(Bloomberg) -- Lockheed Martin Corp. shares fell after its third-quarter revenue missed expectations, pulled down by weaker aeronautical sales and ongoing issues with its F-35 fighter jet program.
The defense contractor’s third-quarter sales were $17.1 billion, according to a statement Tuesday, up from last year’s $16.9 billion but below the average analyst estimate of $17.4 billion.
Lockheed’s shares fell as much as 4.98% in New York, the most intraday since January.
Aeronautical sales, Lockheed’s largest revenue driver, fell 3% as deliveries of its new-generation F-35 fighter jet were lower than anticipated. The company shipped 48 in the quarter as it aims to hand over 75 to 110 new and backlogged jets by the end of the year.
The beleaguered F-35 program saw $480 million less in sales in the third quarter due to contractual authorization and funding delays, Lockheed said in Tuesday’s statement. It was also unable to recognize revenue and profit on about $400 million of costs incurred on the program.
Lockheed was set incremental milestones by the Pentagon earlier this month that could see it earn some of the potential $500 million in payments withheld for F-35s that lacked upgrades. The jet program failed to meet minimum combat readiness rates for six straight years even after the military spent $12 billion on it, the Government Accountability Office said on Monday.
Still, the company raised its outlook for the second time this year as its backlog hit a record $166 billion and sales rose for its tactical and strike missiles, as well as its warfare sensors and helicopters.
The defense contractor now expects revenue of about $71.3 billion this year, near the upper range of its prior outlook and above the average analyst estimate of $71.1 billion. Lockheed raised its earnings per share view to about $26.65, also beating expectations.
Raytheon Technologies reported sales and earnings above expectations on Tuesday.
--With assistance from Tony Capaccio.
(Updates with share move and more information on sales miss.)
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