Company: NOC
Filing Date: 2025-01-30
Form Type: 10-K
Source: 0001133421-25-000006
Chunk: 90

Company: NORTHROP GRUMMAN CORP /DE/
Filing Date: 2025-01-30
Form: 10-K
Item: Item 7
Chunk 90
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NORTHROP GRUMMAN CORPORATION                        

Year Ended December 31% Change in$ in millions20242023202220242023Operating income$4,370 $2,537 $3,601 72 %(30)%Operating margin rate10.6 %6.5 %9.8 %Reconciliation to segment operating income:CAS pension expense(279)(154)(167)81 %(8)%FAS pension service expense239 236 367 1 %(36)%FAS/CAS operating adjustment(40)82 200 NM(59)%Intangible asset amortization and PP&E step-up depreciation97 122 242 (20)%(50)%Deferred state tax expense (benefit)(1) of MTM adjustment23 (22)65 NM(134)%Deferred state tax benefit of B-21 charge(1)— (82)— NMNMOther unallocated corporate expense94 123 145 (24)%(15)%Unallocated corporate expense214 141 452 52 %(69)%Segment operating income$4,544 $2,760 $4,253 65 %(35)%Segment operating margin rate11.1 %7.0 %11.6 %

(1)Represents the deferred state tax expense (benefit) associated with MTM benefit (expense) and the prior year B-21 charge, which are recorded in Unallocated corporate expense consistent with other changes in deferred state taxes.

Segment Operating Income and Margin Rate

2024 segment operating income increased $1.8 billion, or 65 percent, primarily due to higher operating income at Aeronautics Systems, largely driven by the prior year $1.56 billion charge on the B-21 program, as well as higher operating income at Space Systems and Defense Systems. Segment operating margin rate increased to 11.1 percent reflecting higher operating margin rates at Aeronautics Systems and Space Systems, partially offset by a lower operating margin rate at Mission Systems.

FAS/CAS Operating Adjustment

The 2024 FAS/CAS operating adjustment reflects higher CAS pension expense largely driven by plan asset returns in prior years and changes in certain CAS actuarial assumptions as of December 31, 2023.

Unallocated Corporate Expense

The increase in 2024 unallocated corporate expense is primarily due to a $127 million increase in deferred state taxes associated with the prior year B-21 charge and the MTM