finance our business in a manner that preserves financial flexibility while minimizing borrowing costs to the extent practicable. We review changes in financial market and economic conditions to manage the types, amounts and maturities of our indebtedness. We may at times refinance existing indebtedness, vary our mix of variable-rate and fixed-rate debt or seek alternative financing sources or arrangements for our cash and operational needs.

Table of Contents

We continue to return cash to stockholders through dividends and share repurchases. In October 2025, the Board of Directors authorized a fourth quarter dividend payment of $3.45 per share, representing an increase of $0.15 per share over the prior quarterly dividend payment. The Board of Directors also authorized an increase of $2.0 billion to our share repurchase program in addition to the $7.1 billion remaining authorization under our share repurchase program as of September 28, 2025. The share repurchase program does not have an expiration date and may be amended or terminated by the Board of Directors at any time. The amount of shares ultimately purchased and the timing of purchases are at the discretion of management and subject to compliance with applicable law and regulation.

We also actively manage our pension obligations and expect to continue to opportunistically manage our pension liabilities through the purchase of group annuity contracts or other actions for portions of our outstanding defined benefit pension obligations using assets from the pension trust. Future transactions could be significant and result in us making additional contributions to the pension trust. The required funding of our qualified defined benefit pension plans is determined in accordance with the Employee Retirement Income Security Act of 1974 (ERISA), as amended, and CAS. We could be required to make pension contributions earlier than and/or in excess of what was planned if our return on pension assets is less than our assumptions, which would reduce our free cash flow. We may also make additional contributions at our discretion.

The following table provides a summary of our cash flow information followed by a discussion of the key elements (in millions):

Six Months Ended

Nine Months Ended

June 29,2025

June 30,2024

September 28,2025

September 29,2024

Cash and cash equivalents at beginning of year

2,483

1,442

Operating activities

Net earnings

23,~~054~~673

34,~~186~~809

Noncash adjustments

23,~~057~~192

~~971~~1,490

Changes in working capital

(21,~~454~~553)

(~~444~~469)

Other, net

~~(47)~~26

~~(202)~~119

Net cash provided by operating activities

15,~~610~~338

35,~~511~~949

Net cash (used for) investing activities

(1,~~145~~464)

(~~744~~954)

Net cash (used for) financing activities

(12,~~655~~887)

(13,~~686~~286)

Net change in cash and cash equivalents

~~(1,190)~~987

1,~~081~~709

Cash and cash equivalents at end of period

13,~~293~~470

23,~~523~~151

Operating Activities

Net cash provided by operating activities during the ~~six~~nine months ended ~~June~~September 2928, 2025 decreased $~~1.9~~611 ~~billion~~million compared to the same period in 2024. The decrease in cash from operations was primarily due to an increase in working capital, ~~which~~primarily isproduction ~~defined as receivables, contract assets,~~ and ~~inventories~~billing ~~less~~cycles ~~accounts~~impacting ~~payable~~receivables ~~and~~across ~~contract~~all ~~liabilities.~~four ~~This~~business ~~increase in working capital was driven by three main factors: an increase in contract assets as a result of the timing of milestones~~segments, primarily related to the F-35 program at Aeronautics; an increase in Sikorsky inventory at RMS; and decreases in contract liabilities related to classified programs at Aeronautics and national security space programs at Space. These increases were partially offset by ~~favorable~~lower ~~timing~~tax ~~of cash~~ payments, ~~related~~reflecting tothe ~~accounts~~impact ~~payable,~~of ~~primarily~~the atTax ~~Aeronautics~~Act.

Non-GAAP Financial Measure - Free Cash Flow

Free cash flow is a non-GAAP financial measure that we define as cash from operations less capital expenditures. Our capital expenditures are comprised of equipment and facilities infrastructure and information technology (inclusive of costs for the development or purchase of internal-use software that are capitalized). We use free cash flow to evaluate our business performance and overall liquidity, and is a performance goal in our annual and long-term incentive plans. We believe free cash flow is a useful measure for investors because it represents the amount of cash generated from operations after reinvesting in the business and that may be available to return to stockholders and creditors (through dividends, stock repurchases and debt repayments) or available to fund acquisitions and other investments. The entire amount of free cash flow is not necessarily available for discretionary expenditures, however, because it does not account for certain mandatory expenditures, such as the repayment of maturing debt and future pension contributions. While management believes that free cash flow as a non-GAAP financial measure may be useful in evaluating our financial

Table of Contents

costs for the development or purchase of internal-use software that are capitalized). We use free cash flow to evaluate our business performance and overall liquidity, and is a performance goal in our annual and long-term incentive plans. We believe free cash flow is a useful measure for investors because it represents the amount of cash generated from operations after reinvesting in the business and that may be available to return to stockholders and creditors (through dividends, stock repurchases and debt repayments) or available to fund acquisitions and other investments. The entire amount of free cash flow is not necessarily available for discretionary expenditures, however, because it does not account for certain mandatory expenditures, such as the repayment of maturing debt and future pension contributions. While management believes that free cash flow as a non-GAAP financial measure may be useful in evaluating our financial performance and liquidity, it should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP and may not be comparable to similarly titled measures used by other companies.

The following table reconciles net cash provided by operating activities to free cash flow (in millions):

Six Months Ended

Nine Months Ended

June 29,2025

June 30,2024

September 28,2025

September 29,2024

Cash from operations

15,~~610~~338

35,~~511~~949

Capital expenditures

(~~805~~1,186)

(~~748~~1,103)

Free cash flow

~~805~~4,152

24,~~763~~846

Free cash flow during the ~~six~~nine months ended ~~June~~September 2928, 2025 decreased $~~2.0~~694 ~~billion~~million compared to the same period in 2024 primarily due to operating cash flow drivers described above and higher software expenditures.

Investing Activities

Net cash used for investing activities during the ~~six~~nine months ended ~~June~~September 2928, 2025 increased $~~401~~510 million compared to the same period in 2024, primarily due to a $360 million cash payment for the acquisition of Rapid Solutions. Capital expenditures totaled $~~805~~1.2 ~~million~~billion and $~~748~~1.1 ~~million~~billion during the ~~six~~nine months ended ~~June~~September 2928, 2025 and ~~June~~September 3029, 2024. The majority of our capital expenditures are for equipment and facilities infrastructure that generally are incurred to support new and existing programs across all of our business segments. We also incur capital expenditures for information technology to support programs and general enterprise information technology infrastructure, inclusive of costs for the development or purchase of internal-use software.

Financing Activities

Net cash used for financing activities during the ~~six~~nine months ended ~~June~~September 2928, 2025 decreased $31399 million compared to the same period in 2024, primarily attributable to paying $2.3 billion to repurchase 5.0 million shares in 2025 compared to $2.7 billion to repurchase 5.7 million shares in 2024. See “Note 9 - Stockholders’ Equity” and “Note 10 - Other” included in our Notes to Consolidated Financial Statements for additional information regarding dividend payments, share repurchases and debt issuances.

During the six months ended June 29, 2025 and June 30, 2024, we paid dividends totaling $1.6 billion ($6.60 per share) and $1.5 billion ($6.30 per share).

During the six months ended June 29, 2025, we paid $1.3 billion to repurchase 2.7 million shares of our common stock. See “Note 9 - Stockholders’ Equity” included in our Notes to Consolidated Financial Statements for additional information. During the six months ended June 30, 2024, we paid $1.9 billion to repurchase 4.2 million shares of our common stock.

During the six months ended June 29, 2025, we received net proceeds of $1.4 billion from the issuance of commercial paper.

During the six months ended June 29, 2025 and June 30, 2024, we repaid $142 million and $168 million of long-term notes with a fixed interest rate of 7.625% and 8.375% according to their scheduled maturities.

OTHER MATTERS

Status of the F-35 Program

The F-35 program primarily consists of production contracts, sustainment activities, and new development efforts. Production of the aircraft is expected to continue for many decades given the U.S. Government’s objective of procuring and sustaining 2,456 aircraft for the U.S. Air Force, U.S. Marine Corps, and U.S. Navy. We also have commitments from seven international partner countries and 12 Foreign Military Sales (FMS) customers. We continue to see strong international demand for the F-35. In February 2025, Singapore signed an LOA for eight F-35As, adding to their prior program of record of 12 F-35Bs. In June 2025, the United Kingdom announced its intent to purchase 12 F-35As adding to its existing fleet of F-35Bs. Finally, in July 2025 Belgium announced their intention to procure an additional 11 F-35As bringing their total program of record to 45 aircraft. We expect international interest to continue to expand in the coming years.

During the ~~second~~third quarter of 2025, we delivered 5046 aircraft. Since the program inception through ~~June 29~~September 28, 2025, we delivered 1,~~199~~245 production F-35 aircraft, including ~~866~~893 F-35A variants, ~~221~~230 F-35B variants and ~~112~~122 F-35C variants, and our backlog as of that date was ~~311~~265 aircraft~~, demonstrating the F-35 program’s continued progress and longevity~~.

Table of Contents

In ~~December~~addition, ~~2024~~during the third quarter, Lockheed Martin and the Joint Program Office (JPO) reached an agreement for anLot ~~undefinitized~~18 ~~contract~~and ~~action for~~ Lot 1819 F-35 Air Vehicle Production Contract for ~~145~~296 aircraft, resulting in the planned payments during the third quarter of 2025, followed by definitization on September 29, 2025. The scope includes aircraft for the U.S. Air Force, Navy, and Marines and the International Partners and ~~Foreign Military Sales (~~FMS) customers, in addition to the required infrastructure for the international Final Assembly and Checkout Facilities (FACOs) and other equipment. ~~Lot~~With 19this ~~was~~award, ~~negotiated~~an ~~concurrently~~additional ~~with~~3 Lot 18, aircraft and ~~both~~148 ~~Lots~~Lot ~~are~~19 ~~expected~~aircraft were added to bethe ~~fully~~F-35 ~~awarded~~backlog, indemonstrating ~~2025~~the F-35 program’s continued progress and longevity.

The F-35 program is significant and complex, and we and our customers continually review aircraft performance, program and delivery schedule, cost and supply chain issues, and requirements as part of our internal program management efforts and the ~~DoD~~DoW, Congressional and international countries’ oversight and budgeting processes. Areas of particular focus currently include Lockheed Martin’s and supplier performance, Block 4 modernization, flight test execution, cost of life cycle operations, sustainment, inflation-related cost and supply chain-related cost and schedule pressures, and efforts to increase affordability and readiness.

As previously disclosed, deliveries of F-35 aircraft were put on hold in the first half of 2024 due to technology insertion delays in the Lot 15-17 contract. Deliveries resumed in July 2024 after reaching agreement with JPO on a phased approach to inserting such capabilities into the aircraft including timing of the final delivery payments and related withhold liquidations. We continue to make progress on delivering capability while enhancing the air dominance of the F-35 through on-going Block 4 development.

Contingencies

See “Note 7 - Legal Proceedings and Contingencies” included in our Notes to Consolidated Financial Statements for information regarding our contingent obligations, including off-balance sheet arrangements.

Critical Accounting Policies

There have been no significant changes to the critical accounting policies disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our 2024 Form 10-K.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

As disclosed in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of our 2024 Form 10-K, we transact business globally and are subject to risks associated with changing foreign currency exchange rates. We enter into foreign currency hedges such as forward and option contracts that change in value as foreign currency exchange rates change. Our exposures to market risk have not changed materially since December 31, 2024. See “Note 8 - Fair Value Measurements” included in our Notes to Consolidated Financial Statements for additional discussion.

ITEM 4. Controls and Procedures

We performed an evaluation of the effectiveness of our disclosure controls and procedures as of ~~June~~September 2928, 2025. The evaluation was performed with the participation of senior management of each business segment and key corporate functions, under the supervision of the Chief Executive Officer (CEO) and Chief Financial Officer (CFO). Based on this evaluation, the CEO and CFO concluded that our disclosure controls and procedures were operating and effective as of ~~June~~September 2928, 2025.

There were no changes in our internal control over financial reporting during the quarter ended ~~June~~September 2928, 2025 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

Forward-Looking Statements

This Form 10-Q contains statements that, to the extent they are not recitations of historical fact, constitute forward-looking statements within the meaning of the federal securities laws, and are based on our current expectations and assumptions. The words “believe,” “estimate,” “anticipate,” “project,” “intend,” “expect,” “plan,” “outlook,” “scheduled,” “forecast” and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks and uncertainties. Actual results may differ materially due to factors such as:

•our reliance on contracts with the U.S. Government, which are dependent on U.S. Government funding and can be terminated for convenience, and our ability to negotiate favorable contract terms;

•budget uncertainty, the risk of future budget cuts, the impact of continuing resolution funding mechanisms, the debt ceiling and ~~the potential for~~ government shutdowns, and changing funding and acquisition priorities;

•risks related to the development, production, sustainment, performance, schedule, cost and requirements of complex and technologically advanced programs, including the F-35 program;

•planned production rates and orders for significant programs, compliance with stringent performance and reliability standards, and materials availability, including government furnished equipment and rare earth minerals;

•the timing of contract awards or contract definitization, decisions by government customers to impose contract terms following undefinitized contract actions, achievement of performance milestones, customer acceptance of product deliveries, and receipt of customer payments;

•our ability to recover costs under U.S. Government contracts, ~~and~~ the mix of fixed-price and cost-reimbursable contracts and the risks inherent in preparing estimates for fixed-price contracts (particularly for complex and technologically advanced programs);

•customer procurement and other policies, laws, regulations and executive actions that affect our and our industry’s, programs, future opportunities, and financial performance, including those relating to mission priorities, competing domestic and international spending, contracting terms (such as fixed-price requirements), treatment of contractor performance issues, and contractor access to competitive opportunities;

•performance and/or financial viability of key suppliers, teammates, joint ventures (including United Launch Alliance), joint venture partners, subcontractors and customers;

•economic, industry, business and political conditions including their effects on governmental policy;

•the impact of inflation and other cost pressures;

•government actions that restrict or prevent the sale or delivery of our products (such as delays in approvals for exports requiring Congressional notification);

•foreign policy and international trade actions taken by governments such as tariffs, sanctions, embargoes, export and import controls, buying preferences, and other trade restrictions;

•our success expanding into and doing business in adjacent markets and internationally and the risks posed by international sales, including potential effects from fluctuations in currency exchange rates;

•changes in non-U.S. national priorities and government budgets and planned orders;

•the competitive environment for our products and services;

•our ability to develop and commercialize new technologies and products, including emerging digital and network technologies and capabilities;

•our ability to benefit fully from or adequately protect our intellectual property rights;

•our ability to attract and retain a highly skilled workforce and the impact of work stoppages or other labor disruptions;

•cyber or other security threats or other disruptions faced by us or our suppliers;

•our ability to implement and continue, and the timing and impact of, capitalization changes such as share repurchases, dividend payments and financing transactions;

•the accuracy of our estimates and projections;

•changes in pension plan assumptions and actual returns on pension assets; cash funding requirements and pension annuity contracts and associated settlement charges;

•realizing the anticipated benefits of acquisitions or divestitures, investments, joint ventures, teaming arrangements or internal reorganizations, and market volatility affecting the fair value of investments that are marked to market;

•our efforts to increase the efficiency of our operations and improve the affordability of our products and services, including through digital transformation and cost reduction initiatives;

•the risk of an impairment of our assets, including the potential impairment of goodwill and intangibles;

•the availability and adequacy of our insurance and indemnities;

•compliance with laws, regulations, policies, and customer requirements relating to environmental matters;

•the impact of public health crises, natural disasters and other severe weather conditions on our business and financial results, including supply chain disruptions and delays, employee absences, and program delays;

Table of Contents

•changes in accounting, U.S. or foreign tax, export or other laws, regulations, and policies and their interpretation or application, and changes in the amount or reevaluation of uncertain tax positions; and

•the outcome of legal proceedings, bid protests, environmental remediation efforts, audits, administrative reviews, government investigations or government allegations that we have failed to comply with law, other contingencies and U.S. Government identification of deficiencies in our business systems.

These are only some of the factors that may affect the forward-looking statements contained in this Form 10-Q. For a discussion identifying additional important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, see our filings with the U.S. Securities and Exchange Commission (SEC) including, but not limited to, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in our 2024 Form 10-K and subsequent Quarterly Reports on Form 10-Q. Our filings may be accessed through the Investor Relations page of our website, www.lockheedmartin.com/investor, or through the website maintained by the SEC at www.sec.gov. Information contained on or made available through our website or other websites mentioned in this Form 10-Q is not incorporated into and is not a part of this Form 10-Q, and any references to our website are intended to be inactive textual references only.

Our actual financial results likely will be different from those projected due to the inherent nature of projections. Given these uncertainties, forward-looking statements should not be relied on in making investment decisions. The forward-looking statements contained in this Form 10-Q speak only as of the date of our filing. Except where required by applicable law, we expressly disclaim a duty to provide updates to forward-looking statements after the date of this Form 10-Q to reflect subsequent events, changed circumstances, changes in expectations, or the estimates and assumptions associated with them. The forward-looking statements in this Form 10-Q are intended to be subject to the safe harbor protection provided by the federal securities laws.

Table of Contents

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings

We are subject to federal, state, local and foreign requirements for the protection of the environment, including those for discharge of hazardous materials and remediation of contaminated sites. Due in part to the complexity and pervasiveness of these requirements, we are a party to or have property subject to various lawsuits, proceedings and remediation obligations. The extent of our financial exposure cannot in all cases be reasonably estimated at this time.

For more information regarding matters referred to above, including current estimates of the amounts that we believe are required for remediation or clean-up to the extent estimable, see “Note 7 - Legal Proceedings and Contingencies — Legal Proceedings and Environmental Matters” included in our Notes to Consolidated Financial Statements in this Form 10-Q, which is hereby incorporated by reference. For additional information and a description of previously reported matters, see also “Critical Accounting Policies – Environmental Matters” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Note 14 – Legal Proceedings, Commitments and Contingencies,” in our 2024 Form 10-K.

ITEM 1A. Risk Factors

There have been no material changes to the risk factors disclosed in Part I, Item 1A, “Risk Factors” of our 2024 Form 10-K. These risks and uncertainties described in our risk factors have the potential to materially affect our business, results of operations, financial condition, cash flows, projected results and future prospects. These risks are not exclusive and additional risks to which we are subject include the factors mentioned under “Forward-Looking Statements” and the risks described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Form 10-Q.

Table of Contents

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no sales of unregistered equity securities during the quarter ended ~~June~~September 2928, 2025.

The following table provides information about our repurchases of our common stock that is registered pursuant to Section 12 of the Securities Exchange Act of 1934 during the quarter ended September 28, 2025.

Period (a)	Total Numberof SharesPurchased	AveragePrice PaidPer Share		Total Number ofSharesPurchased asPart of PubliclyAnnounced Plansor Programs (b)	Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs (b)
					(in millions)
March 31, 2025 – April 27, 2025 (c)	51,130	$	469.38	51,130	$	8,549
June 30, 2025 – July 27, 2025 (c)	1,019,637	$	422.72	1,019,637	$	7,642
April 28, 2025 – May 25, 2025 (c)	558,151	$	469.65	558,093	$	8,287
July 28, 2025 – August 31, 2025 (c)	810,392	$	433.91	808,402	$	7,292
May 26, 2025 – June 29, 2025 (c)	457,838	$	467.18	457,833	$	8,073
September 1, 2025 – September 28, 2025 (c)	465,622	$	468.59	465,613	$	7,073
Total (c)	12,~~067~~295,~~119~~651	$	~~468~~435.5897	12,~~067~~293,~~056~~652

(a)We close our books and records on the last Sunday of each month to align our financial closing with our business processes, except for the month of December, as our fiscal year ends on December 31. As a result, our fiscal months often differ from the calendar months. For example, ~~June~~September 2928, 2025 was the last day of our ~~June~~September 2025 fiscal month.

(b)In ~~October~~ 2010, our Board of Directors approved ~~and on October 25, 2010 we announced~~ a share repurchase program pursuant to which we are authorized to repurchase our common stock in privately negotiated transactions or in the open market at prices per share not exceeding the then-current market prices. From time to time, our Board of Directors authorizes increases to our share repurchase program. The total remaining authorization for future common share repurchases under our share repurchase program was $87.1 billion as of ~~June~~September 2928, 2025. In October 2025, the Board of Directors authorized an increase of $2.0 billion to our share repurchase program. Under the program, management has discretion to determine the dollar amount of shares to be repurchased and the timing of any repurchases in compliance with applicable law and regulation. This includes purchases pursuant to Rule 10b5-1 plans, including accelerated share repurchases. The program does not have an expiration date.

(c)During the quarter ended ~~June~~September 2928, 2025, the total number of shares purchased included 631,999 shares that were transferred to us by employees in satisfaction of tax withholding obligations associated with the vesting of restricted stock units. These purchases were made pursuant to a separate authorization by our Board of Directors and are not included within the program.

ITEM 5. Other Information

None of our directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarter ended ~~June~~September 2928, 2025.

Table of Contents

ITEM 6. Exhibits

Exhibit No.						Description
10.1						Amendment No. 62 to Credit Agreement dated as of August 28, 2025, among Lockheed Martin Corporation, ~~Executive~~the ~~Severance~~lenders ~~Plan~~listed therein, and Bank of America, N.A., as ~~amended~~administrative ~~and~~agent ~~restated~~(incorporated ~~effective~~by ~~December~~reference to Exhibit 10.1 to Lockheed Martin Corporation’s Current Report on Form 8-K filed with the SEC on August 29, ~~2016~~2025)
15						Acknowledgment of Independent Registered Public Accounting Firm
31.1						Certification of James D. Taiclet pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2						Certification of Evan T. Scott pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32						Certification of James D. Taiclet and Evan T. Scott pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH						Inline XBRL Taxonomy Extension Schema Document
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document contained in Exhibit 101

Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

						Lockheed Martin Corporation
						(Registrant)
Date: July 22, 2025						By: /s/ H. Edward Paul III
Date: October 21, 2025						By: /s/ H. Edward Paul III
						H. Edward Paul III
						Vice President and Controller
						(Duly Authorized Officer and Chief Accounting Officer)

Filing Compare · LOCKHEED MARTIN CORP