Company: NOC
Filing Date: 2025-07-22
Form Type: 10-Q
Source: 0001133421-25-000049
Chunk: 89

Company: NORTHROP GRUMMAN CORP /DE/
Filing Date: 2025-07-22
Form: 10-Q
Item: Part I, Item 2
Chunk 89
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 recovery of certain environmental remediation costs.

Net EAC Adjustments - We record changes in estimated contract earnings at completion (net EAC adjustments) using the cumulative catch-up method of accounting. Net EAC adjustments can have a significant effect on segment operating income and margin rate.

The aggregate favorable and unfavorable EAC adjustments are presented in the table below:

Three Months Ended June 30Six Months Ended June 30$ in millions2025202420252024Favorable EAC adjustments$404 $360 $728 $722 Unfavorable EAC adjustments(278)(322)(702)(590)Net EAC adjustments$126 $38 $26 $132 

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Table of ContentsNORTHROP GRUMMAN CORPORATION                        

Net EAC adjustments by segment are presented in the table below:

Three Months Ended June 30Six Months Ended June 30$ in millions2025202420252024Aeronautics Systems$30 $41 $(159)$117 Defense Systems83 28 106 35 Mission Systems5 (21)42 (5)Space Systems13 (12)42 (10)Eliminations(5)2 (5)(5)Net EAC adjustments$126 $38 $26 $132 

AERONAUTICS SYSTEMSThree Months Ended June 30%Six Months Ended June 30%$ in millions20252024Change20252024ChangeSales$3,114 $3,060 2 %$5,928 $6,104 (3)%Operating income321 312 3 %138 618 (78)%Operating margin rate10.3 %10.2 %2.3 %10.1 %

Sales

Current Quarter

Second quarter 2025 sales increased $54 million, or 2 percent, primarily due to higher volume on B-21 and ramp-up on the E-130J TACAMO (“TACAMO”) program, partially offset by lower volume on restricted programs and a decrease on F/A-18 as production nears completion.

Year to Date

Year to date 2025 sales decreased $176 million, or 3 percent, primarily due to lower volume on restricted programs, commercial aerostructures programs and F/A-18 as production nears completion, partially offset by a $116 million increase on TACAMO as that program ramps.

Operating Income 

Current Quarter