Defense Sector Earnings: RTX, Thales, and Northrop Grumman

Date: April 21, 2026

Overview

On April 21, 2026, major defense sector companies, including Northrop Grumman, Raytheon Technologies (RTX), and Thales, released their earnings reports. The results showed a mixed performance across these industry leaders, with varying impacts on their stock prices.

Thales (HO.FR)

Thales, the French defense and aerospace giant, reported a mixed set of first-quarter results, leading to a decline in its share price by over 4%. Key highlights include:

• Overall orders increased by 23%, with organic growth of 27%, primarily driven by the defense segment, which grew by 71%.
• Sales rose to EUR 5.31 billion, reflecting a 7.2% increase.
• Management reaffirmed targets, including a book-to-bill ratio above 1, organic sales growth of 6-7%, and an EBITDA margin of at least 12.6%.
• Valuation support is expected from large contracts in orbital equipment and air and missile defense systems, particularly in light of increasing geopolitical tensions.

Raytheon Technologies (RTX.US)

Raytheon Technologies reported Q1 2026 results that were perceived as decent by the market. Key points include:

• Sales increased to USD 22.1 billion, a 9% year-over-year growth.
• Order backlog rose to USD 271 billion, up 25%.
• Adjusted EPS increased by 21% to USD 1.78, surpassing expectations of around USD 1.5.
• Sales and profitability growth were consistent across business units, with Raytheon, Pratt & Whitney, and Collins Aerospace achieving 10% organic sales growth.
• Management raised FY2026 sales guidance to USD 92.5-93.5 billion, with expected adjusted EPS of USD 6.7-6.9 and free cash flow of USD 8.25-8.75 billion.

Northrop Grumman (NOC.US)

Northrop Grumman's earnings report yielded mixed results, leading to a moderate negative sentiment among investors, with the stock down about 2% in after-hours trading. Highlights include:

• Sales growth was weak at only 4%, totaling USD 9.8 billion.
• Despite the sales shortfall, the company maintained its full-year sales guidance of at least USD 43.5 billion.
• Profitability improved significantly, with the average margin increasing from 6% to 10.8%.
• Management emphasized alignment with new U.S. Department of Defense plans and accelerated production of the B-21 aircraft.
• Concerns arose from significant inter-segment eliminations and unclear expenditures amounting to USD 280 million.

Conclusion

The earnings reports from these defense sector leaders reflect a complex landscape, with Thales facing challenges despite strong order growth, RTX showing solid performance and guidance, and Northrop Grumman navigating mixed results with a focus on strategic alignment with defense initiatives. Investors are advised to monitor these developments closely as geopolitical factors continue to influence the defense industry.