Northrop Grumman’s third-quarter sales increased 7% to $11.122 billion, while its order backlog reached $109.6 billion. The October 20 earnings release points to a larger pipeline of contracted work, but a decline in reported operating margin shows that revenue growth and profitability are not the same measure.
For the quarter ended September 30, 2026, net earnings rose 2% to $1.124 billion and diluted EPS increased to $7.89 from $7.67. The company also raised its full-year earnings outlook on an adjusted basis.
Source: Northrop Grumman’s October 20, 2026 results. All dollar figures below are US dollars.
Verified figures at a glance
| Measure | Disclosed result or forecast | Primary source |
|---|---|---|
| Quarterly sales | $11.122bn; +7% year on year | Issuer results |
| GAAP net earnings | $1.124bn; +2% | Issuer results |
| Diluted EPS | $7.89, versus $7.67 | Issuer results |
| Reported operating margin | 11.4%, versus 11.9% | Issuer results |
| Net awards / quarter-end backlog | $16.4bn / $109.6bn | Issuer results |
| 2026 MTM-adjusted EPS forecast | $29.35–$29.75; not reported annual earnings | Issuer results |
What the backlog does—and does not—show
Net awards totaled $16.4 billion during the quarter. Backlog is the value of work remaining under the company’s disclosed orders and contracts; it is not cash already collected or sales already recognized. Contract timing, execution and customer funding still determine when that work moves through the financial statements.
Quarterly sales grew by $699 million from $10.423 billion. Reported operating income increased 2% to $1.269 billion, but the operating margin narrowed to 11.4% from 11.9%. A margin is operating profit divided by sales: higher revenue can therefore coexist with a lower proportion retained as operating income.
The release also reports a 12.1% segment operating margin, a non-GAAP measure. That should not replace the consolidated reported margin in comparisons. The company attributed the reported margin decline principally to a lower FAS/CAS pension operating adjustment.
The raised forecast uses a different EPS basis
Northrop now forecasts 2026 MTM-adjusted EPS of $29.35–$29.75, compared with its previous $28.60–$29.10 range. This excludes pension and other postretirement-benefit actuarial mark-to-market effects and related taxes. It is a management projection, not a completed full-year result.
The full-year sales outlook is $43.75–$44.25 billion. Comparing that annual range directly with one quarter’s $11.122 billion would mix reporting periods. Similarly, the annual adjusted EPS range should not be presented as if it were the quarter’s GAAP EPS.
The useful next test is whether contract execution converts the larger backlog into sales and cash while maintaining margins. The filing identifies inflation, labor and supply-chain challenges and customer funding among risks to its assumptions; an order book alone does not remove those uncertainties.
For a separate manufacturer where shipment growth and earnings guidance need distinct labels, see CapKet’s Steel Dynamics quarterly report.
Additional official record: The SEC Form 8-K records the October 20 earnings release and reporting period. Both records originate with the issuer, not independent third-party corroboration.
Primary records observed: and . Announcement dated October 20, 2026; quarterly results cover the period ended September 30, 2026. Forward-looking figures are labeled as forecasts.