Lockheed quarterly profit falls 5.7% on supply chain snags

US weapons maker Lockheed Martin on Tuesday (Apr 19) said its quarterly revenue fell while quarterly profits dropped 5.7 per cent as supply chain woes triggered by the Covid-19 pandemic were compounded by inflation pressure.

The company reaffirmed its full-year revenue outlook of about US$66 billion which is in line with analysts estimates.

US President Joe Biden's record peacetime national defense budget request of US$813 billion was unveiled in March as Russia's invasion of Ukraine spurs demand for more military spending globally.

But the pandemic has crippled several companies' ability to procure as well as supply parts needed to produce products, creating shortages, reducing inventories and hammering profits amid a period of rising inflation.

Plane component makers have been impacted as pandemic-induced financial stress has impacted Lockheed's dual-use suppliers that cater to both commercial aviation and defense markets.

Shares in Lockheed fell 2.4 per cent to US$456 in premarket trading.

Lockheed's Aeronautics unit, its biggest, which makes F-35 fighter jets saw its revenue rise 2 per cent compared to the same quarter a year ago, but profits fell by 2 per cent to US$697 million.

Lockheed reported 26 F-35 jet deliveries in the quarter compared with 17 a year earlier.

Net earnings fell to US$1.73 billion, or US$6.44 per share, in the first quarter ended Mar 27 from US$1.84 billion, or US$6.56 per share, a year earlier.

Net sales fell about 8 per cent to US$14.96 billion in the quarter.

During the quarter Lockheed abandoned its proposed US$4.4 billion purchase of rocket engine maker Aerojet Rocketdyne Holdings Inc after antitrust regulators sued to block the deal.

In February Lockheed named Jesus "Jay" Malave, who was senior vice president and CFO at L3Harris, as the company's chief financial officer. REUTERS