Lockheed Martin (NYSE: LMT) is one of the prominent defense contractors of the U.S. government and has observed stable revenue growth in the last few years. The F-35 Lightning, C-130 Hercules, F-22 Raptor, PAC-3 missile, THAAD, and Black Hawk helicopters are the major programs handled by the company’s Aeronautics, Missiles & Fire Control, and Rotary & Mission Systems segments. In this article, Trefis details the historical trends in allocated budget for these programs and their contribution to the company’s top line. Our interactive dashboard on Lockheed Martin’s Revenues: How Does LMT Make Money? highlights the trends in the company’s revenues across segments.
F-35 program budget has increased by 32% since 2015
The U.S. government initiated the F-35 program in 1995 to replace the existing fourth-generation F-16 fleet with a fifth-generation fighter. Since the program’s inception, the company has delivered 491 F-35s with a total inventory objective of 2,456 jets. The budget allocation to the F-35 program increased from $8.5 billion in 2015 to $11.2 billion in 2020. Notably, the F-35 program accounts for 4.5% of the Department of Defense total program acquisition cost and is the biggest revenue contributor for Lockheed Martin LMT .
The F-22 Raptor is another fifth-generation fighter developed primarily for the U.S. Airforce and DoD’s budget allocation for the program increased from $532 million in 2015 to $820 million in 2020. However, the spending on the C-130J program has decreased in recent years from $3.2 billion in 2018 to $1.6 billion in 2020.
THAAD & PAC-3 budget has also increased over the years
Terminal High Altitude Area Defense is a transportable missile system utilized to eliminate targets within and outside the Earth’s atmosphere. Spending on the THAAD program increased from $725 million in 2015 to $754 million in 2020. Similarly, the budgeted amount for Patriot Advanced Capability – 3, utilized to terminate airborne threats, has increased from $845 million in 2015 to $1.5 billion in 2020.
MORE FOR YOU
Black Hawk remains the most promising program of the U.S. Army
Lockheed Martin acquired Sikorsky Aircraft from United Technologies Corporation UTX in November 2015. Sikorsky’s Black Hawk helicopter has been in service for multiple mission categories including, transportation of troops, casualty evacuation, supplies delivery, rescue operations, and border patrol. Currently, the U.S. Army has 2,135 H-60 helicopters in its inventory, the largest in the world. The program’s budget allocation has increased from $1.5 billion in 2015 to $1.6 billion in 2020
Are you looking to invest in a balanced portfolio of stocks? Here’s a high-quality portfolio to beat the market, with over 100% return since 2016, versus about 55% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.
Source: Forbes – Money