HRL sale gain accounts for about half of Boeing's quarterly defense profit

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

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

Sierra Nevada Corporation (SNC) has left the Navy’s Undergraduate Jet Training System (UJTS) competition to replace the T-45 Goshawk, Breaking Defense reported Nov. 3. SNC told the outlet it could not responsibly bid under the current contract structure.¹

SNC could not responsibly bid the UJTS [Undergraduate Jet Training System] program under the current contract structure

Textron Aviation Defense, the only known major competitor to SNC, confirmed to Breaking Defense that the firm submitted its offering of the M-346N to the Navy.

Stavatti Aerospace said on Oct. 30 it submitted a bid on UJTS

Reported by Breaking Defense

Sources

• breakingdefense.com ↗

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Breaking Defense says SNC’s exit leaves the Navy with “one true competitor”: Textron Aviation Defense, which confirmed to the outlet that it submitted the M-346N. The outlet also reported that Stavatti Aerospace said on Oct. 30 that it submitted a bid.¹

SNC said it remains committed to naval jet training and would be ready to re-engage if the approach is revisited. Breaking Defense’s account does not identify the contract terms SNC objected to.¹

The competitive field had already narrowed: Lockheed Martin announced in April it would not submit the TF-50N with Korea Aerospace Industries, and Boeing announced its departure in June. In September, Breaking Defense reported that Northrop Grumman was dropping off SNC’s bid, which centered on a clean-sheet design called the Freedom.¹

The Navy kept its Oct. 30 proposal deadline, extended from June 30, the program office told the outlet. It now estimates an award between July and the end of September 2027, later than the June 2027 target in its September request for proposals. The service originally planned a March 2027 selection.¹