US defense contractors mostly maintain forecasts despite Trump tariffs

Written by Mike Stone and Utakars Sheti

WASHINGTON (Reuters) -US defense contractors often retain their financial forecasts for 2025, saying it was too early to understand the influence of US president Donald Trump’s tariff.

Lockheed Martin, the largest defense company, reaffirmed its forecast for this year on Tuesday, supported by flexible demand for missile systems and combat aircraft. Likewise, Northwarb Grouman said that the margins of their profit have narrowed, but are stuck in its prediction in sales, indicating some confidence in the face of trade tensions.

“We do not see, at this time period, a great danger to our company related to commercial policies as we understand it today,” Kathi Warden, CEO of Northrop told Owlosts. “We will closely monitor this, and we are already taking measures to calculate the risks we see and mitigate, especially in the availability of certain components that we need to present on our programs.”

RTX Corp, previously known as Raytheon Technologies, shattered by expressing anxiety about $ 850 million of discounted profits from new fees on mineral and China. This difference highlights the various effects of trade policies in the defense and commercial space sectors.

RTX has large commercial companies from space that makes interior designs and jet engines.

The defense industry, like other sectors that have complex manufacturing processes, wrestles with the possible effects of a global trade war. The situation has pressed the already tense supply chain, forcing companies to reassess their strategies and cost structures.

Despite these challenges, the sector continues to benefit from increased demand for global weapons, which are fueled by the Russian war in Ukraine and the conflict in the Middle East. This increased demand helped compensate some of the uncertainty out of commercial conflicts. However, RTX anxiety indicates that the industry is not immune to commercial pressure, highlighting the complex interaction between defense spending, international relations and economic policies.

The high American defense budget proposed by Defense Minister Beit Higseth as social media on April 7, will benefit contractors’ revenues while providing some stability and growth, even amid the uninterrupted economic outlook.

Trump’s review of military equipment export, which aims to reduce restrictions, can enhance revenue for American contractors. However, this comes because some allies, including Canada and the European Union, reconsider their dependence on American defense equipment due to trade tensions and the transfer of geopolitical alliances.