By Nathan Gomes and Mike Stone
(Reuters) -Northrop Grumman Corp on Thursday reported quarterly revenues that fell short of Wall Street expectations, pushing its shares down nearly 7 percent and making it the latest big U.S. defense contractor to disappoint investors with lackluster results.
Lockheed Martin Corp (NYSE:LMT) on Tuesday dramatically lowered its sales expectations for this year and next as the COVID-19 pandemic hobbled the top U.S. defense contractor's supply chain, sending its shares down 11%.
Northrup, the maker of bombers and intercontinental ballistic missiles (ICBMs), also reported a better-than-expected quarterly profit, driven by strong demand in its fast-growing space unit, prompting the company to raise its full-year adjusted profit forecast.
Company Chair Kathy Warden acknowledged "some labor-related and supply-chain challenges stemming from the COVID-19 pandemic on our operations" in the earnings release.
Northrop (NYSE:NOC) shares fell $26.40 to $361.75 by Thursday midday trading.
Northrop said it now expects full-year adjusted earnings per share of $25.20 to $25.60, up from its prior range of $24.40 to $24.80.
The pandemic has hurt companies around the globe by reducing their ability to send or receive components, thereby creating shortages and reducing sales.
Northrop said it completed a flight test for its Hypersonic Air-breathing Weapon Concept (HAWC) with Raytheon Technologies (NYSE:RTX) in the third quarter.
This comes as defense contractors quicken their pace to build hypersonic weapons - the next generation of arms that deprive adversaries of reaction time and traditional defeat mechanisms.
The missile, built by Raytheon (NYSE:RTN) and equipped with a Northrop scramjet (supersonic combustion ramjet) engine, is capable of achieving speeds faster than five times the speed of sound, marking the first successful test of the class of weapon since 2013.
Northrop's space unit, which makes satellites and missile systems, reported a 22% jump in sales to $2.68 billion for the third quarter ended Sept. 30.
Excluding items, Northrop earned $6.63 per share, topping Wall Street estimates of $5.99, according to Refinitiv IBES.
The company's total sales, however, fell 4% to $8.72 billion, missing estimates $8.94 billion.