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Contracts · Missile defense

Missile Defense Agency awards Raytheon multiyear SM-3 IB contract worth up to $6.3 billion

The Missile Defense Agency award carries a $4.4 billion base value. It is undefinitized, so work can begin before terms, specifications or price are agreed.

The Missile Defense Agency awarded Raytheon a noncompetitive, multiyear contract on Oct. 7 to manufacture and assemble Standard Missile-3 Block IB interceptors, with a total value of $6.3 billion including options.2 RTX says the award is part of Raytheon's recent agreements with the Department of War and supports urgent replenishment of an interceptor first used in combat in 2024.3

Raytheon will manufacture and assemble SM-3 Block IB All-Up-Rounds

The Missile Defense Agency is the contracting activity; the contract was awarded Oct. 7, 2026

obligated on the award$454,215,132actual

Awarded on Oct. 7, 2026

base value$4,432,040,944actual

noncompetitive, multi-year undefinitized contract action

total value, including options$6,342,404,516contingent

five-year contract, with two additional option years, valued up to $6.3 billion

RTX says the contract is part of the recent agreements between Raytheon and the department

DFARS defines an undefinitized contract action as one whose terms, specifications or price are not agreed before performance begins

Source: Department of War contract announcement and release, Oct. 8, 2026; RTX release, Oct. 8, 2026; DFARS 217.7401. Data as of Oct. 8, 2026.

Sources
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That link runs back to February. Breaking Defense reported that the department and Raytheon signed a framework agreement in February designed to pave the way for this multiyear deal, and that under the agreements Raytheon would accelerate SM-3 IB production.4–5 RTX said at the time that the agreements would span up to seven years once contracts were finalized, according to Breaking Defense.5 With both option years, this contract's five-plus-two-year span reaches that outer bound.1

The department's case for the contract runs through the suppliers beneath Raytheon. It says the deal forces capital allocation "directly into assembly lines, solid-rocket motor suppliers, and critical domestic sub-tier vendors." Michael Duffey, the Under Secretary of War for Acquisition and Sustainment, said it "breaks sub-tier manufacturing bottlenecks."1

As an undefinitized contract action, the award authorizes Raytheon to begin work immediately in Tucson, Ariz., and Huntsville, Ala.1 Neither the department's announcements nor Raytheon's said how many missiles the contract buys.1–3

The milestone to watch is definitization, the agreement on or determination of terms, specifications and price that converts the award into a definitive contract.6 At award, $454 million in fiscal 2026 procurement funds was obligated against the $4.4 billion base. Funding actions on contract HQ0851-27-C-E001 will show the pace of any further obligations.2

Sources (6)
  1. Department of War: Department of War Awards $6.3 Billion Multi-Year Contract to RTX's Raytheon for SM-3 BLOCK IB Interceptors (Oct. 8, 2026) www.war.gov
  2. Department of War: Contracts for Oct. 8, 2026 www.war.gov
  3. RTX: RTX's Raytheon awarded $6.3 billion multi-year contract for SM-3 IB interceptors (Oct. 8, 2026) www.rtx.com
  4. Breaking Defense: Pentagon, Raytheon ink up to $6.3 billion multi-year contract for SM-3 IB missiles (Oct. 8, 2026) breakingdefense.com
  5. Breaking Defense: RTX to ramp up production of five weapons in new deal with Pentagon (Feb. 4, 2026) breakingdefense.com
  6. DFARS 217.7401, Definitions www.acquisition.gov
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Contracts · Munitions

A PAC-3 MSE missile launching from a MEADS test launcher in 2012.
Archive photograph · A PAC-3 MSE missile launches during a MEADS test at White Sands Missile Range, November 29, 2012. U.S. Army / John Drew Hamilton Taken 2012-11-29. public-domain; reuse terms. The appearance of U.S. Department of War (DoW) visual information does not imply or constitute DoW endorsement.

Boeing wins about $14.7 billion Lockheed award to triple PAC-3 MSE seeker production

The award is more than five times the seeker contracts Boeing announced in October 2025. It is undefinitized, so its terms, specifications or price are not yet agreed.

· Updated

Lockheed Martin awarded Boeing an undefinitized contract action worth approximately $14.7 billion to scale production and deliver PAC-3 Missile Segment Enhancement (MSE) seekers, Boeing announced Oct. 5.1 Boeing says the award enables it to triple seeker production under the seven-year framework with the Department of War that it announced April 1.1–2

Boeing's new PAC-3 seeker award is more than five times its October 2025 contracts

Announced value, USD billion. The October 2025 multiyear contracts run through 2030; the October 2026 award sits under a seven-year framework.

Oct. 2025 multiyear contractsapproximately $2.7B
Oct. 2026 Lockheed awardapproximately $14.7B

The 2026 award is an undefinitized contract action: its terms, specifications or price are not yet agreed.

Source: Boeing releases, Oct. 14, 2025 and Oct. 5, 2026; DFARS 217.7401. Data as of Oct. 5, 2026.

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That is a step change in a long-running supply relationship. Boeing has delivered more than 6,000 PAC-3 seekers to the Army as a Lockheed subcontractor from Huntsville, Alabama, since 2000.5 Boeing-built seekers enable the most advanced Patriot interceptors to identify, track and engage threats.1 In October 2025, Boeing announced multiyear seeker contracts valued at roughly $2.7 billion.5 The new award is more than five times that. Under the 2025 contracts, Boeing will deliver more than 3,000 seekers through 2030, at rates of up to 750 a year.5

The prime describes the same multiple for its own line. Lockheed's PAC-3 MSE multiyear contract reached a total value of $58.62 billion in July, most of it a seven-year undefinitized modification for up to $53.86 billion. Lockheed says that funding enables it to triple PAC-3 MSE capacity by the end of 2030.4

Boeing says ramp-up and hiring began earlier this year after the framework announcement, with hundreds of direct and indirect jobs expected in the Huntsville area. Its Oct. 5 release did not give seeker quantities, annual rates, the amount obligated or a definitization date.1

The PAC-3 framework has a parallel on another missile. On Aug. 14, Boeing announced seven-year framework agreements with the department and Raytheon to increase production of Standard Missile-3 hardware.3

Both companies' tripling statements are tied to undefinitized contract actions: Lockheed's July modification and Boeing's seeker award.1, 4 Definitization of Boeing's award, when its terms, specifications and price are agreed or determined, is the next step to watch.6

Clarification, October 7, 2026: The headline changed from “Boeing wins about $14.7 billion from Lockheed Martin to triple PAC-3 MSE seeker production” to “Boeing wins about $14.7 billion Lockheed award to triple PAC-3 MSE seeker production”. The summary now reads: “The award is more than five times the seeker contracts Boeing announced in October 2025. It is undefinitized, so its terms, specifications or price are not yet agreed.” Revision notice clarified October 11, 2026.

Clarification, October 8, 2026: This brief was updated to link Boeing's April 1 PAC-3 seeker framework release and its Aug. 14 SM-3 framework release directly, in place of a newsroom search page that no longer lists them. The brief's facts are unchanged.

Sources (6)
  1. Boeing: Boeing receives seven-year contract to accelerate PAC-3 MSE seeker output (Oct. 5, 2026) boeing.mediaroom.com
  2. Boeing: Boeing and Department of War Sign 7-Year Framework to Expand PAC-3 Seeker Production (April 1, 2026) boeing.mediaroom.com
  3. Boeing: Boeing to increase Standard Missile-3 hardware production under new Pentagon framework agreements (Aug. 14, 2026) boeing.mediaroom.com
  4. Lockheed Martin: Department of War Awards Lockheed Martin $58.62B for Multiyear PAC-3 MSE Production (July 29, 2026) news.lockheedmartin.com
  5. Boeing: Boeing Awarded Approximately $2.7 Billion in Multiyear Contracts for PAC-3 Seeker Production (Oct. 14, 2025) boeing.mediaroom.com
  6. DFARS 217.7401, Definitions www.acquisition.gov
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Industry · Primes

RTX's defense backlog grows $45 billion in a quarter

Defense reached about 48% of RTX's backlog in the third quarter, up from about 41% in the second. RTX also raised its 2026 adjusted sales outlook.

RTX's defense backlog rose $45 billion to $164 billion in the third quarter of 2026.1–2 Commercial backlog increased $6 billion.1

RTX's defense backlog rose far more than its commercial backlog

Company-wide backlog change, Q2 to Q3 2026; USD billion

Defense+$45B
Commercial+$6B

Net changes between reported quarterly backlog balances.

Source: RTX Q2 and Q3 2026 results. As of Oct. 20, 2026.

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The increase shifted the company's backlog mix toward defense, which accounted for about 48% of the total, compared with about 41% in the second quarter.1–2

RTX received Tomahawk and AMRAAM multi-year undefinitized production contracts during the quarter. Its results release did not disclose their values, leaving their contribution to the defense backlog increase unspecified. Chief executive Chris Calio cited more than $81 billion in new awards across commercial and defense combined.1

RTX raised its full-year adjusted sales outlook to $97.0 billion to $97.5 billion, following an increase in July.1–2 It also raised its 2026 organic sales growth forecast to 10% to 11%.1

The company-wide defense backlog expansion accompanied slower reported sales growth at Raytheon: the segment's third-quarter sales grew 14% year over year on both a reported and organic basis.1–2 Reported year-over-year growth was 18% in the second quarter.2 RTX attributed the third-quarter sales increase to higher volume on naval programs and land and air defense systems, including Patriot, Standard Missile and Tomahawk.1

Sources (2)
  1. RTX Reports Q3 2026 Results, Oct. 20, 2026 www.rtx.com
  2. RTX Reports Q2 2026 Results, July 23, 2026 www.rtx.com
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