The Pentagon is significantly reducing its request for Lockheed Martin F-35 fighter jets, according to a Bloomberg News report. This development could have implications for Lockheed Martin's (LMT) stock.
A U.S. Defense Department procurement request document sent to Capitol Hill this week requested 24 F-35 jets for the U.S. Air Force, a sharp decrease from the 48 that were projected last year, the report stated. Reuters was unable to immediately confirm the details, and neither Lockheed Martin nor the Department of Defense immediately responded to requests for comment.
The Air Force now plans to seek $3.5 billion for the F-35 aircraft and an additional $531 million for advance procurement of necessary materials, according to the report.
The Pentagon's request also includes 12 of the Navy's carrier version of the F-35, which is less than the 17 approved by Congress for the current fiscal year. The Marines are also expected to see a reduction of two jets compared to this year’s funding.
In May, Lockheed Martin's finance chief indicated the company anticipated being awarded a finalized contract for its F-35 jets, which have faced delays attributed to a technology upgrade. In 2024, Lockheed Martin delivered a total of 110 F-35 fighter jets to the United States and its allies. The F-35 program represents approximately 30% of Lockheed Martin's overall revenue.
Potential Impact on Lockheed Martin (LMT)
The reduction in the F-35 jet request could potentially impact Lockheed Martin's future revenue and earnings. Investors will be closely watching how this development affects the company's financial outlook and LMT stock price.
Factors to Consider
- The overall impact on Lockheed Martin's revenue streams.
- The company's ability to secure other defense contracts.
- The progress of the F-35 technology upgrade and its effect on future orders.