Company: NOC
Filing Date: 2025-10-21
Form Type: 10-Q
Source: 0001133421-25-000053
Chunk: 41

Company: NORTHROP GRUMMAN CORP /DE/
Filing Date: 2025-10-21
Form: 10-Q
Item: Part I, Item 1
Chunk 41
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 projects and Pacific region deterrence, among other programs. See Note 4 to the financial statements for additional information on key income tax provisions of the OBBBA.

Appropriations for FY 2026 were not enacted by September 30, 2025, and on October 1, 2025, the U.S. Government entered a shutdown, which is ongoing. Consistent with federal guidelines, we are continuing to perform work on existing contracts funded with appropriations from prior fiscal years. In addition, we may be expected to continue to perform for some period of time on certain of our U.S. Government contracts even if the U.S. Government is unable to make timely payments, for example if funding from prior year appropriations has been exhausted and appropriations legislation or a continuing resolution for FY 2026 has not been enacted. If a prolonged government shutdown occurs, it could result in program disruptions, limit the U.S. Government’s ability to progress programs and make timely payments and impact new program starts. A prolonged shutdown could have significant 

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Table of ContentsNORTHROP GRUMMAN CORPORATION                        

consequences for our company, our employees, our suppliers and our industry and could result in delayed cash collections and/or have a material adverse effect on our financial position, results of operations and/or cash flows.

The Administration has issued numerous executive orders, including orders that direct executive departments and agencies to put in place a regulatory freeze on pending rules, to effectuate the repeal of any regulation that an agency determines is unlawful, to undertake a comprehensive overhaul of the Federal Acquisition Regulation and to reform the DoW defense acquisition process. Some of the Administration’s executive orders are subject to ongoing court challenges. Implementation of certain of these executive orders could adversely affect our business or create a more challenging or costly regulatory, operating and economic environment. For example, on April 9, 2025, the President signed an executive order entitled Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base. The executive order directs the Secretary of War to submit a plan for expediting DoW acquisitions that relies on existing authorities. According to the executive order, the plan, among other things, should include a first preference for commercial solutions and a general preference for Other Transaction Authority procurements. In addition, the executive order directs the DoW to review all major defense acquisition programs (MDAP). Any program that is more than 15% behind schedule or over cost based on the current Acquisition Program Baseline, unable to meet key performance parameters, or unaligned