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Raytheon and Lockheed earnings lift defense stocks as backlogs hit records
Raytheon reported 14.5% year-over-year revenue growth, record backlog at $289 billion, and raised full-year 2026 EPS guidance to $7.10 to $7.25.
Defense contractor earnings are reviving investor focus on a “war trade” that had weakened earlier in the year after a tenuous Iran ceasefire, with Raytheon and Lockheed Martin both turning in Q2 results that topped estimates. MarketBeat Ratings notes the sector had deepened drawdowns in the first quarter as markets repriced defense restocking expectations and institutional selling increased.
The outlet says Lockheed and Raytheon both beat on earnings per share and revenue in Q2, adding to backlogs described as record levels. It also highlights that, in those disclosures, “not a dollar” of earnings or backlog capacity had been assumed to reflect the resumption of hostilities in Iran.
For Raytheon specifically, MarketBeat Ratings cites 14.5% year-over-year revenue growth, with revenue more than 8% above analysts’ expectations. It adds that EPS was $1.89 versus an expected $1.66, and that backlog grew 22% year-over-year to a record $289 billion, with more than $43 billion in new orders booked during the quarter, including $20 billion for the Raytheon division.
The piece also flags a policy timing risk around the 2027 National Defense Authorization Act, noting a failed Senate cloture vote and that the act had not yet been enacted. It says if the NDAA is not signed by October 1, multiyear defense procurement contracts cannot be distributed, which it describes as a key driver for RTX and LMT backlog formation. MarketBeat Ratings adds that RTX’s results helped drive an end to its drawdown, and that the company raised full-year 2026 guidance for sales, EPS, and free cash flow, now projecting total 2026 EPS of $7.10 to $7.25, a 5% increase over the prior high-end estimate.