v3.26.1
Segment Information (Unaudited)
 6 Months Ended
Jun. 30, 2026
Segment Reporting [Abstract]  
SEGMENT INFORMATION SEGMENT INFORMATION
The company is aligned in four operating sectors, which also comprise our reportable segments: Aeronautics Systems, Defense Systems, Mission Systems and Space Systems. We generally organize our segments based on the nature of products and services offered.
The following table presents sales, operating costs and expenses, and operating income by segment:
Three Months Ended June 30Six Months Ended June 30
$ in millions2026202520262025
Aeronautics Systems
Sales
$3,519 $3,114 $6,802 $5,928 
Operating costs and expenses:
Product
2,423 2,109 4,717 4,467 
Service
697 649 1,350 1,250 
Intersegment
37 35 68 73 
Aeronautics Systems operating income362 321 667 138 
Defense Systems
Sales
2,0931,9913,9923,796
Operating costs and expenses:
Product
1,5761,3722,9512,634
Service
312319606643
Intersegment
49479587
Defense Systems operating income
156253340432
Mission Systems
Sales
3,2503,1576,1115,964
Operating costs and expenses:
Product
1,9001,9453,5823,675
Service
453483872917
Intersegment
396288723570
Mission Systems operating income
501441934802
Space Systems
Sales
2,7532,6465,2335,214
Operating costs and expenses:
Product
2,0501,8933,8613,722
Service
307362588724
Intersegment
160111313205
Space Systems operating income
236280471563
Intersegment profit eliminations
(97)(76)(182)(148)
Total segment operating income1,1581,2192,2301,787
FAS/CAS operating adjustment76314126
Unallocated corporate (expense) income(69)143(159)85
Total operating income1,096 1,425 2,085 1,998 
Other (expense) income
Interest expense(161)(173)(323)(329)
Non-operating FAS pension benefit166137332267
Other, net673810469
Earnings before income taxes$1,168 $1,427 $2,198 $2,005 
FAS/CAS Operating Adjustment
For financial statement purposes, we account for our employee pension plans in accordance with FAS. However, the cost of these plans is charged to our contracts in accordance with applicable Federal Acquisition Regulation (FAR) and CAS requirements. The FAS/CAS operating adjustment reflects the difference between CAS pension expense included as cost in segment operating income and the service cost component of FAS expense included in total operating income.
Unallocated Corporate (Expense) Income
Unallocated corporate (expense) income includes the portion of corporate costs not considered allowable or allocable under applicable FAR and CAS requirements, and therefore not allocated to the segments, such as changes in deferred state income taxes and a portion of management and administration, legal, environmental, compensation, retiree benefits, advertising and other corporate unallowable costs. Unallocated corporate (expense) income also includes costs not considered part of management’s evaluation of segment operating performance, such as amortization of purchased intangible assets and the additional depreciation expense related to the step-up in fair value of property, plant and equipment acquired through business combinations, as well as certain compensation and other costs.
Disaggregation of Revenue
Sales by Customer TypeThree Months Ended June 30Six Months Ended June 30
2026202520262025
$ in millions$
%(3)
$
%(3)
$
%(3)
$
%(3)
Aeronautics Systems
U.S. government(1)
$2,809 81 %$2,526 82 %$5,503 82 %$4,816 82 %
International(2)
652 19 %544 18 %1,192 18 %1,022 18 %
Other customers17 — %6 — %32 — %11 — %
Intersegment sales41 38 75 79 
Aeronautics Systems sales3,519 3,114 6,802 5,928 
Defense Systems
U.S. government(1)
1,738 85 %1,611 83 %3,329 86 %3,062 83 %
International(2)
279 14 %305 16 %514 13 %594 16 %
Other customers21 1 %22 1 %42 1 %42 1 %
Intersegment sales55 53 107 98 
Defense Systems sales2,093 1,991 3,992 3,796 
Mission Systems
U.S. government(1)
2,180 78 %2,282 81 %4,159 79 %4,255 80 %
International(2)
563 20 %505 18 %1,027 20 %980 19 %
Other customers43 2 %29 1 %76 1 %53 1 %
Intersegment sales464 341 849 676 
Mission Systems sales3,250 3,157 6,111 5,964 
Space Systems
U.S. government(1)
2,500 97 %2,349 93 %4,700 96 %4,658 93 %
International(2)
49 2 %47 2 %91 2 %91 2 %
Other customers25 1 %125 5 %92 2 %235 5 %
Intersegment sales179 125 350 230 
Space Systems sales2,753 2,646 5,233 5,214 
Total
U.S. government(1)
9,227 85 %8,768 85 %17,691 85 %16,791 85 %
International(2)
1,543 14 %1,401 13 %2,824 14 %2,687 13 %
Other customers106 1 %182 2 %242 1 %341 2 %
Total Sales$10,876 $10,351 $20,757 $19,819 
(1) Sales to the U.S. government include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is the U.S. government. Each of the company’s segments derives a substantial percentage of its revenue from the U.S. government.
(2) International sales include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is an international customer to the extent that information is available to us or can be reasonably estimated. These sales include foreign military sales contracted through the U.S. government.
(3) Percentages calculated based on external customer sales.
Sales by Contract TypeThree Months Ended June 30Six Months Ended June 30
2026 20252026 2025
$ in millions$
%(1)
$
%(1)
$
%(1)
$
%(1)
Aeronautics Systems
Cost-type$1,607 46 %$1,461 47 %$2,966 44 %$2,800 48 %
Fixed-price1,871 54 %1,615 53 %3,761 56 %3,049 52 %
Intersegment sales41 38 75 79 
Aeronautics Systems sales3,519 3,114 6,802 5,928 
Defense Systems
Cost-type1,161 57 %1,084 56 %2,227 57 %2,049 55 %
Fixed-price877 43 %854 44 %1,658 43 %1,649 45 %
Intersegment sales55 53 107 98 
Defense Systems sales2,093 1,991 3,992 3,796 
Mission Systems
Cost-type1,075 39 %1,406 50 %2,256 43 %2,569 49 %
Fixed-price1,711 61 %1,410 50 %3,006 57 %2,719 51 %
Intersegment sales464 341 849 676 
Mission Systems sales3,250 3,157 6,111 5,964 
Space Systems
Cost-type1,394 54 %1,562 62 %2,724 56 %3,102 62 %
Fixed-price1,180 46 %959 38 %2,159 44 %1,882 38 %
Intersegment sales179 125 350 230 
Space Systems sales2,753 2,646 5,233 5,214 
Total
Cost-type5,237 48 %5,513 53 %10,173 49 %10,520 53 %
Fixed-price5,639 52 %4,838 47 %10,584 51 %9,299 47 %
Total Sales$10,876 $10,351 $20,757 $19,819 
(1)Percentages calculated based on external customer sales.
Sales by Geographic Region(1)
Three Months Ended June 30Six Months Ended June 30
2026202520262025
$ in millions$
%(3)
$
%(3)
$
%(3)
$
%(3)
Aeronautics Systems        
United States$2,826 81 %$2,532 82 %$5,535 82 %$4,827 82 %
Asia/Pacific263 7 %226 8 %492 7 %426 8 %
Europe369 11 %301 10 %658 10 %570 10 %
Other geographic regions
20 1 %17 — %42 1 %26 — %
Intersegment sales41 38 75 79 
Aeronautics Systems sales3,519 3,114 6,802 5,928 
Defense Systems
United States1,759 86 %1,633 84 %3,371 87 %3,104 84 %
Asia/Pacific110 6 %79 4 %191 5 %160 4 %
Europe129 6 %168 9 %254 6 %338 9 %
Other geographic regions
40 2 %58 3 %69 2 %96 3 %
Intersegment sales55 53 107 98 
Defense Systems sales2,093 1,991 3,992 3,796 
Mission Systems
United States2,223 80 %2,311 82 %4,235 80 %4,308 81 %
Asia/Pacific148 5 %132 5 %262 5 %260 5 %
Europe302 11 %263 9 %554 11 %502 10 %
Other geographic regions
113 4 %110 4 %211 4 %218 4 %
Intersegment sales464 341 849 676 
Mission Systems sales3,250 3,157 6,111 5,964 
Space Systems
United States2,525 98 %2,474 98 %4,792 98 %4,893 98 %
Asia/Pacific15 1 %15 1 %33 1 %23 — %
Europe28 1 %20 1 %48 1 %46 2 %
Other geographic regions
6 — %12 — %10 — %22 — %
Intersegment sales179 125 350 230 
Space Systems sales2,753 2,646 5,233 5,214 
Total
United States9,333 86 %8,950 87 %17,933 86 %17,132 87 %
Asia/Pacific536 5 %452 4 %978 5 %869 4 %
Europe828 7 %752 7 %1,514 7 %1,456 7 %
Other geographic regions(2)
179 2 %197 2 %332 2 %362 2 %
Total Sales$10,876 $10,351 $20,757 $19,819 
(1)Sales are attributed to countries based on the ultimate customer’s location to the extent that information is available to us or can be reasonably estimated. No country other than the United States represents greater than 10 percent of total company sales.
(2)Other geographic regions are principally comprised of the Middle East.
(3)Percentages calculated based on external customer sales.
Capital Expenditures and Depreciation and Amortization
The following table presents capital expenditures and depreciation and amortization for each of our reportable segments and for Corporate:
Three Months Ended June 30Six Months Ended June 30
$ in millions2026202520262025
Capital Expenditures
Aeronautics Systems$35 $69 $69 $148 
Defense Systems28 11 44 23 
Mission Systems42 47 87 86 
Space Systems84 71 127 181 
Corporate(1)
113 33 142 49 
Total capital expenditures$302 $231 $469 $487 
Depreciation and Amortization
Aeronautics Systems$86 $92 $177 $181 
Defense Systems44 42 88 85 
Mission Systems70 68 139 135 
Space Systems99 84 195 163 
Corporate(1)
68 64 140 123 
Total depreciation and amortization$367 $350 $739 $687 
(1)Corporate amounts include the amortization of purchased intangible assets and the additional depreciation expense related to the step-up in fair value of PP&E acquired through business combinations as they are not considered part of management’s evaluation of segment operating performance.
Assets
Our chief operating decision maker (“CODM”) does not use assets by segment to evaluate segment performance or allocate resources. Therefore, we do not disclose assets by segment.