Company: NOC
Filing Date: 2025-10-21
Form Type: 10-Q
Source: 0001133421-25-000053
Chunk: 99

Company: NORTHROP GRUMMAN CORP /DE/
Filing Date: 2025-10-21
Form: 10-Q
Item: Part I, Item 2
Chunk 99
---
 $1.0 billion of unsecured senior notes for general corporate purposes, including debt repayment, share repurchases, and working capital.

Cash Flow Measures

In addition to our cash position, we consider various cash flow measures in capital deployment decision-making, including cash provided by operating activities and free cash flow, a non-GAAP measure described in more detail below. 

Operating Cash Flow

The table below summarizes key components of cash provided by operating activities: 

Nine Months Ended September 30%$ in millions20252024ChangeNet earnings$2,755 $2,910 (5)%B-21 loss provision477 — NMGain on sale of business(231)— NMNon-cash items(1)1,219 302 304 %Pension and OPB contributions(94)(93)1 %Changes in trade working capital(3,227)(1,346)140 %Other, net(39)37 NMNet cash provided by operating activities$860 $1,810 (52)%

(1)Includes depreciation and amortization, stock based compensation expense, deferred income taxes and net periodic pension and OPB income.

Year to date 2025 net cash provided by operating activities decreased $950 million as compared with the same period in 2024, primarily due to $1.0 billion of higher net cash taxes, due, in part, to a $500 million federal tax refund received in the prior year. Higher cash earnings were offset by increased trade working capital largely driven by the timing of collections and advance payments.

Free Cash Flow

Free cash flow, as reconciled in the table below, is a non-GAAP measure defined as net cash provided by or used in operating activities less capital expenditures, and may not be defined and calculated by other companies in the same manner. We use free cash flow as a key factor in our planning for, and consideration of, acquisitions, the payment of dividends and stock repurchases. This non-GAAP measure may be useful to investors and other users of our financial statements as a supplemental measure of our cash performance, but should not be considered in isolation, as a measure of residual cash flow available for discretionary purposes, or as an alternative to operating cash flows presented in accordance with GAAP.

The table below reconciles net cash provided by operating activities to free cash flow:

Nine Months Ended September 30%$ in millions20252024ChangeNet cash provided by operating activities$860 $1,810 (52)%Capital