Northrop Grumman Q3 2026 Earnings: Record Backlog Reaches $109.6 Billion
Northrop Grumman ended the third quarter of 2026 with a record $109.6 billion order backlog, its second record quarter in a row, as orders ran about 1.5 times sales. By our count it equals 2.51 years of sales, the highest of 14 quarter ends we measured from the end of 2022, and 2026 orders nearly match all of 2025.
The short answer. Northrop Grumman, which builds the B-21 bomber and the new Sentinel missile system, reported higher sales and raised its 2026 earnings forecast again. Its backlog is the work customers have ordered and it has not yet delivered, and sales to the U.S. government were 84% of its 2025 sales. That backlog grew $13.9 billion this year, and Defense Systems, home of Sentinel, accounts for 62% of the increase.
Northrop Grumman Q3 2026: the order book in three numbers
On this page
- Northrop Grumman backlog hits a record $109.6 billion
- Northrop Grumman Q3 2026 earnings and raised guidance
- Northrop Grumman orders and book to bill in 2026
- What is in Northrop Grumman’s order backlog
- How much of Northrop Grumman’s backlog is funded
- Northrop Grumman backlog compared with Lockheed Martin and General Dynamics
- How we counted
- Frequently asked questions
Northrop Grumman backlog hits a record $109.6 billion
The work Northrop Grumman has signed but not yet delivered reached a record $109.6 billion on September 30. That equals about two and a half years of the company’s sales. We checked every quarter end from the end of 2022, and none was higher.
Backlog is the value of signed contracts the company has not yet turned into sales. Northrop Grumman’s stood at $95.7 billion at the end of 2025, a company record at the time, according to its fourth quarter 2025 release.
It slipped by $73 million at the end of March, so that quarter set no record. Then came the jump: $104.7 billion at the end of June and $109.6 billion at the end of September, which the chief executive called a “new record backlog”. The run of records is two quarters long, and three of the last four quarter ends set one. Against September 30, 2025, the backlog is up 19.8%.
Show the data
| Category | Total backlog | Note |
|---|---|---|
| Q4 22 | $78.7B | |
| Q1 23 | $77.5B | |
| Q2 23 | $78.8B | |
| Q3 23 | $83.9B | |
| Q4 23 | $84.2B | |
| Q1 24 | $78.9B | |
| Q2 24 | $83.1B | |
| Q3 24 | $84.8B | |
| Q4 24 | $91.5B | |
| Q1 25 | $92.8B | |
| Q2 25 | $89.7B | |
| Q3 25 | $91.4B | |
| Q4 25 | $95.7B | |
| Q1 26 | $95.6B | $95.6B, $73M below the end of 2025 |
| Q2 26 | $104.7B | $7.6B Sentinel award; record $104.7B |
| Q3 26 | $109.6B | Record $109.6B |
A bigger company carries a bigger backlog, so the dollar figure alone says little. We divided the backlog by the last four quarters of sales, $43.6 billion, which gives 2.51 years. A year earlier the same measure stood at 2.23, and its low in our series was 1.97 at the end of March 2024.
Show the data
| Item | Value |
|---|---|
| Q4 2022 | 2.15 |
| Q3 2023 | 2.17 |
| Q4 2023 | 2.14 |
| Q1 2024 | 1.97 |
| Q2 2024 | 2.04 |
| Q3 2024 | 2.07 |
| Q4 2024 | 2.23 |
| Q1 2025 | 2.30 |
| Q2 2025 | 2.22 |
| Q3 2025 | 2.23 |
| Q4 2025 | 2.28 |
| Q1 2026 | 2.26 |
| Q2 2026 | 2.44 |
| Q3 2026 | 2.51 |
The backlog equals 2.51 times the company’s sales over the last four quarters. That measures its size, while the company’s contract schedules decide when it becomes revenue, a timing covered in the funded section below.
How we counted
Backlog is total backlog (funded plus unfunded) from the backlog schedule of each quarterly earnings release. The company leaves out unexercised contract options and indefinite delivery, indefinite quantity contracts. They enter backlog only when an option or task order is exercised or awarded.
Northrop Grumman Q3 2026 earnings and raised guidance
Third quarter sales rose 7% to $11.1 billion, with growth in all four of the company’s segments. Northrop Grumman raised its forecast for 2026 MTM-adjusted earnings per share for the second quarter in a row and kept its sales forecast where it set it in July.
Diluted earnings per share were $7.89, against $7.67 a year earlier, according to the earnings release the company furnished at 6:00 a.m. ET on October 20. Net earnings rose 2% to $1.124 billion.
Aeronautics Systems, which builds the B-21, grew sales 14%, helped by F-35 work and B-2 support. Defense Systems grew 12% as Sentinel “continues to ramp”, in the release’s words, and the other two segments grew more slowly.
Operating margin, operating income as a share of sales, was 11.4% against 11.9% a year earlier. The company attributes the change mainly to a smaller pension accounting credit, and its segment operating margin was 12.1%. A lower tax rate on higher research credits also helped earnings.
Adjusted free cash flow, the company’s measure of cash generated after investment in plants and equipment, was $1.81 billion in the quarter. It includes $371 million of proceeds from the sale of equipment to a customer. The company’s second quarter 10-Q describes one such agreement. Under it the Air Force takes a B-21 the company had planned to keep as a test aircraft, and no material cash had come in by June.
For 2026, the company now expects MTM-adjusted earnings per share, which leave out mark-to-market pension gains and losses, of $29.35 to $29.75. In July the range was $28.60 to $29.10.
| Measure | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
| Sales | $11,122M | $10,423M | +7% |
| Aeronautics Systems sales | $3,575M | $3,142M | +14% |
| Defense Systems sales | $2,307M | $2,059M | +12% |
| Mission Systems sales | $3,155M | $3,093M | +2% |
| Space Systems sales | $2,749M | $2,698M | +2% |
| Operating margin | 11.4% | 11.9% | FAS/CAS operating adjustment $15M vs. $67M |
| Segment operating margin (non-GAAP) | 12.1% | 12.3% | Prior year held a $68M favorable adjustment at Mission Systems |
| Effective tax rate | 13.4% | 16.9% | Higher research credits |
| Net earnings | $1,124M | $1,100M | +2% |
| Diluted EPS | $7.89 | $7.67 | +3% |
| Adjusted free cash flow (non-GAAP) | $1,810M | $1,256M | Includes $371M from the sale of equipment to a customer |
| 2026 guidance | April 21 | July 21 | October 20 |
|---|---|---|---|
| Sales | $43,500M to $44,000M | $43,750M to $44,250M | $43,750M to $44,250M |
| Segment operating income | $4,850M to $5,000M | $4,850M to $5,000M | $4,940M to $5,040M |
| MTM-adjusted EPS | $27.40 to $27.90 | $28.60 to $29.10 | $29.35 to $29.75 |
| Adjusted free cash flow | $3,100M to $3,500M | $3,100M to $3,500M | $3,100M to $3,500M |
Source: Northrop Grumman earnings releases for Q3 2026, Q2 2026 and Q1 2026 (Form 8-K, Exhibit 99).
Northrop Grumman orders and book to bill in 2026
Over the last four quarters, orders have outrun sales. In the first nine months of 2026 Northrop Grumman booked about as much as in the whole of 2025.
Book to bill compares new orders, net of reductions, with sales in the same period, so a reading above one adds to the backlog, before other adjustments. Third quarter net awards were $16.4 billion against $11.1 billion of sales, 1.47 by our math, which the company rounds to 1.5x.
The second quarter was stronger still, at 1.84, the highest of the 16 quarters we lined up from the company’s releases. Adding the three quarters of 2026 gives $46.2 billion of net awards, against $46.3 billion for all of 2025. Nine months nearly matched twelve.
So far this year, orders have run about 1.45 times sales. For 2025 as a whole the company reported a book to bill of 1.10.
Against the same periods of 2025, third quarter net awards were up about 34%, from $12.2 billion. Nine month awards were up about 52%, from $30.4 billion, by our sum of the rounded quarterly figures.
| Quarter | Net awards | Sales | Book to bill (our calculation) | Total backlog at quarter end |
|---|---|---|---|---|
| Q4 2022 | $9.1B | $10,033M | 0.91 | $78,743M |
| Q1 2023 | $8.0B | $9,301M | 0.86 | $77,473M |
| Q2 2023 | $10.9B | $9,576M | 1.14 | $78,805M |
| Q3 2023 | $15.0B | $9,775M | 1.53 | $83,931M |
| Q4 2023 | $10.9B | $10,638M | 1.02 | $84,230M |
| Q1 2024 | $6.5B | $10,133M | 0.64 | $78,920M |
| Q2 2024 | $15.1B | $10,218M | 1.48 | $83,118M |
| Q3 2024 | $11.7B | $9,996M | 1.17 | $84,800M |
| Q4 2024 | $17.3B | $10,686M | 1.62 | $91,468M |
| Q1 2025 | $10.8B | $9,468M | 1.14 | $92,797M |
| Q2 2025 | $7.4B | $10,351M | 0.71 | $89,737M |
| Q3 2025 | $12.2B | $10,423M | 1.17 | $91,448M |
| Q4 2025 | $15.9B | $11,712M | 1.36 | $95,681M |
| Q1 2026 | $9.8B | $9,881M | 0.99 | $95,608M |
| Q2 2026 | $20.0B | $10,876M | 1.84 | $104,692M |
| Q3 2026 | $16.4B | $11,122M | 1.47 | $109,597M |
Source: Northrop Grumman quarterly earnings releases, Form 8-K, Exhibit 99, fourth quarter 2022 to third quarter 2026. The company states 1.53 for Q3 2023, 1.17 for Q3 2025 and 1.5x for Q3 2026.
What is in Northrop Grumman’s order backlog
Two kinds of work lead the awards the company named this year. One is classified programs, whose details the government keeps secret, and the other is Sentinel, the Air Force’s new intercontinental ballistic missile system.
Each release lists the quarter’s significant new awards. Across 2026 those lists add up to $13.8 billion for restricted, meaning classified, programs. Sentinel adds $9.6 billion, of which $7.6 billion came in the second quarter and $2.0 billion in the third.
The two together, $23.4 billion, equal about half of the $46.2 billion of net awards the company reported for the nine months.
F-35 work, where Northrop Grumman builds fuselage sections according to its 2025 annual report, adds $2.8 billion. Smaller named awards include Virginia class submarines, the E-2 radar plane, the MQ-4C Triton drone and the Glide Phase Interceptor, a missile defense program.
Show the data
| Part | Value | Share |
|---|---|---|
| Classified programs | $13.8B | 44.5% |
| Sentinel | $9.6B | 31.0% |
| Six other named programs | $4.8B | 15.5% |
| F-35 | $2.8B | 9.0% |
Defense Systems, where Sentinel sits, raised its backlog 31% to $36.5 billion since December. That one segment accounts for 62% of the company’s increase.
Aeronautics Systems grew its backlog 16%. Mission Systems added 7%, and Space Systems was close to flat at 1%.
Show the data
| Step | Value |
|---|---|
| End 2025 | $95.7B |
| Defense | +$8.7B |
| Aero | +$3.7B |
| Mission | +$1.3B |
| Space | +$0.1B |
| Q3 2026 | $109.6B |
The company’s second quarter 10-Q explains the Sentinel step. Work with the Air Force produced “further definition and authorization of elements of the program execution plan, resulting in a $7.6 billion increase in program backlog”. The same filing says Northrop Grumman is working under a cost-type contract for the development phase, and that the production and deployment phases “are yet to be priced and negotiated”.
How we counted
The awards in this section are the ones each release lists as significant new awards, summed across the first, second and third quarters of 2026. The chart shows only those named awards, $31.0 billion in all. The releases report net awards separately, and the named new awards are not a breakdown of that net total, so we compare the two only as sizes.
How much of Northrop Grumman’s backlog is funded
Northrop Grumman splits its backlog into funded and unfunded orders. Both are firm orders, and funded backlog is the part whose funding is already authorized and appropriated.
The company defines funded backlog as “firm orders for which funding is authorized and appropriated”. It was $50.1 billion at September 30, up $11.1 billion from a year earlier, and the rest of the $109.6 billion total was unfunded.
The mix differs by segment. Defense Systems, where the Sentinel work sits, has the largest unfunded portion, and Mission Systems the smallest, as the table below shows.
The filings also say how fast the company expects the backlog to turn into sales. Of the June 30 backlog, it expected about 35% to become revenue within a year, the same share it gave for the end of 2025. Within two years the share was 55%, against 60% for the end of 2025.
The customer behind most of this is one government. Sales to the U.S. government were 84% of Northrop Grumman’s sales in 2025, according to its 2025 annual report.
Federal agencies are funded through December 11, 2026 under the stopgap law the President signed on September 2, according to the White House.
| Segment, Sep 30, 2026 | Funded | Unfunded | Total backlog | Unfunded share |
|---|---|---|---|---|
| Aeronautics Systems | $15,511M | $11,288M | $26,799M | 42.1% |
| Defense Systems | $10,294M | $26,181M | $36,475M | 71.8% |
| Mission Systems | $14,442M | $5,533M | $19,975M | 27.7% |
| Space Systems | $9,848M | $16,500M | $26,348M | 62.6% |
| Total | $50,095M | $59,502M | $109,597M | 54.3% |
| Expected to become revenue | Within 12 months | Within 24 months |
|---|---|---|
| Backlog at Dec 31, 2025 ($95.7B) | About 35% | About 60% |
| Backlog at Jun 30, 2026 ($104.7B) | About 35% | About 55% |
Source: Northrop Grumman Q3 2026 earnings release, backlog schedule; 2025 Form 10-K and Q2 2026 Form 10-Q, backlog note. Unfunded shares are our calculation.
Northrop Grumman backlog compared with Lockheed Martin and General Dynamics
Lockheed Martin and General Dynamics also reported large order books in their second quarter releases of July. Those figures are a quarter older than Northrop Grumman’s, and the table below labels each period.
Lockheed Martin reported a record backlog of $230.4 billion at June 28, 2026, the end of its second quarter. It includes a $35 billion multi-year contract with the Missile Defense Agency for THAAD interceptors, and the company booked $65 billion of new orders in that quarter.
General Dynamics reported a backlog of $136.5 billion at the end of its second quarter, July 5, 2026, with a company-wide book to bill of 1.4. That backlog also covers its Aerospace segment, which makes Gulfstream business jets. Each company defines backlog in its own way, so we set these figures side by side as sizes only.
| Company | Period | Backlog at period end | Release date |
|---|---|---|---|
| Northrop Grumman | Q3 2026, ended Sep 30, 2026 | $109.6B | Oct 20, 2026 |
| Lockheed Martin | Q2 2026, ended Jun 28, 2026 | $230.4B | Jul 23, 2026 |
| General Dynamics | Q2 2026, ended Jul 5, 2026 | $136.5B | Jul 29, 2026 |
Source: each company’s own earnings release, Form 8-K, Exhibit 99 or 99.1.
How we counted
We read the earnings release for each quarter from the fourth quarter of 2022 to the third quarter of 2026, 16 in all. Each is Exhibit 99 to a Form 8-K, and we read them on sec.gov on October 20, 2026.
Years of sales: total backlog at the quarter end divided by the sum of the four most recent quarters of sales. For the fourth quarter of 2022 we used full year 2022 sales of $36.6 billion. The first two quarters of 2023 are left out because their four quarters of sales reach back into quarters we did not read. At September 30, 2026 the sum is $43.6 billion, and against the midpoint of the 2026 sales forecast, $44.0 billion, the backlog equals 2.49 years.
Book to bill: each quarter’s net awards, which the releases give to one decimal place in billions, divided by that quarter’s sales. The nine month total of $46.2 billion adds three rounded figures, so it may differ slightly from the exact sum the company will report in its 10-Q.
Segment shares: the change in each segment’s total backlog from December 31, 2025 to September 30, 2026, from the backlog schedules, divided by the company’s total change of $13.9 billion.
Frequently asked questions
What is Northrop Grumman’s backlog in 2026?
Total backlog was $109.6 billion on September 30, 2026, a company record, up from $95.7 billion at the end of 2025 and $104.7 billion at the end of June. Of that total, $50.1 billion was funded.
What did Northrop Grumman report for Q3 2026?
Sales rose 7% to $11.1 billion and diluted earnings per share were $7.89, against $7.67 a year earlier. Net awards were $16.4 billion, a book to bill of about 1.5.
Did Northrop Grumman raise its 2026 guidance?
Yes, for profit. It raised MTM-adjusted earnings per share to $29.35 to $29.75 and segment operating income to $4.94 billion to $5.04 billion. The sales forecast stayed at $43.75 billion to $44.25 billion.
What is the Northrop Grumman Sentinel contract?
Sentinel is the Air Force’s new intercontinental ballistic missile system, and Northrop Grumman holds the development contract, a cost-type contract. The company’s releases name $9.6 billion of Sentinel awards in 2026, and its filings say the production and deployment phases are yet to be priced and negotiated.
What does book to bill mean for Northrop Grumman?
It is net awards divided by sales for the same period. Above one, net awards exceed sales and add to the backlog, before other adjustments. Northrop Grumman’s was about 1.5 in the third quarter of 2026 and 1.84 in the second, by our calculation from its releases.
Where can I read Northrop Grumman’s press releases and SEC filings?
The Northrop Grumman overview page on StockTitan collects the company’s press releases and SEC filings as they arrive, and the financials page shows its reported results.
Sources
- Northrop Grumman third quarter 2026 results release, on StockTitan
- Northrop Grumman Form 8-K of October 20, 2026, on StockTitan
- Northrop Grumman company overview, on StockTitan
- Northrop Grumman financials, on StockTitan
- Largest companies by market cap, on StockTitan
- Lockheed Martin second quarter 2026 results release, on StockTitan
- General Dynamics second quarter 2026 results release, on StockTitan
- Earnings Calendar for the Week of October 19, 2026
- Rocket Lab Pushes Neutron to 2027, Three Years Behind Plan
- Northrop Grumman Form 8-K, Exhibit 99, third quarter 2026 earnings release
- Northrop Grumman second quarter 2026 earnings release
- Northrop Grumman first quarter 2026 earnings release
- Northrop Grumman fourth quarter 2025 earnings release
- Northrop Grumman Form 10-Q for the quarter ended June 30, 2026
- Northrop Grumman Form 10-K for 2025
- Lockheed Martin second quarter 2026 earnings release, Form 8-K, Exhibit 99.1
- General Dynamics second quarter 2026 earnings release, Form 8-K, Exhibit 99.1
- The White House, H.R. 6500 signed into law, September 2, 2026
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