On a day marked by strategic adjustments, U.S. defense and aerospace stalwart Lockheed Martin (NYSE: LMT) has revised its delivery expectations for the iconic F-35 jets and postponed the rollout of its updated Technology Refresh 3 (TR-3) aircraft.
This announcement had a discernible impact on the company’s stock, with shares dipping approximately 2% during early trading.
In a regulatory filing, Lockheed Martin conveyed its revised projection, anticipating the delivery of 97 aircraft for the year. This represents a reduction from its previous outlook, which spanned between 100 and 120 jets.
The F-35, a flagship program for Lockheed Martin, occupies a pivotal position in its portfolio, contributing a substantial 27% of the total consolidated net sales in 2022. Notably, it accounted for an impressive 66% of aeronautics’ net sales, driven by a surge in orders from nations augmenting their defense expenditures.
Lockheed Martin, headquartered in Bethesda, Maryland, has also revised its timeline for the maiden delivery of TR-3 jets. Previously slated for 2023, the company now anticipates these deliveries to commence between April and June in the forthcoming year.
Complicating matters further, the Pentagon has deferred the final delivery acceptance for F-35 jets, leading to a payment delay amounting to approximately $7 million per jet.
In a preceding disclosure made in July, the defense contractor had forewarned that the completion of software integration testing might introduce delays in the TR-3 jet program. The company elaborated, stating, “The number of 2024 F-35 deliveries will depend on when the first TR-3 aircraft is delivered and the time needed to complete the customer’s acceptance process.”
Despite these challenges, Lockheed Martin maintains its production pace, churning out 156 jets per year. This commitment is coupled with ongoing efforts to finalize the development and testing of TR-3 software, underlining the company’s dedication to delivering cutting-edge technology and maintaining its position as a key player in the defense industry.