President Donald Trump on Friday awarded Boeing an estimated $20 billion contract to develop a sixth-generation of fighter jets. Bloomberg and Reuters first confirmed that Boeing won the contract. Boeing stock swung higher on the news. Rival Lockheed Martin, the loser in the deal, sold off.
President Trump announced the deal during an Oval Office meeting with Defense Secretary Pete Hegseth.
The award provides a much-needed boost for Boeing, which could potentially receive hundreds of billions worth of orders over the multi-decade lifetime of the contract.
The contract is part of the Next Generation Air Dominance (NGAD) program, which looks to replace the Lockheed Martin F-22 Raptor. The next-gen jet will be called the F-47, Trump said during the press conference.
Fifth-generation fighters, such as the F-22 and F-35, essentially serve as stealthy supercomputers with a multitude of advanced sensors and superior maneuverability to handle a range of engagement scenarios.
Sixth-generation fighters promise to be the most sophisticated aircraft yet, although exact specifications remain classified. Reportedly, designs incorporate stealth and AI technology, increased computing power and laser weapons. The sixth-generation fighter itself will serve as central command to a "system" of drones, and have the ability to coordinate with other aerial, surface or aquatic assets.
The U.S. military plans to spend over $28 billion on the NGAD program and CCA development through 2029, according to the Air Force Budget Justification from March 2024.
Lockheed, Boeing Stock
Lockheed Martin retreated 5.8% Friday after losing out on the contract. Shares were up about 2% ahead of the announcement. The tumbled killed LMT stock's gain for the week, sending it back below support at its 50-day moving average in very heavy trade.
Lockheed shares were down almost 29% from their October record of 618.95.
BA stock popped 3% Friday on the news. The advance put Boeing shares ahead more than 10% for the week, setting the stage for its strongest weekly advance since July 2023.
The Dow Jones aerospace manufacturer on Wednesday said it was tracking to hit Q1 estimates and expects to deliver about 44 aircraft this month.
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