(Reuters) – Lockheed Martin raised its annual profit and revenue forecast on Tuesday, like its rival RTX, with the American defense group citing strong demand for military equipment amid escalating prices. global conflicts.

The company now expects earnings per share of $26.65 (24.64 euros) for 2024, compared to a previous forecast of $26.10 to $26.60.

The group also expects sales of $71.25 billion this year, slightly above the midpoint of a previously reported range of $70.50 billion to $71.50 billion.

Conflicts in the Middle East and the war between Russia and Ukraine, which has already lasted more than two and a half years, have prompted governments to increase defense spending, which has benefited arms manufacturers.

Lockheed’s flagship F-35 fighter program, however, is facing challenges, including delays in rolling out a technology upgrade intended to improve its processing capabilities.

The U.S. military, which had stopped accepting deliveries due to the delay, resumed them earlier this year with a truncated upgrade, but is withholding a $5 million payment for each plane until completion of the update.

In the absence of reimbursements, Lockheed is forced to pay for parts for the F-35s which will be delivered in 2026 and 2027.

“If the program had been fully funded during this period in the third quarter, we would have seen sales growth closer to around 5%,” Jay Malave, the group’s chief financial officer, said in an interview with Reuters .

Revenue for the division that makes the F-35 fell 3 percent in the third quarter, while overall group revenue was $17.10 billion in the quarter. period, missing analysts’ estimates of $17.35 billion, according to LSEG data.

Lockheed Martin’s earnings per share, however, came to $6.80, while analysts expected $6.50.

(Reporting Pratyush Thakur in Bangalore, Diana Mandiá, editing by Augustin Turpin)

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