Company: NOC
Filing Date: 2025-07-22
Form Type: 10-Q
Source: 0001133421-25-000049
Chunk: 83

Company: NORTHROP GRUMMAN CORP /DE/
Filing Date: 2025-07-22
Form: 10-Q
Item: Part I, Item 2
Chunk 83
---
 include a revision to the acquisition strategy, joint establishment of a new program baseline, and other critical preparation activities necessary to re-accomplish Milestone B approval. Based on this preliminary execution framework, we updated our 

-24-

Table of ContentsNORTHROP GRUMMAN CORPORATION                        

estimated profitability on the program and recognized a $76 million favorable EAC adjustment largely related to our expectations for achieving certain contract incentives.

CONSOLIDATED OPERATING RESULTS

For purposes of the operating results discussion below, we assess our performance using certain financial measures that are not calculated in accordance with GAAP. Organic sales is defined as total sales excluding sales attributable to the company's training services business. This measure may be useful to investors and other users of our financial statements as a supplemental measure in evaluating the company’s underlying sales growth as well as in understanding our ongoing business and future sales trends by presenting the company’s sales adjusted for the impact of the divestiture.

We reconcile this non-GAAP financial measure to its most directly comparable GAAP financial measure below. This non-GAAP measure may not be defined and calculated by other companies in the same manner and should not be considered in isolation or as an alternative to operating results presented in accordance with GAAP.

Selected financial highlights are presented in the table below:

Three Months Ended June 30%Six Months Ended June 30%$ in millions, except per share amounts20252024Change20252024ChangeSales$10,351 $10,218 1 %$19,819 $20,351 (3)%Operating costs and expenses9,157 9,128 — %18,052 18,190 (1)%Operating costs and expenses as a % of sales88.5 %89.3 %91.1 %89.4 %Gain on sale of business231 — NM231 — NMOperating income1,425 1,090 31 %1,998 2,161 (8)%Operating margin rate13.8 %10.7 %10.1 %10.6 %Federal and foreign income tax expense253 206 23 %350 393 (11)%Effective income tax rate17.7 %18.0 %17.5 %17.3 %Net earnings1,174 940 25 %1,655 1,884 (12)%Diluted earnings per share$8.15