(C) Reuters. FILE PHOTO: The Northrop Grumman Antares rocket, with Cygnus resupply spacecraft onboard, launches from Pad-0A, at NASA’s Wallops Flight Facility in Virginia, U.S., April 17, 2019. NASA/Bill Ingalls/Handout via REUTERS
(Reuters) -Northrop Grumman Corp on Thursday reported a better-than-expected quarterly profit, driven by strong demand in its fast-growing space unit, prompting the U.S. defense contractor to raise its full-year adjusted profit forecast.
Northrop (NYSE:NOC) said it now expects full-year adjusted earnings per share of $25.20 to $25.60, up from its prior range of $24.40 to $24.80.
However, the company flagged some labor and supply chain challenges on its operations stemming from the COVID-19 pandemic.
The pandemic has crippled companies around the globe by reducing their ability to send or receive components, thereby creating shortages and reducing sales.
Northrop said it completed a flight test for its Hypersonic Air-breathing Weapon Concept (HAWC) with Raytheon Technologies (NYSE:RTX) in the third quarter.
This comes as defense contractors quicken their pace to build hypersonic weapons – the next generation of arms that rob adversaries of reaction time and traditional defeat mechanisms.
The missile, built by Raytheon (NYSE:RTN) and equipped with a Northrop scramjet (supersonic combustion ramjet) engine, is capable of achieving speeds faster than five times the speed of sound, marking the first successful test of the class of weapon since 2013.
Northrop’s space unit, which makes satellites and missile systems, reported a 22% jump in sales to $2.68 billion for the third quarter ended Sept. 30.
Excluding items, Northrop earned $6.63 per share, topping Street estimates of $5.99, according to Refinitiv IBES.
The company’s total sales, however, fell 4% to $8.72 billion, missing estimates $8.94 billion.
Northrop beats profit estimates on strong demand in space unit; raises forecast
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