U.S. Army Awards Lockheed $9.8 Billion Patriot Missile Contract

The U.S. Army has awarded Lockheed Martin (NYSE: LMT) a $9.8 billion multiyear production contract for 1,970 Patriot Advanced Capability-3 Missile Segment Enhancement interceptors and related hardware, the largest contract in the history of the company’s Missiles and Fire Control unit.

The deal covers fiscal years 2024 through 2026 and supports deliveries for U.S. forces and international partners. For investors, it extends revenue visibility in one of Lockheed’s core missile-defense franchises and reinforces demand for air and missile defense systems across U.S. and allied markets.

The Army obligated the full $9.8 billion at the time of award, using fiscal 2024 missile procurement funds and Foreign Military Sales funds. That structure ties the program to U.S. procurement plans and to allied demand channeled through the U.S. government.

The Army’s Program Executive Office Missiles and Space, working with Army Contracting Command at Redstone Arsenal in Alabama, definitized the three-year contract. The Pentagon said work is expected to be completed by June 30, 2027. Army and company officials marked the award at a Sept. 3 signing ceremony at Lockheed’s facility in Grand Prairie, Texas.

The PAC-3 MSE is the most advanced Patriot missile variant in production. It uses hit-to-kill technology to destroy incoming threats by direct impact rather than blast fragmentation, and is deployed in layered defense networks against ballistic missiles, cruise missiles, hypersonic threats and other airborne targets.

The award reflects the Pentagon’s push to expand munitions and missile-defense production after years of pressure on inventories and rising allied demand. Reuters reported that demand for Patriot interceptors from the U.S. military and foreign customers continues to climb.

Lockheed has been increasing PAC-3 MSE output and expects to deliver more than 600 interceptors in 2025, a step-up enabled by earlier internal investments. The multiyear award gives Lockheed and its suppliers greater planning certainty than annual contract renewals.

The work will span more than 10 U.S. states, including Alabama, Florida, New York, Texas and California, according to Pentagon contract details.

The contract adds to a growing list of PAC-3-related Army awards. Industry and contract records show Lockheed received a $5.3 billion PAC-3 production contract in July 2024, following a $2.45 billion modification in April 2023.

The company has not quantified any margin impact. For investors, the takeaway is backlog strength and sustained demand in a program with both domestic and international buyers.