Lockheed Martin's biggest risks in the FY2024 10-K
- U.S. government budget authorization and the F-35 program, which generated 26% of net sales in 2024, dominate risk factors.
- International sales generated 26% of net sales, introducing distinct geopolitical and regulatory risks.
- Cyber-attacks from advanced nation-state adversaries threaten critical infrastructure and sensitive data.
The risks most specific to Lockheed Martin
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
overall budget environment and whether development programs transition to production and the timing of such transition, all of which are dependent on U.S. Government authorization and funding
Overall budget environment, U.S. government authorization, and funding levels determine whether our development programs successfully transition to production.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
The F-35 program comprises a material portion of our revenue and reductions or delays in funding for this program and risks related to performance, schedule, cost and requirements of the program could adversely affect our performance
The F-35 program represented 26% of total consolidated net sales in 2024, making us vulnerable to funding reductions, delays, or performance issues.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Our profitability and cash flow may vary based on the mix of our contracts and programs, our performance, and our ability to control costs
Our profitability and cash flow vary based on contract mix, cost control, and performance milestones, particularly under award and fixed-price arrangements.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Geopolitical, macroeconomic and public health events and conditions could adversely affect our business, financial condition and operating results
Geopolitical issues and foreign policy actions by governments, including tariffs, sanctions, embargoes, and export controls, impact our operations.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
International sales may pose different economic, regulatory, competition and other risks
International customers accounted for 26% of our total net sales in 2024, exposing us to distinct economic and regulatory risks.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Cyber-attacks and other security threats and disruptions could have a material adverse effect on our business
We face sophisticated cyber-attacks and security threats from advanced, persistent adversaries, including nation-state actors targeting the defense industrial base.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Pension funding requirements and costs are dependent on return on pension assets and other economic and actuarial assumptions which if changed may cause our future earnings and cash flow to fluctuate significantly and affect the affordability of our products and services
Return on pension assets and actuarial assumptions heavily influence our defined benefit pension plans and can cause significant earnings and cash flow volatility.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Our business involves significant risks and uncertainties that may not be covered by indemnity or insurance
Designing and manufacturing advanced defense and technology products involves risks and liabilities, such as product failures, that may not be covered by insurance or indemnity.
- Risks Related to our Reliance on Government Contracts, our Industry and the Economy
Environmental regulations, including in relation to climate change, could adversely affect our future earnings as well as the affordability of our products and services
Environmental regulations and climate change requirements subject us to remediation obligations and lawsuits regarding hazardous materials.
All 23 risk factors
Headings as the filing states them, in filing order.
Risks Related to our Reliance on Government Contracts, our Industry and the Economy
- 01overall budget environment and whether development programs transition to production and the timing of such transition, all of which are dependent on U.S. Government authorization and funding
- 02The F-35 program comprises a material portion of our revenue and reductions or delays in funding for this program and risks related to performance, schedule, cost and requirements of the program could adversely affect our performance
- 03Competition and changing procurement policies could adversely affect our business and financial results
- 04Our profitability and cash flow may vary based on the mix of our contracts and programs, our performance, and our ability to control costs
- 05contract exceed total estimates of the transaction price. When this occurs, a provision for the entire loss is determined at the contract level and is recorded in the period in which the loss is evident
- 06We are heavily dependent on suppliers and if our subcontractors or other suppliers or teaming agreement or joint venture partners fail to perform their obligations, our performance and ability to win future business could be adversely affected
- 07Our success depends, in part, on our ability to develop new technologies, products and services and efficiently produce and deliver existing products
- 08prevent or lessen the benefit of collaboration. We may not be successful in identifying or developing emerging technologies and may spend significant resources on projects that ultimately are unsuccessful or yield a low return on the amount invested
- 09Geopolitical, macroeconomic and public health events and conditions could adversely affect our business, financial condition and operating results
- 10International sales may pose different economic, regulatory, competition and other risks
- 11We may be unable to benefit fully from or adequately protect our intellectual property rights or use third-party intellectual property, which could negatively affect our business
- 12Our business and financial performance depends on us identifying, attracting and retaining a highly skilled workforce
- 13Cyber-attacks and other security threats and disruptions could have a material adverse effect on our business
- 14behalf who have access to export controlled, classified or other sensitive information could also adversely affect our business and reputation
- 15If we fail to successfully complete or manage acquisitions, divestitures, equity investments and other transactions or if acquired entities or equity investments fail to perform as expected, our financial results, business and future prospects could be harmed
- 16operations. We also could be adversely affected by, or liable for, actions taken by these joint ventures that we do not control, including violations of anti-corruption, import and export, taxation and anti-boycott laws
- 17Pension funding requirements and costs are dependent on return on pension assets and other economic and actuarial assumptions which if changed may cause our future earnings and cash flow to fluctuate significantly and affect the affordability of our products and services
- 18Our estimates and projections may prove to be inaccurate and certain of our assets may be at risk of future impairment
- 19Changes in tax laws and regulations or exposure to additional tax liabilities could adversely affect our financial results
- 20Our business involves significant risks and uncertainties that may not be covered by indemnity or insurance
- 21Environmental regulations, including in relation to climate change, could adversely affect our future earnings as well as the affordability of our products and services
- 22We are involved in a number of legal proceedings. We cannot predict the outcome of litigation and other contingencies with certainty
Risks Related to Ownership of our Common Stock
- 23There can be no assurance that we will continue to increase our dividend or to repurchase shares of our common stock
Other Lockheed Martin 10-Ks
- FY2025 10-K risk factors19 risks4 dropped9 reworded
The F-35 program contribution rose from 26% to 27% of total consolidated sales. Cybersecurity risks were updated to specifically target the U.S. defense industrial base. Pension risks were updated to warn of earlier or larger required contributions.
Filed Jan 29, 2026
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.