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INFORMATION ON BUSINESS SEGMENTS | 3 Months Ended
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Mar. 30, 2025
Segment Reporting [Abstract] |
INFORMATION ON BUSINESS SEGMENTS | INFORMATION ON BUSINESS SEGMENTS Our operations are organized into four business segments, which also comprise our reportable segments: Aeronautics, Missiles and Fire Control (MFC), Rotary and Mission Systems (RMS) and Space. We generally organize our business segments based on the nature of products and services offered. Our chief operating decision maker (CODM) consists of the Chairman, President and Chief Executive Officer and the Chief Operating Officer. The CODM is responsible for allocating resources and assessing the performance of our consolidated enterprise and business segments. The profitability measure the CODM uses to allocate resources and assess segment performance is segment operating profit (and related margin rate, calculated as segment operating profit divided by sales), which is compared to historical and forecasted amounts on a regular basis. Summary operating results for each of our business segments were as follows (in millions):
|  |  | Quarters Ended
|  |  |  |  | March 30, 2025 |  | March 31, 2024
Sales |  |  |  |  |  |  |  |  |  |  |
Aeronautics |  |  |  |  |  |  | $ | 7,057 |  |  |  | $ | 6,845 |  |
Missiles and Fire Control |  |  |  |  |  |  | 3,373 |  |  |  | 2,993 |  |
Rotary and Mission Systems |  |  |  |  |  |  | 4,328 |  |  |  | 4,088 |  |
Space |  |  |  |  |  |  | 3,205 |  |  |  | 3,269 |  |
Total sales |  |  |  |  |  |  | $ | 17,963 |  |  |  | $ | 17,195 |  |
Operating costs and expenses |  |  |  |  |  |  |  |  |  |  |
Aeronautics |  |  |  |  |  |  | $ | 6,337 |  |  |  | $ | 6,170 |  |
Missiles and Fire Control |  |  |  |  |  |  | 2,908 |  |  |  | 2,686 |  |
Rotary and Mission Systems |  |  |  |  |  |  | 3,858 |  |  |  | 3,665 |  |
Space |  |  |  |  |  |  | 2,821 |  |  |  | 2,966 |  |
Total operating costs and expenses |  |  |  |  |  |  | $ | 15,924 |  |  |  | $ | 15,487 |  |
Operating profit (a) |  |  |  |  |  |  |  |  |  |  |
Aeronautics |  |  |  |  |  |  | $ | 720 |  |  |  | $ | 679 |  |
Missiles and Fire Control |  |  |  |  |  |  | 465 |  |  |  | 311 |  |
Rotary and Mission Systems |  |  |  |  |  |  | 521 |  |  |  | 430 |  |
Space |  |  |  |  |  |  | 379 |  |  |  | 325 |  |
Total business segment operating profit |  |  |  |  |  |  | 2,085 |  |  |  | 1,745 |  |
Unallocated items |  |  |  |  |  |  |  |  |  |  |
FAS/CAS pension operating adjustment |  |  |  |  |  |  | 379 |  |  |  | 406 |  |
Intangible asset amortization expense |  |  |  |  |  |  | (64) |  |  |  | (61) |  |
Other, net |  |  |  |  |  |  | (28) |  |  |  | (61) |  |
Total unallocated items |  |  |  |  |  |  | 287 |  |  |  | 284 |  |
Total consolidated operating profit |  |  |  |  |  |  | $ | 2,372 |  |  |  | $ | 2,029 |  |
Intersegment sales |  |  |  |  |  |  |  |  |  |  |
Aeronautics |  |  |  |  |  |  | $ | 89 |  |  |  | $ | 70 |  |
Missiles and Fire Control |  |  |  |  |  |  | 169 |  |  |  | 202 |  |
Rotary and Mission Systems |  |  |  |  |  |  | 564 |  |  |  | 586 |  |
Space |  |  |  |  |  |  | 83 |  |  |  | 107 |  |
Total intersegment sales |  |  |  |  |  |  | $ | 905 |  |  |  | $ | 965 |  |
(a)Operating profit by segment includes certain immaterial items, such as other income (primarily equity earnings) that are not presented separately in the table. Accordingly, the difference between sales less operating costs and expenses may not equal operating profit by segment. Segment results exclude intersegment transactions as these activities are eliminated in consolidation and are not considered in assessing the performance of each segment. As described below, segment operating profit also excludes other transactions that are not part of management’s evaluation of segment operating performance, which are included in “Unallocated items” to reconcile total segment operating profit to consolidated amounts. Business segment operating profit includes our share of earnings or losses from equity method investees as the operating activities of the equity method investees are closely aligned with the operations of our business segments. Unallocated Items Business segment operating profit excludes the FAS/CAS pension operating adjustment described below, a portion of corporate costs not considered allowable or allocable to contracts with the U.S. Government under the applicable U.S. Government Cost Accounting Standards (CAS) or Federal Acquisition Regulations (FAR), and other items not considered part of management’s evaluation of segment operating performance such as a portion of management and administration costs, legal fees and settlements, stock-based compensation expense, changes in the fair value of assets and liabilities for deferred compensation plans, retiree benefits, significant severance charges, significant asset impairments, gains or losses from divestitures, intangible asset amortization expense, and other miscellaneous corporate activities. Collectively these items are included in “Unallocated items” to reconcile total segment to consolidated operating profit. See “Note 10 - Other” for a discussion related to certain factors that may impact the comparability of sales and operating profit of our business segments. FAS/CAS Pension Operating Adjustment Our business segment results of operations include pension expense as calculated under CAS, which we refer to as CAS pension cost. We recover CAS pension and other postretirement benefit plan cost through the pricing of our products and services on U.S. Government contracts and, therefore, recognize CAS pension cost in each business segments’ sales and operating costs and expenses. Our consolidated financial statements must present pension and other postretirement benefit plan (expense) income calculated in accordance with Financial Accounting Standards (FAS) requirements under U.S. GAAP. The FAS/CAS pension operating adjustment represents the difference between CAS pension cost included in segment operating income and the service cost component of FAS pension (expense) income included in consolidated operating profit. To the extent that CAS pension cost exceeds the service cost component of FAS pension (expense) income we have a favorable FAS/CAS pension operating adjustment. The non-service FAS pension (expense) income components are included in non-service FAS pension (expense) income on our consolidated statements of earnings. Disaggregation of Sales Sales by products and services, contract type, customer, and geographic region were as follows (in millions):
|  | Quarter Ended March 30, 2025
|  | Aeronautics |  | MFC |  | RMS |  | Space |  | Total
Sales |  |  |  |  |  |  |  |  |  |
Products |  | $ | 5,746 |  |  | $ | 3,017 |  |  | $ | 3,496 |  |  | $ | 2,677 |  |  | $ | 14,936 |
Services |  | 1,311 |  |  | 356 |  |  | 832 |  |  | 528 |  |  | 3,027 |
Total sales |  | $ | 7,057 |  |  | $ | 3,373 |  |  | $ | 4,328 |  |  | $ | 3,205 |  |  | $ | 17,963 |
Sales by contract type |  |  |  |  |  |  |  |  |  |
Fixed-price |  | $ | 4,713 |  |  | $ | 2,440 |  |  | $ | 2,660 |  |  | $ | 942 |  |  | $ | 10,755 |
Cost-reimbursable |  | 2,344 |  |  | 933 |  |  | 1,668 |  |  | 2,263 |  |  | 7,208 |
Total sales |  | $ | 7,057 |  |  | $ | 3,373 |  |  | $ | 4,328 |  |  | $ | 3,205 |  |  | $ | 17,963 |
Sales by customer |  |  |  |  |  |  |  |  |  |
U.S. Government |  | $ | 4,642 |  |  | $ | 2,391 |  |  | $ | 2,787 |  |  | $ | 3,129 |  |  | $ | 12,949 |
International (a) |  | 2,405 |  |  | 978 |  |  | 1,468 |  |  | 71 |  |  | 4,922 |
U.S. commercial and other |  | 10 |  |  | 4 |  |  | 73 |  |  | 5 |  |  | 92 |
Total sales |  | $ | 7,057 |  |  | $ | 3,373 |  |  | $ | 4,328 |  |  | $ | 3,205 |  |  | $ | 17,963 |
Sales by geographic region |  |  |  |  |  |  |  |  |  |
United States |  | $ | 4,652 |  |  | $ | 2,395 |  |  | $ | 2,860 |  |  | $ | 3,134 |  |  | $ | 13,041 |
Europe |  | 1,247 |  |  | 395 |  |  | 304 |  |  | 22 |  |  | 1,968 |
Asia Pacific |  | 840 |  |  | 224 |  |  | 633 |  |  | 47 |  |  | 1,744 |
Middle East |  | 148 |  |  | 342 |  |  | 212 |  |  | 2 |  |  | 704 |
Other |  | 170 |  |  | 17 |  |  | 319 |  |  | — |  |  | 506 |
Total sales |  | $ | 7,057 |  |  | $ | 3,373 |  |  | $ | 4,328 |  |  | $ | 3,205 |  |  | $ | 17,963 |
|  | Quarter Ended March 31, 2024
|  | Aeronautics |  | MFC |  | RMS |  | Space |  | Total
Sales |  |  |  |  |  |  |  |  |  |
Products |  | $ | 5,592 |  |  | $ | 2,664 |  |  | $ | 3,241 |  |  | $ | 2,699 |  |  | $ | 14,196 |
Services |  | 1,253 |  |  | 329 |  |  | 847 |  |  | 570 |  |  | 2,999 |
Total sales |  | $ | 6,845 |  |  | $ | 2,993 |  |  | $ | 4,088 |  |  | $ | 3,269 |  |  | $ | 17,195 |
Sales by contract type |  |  |  |  |  |  |  |  |  |
Fixed-price |  | $ | 4,584 |  |  | $ | 1,996 |  |  | $ | 2,477 |  |  | $ | 900 |  |  | $ | 9,957 |
Cost-reimbursable |  | 2,261 |  |  | 997 |  |  | 1,611 |  |  | 2,369 |  |  | 7,238 |
Total sales |  | $ | 6,845 |  |  | $ | 2,993 |  |  | $ | 4,088 |  |  | $ | 3,269 |  |  | $ | 17,195 |
Sales by customer |  |  |  |  |  |  |  |  |  |
U.S. Government |  | $ | 4,666 |  |  | $ | 2,167 |  |  | $ | 2,840 |  |  | $ | 3,162 |  |  | $ | 12,835 |
International (a) |  | 2,152 |  |  | 824 |  |  | 1,162 |  |  | 68 |  |  | 4,206 |
U.S. commercial and other |  | 27 |  |  | 2 |  |  | 86 |  |  | 39 |  |  | 154 |
Total sales |  | $ | 6,845 |  |  | $ | 2,993 |  |  | $ | 4,088 |  |  | $ | 3,269 |  |  | $ | 17,195 |
Sales by geographic region |  |  |  |  |  |  |  |  |  |
United States |  | $ | 4,693 |  |  | $ | 2,169 |  |  | $ | 2,926 |  |  | $ | 3,201 |  |  | $ | 12,989 |
Europe |  | 1,211 |  |  | 245 |  |  | 269 |  |  | 18 |  |  | 1,743 |
Asia Pacific |  | 636 |  |  | 187 |  |  | 540 |  |  | 46 |  |  | 1,409 |
Middle East |  | 203 |  |  | 370 |  |  | 162 |  |  | 4 |  |  | 739 |
Other |  | 102 |  |  | 22 |  |  | 191 |  |  | — |  |  | 315 |
Total sales |  | $ | 6,845 |  |  | $ | 2,993 |  |  | $ | 4,088 |  |  | $ | 3,269 |  |  | $ | 17,195 |
(a)International sales include foreign military sales (FMS) contracted through the U.S. Government and direct commercial sales to international governments and other international customers. Our Aeronautics business segment includes our largest program, the F-35 Lightning II, an international multi-role, multi-variant, stealth fighter aircraft. Sales for the F-35 program represented approximately 25% of our total consolidated sales for the quarters ended both March 30, 2025 and March 31, 2024. Assets Total assets for each of our business segments were as follows (in millions):
|  | March 30, 2025 |  | December 31, 2024
Assets |  |  |  |  |  |
Aeronautics |  | $ | 14,130 |  |  |  | $ | 13,223 |  |
Missiles and Fire Control |  | 6,140 |  |  |  | 5,952 |  |
Rotary and Mission Systems |  | 17,199 |  |  |  | 17,025 |  |
Space |  | 7,617 |  |  |  | 7,388 |  |
Total business segment assets |  | 45,086 |  |  |  | 43,588 |  |
Corporate assets (a) |  | 11,583 |  |  |  | 12,029 |  |
Total assets |  | $ | 56,669 |  |  |  | $ | 55,617 |  |
(a)Corporate assets primarily include cash and cash equivalents, deferred income taxes, assets for the portion of environmental costs that are probable of future recovery, property, plant and equipment used in our corporate operations, assets held in a trust for deferred compensation plans, and other marketable investments.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 48 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482785/280-10-55-48 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards 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