Northrop Grumman [NOC] said on Thursday that it received, as expected, a U.S. Air Force contract in the fourth quarter last year for the second low-rate initial production (LRIP) lot of the company’s B-21 Raider stealth bomber.
While Lockheed Martin
[LMT] has relied on the F-35 fighter for 25 percent to 30 percent of the company’s revenue, Northrop Grumman CEO Kathy Warden told investors in a fourth quarter earnings call on Thursday that Northrop Grumman expected its B-21 and the Sentinel next-generation ICBM “to be less than 10 percent of sales in the company, but continuing to gradually increase from ’24 into ’25.”
For this year, Northrop Grumman’s aeronautics sector “margins are expected in the mid to high 9 percent range and reflect higher sales on the LRIP phase of B-21,” Northrop Grumman Chief Financial Officer Kenneth Crews told investors during Thursday’s call.
While Northrop Grumman bowed out of the Air Force’s Next Generation Air Dominance (NGAD) fighter competition in July, 2023, Warden left the door open on Thursday to a possible company reconsideration and to bids on Navy NGAD and the Air Force’s unmanned Collaborative Combat Aircraft (CCA) programs.
“We believe we are well positioned to offer sixth generation aircraft based on our successful B-21 performance and experience to date,” she said. “We are not laying any of that into our forecast at this moment, given the uncertainty of timing, particularly the Air Force program. We’re not a prime, but we are a contributor to the program through mission systems.”
In the coming weeks, a congressionally mandated review by the Air Force of its inventory may provide insights on whether the service will increase its planned number of 100 B-21s (Defense Daily, Dec. 4, 2024).
The Lot 1 LRIP award for the B-21 followed the start of B-21 flight testing in November 2023.
21 B-21s are in the first five LRIP lots.
The LRIP contracts are fixed-price. Early last year, Northrop Grumman took a $1.2 billion charge on the first 21 aircraft due to macroeconomic factors that include inflation, supply chain, and labor constraints (Defense Daily, Jan. 25).
York Space Systems (York) said on Jan. 29 it had expanded its satellite platform portfolio, adding the M-CLASS, which is now its largest platform.
The M-CLASS builds upon York’s existing S-CLASS and LX-CLASS platforms, reusing over 75% of its technology to deliver capabilities while maintaining rapid production timelines.
York said the M-CLASS has a payload capacity of 1,000 kilograms and 8 kW of peak power, addressing the growing demand for higher power and greater mission flexibility. The M-CLASS platform is designed to support a wide range of space missions for government and commercial partners, from single spacecraft to large constellations.
York CTO Michael Lajczok said, “Customers are asking for more power and capability, and the M-CLASS is our response to that strong demand signal. We remain committed to delivering on-time solutions that empower our customers to achieve their objectives.”
York supports national security and commercial missions, including its work for the Space Development Agency, like the T0 Transport satellites
which demonstrated Link 16 from space. York said Wednesday that its Tranche 1 and Tranche 2 satellites for the SDA are set to launch later this year.
The National Nuclear Security Administration (NNSA) and environmental plaintiffs settled a lawsuit that could put a pause on plutonium pit production efforts at Savannah River Site if approved.
The agreement, made public Jan. 16, would leave Los Alamos National Laboratory as the National Nuclear Security Administration’s sole pit factory until an environmental impact statement is completed as part of the National Environmental Protection Act (NEPA). The process is expected to take at least two-and-a-half years, according to the document.
Until a record of decision is issued from the environmental review, NNSA is enjoined from installing classified equipment or introducing nuclear material at the Savannah River plant,
according to a press release from the citizen groups. Actual pit production at Savannah River is not expected before the 2030s, according to NNSA.
The plaintiffs alleged in the lawsuit from 2021 that NNSA and DoE would violate NEPA by producing plutonium pits at Los Alamos and Savannah River Site without conducting a proper environmental review. A federal judge agreed with the plaintiffs in September, but instigated months of back and forth between both parties by forcing them to agree to a solution themselves.
The settlement requires NNSA to produce a new programmatic environmental impact statement within two-and-a-half years. Until that is complete in a process that would include public hearings nationwide and public comment on the draft of the statement, NNSA would not be able to process nuclear material at Savannah River’s plutonium facility.
The plaintiffs in the suit include environmental watch group Savannah River Site Watch of South Carolina; Tom Clements, director of Savannah River Site Watch; The Gullah Geechee Sea Island Coalition, a group representing the interests of some descendants of enslaved Africans dwelling on the lower Atlantic coast; Nuclear Watch New Mexico of Santa Fe, N.M.; and the Tri-Valley Communities Against a Radioactive Environment, of Livermore, Calif.
The U.S. Space Force’s Space Systems Command has awarded L3Harris Technologies [LHX] a nearly $90 million cost-plus-fixed fee contract through October 2027 with two option periods for the Advanced Tracking and Launch Analysis System (ATLAS).
“This delivery order provides for developing, integrating and delivering mission thread software within ATLAS to meet ATLAS initial operational capability [IOC] and to achieve software stability,” according to a Wednesday contracts announcement. “Work will be performed at Colorado Springs, Colorado; and Chantilly, Virginia.”
Two months ago, the Space Force said that it had informed Congress that the service’s goal for ATLAS IOC is this September (Defense Daily, Nov. 26, 2024).
Section 1607 of the fiscal 2024 National Defense Authorization Act gave the Department of the Air Force until the end of March last year this year to specify a date for ATLAS IOC and to cancel the program, if it fails to meet the IOC date. If canceled, the Department of the Air Force is to inform Congress of an ATLAS alternative.
For space situational awareness/command and control (C2), ATLAS is to replace the Space Defense Operations Center (SPADOC), established in 1979 at the North American Aerospace Defense Command’s Cheyenne Mountain Complex in Colorado.
ATLAS is to speed the identification of potential space anomalies and threats.
Former Assistant Secretary of the Air Force for Space Acquisition and Integration Frank Calvelli said last February that he had convened regular sessions to right some space programs, including ATLAS.
Initially, Space Force expected to field a SPADOC replacement by mid-2021. The Pentagon’s Directorate of Operational Test & Evaluation’s fiscal 2023 report said that a subsequent fiscal 2023 planned fielding of ATLAS “was slowed by delayed capability delivery, system stability problems, lack of trained operators, and non-operationally representative test environments.”
Omitron and Parsons Corp. [PSN] have been subcontractors to L3Harris on ATLAS.
In November last year, L3Harris said that “for ATLAS, we have positive momentum as L3Harris continues to perform and deliver our work scope, mission application software, [and] meeting government directed timelines.”
“L3Harris recently completed the ninth integrated software test, delivery of 95 percent of the software capabilities needed to decommission SPADOC,” the company said at the time. “L3Harris has been developing applications in a new architecture that will allow ATLAS to scale and handle the exponential growth of commercial constellations, increased debris, anti-satellite tests and adversarial threats. We are in lockstep with the U.S. government to enhance our program increment events to be more inclusive of all parties that must contribute to SPADOC decommissioning.”
L3Harris said that by early next year the company plans to have tested 98 percent of the software required to scrap SPADOC.
Delivery of ATLAS “is the highest priority objective for Mission Delta 2 and the Space C2 program, which includes deployment of all functionalities required to enable the decommissioning of SPADOC,” Space Force said in response to questions last November. “The program continues to incrementally plan, develop and deploy functionality for ATLAS. The Department of the Air Force is well positioned to deliver the capability needed to enable the decommissioning of SPADOC.”
Begun in 2009, the Joint Space Operations Center Mission System (JMS) was a previous Air Force effort to replace SPADOC, but the Air Force canceled JMS in 2019 after it faced technical and cost challenges. JMS was to process and integrate inputs from a variety of sensors, Omitron was a subcontractor on JMS’ Increment 2–the effort to make JMS operational.
In June last year, the Government Accountability Office projected that Space Force will spend $1.2 billion on space C2 modernization between fiscal 2018 and fiscal 2028. L3Harris received its first ATLAS contract, for $53 million, in October 2018.
Britain’s Serco Group on Thursday said it agreed to acquire Northrop Grumman’s [NOC] Mission Training and Satellite Ground Network Communications Software Business (MT&S) for $327 million, expanding its U.S. presence, and defense and space work.
The MT&S business has nearly 1,000 employees and generates about $300 million in annual sales. The transaction is expected to close in mid-2025 and the business will become part of Serco, Inc., which is based in Northern Virginia. Serco, Inc.’s, current sales are $1.7 billion and the company said the addition of MT&S will take it above $2 billion. The U.S. operations currently have 9,000 employees.
Serco said the acquisition will add expertise in digital engineering, synthetic training, exercise simulation, and ground satellite software communications, and allow it to offer more secure solutions to meet increasingly complex operations. MT&S also strengthens customer relations with the Army, Space Force, Air Force, Navy, and Combatant Commands, it said.
“We have approximately doubled the revenue and more than trebled profit in Serco’s North America business in recent years through a successful combination of organic growth and strategic acquisitions,” Mark Irwin, CEO of Serco Group, said in a statement. “MT&S provides and excellent opportunity to continue that success. The acquisition increases our scale, capabilities, and growth potential in U.S. defense, the largest defense market in the world, as well as providing solutions we can offer to customers worldwide.”
Northrop Grumman said the pending deal will add about $150 million in after-tax gains this year to operating income and free cash flow.
Northrop Grumman [NOC] on Thursday said it swung to a profit in the fourth quarter on a pension-related benefit and because year ago results were hit by a charge on the Air Force’s B-21 stealth bomber program.
Net income of $1.3 billion, $8.66 earnings per share (EPS) compared to a loss of $535 million ($3.54 EPS) a year ago when the company took a nearly $1.2 billion after-tax charge on the B-21 due to macroeconomic factors for the first five low-rate production lots (Defense Daily
, Jan. 25, 2024). Northrop Grumman’s bottom-line was also aided by a $332 million pension benefit after accounting adjustments.
After various adjustments, per share earnings of $6.39 in the quarter topped consensus estimates by four pennies.
Sales in the quarter were essentially flat at nearly $10.7 billion with increases at Aeronautics, Defense, and Mission Systems largely offset by a 13 percent decline at Space Systems. Sales drivers across the business included the B-21, F-35 fighter production and sustainment, the Sentinel ICBM, military ammunition, classified microelectronics, communications, and electronic warfare programs for self-protection and targeting systems.
Declines at Space Systems were due to less work on a classified program, loss of the Next Generation Interceptor, and timing issues that led to lower volume on another classified program, the Next-Generation Overhead Persistent Infrared Satellite, and the Glide Phase Interceptor.
Aeronautics, Defense, and Mission Systems also posted higher operating earnings on absence of a B-21 charge and lower cost estimates to complete certain programs. Operating income at Space Systems fell on the lower sales but the segment enjoyed higher margins on improved estimates to complete programs.
Segment operating margin for the quarter was 11.2 percent and for the year 11.1 percent.
For all of 2024, sales increased 4 percent to $41 billion from $39.3 billion in 2023 and net income doubled to $4.2 billion ($28.34 EPS) from $2.1 billion ($13.53 EPS). Segment operating margin was 11.1 percent.
Backlog at the end of 2024 was a record $91.5 billion, up 9 percent from $84.2 billion a year ago, driven by $50.6 billion in orders.
Bookings from international customers exceeded domestic orders, leading the company to forecast international sales growing faster than U.S. sales in 2025, Kathy Warden, Northrop Grumman’s chairwoman, president, and CEO, told investors. International business will grow at double-digit rates this year and potentially in the years ahead, she said.
Northrop Grumman introduced guidance for 2025, with sales projected to be between $42 billion and $42.5 billion, up 3 to 4 percent versus 2024. Growth will come from the Aeronautics and Mission Systems segments, partially offset by declines at Defense and Space Systems. The B-21 and Sentinel programs will continue to grow but at more moderate rates, and each one makes up less than 10 percent of overall sales, Warden said.
Segment operating income is also forecast to increase to $4.7 billion to $4.8 billion versus $4.5 billion in 2024, and adjusted earnings are pegged to be between $27.85 and $28.25 EPS.
The outlook factors in the pending sale, announced on Thursday, of the Training Services business unit to Serco for $327 million. The training business provides about $300 million in annual sales and result in about a $150 million after-tax gain. The deal is expected to close in mid-2025.
Free cash flow in 2024 was $2.6 billion and is expected to grow to between $2.9 billion and $2.3 billion this year. The outlook for cash remains positive every year through 2028 when the forecast reaches about $4 billion.
On the earnings call, Warden highlighted the company’s trusted microelectronics foundry that designs and develops computer chips for Defense Department programs, noting that it produces a terahertz chip that operates at a record one trillion cycles per second. The foundry’s chips are embedded in Northrop Grumman’s and other company’s platforms, she said. The microelectronics business grew over 20 percent in 2024, she added.
HII [HII] brought its REMUS 620 medium-class unmanned underwater vehicle (MUUV) to the Navy’s UUV Confidence Course in Bangor, Wash., to validate the design and add more operational data, the company said Jan. 29.
The company said it shipped the REMUS 620 from the factory in Pocasset, Mass., whereupon it successfully underwent a full range of pre-mission checks and ballasting. The vessel’s operations on the course validated “several” technical aspects of the MUUV, HII said.
HII boasted this was the first time an industry-provided MUUV utilized the Navy’s confidence course and argued this is an example of the relationship and partnership between industry and the Unmanned Undersea Vehicles Group ONE (UUVGRU-1).
The Navy established this course to help provide repeatable and comparable performance data for accelerated UUV capability development.
The company connected this work to the Chief of Naval Operations NAVLAN Project 33 initiatives, including accelerating the capability of unmanned systems and submarine force objectives to improve warfighter readiness.
“Getting a chance to put our newest design through its paces on the Navy’s UUV confidence course was a great opportunity for us to validate our design improvements to the vehicle,” Adrian Gonsalves, REMUS 620 product manager, said in a statement.
Gonsalves noted the company also gained “a lot of valuable operational data using the KRAKEN MINSAS 120,” a configurable Miniature Interferometric Synthetic Aperture Sonar (SAS).
The MINSAS was provided by marine technology firm Kraken Robotics.
According to the Kraken company website, its SAS integrates the capability to perform imaging and bathymetric mapping at the same time while also delivering higher resolution, range and area coverage rates.
“The confidence course provided us a great benchmark we can use to continue our improvements to this great design and gave us a chance to show UUV sailors in Keyport how much improvement we built into this next gen MUUV in terms of modularity and maintainability,” Gonsalves added.
The company first revealed the REMUS 620 in 2022 (Defense Daily, Nov. 7, 2022).
Last year, HII announced it had the second order for the REMUS 620 by an undisclosed customer in the Indo-Pacific region (Defense Daily, March 15, 2024).
The REMUS 620 is billed as having a range of 275 nautical miles; battery life of up to 110 hours; and designed to be deployed from submarines, small manned or unmanned boats, amphibious ships, surface combatants or helicopters.
SAN DIEGO– The commander of Naval Surface Forces confirmed naval forces conducting combat operations in the Red Sea have used a feedback loop 55 times over the past 15 months to make quick updates thanks to over-the-air networks for tactical and software updates.
Speaking here during the WEST 2025 conference on Jan. 28, hosted by AFCEA and the U.S. Naval Institute, Navy officials said it only takes about 48 hours following a combat engagement for the ship to send the data to analysis centers like Naval Surface Warfare Center Dahlgren Division and get analysis and improvements back via over-the-air transfers.
ArleighBurke-class guided-missile destroyer USS Spruance (DDG 111) sails in the Red Sea on Oct. 2nd last year. The ship returned to home port in San Diego on Dec. 19. 2024 (U.S. Central Command Photo)
Commander of Naval Surface Forces Vice Adm. Brendan McLane said Dahlgren downloads the data stateside, then works together with other analysis partners like Naval Information Warfighting Development Center (NIWDC) and Lockheed Martin [LMT] to see what happened in any given engagement.
McLane compared it to an NFL game film.
“Sometimes in the press conference you get the answer – we’re not quite sure what happened in that play, we’re going to have to watch the film. And that’s exactly what happens here. We break down the film and then we get feedback to the warfighters on the ship within 48 hours,” McLane said.
He noted the feedback, analysis conclusions and recommendations go to the ship, Destroyer Squadron (DESRON), fleet, and strike group commander.
McLane added these Navy components then watch to see if the doctrine was followed, was it successful and anything else they can learn from the experience.
The Navy also does a “deeper dive” that takes a few additional days as well as taking lessons learned to determine “if we see a new tactic being used against us or if we had seen something that we can do better, that thing goes to Strike Group 4 and Strike Group 15 so that we can work that in to the next [Composite Training Unit Exercise, COMPTUEX].”
These engagement lessons are also getting worked into the current curriculum for tactical action officers at the Surface Warfare Officer School and at Surface Combat Systems Training Command, “so that all of our warfighters, as they’re going thru their brick and mortar schoolhouses are getting the very latest on what’s happening in the southern Red Sea.”
McLane highlighted this Observe, Orient, Decide, and Act (OODA) loop process has been used 55 times so far over the last 15 months of Red Sea activities.
“You can kind of think of the scenario where a strike group has already gone through a COMPTUEX and a lesson’s been learned subsequently that needs to be shared with them. We fly [warfare tactics instructor] teams out to the strike group to get all of our ships up to speed on the latest tactics.”
Vice Adm. Brendan McLane, Commander of Naval Surface Forces and Naval Surface Force, Pacific Fleet. (Photo: U.S. Navy)
Before these kinds of over-the-air data transmissions were possible McLane said that was a 40-plus day process to get a ship in port, download data onto tapes then hand walking them all the way to Dahlgren for download and analysis.
“So the satellite connectivity that we have now enables us on every baseline to be able to do that download. And that took a lot of industry and Navy partnering to be able to figure it out, because it’s a different way with each baseline, to be able to get that loop completed.”
Similarly, Rear Adm. Wilson Marks, Commander of the Naval Surface and Mine Warfighting Development Center, noted an example where they fully updated and solved a software issue affecting a Red Sea ship within 17 days using over-the-air transmissions.
His team alerted him on a Friday night to an issue a ship was having with “one of our baselines over in the Red Sea that was causing a tactical issue with them in the [Weapons Engagement Zone, or WEZ] right then.”
Marks alerted Rear Adm. Joseph Cahill, commander of Naval Surface Force Atlantic, about the issue, who then called the strike group commander to find out what the issue specifically was.
“Within 48 hours we had some [Tactics, Techniques and Procedures] workaround, but with Lockheed Martin coming in that weekend along with our folks over at NSWC and our folks over at [Program Executive Office Integrated Warfare Systems] in 17 days we had a software patch.”
Marks said the Navy first tested the software patch to a ship underway in 3rd Fleet, then transmitted it to a ship in the WEZ, brought them out of the zone to update the software, “and then brought them right back out and that fixed a problem with a baseline.”
Marks underscored this is how the Navy knows it can fix software problems akin to smartphone software updates.
“That’s now, we know we can do it and that’s because everybody lined up behind us and said yes, make this happen. So we know we can do it, we’ve just got to make that the normal.”
The U.S. Space Force’s Space Rapid Capabilities Office (RCO) at Kirtland AFB, N.M., on Wednesday identified five teams of small businesses and “leading prime integrators to advance integrated satellites” under the Space RCO’s Prime Fusion Pilot Accelerator Program.
The latter “supports the Space RCO’s mission to accelerate the transition from development to deployment, paving the way for rapid acquisition and delivery of time-sensitive, critical space systems,” the office said.
The integrator-small business teams are Anduril Industries and Colorado’s Digantara, California’s Impulse Space and Arizona’s Geost, Colorado’s True Anomaly and Raptor Dynamix, California’s Turion Space and Wyoming’s Active Vigilance, and New Mexico’s BlackVe and California’s TRL11.
Col. Owen Stephens, Space RCO’s director of contracting, said in an office statement on Wednesday that the program “positions the United States to acquire next-generation satellites with enhanced situational awareness, ensuring the safety, stability, and sustainability of space assets.”
The teams will collaborate for two months under the program, whose name “describes a combination of on-satellite sensors, onboard software, and ground software that can detect and report anomalies, hazards, and threats to individual satellites,” the Space RCO said. “The ultimate goal is to seamlessly integrate new and innovative technologies into satellites offered by prime integrators, creating adaptable space assets with built-in awareness and responsiveness…Participants will showcase their solutions to Space RCO leadership and industry stakeholders in March, 2025 at a capstone pitch event in Albuquerque.”
In September last year, the Space RCO said that it had placed the first $12 million in delivery orders for the Rapid Resilient Command and Control (R2C2) program to field software for cloud-based satellite operations that will allow quick repositioning of satellites to respond to orbital events (Defense Daily, Sept. 26, 2024).
R2C2 is to feature ground segment software for Space Force satellites in areas such as Rendezvous and Proximity Operations (RPO) planning, antenna brokering and telemetry, and tracking and command.
While spacefaring countries may benignly use RPO for satellite maintenance and docking, they may also use RPO for destruction of adversary satellites or imaging of those satellites–counterspace features that Space Force has warned that China and Russia are pursuing.
Sikorsky [LMT] on Wednesday said it has started ground runs with the new GE Aerospace [GE] T901 engines integrated on a Black Hawk helicopter, ahead of the first test flight later this year.
GE Aerospace added that the successful ground runs with its T901 engines, developed under the Improved Turbine Engine Program (ITEP), “successfully validated the initial performance of all critical systems — including fuel, electrical, hydraulic, engine and flight control systems and engine bay flow” on the UH-60M Black Hawk.
Sikorsky, a Lockheed Martin company, started ground runs on a UH-60M Black Hawk equipped with two Improved Turbine Engines (ITE) in West Palm Beach, Florida. Photos courtesy Sikorsky, a Lockheed Martin company
“These tests mark a pivotal moment in history as the T901 engine powers the Black Hawk for the first time,” Amy Gowder, GE Aerospace’s president and CEO of defense and systems, said in a statement. “This achievement paves the way for a more powerful and mission-ready Black Hawk, equipping the U.S. Army with the ability to meet the growing demands of future operations.”
GE Aerospace was awarded a $517 million contract in February 2019 to develop its T901 engine for ITEP, which will eventually power the Army’s AH-64 Apache and UH-60 Black Hawk helicopters.
Last June, GE Aerospace delivered the first two T901 engines to Sikorsky to begin integration work on the UH-60M Black Hawk as the companies and the Army targeted 2025 for first flight on the platform (Defense Daily, June 28 2024).
To inform Black Hawk efforts, Sikorsky integrated the T901 engine into its Raider X prototype developed for the Army’s canceled Future Attack Reconnaissance Aircraft program and ultimately conducted three ground runs on the platform (Defense Daily, Sept. 6 2024).
Along with canceling FARA a year ago, the Army noted at the time it would also delay moving into production of the T901 engine and invest in further research and development efforts.
Sikorsky noted the new T901 engine is designed to increase the Black Hawk’s power by 50 percent, improve fuel efficiency and is “a critical component of the roadmap to a modernized Black Hawk.”
“Soldiers will rely on Black Hawk helicopters well into the future, and upgrades to the aircraft today will pay dividends for decades, enabling new missions such as deploying and managing launched effects,” Hamid Salim, Sikorsky’s vice president of Army and Air Force systems, said in a statement. “A modernized Black Hawk fleet will create new operational opportunities for the Army by extending the capabilities of a proven, fielded fleet to travel farther on less fuel and with more troops and cargo.”
