LOCKHEED MARTIN CORPLMT

LOCKHEED MARTIN CORP Revenue Disclosure

10-KFiled Jan 29, 20262 min read
Receivables, net, Contract Assets and Contract Liabilities
Receivables, net, contract assets and contract liabilities were as follows (in millions):
20252024
Receivables, net$3,901 $2,351 
Contract assets13,001 12,957 
Contract liabilities11,440 9,795 
Receivables, net consist of approximately $3.0 billion from the U.S. Government and $877 million from other governments and commercial customers as of December 31, 2025. Substantially all accounts receivable at December 31, 2025 are expected to be collected in 2026. We do not believe we have significant exposure to credit risk as the majority of our accounts receivable are due from the U.S. Government either as the ultimate customer or in connection with foreign military sales.
Contract assets are net of progress payments and performance based payments from our customers as well as advance payments from non-U.S. government customers totaling approximately $56.5 billion and $55.6 billion as of December 31, 2025 and 2024. Contract assets increased $44 million during 2025. There were no significant credit or impairment losses related to our contract assets during 2025 and 2024. We expect to bill our customers for the majority of the December 31, 2025 contract assets during 2026.
Contract liabilities increased $1.6 billion during 2025, primarily due to payments received in excess of revenue recognized on these performance obligations (primarily on the C-130 and F-35 programs at Aeronautics and Sikorsky at RMS). During 2025, we recognized $6.3 billion of our contract liabilities at December 31, 2024 as revenue. During 2024, we recognized $5.9 billion of our contract liabilities at December 31, 2023 as revenue. During 2023, we recognized $5.1 billion of our contract liabilities at December 31, 2022 as revenue.
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Historical Timeline

Fiscal YearFiled
2025Jan 29, 2026Showing above
2024Jan 28, 2025
2023Jan 23, 2024

About Revenue Disclosures

Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.

Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.

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