LOCKHEED MARTIN CORP [LMT] Filings

10-Q 1 lmt-20230924.htm 10-Q lmt-20230924

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 24, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number: 1-11437

LOCKHEED MARTIN CORPORATION

(Exact name of registrant as specified in its charter)

Maryland

52-1893632

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer Identification No.)

6801 Rockledge Drive,

Bethesda,

Maryland

20817

(Address of principal executive offices)

(Zip Code)

(301) 897-6000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $1 par value	LMT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non–accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b–2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non–accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 248,098,715 shares of our common stock, $1 par value per share, outstanding as of October 13, 2023.

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Lockheed Martin Corporation

Form 10-Q

For the Quarterly Period Ended September 24, 2023

Table of Contents


			Page

PART I. FINANCIAL INFORMATION

	ITEM 1.	Financial Statements (Unaudited)

		Consolidated Statements of Earnings for the Quarters and Nine Months Ended September 24, 2023 and September 25, 2022	3

		Consolidated Statements of Comprehensive Income for the Quarters and Nine Months Ended September 24, 2023 and September 25, 2022	4

		Consolidated Balance Sheets as of September 24, 2023 and December 31, 2022	5

		Consolidated Statements of Cash Flows for the Nine Months Ended September 24, 2023 and September 25, 2022	6

		Consolidated Statements of Equity for the Quarters Ended September 24, 2023 and September 25, 2022	7

		Consolidated Statements of Equity for the Nine Months Ended September 24, 2023 and September 25, 2022	8

		Notes to Consolidated Financial Statements	9

		Report of Independent Registered Public Accounting Firm	26

	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27

	ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	43

	ITEM 4.	Controls and Procedures	43

PART II. OTHER INFORMATION

	ITEM 1.	Legal Proceedings	44

	ITEM 1A.	Risk Factors	45

	ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45

	ITEM 5.	Other Information	46

	ITEM 6.	Exhibits	46

SIGNATURE			47

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PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Lockheed Martin Corporation

Consolidated Statements of Earnings

(unaudited; in millions, except per share data)



	Quarters Ended				Nine Months Ended
	September 24, 2023		September 25, 2022		September 24, 2023		September 25, 2022
Net sales
Products	$	14,014	$	14,011	$	40,298	$	39,266
Services	2,864		2,572		8,399		7,727
Total net sales	16,878		16,583		48,697		46,993
Cost of sales
Products	(12,571)		(12,493)		(35,960)		(34,939)
Services	(2,510)		(2,235)		(7,436)		(6,758)

Other unallocated, net	251		265		883		689
Total cost of sales	(14,830)		(14,463)		(42,513)		(41,008)
Gross profit	2,048		2,120		6,184		5,985
Other (expense) income, net	(6)		39		30		70
Operating profit	2,042		2,159		6,214		6,055
Interest expense	(237)		(145)		(662)		(421)
Non-service FAS pension income (expense)	111		111		332		(1,080)


Other non-operating income (expense), net	37		(26)		69		(64)
Earnings before income taxes	1,953		2,099		5,953		4,490
Income tax expense	(269)		(321)		(899)		(670)


Net earnings	$	1,684	$	1,778	$	5,054	$	3,820

Earnings per common share
Basic	$	6.75	$	6.73	$	20.04	$	14.36



Diluted	$	6.73	$	6.71	$	19.97	$	14.31




Cash dividends paid per common share	$	3.00	$	2.80	$	9.00	$	8.40

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Consolidated Statements of Comprehensive Income

(unaudited; in millions)



	Quarters Ended				Nine Months Ended
	September 24, 2023		September 25, 2022		September 24, 2023		September 25, 2022
Net earnings	$	1,684	$	1,778	$	5,054	$	3,820
Other comprehensive income, net of tax
Postretirement benefit plans
Net actuarial gain recognized due to plan remeasurements, net of tax of $44 million and $505 million in 2022	—		162		—		1,860
Amortization of actuarial losses and prior service credits, net of tax of $10 million and $30 million in 2023 and $1 million and $27 million in 2022	(37)		(2)		(111)		93
Pension settlement charge, net of tax of $314 million in 2022	—		—		—		1,156
Other, net, net of tax of $5 million and $4 million in 2023 and $6 million and $12 million in 2022	(30)		(126)		(12)		(237)
Other comprehensive income, net of tax	(67)		34		(123)		2,872
Comprehensive income	$	1,617	$	1,812	$	4,931	$	6,692

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Consolidated Balance Sheets

(in millions, except par value)


	September 24, 2023		December 31, 2022
	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	3,551	$	2,547
Receivables, net	2,405		2,505
Contract assets	13,605		12,318
Inventories	3,312		3,088
Other current assets	449		533
Total current assets	23,322		20,991
Property, plant and equipment, net	8,046		7,975
Goodwill	10,782		10,780
Intangible assets, net	2,274		2,459
Deferred income taxes	4,873		3,744
Other noncurrent assets	7,369		6,931
Total assets	$	56,666	$	52,880
Liabilities and equity
Current liabilities
Accounts payable	$	3,817	$	2,117
Salaries, benefits and payroll taxes	3,139		3,075
Contract liabilities	7,936		8,488
Current maturities of long-term debt	168		118
Other current liabilities	2,133		2,089
Total current liabilities	17,193		15,887
Long-term debt, net	17,221		15,429
Accrued pension liabilities	5,323		5,472
Other noncurrent liabilities	7,655		6,826
Total liabilities	47,392		43,614
Stockholders’ equity
Common stock, $1 par value per share	247		254
Additional paid-in capital	107		92
Retained earnings	17,066		16,943
Accumulated other comprehensive loss	(8,146)		(8,023)
Total stockholders’ equity	9,274		9,266


Total liabilities and equity	$	56,666	$	52,880

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Consolidated Statements of Cash Flows

(unaudited; in millions)


	Nine Months Ended
	September 24, 2023		September 25, 2022
Operating activities
Net earnings	$	5,054	$	3,820
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation and amortization	1,009		965
Stock-based compensation	221		195


Deferred income taxes	(395)		(540)
Pension settlement charge	—		1,470


Changes in assets and liabilities
Receivables, net	100		(521)
Contract assets	(1,287)		(1,754)
Inventories	(224)		(132)
Accounts payable	1,731		1,834
Contract liabilities	(552)		(48)
Income taxes	(81)		113
Qualified defined benefit pension plans	(283)		(322)
Other, net	262		794
Net cash provided by operating activities	5,555		5,874
Investing activities
Capital expenditures	(987)		(977)
Other, net	(4)		(4)
Net cash used for investing activities	(991)		(981)
Financing activities
Issuance of long-term debt, net of related costs	1,975		2,267
Repayments of long-term debt	(115)		(2,250)
Repurchases of common stock	(3,000)		(3,694)
Dividends paid	(2,289)		(2,250)

Other, net	(131)		(140)
Net cash used for financing activities	(3,560)		(6,067)
Net change in cash and cash equivalents	1,004		(1,174)
Cash and cash equivalents at beginning of period	2,547		3,604
Cash and cash equivalents at end of period	$	3,551	$	2,430

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Consolidated Statements of Equity

For the Quarters Ended September 24, 2023 and September 25, 2022

(unaudited; in millions)



	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
Balance at June 25, 2023	$	251	$	—	$	17,068	$	(8,079)		$	9,240
Net earnings	—		—		1,684		—			1,684
Other comprehensive income, net of tax	—		—		—		(67)			(67)
Dividends declared	—		—		11		—			11
Repurchases of common stock	(4)		(49)		(1,697)		—			(1,750)
Stock-based awards, ESOP activity and other	—		156		—		—			156
Balance at September 24, 2023	$	247	$	107	$	17,066	$	(8,146)		$	9,274

Balance at June 26, 2022	$	264	$	—	$	19,336	$	(8,168)		$	11,432
Net earnings	—		—		1,778		—			1,778
Other comprehensive income, net of tax	—		—		—		34			34
Dividends declared	—		—		7		—			7
Repurchases of common stock	(3)		(148)		(1,282)		—			(1,433)
Stock-based awards, ESOP activity and other	—		148		—		—			148


Balance at September 25, 2022	$	261	$	—	$	19,839	$	(8,134)		$	11,966

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Consolidated Statements of Equity

For the Nine Months Ended September 24, 2023 and September 25, 2022

(unaudited; in millions)



	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
Balance at December 31, 2022	$	254	$	92	$	16,943	$	(8,023)		$	9,266
Net earnings	—		—		5,054		—			5,054
Other comprehensive income, net of tax	—		—		—		(123)			(123)
Dividends declared	—		—		(2,280)		—			(2,280)
Repurchases of common stock	(8)		(341)		(2,651)		—			(3,000)
Stock-based awards, ESOP activity and other	1		356		—		—			357
Balance at September 24, 2023	$	247	$	107	$	17,066	$	(8,146)		$	9,274

Balance at December 31, 2021	$	271	$	94	$	21,600	$	(11,006)		$	10,959
Net earnings	—		—		3,820		—			3,820
Other comprehensive income, net of tax	—		—		—		2,872			2,872
Dividends declared	—		—		(2,239)		—			(2,239)
Repurchases of common stock	(11)		(453)		(3,342)		—			(3,806)
Stock-based awards, ESOP activity and other	1		359		—		—			360

Balance at September 25, 2022	$	261	$	—	$	19,839	$	(8,134)		$	11,966

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited)

NOTE 1 - BASIS OF PRESENTATION

We prepared these consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information, the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements.

In the opinion of management, these consolidated financial statements reflect all adjustments that are of a normal recurring nature necessary for a fair presentation of our results of operations, financial condition, and cash flows for the interim periods presented. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We base these estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates. Significant estimates inherent in the preparation of our consolidated financial statements include, but are not limited to, accounting for sales and cost recognition; postretirement benefit plans; environmental liabilities and assets for the portion of environmental costs that are probable of future recovery; evaluation of goodwill, intangible assets, investments and other assets for impairment; income taxes including deferred tax assets; fair value measurements; and contingencies. The consolidated financial statements include the accounts of subsidiaries we control and variable interest entities if we are the primary beneficiary. We eliminate intercompany balances and transactions in consolidation.

Effective January 1, 2023, we no longer consider amortization expense related to purchased intangible assets when evaluating the operating performance of our business segments. As a result, intangible asset amortization expense, which was previously included in segment operating profit, is now reported in unallocated corporate expense within total consolidated operating profit. This change has no impact on our consolidated operating results. Management believes this updated presentation better aligns with how the business is viewed and managed and will provide better insights into business segment performance. This change has been applied to the amounts in this Form 10-Q, including amounts for 2022. See “Note 3 - Information on Business Segments” for further information regarding the impact of this change on our current and prior period segment operating profit.

We close our books and records on the last Sunday of the interim calendar quarter, which was on September 24 for the third quarter of 2023 and September 25 for the third quarter of 2022 to align our financial closing with our business processes. The consolidated financial statements and tables of financial information included herein are labeled based on that convention. This practice only affects interim periods as our fiscal year ends on December 31.

The results of operations for the interim periods presented are not necessarily indicative of results to be expected for the full year or future periods. Unless otherwise noted, we present all per share amounts cited in these consolidated financial statements on a “per diluted share” basis. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022 (2022 Form 10-K).

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Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

NOTE 2 - EARNINGS PER COMMON SHARE

The weighted average number of shares outstanding used to compute earnings per common share were as follows (in millions):


	Quarters Ended		Nine Months Ended
	September 24, 2023	September 25, 2022	September 24, 2023	September 25, 2022
Weighted average common shares outstanding for basic computations	249.3	264.1	252.2	266.0
Weighted average dilutive effect of equity awards	0.9	1.0	0.9	0.9
Weighted average common shares outstanding for diluted computations	250.2	265.1	253.1	266.9

We compute basic and diluted earnings per common share by dividing net earnings by the respective weighted average number of common shares outstanding for the periods presented. Our calculation of diluted earnings per common share also includes the dilutive effects for the assumed vesting of outstanding restricted stock units (RSUs) and performance stock units (PSUs) based on the treasury stock method. There were no significant anti-dilutive equity awards during the quarters and nine months ended September 24, 2023 and September 25, 2022. Basic and diluted weighted average common shares outstanding decreased in 2023 compared to 2022 due to share repurchases. See “Note 9 - Stockholders’ Equity” for more information.

NOTE 3 - INFORMATION ON BUSINESS SEGMENTS

Overview

We operate in four business segments: Aeronautics, Missiles and Fire Control (MFC), Rotary and Mission Systems (RMS) and Space. We organize our business segments based on the nature of products and services offered.

Selected Financial Data by Business Segment

Net sales and operating profit of our business segments exclude intersegment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management’s evaluation of performance of each segment. 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.

Summary Operating Results

As discussed in “Note 1 - Basis of Presentation”, effective January 1, 2023, we no longer consider amortization expense related to purchased intangible assets when evaluating the operating performance of our business segments. As a result, intangible asset amortization expense, which was previously included in segment operating profit, is now reported in unallocated items within total consolidated operating profit.

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Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

This change has been applied to the amounts below, including the amounts for 2022. Sales and operating profit for each of our business segments were as follows (in millions):


	Quarters Ended				Nine Months Ended
	September 24, 2023		September 25, 2022		September 24, 2023		September 25, 2022
Net sales
Aeronautics	$	6,717	$	7,089	$	19,861	$	19,352
Missiles and Fire Control	2,939		2,831		8,082		8,030
Rotary and Mission Systems	4,121		3,781		11,528		11,345
Space	3,101		2,882		9,226		8,266
Total net sales	$	16,878	$	16,583	$	48,697	$	46,993
Operating profit
Aeronautics	$	671	$	759	$	2,064	$	2,051
Missiles and Fire Control	398		383		1,146		1,186
Rotary and Mission Systems	482		472		1,286		1,339
Space	259		304		851		823
Total business segment operating profit	1,810		1,918		5,347		5,399
Unallocated items
FAS/CAS pension operating adjustment	414		430		1,245		1,281

Intangible asset amortization expense	(61)		(62)		(185)		(186)
Other, net	(121)		(127)		(193)		(439)
Total unallocated items	232		241		867		656
Total consolidated operating profit	$	2,042	$	2,159	$	6,214	$	6,055
Intersegment sales
Aeronautics	$	62	$	63	$	186	$	181
Missiles and Fire Control	177		146		482		463
Rotary and Mission Systems	518		503		1,512		1,411
Space	97		102		275		284
Total intersegment sales	$	854	$	814	$	2,455	$	2,339

Unallocated Items

Business segment operating profit excludes the FAS/CAS pension operating adjustment, 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, environmental costs, 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. Excluded items are included in the reconciling item “Unallocated items” between operating profit from our business segments and our consolidated operating profit. See “Note 10 - Other” for a discussion related to certain factors that may impact the comparability of net sales and operating profit of our business segments.

FAS/CAS Pension Operating Adjustment

Our business segments’ results of operations include pension expense only as calculated under U.S. Government Cost Accounting Standards (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 of our business segment’s net sales and cost of sales. Our consolidated financial statements must present pension and other postretirement benefit plan income calculated in accordance with Financial Accounting Standards (FAS) requirements under U.S. GAAP. The operating portion of the total FAS/CAS pension adjustment represents the difference between the service cost component of FAS pension income (expense) and total CAS pension cost. The non-service FAS pension income (expense) components are included in non-service FAS pension income (expense) in our consolidated statements of earnings. As a result, to the extent that CAS pension cost exceeds the service cost component of FAS pension income (expense) we have a favorable FAS/CAS pension operating adjustment.

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Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Disaggregation of Net Sales

Net sales by products and services, contract type, customer, and geographic region were as follows (in millions):


	Quarter Ended September 24, 2023
	Aeronautics		MFC		RMS		Space		Total
Net sales
Products	$	5,538	$	2,609	$	3,249	$	2,618	$	14,014
Services	1,179		330		872		483		2,864
Total net sales	$	6,717	$	2,939	$	4,121	$	3,101	$	16,878
Net sales by contract type
Fixed-price	$	4,495	$	2,017	$	2,602	$	796	$	9,910
Cost-reimbursable	2,222		922		1,519		2,305		6,968
Total net sales	$	6,717	$	2,939	$	4,121	$	3,101	$	16,878
Net sales by customer
U.S. Government	$	4,547	$	2,061	$	2,796	$	3,055	$	12,459
International (a)	2,170		875		1,254		24		4,323
U.S. commercial and other	—		3		71		22		96
Total net sales	$	6,717	$	2,939	$	4,121	$	3,101	$	16,878
Net sales by geographic region
United States	$	4,547	$	2,064	$	2,867	$	3,077	$	12,555
Europe	1,190		197		269		1		1,657
Asia Pacific	693		155		601		22		1,471
Middle East	220		474		185		1		880
Other	67		49		199		—		315
Total net sales	$	6,717	$	2,939	$	4,121	$	3,101	$	16,878


	Nine Months Ended September 24, 2023
	Aeronautics		MFC		RMS		Space		Total
Net sales
Products	$	16,339	$	7,110	$	9,082	$	7,767	$	40,298
Services	3,522		972		2,446		1,459		8,399
Total net sales	$	19,861	$	8,082	$	11,528	$	9,226	$	48,697
Net sales by contract type
Fixed-price	$	13,463	$	5,498	$	7,261	$	2,359	$	28,581
Cost-reimbursable	6,398		2,584		4,267		6,867		20,116
Total net sales	$	19,861	$	8,082	$	11,528	$	9,226	$	48,697
Net sales by customer
U.S. Government	$	13,285	$	5,553	$	7,973	$	9,084	$	35,895
International (a)	6,453		2,521		3,349		110		12,433
U.S. commercial and other	123		8		206		32		369
Total net sales	$	19,861	$	8,082	$	11,528	$	9,226	$	48,697
Net sales by geographic region
United States	$	13,408	$	5,561	$	8,179	$	9,116	$	36,264
Europe	3,466		582		706		48		4,802
Asia Pacific	2,058		472		1,593		60		4,183
Middle East	671		1,340		526		2		2,539
Other	258		127		524		—		909
Total net sales	$	19,861	$	8,082	$	11,528	$	9,226	$	48,697

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Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)


	Quarter Ended September 25, 2022
	Aeronautics		MFC		RMS		Space		Total
Net sales
Products	$	6,072	$	2,530	$	2,968	$	2,441	$	14,011
Services	1,017		301		813		441		2,572
Total net sales	$	7,089	$	2,831	$	3,781	$	2,882	$	16,583
Net sales by contract type
Fixed-price	$	5,217	$	2,005	$	2,436	$	722	$	10,380
Cost-reimbursable	1,872		826		1,345		2,160		6,203
Total net sales	$	7,089	$	2,831	$	3,781	$	2,882	$	16,583
Net sales by customer
U.S. Government	$	4,728	$	2,086	$	2,721	$	2,842	$	12,377
International (a)	2,326		744		1,002		34		4,106
U.S. commercial and other	35		1		58		6		100
Total net sales	$	7,089	$	2,831	$	3,781	$	2,882	$	16,583
Net sales by geographic region
United States	$	4,763	$	2,087	$	2,779	$	2,848	$	12,477
Europe	1,184		228		199		21		1,632
Asia Pacific	785		100		440		10		1,335
Middle East	255		374		181		3		813
Other	102		42		182		—		326
Total net sales	$	7,089	$	2,831	$	3,781	$	2,882	$	16,583


	Nine Months Ended September 25, 2022
	Aeronautics		MFC		RMS		Space		Total
Net sales
Products	$	16,293	$	7,147	$	8,906	$	6,920	$	39,266
Services	3,059		883		2,439		1,346		7,727
Total net sales	$	19,352	$	8,030	$	11,345	$	8,266	$	46,993
Net sales by contract type
Fixed-price	$	13,819	$	5,661	$	7,243	$	2,112	$	28,835
Cost-reimbursable	5,533		2,369		4,102		6,154		18,158
Total net sales	$	19,352	$	8,030	$	11,345	$	8,266	$	46,993
Net sales by customer
U.S. Government	$	12,904	$	5,605	$	8,017	$	8,144	$	34,670
International (a)	6,344		2,419		3,102		97		11,962
U.S. commercial and other	104		6		226		25		361
Total net sales	$	19,352	$	8,030	$	11,345	$	8,266	$	46,993
Net sales by geographic region
United States	$	13,008	$	5,611	$	8,243	$	8,169	$	35,031
Europe	3,052		746		564		65		4,427
Asia Pacific	2,211		313		1,425		23		3,972
Middle East	739		1,256		558		9		2,562
Other	342		104		555		—		1,001
Total net sales	$	19,352	$	8,030	$	11,345	$	8,266	$	46,993

(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.

Table of Contents

Lockheed Martin Corporation

Notes to Consolidated Financial Statements (unaudited) (continued)

Our Aeronautics business segment includes our largest program, the F-35 Lightning II, an international multi-role, multi-variant, stealth fighter aircraft. Net sales for the F-35 program represented approximately 26% of our total consolidated net sales for both the quarter and nine months ended September 24, 2023 and 29% and 27% of our total consolidated net sales for the quarter and nine months ended September 25, 2022.

Assets

Total assets for each of our business segments were as follows (in millions):


	September 24, 2023		December 31, 2022
Assets
Aeronautics	$	13,252	$	12,055
Missiles and Fire Control	5,706		5,788
Rotary and Mission Systems	17,822		17,988
Space	6,522		6,351
Total business segment assets	43,302		<