Boeing says new fighter contracts boost defense revenue growth outlook
Boeing’s Defense, Space & Security unit reported third‑quarter 2026 revenue of $7.94 billion, up 15% year‑over‑year, and operating profit of $492 million, driven by the recent $20 billion F/A‑XX Navy win and the $2.38 billion F‑47 Air Force contract. CEO Kelly Ortberg said the cost‑plus structure of the F‑47 and the “appropriate” contract type for the F/A‑XX will help avoid the losses seen under earlier fixed‑price programs and support mid‑single‑digit or higher defense revenue growth. The division booked $23 billion of orders in the quarter, raising its backlog to a record $101 billion, though the F/A‑XX award is not yet reflected in the backlog.
Why it matters
The company expects defense revenue growth of at least mid‑single‑digit percentages, higher than the low‑single‑digit growth it forecast a year earlier, which could lift overall earnings and free‑cash‑flow generation. Boeing also projects roughly $3 billion of free cash flow in 2027, reflecting the anticipated cash contribution from the new fighter programs.
Key facts
- 1Boeing Defense, Space & Security generated US$7.94 billion in revenue in Q3 2026, up 15% from US$6.90 billion a year earlier. airdatanews.com
- 2Operating profit rose to US$492 million in Q3 2026, up from US$114 million a year earlier. airdatanews.com
- 3The division booked US$23 billion of orders during the quarter, pushing the backlog to a record US$101 billion (excluding the F/A‑XX award). defence-industry.eu
- 4Boeing won a $20 billion contract to develop the Navy’s F/A‑XX sixth‑generation fighter and a $2.38 billion contract for 22 additional F‑15EX fighters. airandspaceforces.com
- 5CEO Kelly Ortberg said the F‑47 program is cost‑plus and the F/A‑XX contract is an “appropriate contract type,” intended to avoid the losses from earlier fixed‑price deals. airdatanews.com
- 6Boeing expects defense revenue growth of at least the mid‑single‑digit range or higher, up from a low‑single‑digit outlook a year earlier. airandspaceforces.com
Open questions
- The contract value, quantity and delivery schedule for the F/A‑XX program were not disclosed, and the award is excluded from the current backlog.
Summary written by AlphAI AI Desk from 4 of 4 sources. Not investment advice. Figures are as stated by the linked sources.