Pentagon reduces F-35 request; Lockheed Martin shares fall

Additionally, funding has been requested for only 12 F-35C jets, fewer than the previously approved 17 for this year. The Marines will also face a reduction in their order by two units, indicating serious budget cuts for this fiscal year.

Lockheed Martin stated: "The F-35 is the cornerstone of the battlespace for the U.S. military…We will continue to work closely with the Administration, Congress, and our customers to deliver this game-changing capability as the budget process continues in the months ahead."

Despite ongoing challenges with delays and technological upgrades in the F-35 development program, Lockheed Martin anticipates receiving a final contract soon. In 2024, they delivered 110 F-35 jets to various nations.

Market reactions were largely negative due to concerns over potential shifts in Air Force strategy regarding the fighter jet program. The F-35 program accounts for 30% of Lockheed's revenue.

While Lockheed Martin's shares dropped by 4.26%, other defense contractors linked to the F-35 program also saw declines except RTX Corporation (formerly Raytheon Technologies), which increased by 2.38%. RTX owns Pratt & Whitney, responsible for manufacturing engines powering these jets.

With today's market close, Lockheed Martin remains underperforming among top US defense contractors with year-to-date losses at 6.04%. In contrast, General Dynamics and Northrop Grumman posted profits around 4%.