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    Home»ETFs»Aerospace & Defense ETFs in Focus This Earnings Season
    ETFs

    Aerospace & Defense ETFs in Focus This Earnings Season

    October 23, 2025


    The uptrend in the Aerospace & Defense industry is evident from the performance of the S&P Aerospace & Defense Select Industry Index, which has added 43.23% year to date, surpassing the S&P 500’s 13.90% gain in the same period.

    According to Reuters, ongoing conflicts in the Middle East and the prolonged Russia-Ukraine war have spurred greater demand for missiles and fighter jets, lifting defense contractor sales. However, persistent supply chain disruptions, intensified by the Trump administration’s trade policies, have impeded production efficiency and delayed backlog execution across the industry.

    Below, we highlight the third-quarter results of a few renowned U.S. Aerospace – Defense industry players.

    Northrop Grumman NOC reported third-quarter 2025 earnings of $7.67 per share, which beat the Zacks Consensus Estimate of $6.49 by 18.2%. NOC’s total sales of $10.42 billion missed the Zacks Consensus Estimate of $10.72 billion by 2.8%.

    However, the top line rose 4.3% from $10 billion reported in the year-ago quarter, driven by higher sales from its Aeronautics Systems, Defense Systems and Mission Systems segments.

    Per the abovementioned Reuters article, Northrop Grumman is also anticipated to participate in bids for the U.S. administration’s $175 billion Golden Dome missile defense system, potentially supporting long-term revenue expansion.

    NOC’s year-over-year improvement can be attributed to strong segment operating performance. The company’s operating income during the quarter totaled $1.24 billion, reflecting a significant rise from $1.12 billion in the prior-year quarter.

    NOC’s total backlog was $91.45 billion at the end of the third quarter compared with $89.74 billion at the end of second-quarter 2025.

    NOC now expects its revenues in the range of $41.70-$41.90 billion, lower than the previous guidance in the band of $42.05-$42.25 billion. The Zacks Consensus Estimate for sales is pegged at $42.17 billion, above the company’s newly guided range.

    RTX Corporation RTX reported third-quarter 2025 adjusted EPS of $1.70, beating the Zacks Consensus Estimate of $1.42 by 19.7%. The bottom line also improved 17.2% from the year-ago quarter’s level of $1.45.

    RTX’s third-quarter sales totaled $22.48 billion, which surpassed the Zacks Consensus Estimate of $21.48 billion by 4.6%. The top line also surged a solid 11.9% from $20.09 billion recorded in the third quarter of 2024. RTX’s total costs and expenses increased nearly 10% year over year to $20.02 billion in the quarter. For first-quarter 2025, RTX reported a backlog of $217 billion.

    During its post-earnings conference call, RTX management noted that the company aims to capture a share of the billions in U.S. defense spending allocated for the Golden Dome missile defense system, alongside continued demand for munitions replenishment, as quoted in a Reuters article.

    RTX now expects adjusted EPS to be in the band of $6.10-$6.20, up from the previous projection of $5.80-$5.95. The Zacks Consensus Estimate for 2025 EPS is pegged at $5.94

    Lockheed Martin LMT reported third-quarter 2025 adjusted earnings of $6.95 per share, which beat the Zacks Consensus Estimate of $6.33 by 9.8%. The bottom line increased 2.2% from the year-ago quarter’s reported figure of $6.80. The year-over-year improvement in earnings was primarily driven by higher revenues and operating profit.

    Alongside Northrop Grumman and RTX, Lockheed Martin is also competing for a share of the Trump administration’s proposed $175 billion Golden Dome missile defense program, according to Reuters.

    Net sales came in at $18.61 billion, which beat the Zacks Consensus Estimate of $18.56 billion by 0.3%. The top line also increased 8.8% from $17.10 billion reported in the year-ago quarter. The year-over-year improvement was driven by higher sales growth registered by LMT’s business segments.

    LMT’s backlog, as of Sept. 28, 2025, was $179.07 billion compared with $176.04 billion as of Dec. 31, 2024. Lockheed now expects to generate sales in the range of $74.25-$74.75 billion in 2025, narrower than its earlier estimate of $73.75-$74.75 billion, with the Zacks Consensus Estimate pegged at $74.20 billion.

    The aerospace and defense industry maintains an optimistic outlook. Given the current geopolitical climate, the trend of rising military spending is likely to persist.

    For investors looking to bet on Q3 results as well as the continued surge in military spending, the following Aerospace – Defense ETFs provide a great opportunity.

    Investors can consider iShares U.S. Aerospace & Defense ETF ITA, Invesco Aerospace & Defense ETF PPA, SPDR S&P Aerospace & Defense ETF XAR, Global X Defense Tech ETF SHLD and U.S. Global Technology and Aerospace & Defense ETF WAR.

    Regarding charging annual fees, XAR is the cheapest option, charging 0.35%, and is more suitable for long-term investing.

    With a one-month average trading volume of about 1.38 million shares, SHLD is the most liquid option, offering investors easier entry and exit, ideal for active trading strategies.

    Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

    Lockheed Martin Corporation (LMT) : Free Stock Analysis Report

    Northrop Grumman Corporation (NOC) : Free Stock Analysis Report

    Global X Defense Tech ETF (SHLD): ETF Research Reports

    iShares U.S. Aerospace & Defense ETF (ITA): ETF Research Reports

    Invesco Aerospace & Defense ETF (PPA): ETF Research Reports

    SPDR S&P Aerospace & Defense ETF (XAR): ETF Research Reports

    RTX Corporation (RTX) : Free Stock Analysis Report

    This article originally published on Zacks Investment Research (zacks.com).

    Zacks Investment Research



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