v3.26.3
BUSINESS SEGMENT INFORMATION
 9 Months Ended
Oct. 02, 2026
Segment Reporting [Abstract]  
BUSINESS SEGMENT INFORMATION
NOTE Q: BUSINESS SEGMENT INFORMATION
Description of Business Segments
We structure our operations primarily around the capabilities we provide, with each segment consisting of similar end products and technologies, and report our financial results in the following three operating segments, which are also our reportable segments or business segments, consistent with the manner in which our CODM manages the business, evaluates performance and allocates resources. In second quarter 2026, we enhanced our business segment disclosure to clarify the manner in which our CODM evaluates segment performance and allocates resources. Investment gains and losses, net of impairments, associated with investments in companies with dual-use technologies that accelerate our capabilities, improve go-to-market efforts and are operationally aligned with our business segments are included in the respective segments’ operating income. There were no material changes to the historical results, discussion and presentation of our business segments in the accompanying Condensed Consolidated Financial Statements and these Notes. Our three business segments are:
Space & Mission Systems: Supplies full mission solutions as a prime and subsystem integrator in the space, airborne, maritime, and cyber domains. We provide top-tier capabilities in the design, development, integration, production and sustainment of weapons systems for national security, civil government and international customers in the following business sectors:
Intelligence, Surveillance and Reconnaissance (“ISR”): Airborne passive sensing and targeting, mission systems development, integration and life-cycle management for strategic reconnaissance and air superiority platforms, national command and control, tactical surveillance, electronic attack, agile strike, mobility, and classified platforms.
Space Systems: End-to-end mission solutions to support intelligence, surveillance and reconnaissance; missile defense; positioning, navigation and timing; weather and climate monitoring; and ground-based space surveillance networks.
Maritime: Power, electrical, imaging, communication and sensor systems for naval platforms; autonomous solutions for surface and undersea operations; high-assurance encryption; in-service support; missionization prototyping; and naval integration.
Mission Networks: Integrator of large-scale, highly secure, and resilient mission critical infrastructure and enterprise systems for communications, air traffic surveillance, and enterprise information management.
Airborne Solutions: Integrated and multi-function processors, memory, communication, displays, and other hardened electronics, for airborne and ground platforms.
Intel & Cyber: Situational awareness, optical networks and advanced wireless solutions for classified intelligence and defense customers.
Communications & Spectrum Dominance: Enables warfighters across all domains with solutions critical to mission success even in the most contested environments. We are a leading provider of resilient communication solutions for the DoW and international, federal, and state agency customers in the following business sectors:
Mission Critical Communications: Design, manufacture and sustainment of resilient and interoperable secure communication solutions that includes software defined radios, waveforms, satellite terminals and end-to-end battlefield systems for the warfighter and government agencies.
Spectrum Superiority: Design, manufacture and sustainment of resilient and secure communication solutions that include ISR and tactical data links, software and integrated broadband networks and electronic warfare.
Targeting & Sensor Systems: Multi-domain, multi-spectral electro-optical and infrared sensor systems supporting ISR and target acquisition missions; manufacturing of specialty laser transmitters and filter glass materials; manufacturing of counter unmanned aircraft integrated systems; and specialized mission management software solutions.
Integrated Vision Solutions: Design, manufacture and sustainment of a full suite of helmet-mounted integrated night vision goggles with leading-edge image intensifier tubes, as well as weapon-mounted sights, aiming lasers, and range finders.
Missile Solutions: Provides a comprehensive portfolio of missile technologies spanning the full mission lifecycle, as well as critical space propulsion capabilities to the U.S. Government and its allies, including the DoW, NASA and major aerospace and defense prime contractors in the following business sectors:
Propulsion Systems: Provides propulsion, maneuvering, and control technologies as well as fuzing systems that support missile defense interceptors, strategic deterrence systems, and precision strike weapons; and space propulsion for national security and space exploration missions.
Advanced Effects: Provides advanced systems that improve missile performance, accuracy, and mission effectiveness across four capability areas including advanced sensing and targeting systems, guidance systems, weapons release systems, and complete weapons systems.
Business Segment Financial Results
The following table presents results by business segment:
Third QuarterYear to Date
(In millions)2026202520262025
Revenue
Space & Mission Systems$3,093 $2,803 $9,049 $7,984 
Communications & Spectrum Dominance1,995 1,935 5,793 5,605 
Missile Solutions1,057 1,008 3,101 2,773 
Intersegment(80)(88)(253)(292)
Segment revenue6,065 5,658 17,690 16,070 
Other(1)
(5)1 (5)147 
Total revenue6,060 5,659 17,685 16,217 
Cost of revenue
Space & Mission Systems(2,486)(2,248)(7,367)(6,483)
Communications & Spectrum Dominance(1,214)(1,218)(3,554)(3,560)
Missile Solutions(832)(786)(2,466)(2,164)
Intersegment80 88 253 292 
Segment cost of revenue(4,452)(4,164)(13,134)(11,915)
Company-funded R&D costs(2)
Space & Mission Systems(51)(51)(155)(144)
Communications & Spectrum Dominance(71)(61)(209)(167)
Missile Solutions(21)(26)(85)(69)
Segment company-funded R&D costs(143)(138)(449)(380)
Other segment items(3)
Space & Mission Systems(218)(205)(586)(531)
Communications & Spectrum Dominance(208)(179)(541)(500)
Missile Solutions(77)(72)(169)(204)
Total other segment items(503)(456)(1,296)(1,235)
Operating income
Space & Mission Systems338 299 941 826 
Communications & Spectrum Dominance502 477 1,489 1,378 
Missile Solutions127 124 381 336 
Segment operating income$967 $900 $2,811 $2,540 
______________
(1)Includes corporate headquarters. Additionally, year to date 2025 includes other non-reportable businesses, which consists of the CAS disposal group.
(2)Included as a component of the “General and administrative expenses” line item in our Condensed Consolidated Statement of Operations.
(3)Includes selling and marketing costs and other General and Administrative (“G&A”) expenses, which includes depreciation and amortization costs that are disaggregated by segment under the “Disaggregation of Revenue” heading below in this Note, and investment gains recognized on segment aligned investments. See Note P: Investments for further information.
The following table presents a reconciliation of segment operating income to consolidated Income before income taxes:
Third QuarterYear to Date
(In millions)2026202520262025
Segment operating income$967 $900 $2,811 $2,540 
Unallocated corporate items and other, net(181)(279)(719)(823)
Operating income786 621 2,092 1,717 
Non-service FAS pension income74 73 224 236 
Other non-operating (expense) income, net(1)25 107 51 
Interest expense, net(116)
(152)(381)
(454)
Income before income taxes$743 
$567 
$2,042 
$1,550 
Unallocated Corporate Items and Other, Net. Unallocated corporate items include expenses not included in management’s evaluation of segment operating performance, such as: amortization of acquisition-related intangibles; acquisition, divestiture and transaction-related expenses; business divestiture-related losses; LHX NeXt implementation costs; a portion of management and administration, legal, environmental, compensation and retiree benefits, and the FAS/Cost Accounting Standards (“CAS”) operating adjustment.
Other, net includes the operating results of other non-reportable businesses, which consists of the CAS disposal group, eliminations and other. Other, net also includes a segment investment offset to eliminate the effect of net investment gains on segment aligned investments included in segment operating income, when applicable. There were no segment investment gains or losses recognized in third quarter and $39 million of segment investment gains recognized in year to date 2026. There were no segment investment gains or losses recognized in third quarter or year to date 2025. Net investment gains or losses are included in the “Other non-operating (expense) income, net” line item in our Condensed Consolidated Statement of Operations. See Note P: Investments for further information.
Assets
Total assets by business segment were as follows:
(In millions)October 2, 2026January 2, 2026
Space & Mission Systems$14,233 $13,736 
Communications & Spectrum Dominance11,063 10,862 
Missile Solutions6,015 6,605 
Corporate
12,495 9,992 
Total assets$43,806 $41,195 
Other Financial Information
Other financial information by business segment is summarized below:
Third QuarterYear to Date
(In millions)2026202520262025
Capital expenditures
Space & Mission Systems$39 $34 $101 $97 
Communications & Spectrum Dominance23 25 58 53 
Missile Solutions101 40 172 77 
Corporate16 20 55 39 
Total capital expenditures$179 $119 $386 $266 
Depreciation and amortization
Space & Mission Systems$44 $50 $128 $130 
Communications & Spectrum Dominance19 19 58 54 
Missile Solutions15 16 44 50 
Corporate189 224 607 679 
Total depreciation and amortization$267 $309 $837 $913 
Disaggregation of Revenue
We disaggregate revenue by customer relationship, contract type and geographical region. We believe these categories best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
Third Quarter
20262025
(In millions)SMSCSDMSLSMSCSDMSL
Revenue by customer relationship
Prime contractor$2,324 $1,293 $277 $2,027 $1,335 $274 
Subcontractor742 662 767 752 549 722 
Intersegment27 40 13 24 51 12 
Total segment$3,093 $1,995 $1,057 $2,803 $1,935 $1,008 
Revenue by contract type
Fixed-price
$2,030 $1,648 $711 $1,898 $1,585 $634 
Cost-type1,036 307 333 881 299 362 
Intersegment27 40 13 24 51 12 
Total segment$3,093 $1,995 $1,057 $2,803 $1,935 $1,008 
Revenue by geographical region
United States$2,554 $1,125 $932 $2,415 $1,154 $859 
International512 830 112 364 730 137 
Intersegment27 40 13 24 51 12 
Total segment$3,093 $1,995 $1,057 $2,803 $1,935 $1,008 
Year to Date
20262025
(In millions)SMSCSDMSLSMSCSDMSL
Other(1)
Revenue by customer relationship
Prime contractor$6,787 $3,785 $772 $5,773 $3,712 $741 $72 
Subcontractor2,190 1,863 2,293 2,133 1,719 1,994 73 
Intersegment72 145 36 78 174 38 1 
Total segment$9,049 $5,793 $3,101 $7,984 $5,605 $2,773 $146 
Revenue by contract type
Fixed-price
$6,078 $4,753 $2,058 $5,513 $4,596 $1,715 $145 
Cost-type2,899 895 1,007 2,393 835 1,020 — 
Intersegment72 145 36 78 174 38 1 
Total segment$9,049 $5,793 $3,101 $7,984 $5,605 $2,773 $146 
Revenue by geographical region
United States$7,599 $3,238 $2,728 $6,823 $3,358 $2,463 $61 
International1,378 2,410 337 1,083 2,073 272 84 
Intersegment72 145 36 78 174 38 1 
Total segment$9,049 $5,793 $3,101 $7,984 $5,605 $2,773 $146 
_______________
(1)Includes revenue associated with other non-reportable businesses, which consists of the CAS disposal group. These amounts are included to reconcile total revenue.