Lockheed Martin unveils 10-year F-35 framework agreement, reports third-quarter sales of $20.7 billion

As of 7:24 a.m. ET, Thursday, Oct. 22, 2026

Lockheed Martin said Thursday that it and the Department of War had unveiled a framework agreement for multiyear production and sustainment of the F-35 Lightning II that includes 850 U.S. aircraft over 10 years, as the company reported third-quarter 2026 sales of $20.7 billion.

The framework also includes associated initial spares, 10 years of modification kits and sustainment, and international customer orders across Lots 21-30, at a continued production rate of 156 aircraft per year, according to the company.

Lockheed said that if multiyear authority and associated appropriations are granted in the coming months, the F-35 Joint Program Office and the company will work to finalize contract terms, pricing and schedules through a formal contract award. The company said it expects the effort to save taxpayers billions of dollars over the F-35's lifecycle through long-term pricing and industry volume discounts.

"This multiyear framework strengthens the way we can plan and invest in the F-35 enterprise," Lockheed Martin Chairman, President and CEO Jim Taiclet said. "With the greater certainty that comes from the U.S. government's transformative approach to F-35 production and sustainment, we can make the upfront investments needed to expand capacity, improve efficiency, and build a more resilient supply chain."

Third-quarter results

Lockheed reported third-quarter net earnings of $1.8 billion, or $7.97 per share, compared with $1.6 billion, or $6.95 per share, a year earlier. Sales rose 11% from $18.6 billion in the third quarter of 2025, with growth in each of the company's four business segments, the company said.

Backlog grew 27% from the second quarter to a record $292.0 billion, including $52.5 billion associated with a multi-year award to produce PAC-3 Missile Segment Enhancement interceptors, according to the company. Cash from operations was $3.4 billion and free cash flow was $3.0 billion, compared with $3.7 billion and $3.3 billion in the third quarter of 2025.

The company delivered 43 F-35s in the quarter, compared with 46 a year earlier, according to its release.

Lockheed raised its 2026 outlook and now expects sales of about $80 billion to $82 billion and diluted earnings per share of about $30.35 to $30.75. "The sustained financial momentum across our portfolio gives us confidence to increase our outlook for sales, earnings per share and free cash flow, the second consecutive quarter we have raised our financial guidance," Taiclet said.

F-35 contract negotiations

Lockheed said it remains in negotiations with the U.S. government on production contracts for F-35 lots 20 and higher. The company said its costs began to exceed the current contractual authorization and funding on the Lot 20 advance acquisition contract during the third quarter, and that without additional contractual authorization and funding from the government, its results of operations, cash flows and financial condition will be negatively impacted in future periods.

What is not known

Lockheed's release does not give a value for the F-35 framework agreement. The company says contract terms, pricing and schedules are still to be set through a formal contract award, which depends on multiyear authority and associated appropriations being granted.