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Industrials · Defense Electronics · NYSE

NOCNorthrop Grumman

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The 10-K against last year's

182 changes: 31 added, 19 removed, 129 reworded, 3 quiet changes

10-K Jan 27, 2026 vs Jan 30, 2025
Risk FactorsRedline ↓
29.7%
of the text changed · 10,893 words now
31.0%
of the text changed · 9,872 words now
Legal ProceedingsRedline ↓
0.0%
of the text changed · 232 words now
Accounting PoliciesRedline ↓
20.0%
of the text changed · 5,524 words now

10-K 0001133421-26-000003 (Jan 27, 2026) vs 10-K 0001133421-25-000006 (Jan 30, 2025)

The redline

The paragraph that changed most in each section

Marked against last year's 10-K: cut words struck through, new words highlighted and underlined.

Risk Factors 357 words changed in this paragraph; it is 32% similar to last year's version.
We operate in highly competitive markets and our competitors may have more financial capacity or more extensive or specialized engineering, technical, manufacturing, marketing or servicing capabilities. They may be willing to accept more risk or lower profitability in competing for contracts. We have seen, and anticipate we will continue to see, increased competition competition, including in some of our core markets, especially as a result of our customers’ budget pressures, pressures and their focus on speed, affordability and competition, competition. The U.S. government’s continued emphasis on reforming its acquisition processes, including procuring commercial products and our own success in winning business. We are facing increasing competition services and utilizing non-Federal Acquisition Regulation-based procurement methods, such as Other Transaction Authority (OTA) agreements and other contract types, has facilitated, and may continue to facilitate, participation by new and emerging market entrants, which has increased and may in the U.S. and outside the U.S. from U.S., foreign and multinational firms, including new entrants, and anticipate that mergers or acquisitions within our industry could future further increase competition for the programs we pursue, which could result in reduced contract opportunities, increased pricing pressure, and/or demands to accept less favorable terms. In certain circumstances, these alternative contracting models may place increased risk on the contractor, such as the potential for greater assumption of development costs or could limit our access for limited reimbursement recourse in certain situations. Further, certain non-Federal Acquisition Regulation-based procurement methods, such as OTA awards, are not subject to certain suppliers without appropriate remedies all of the procurement requirements that typically apply to protect our interests. We are also facing increasing competition for, DoW contracts and rights to protest such awards may be more limited access to various critical products, services and than for other supplies. In some instances, foreign companies may receive loans, subsidies and other assistance from their governments that may not be available to U.S. companies and foreign companies may be subject to fewer restrictions on technology transfer. For some products and services, some customers, including the DoD, are turning to commercial contractors, newer entrants to markets and non-traditional defense contractors, which may have lower cost or more agile operating structures and the ability to leverage changes in customer acquisition strategies (e.g., multiple awardees, short lifecycles). In addition, some customers continue to utilize small business contractors or determine to source work internally. Our success in competing depends, in part, on our ability to remain cost-competitive, respond to changes in customer acquisition strategies, accurately anticipate our customers’ needs and successfully effect our digital transformation strategy and adopt and integrate new digital technologies into our manufacturing, operations, and products and services. contracts.

Source: Item 1A, 10-K 0001133421-26-000003 vs Item 1A, 10-K 0001133421-25-000006

MD&A 133 words changed in this paragraph; it is 34% similar to last year's version.
Impairment Testing – We test for impairment of goodwill annually as of December 31 at each of our reporting units, which comprise our operating segments. The results of our annual segments, or more frequently if events occur or circumstances change such that it is more likely than not an impairment may exist. When testing for goodwill impairment tests as of December 31, 2024 impairment, we may perform both qualitative and 2023, respectively, indicated quantitative assessments. If we perform a qualitative assessment and conclude that it is more likely than not that the estimated fair value of a reporting unit is less than the carrying value, then a quantitative assessment is performed. When a quantitative assessment is performed, we compare the carrying value of each reporting unit significantly exceeded to its respective fair value and recognize an impairment loss to the extent that the fair value is less than the carrying value. There were no impairment charges recorded in the years ended December 31, 2024, 2023 and 2022.

Source: Item 7, 10-K 0001133421-26-000003 vs Item 7, 10-K 0001133421-25-000006

Accounting Policies 123 words changed in this paragraph; it is 38% similar to last year's version.
On November 27, 2023, September 18, 2025, the Financial Accounting Standards Board (FASB) FASB issued Accounting Standards Update (ASU) ASU No. 2023-07 Segment Reporting (Topic 280): 2025-06 Targeted Improvements to Reportable Segment Disclosures. Among other new disclosure requirements, the Accounting for Internal-Use Software (Subtopic 350-40). ASU 2023-07 requires 2025-06 removes references to prescriptive and sequential software development stages, requiring companies to disclose significant segment expenses that are regularly provided capitalize internal-use software costs when management commits to funding the chief operating decision maker. We adopted software project and it is probable the standard project will be completed. ASU 2025-06 will be effective for annual and interim periods beginning January 1, 2024 2028, and can be applied on a prospective, modified prospective, or retrospective basis. We are currently evaluating the disclosure requirements retrospectively to all prior periods presented in the financial statements. Adoption potential impact of ASU 2023-07 did not have an impact 2025-06 on the company’s consolidated financial position, results of operations and/or and cash flows.

Source: Item 8, Note 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001133421-26-000003 vs Item 8, Note 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001133421-25-000006

Every change, by type

Sentences and paragraphs added, removed or reworded

Sentences and paragraphs of NOC's Risk Factors and MD&A, 10-K Jan 27, 2026 against 10-K Jan 30, 2025. Each links to the text at sec.gov.

RemovedRisk Factors
Future funding for certain programs in which we participate may be reduced, delayed or cancelled. Budget cuts globally could adversely affect the viability of our subcontractors and suppliers. While we believe that our business is well-positioned in areas for future defense spending, changing priorities, budget pressures, defense spending cuts, challenges in the appropriations process, the possibility of a long-term continuing resolution (or series of continuing resolutions) and breach of the debt ceiling, ongoing fiscal debates and the global economic and security environment increase uncertainties and risk.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
We operate in highly competitive markets and our competitors may have more financial capacity or more extensive or specialized engineering, technical, manufacturing, marketing or servicing capabilities. They may be willing to accept more risk or lower profitability in competing for contracts. We have seen, and anticipate we will continue to see, increased competition in some of our core markets, especially as a result of our customers’ budget pressures, their focus on affordability and competition, and our own success in winning business. We are facing increasing competition in the U.S. and outside the U.S. from U.S., foreign and multinational firms, including new entrants, and anticipate that mergers or acquisitions within our industry could further increase competition or could limit our access to certain suppliers without appropriate remedies to protect our interests. We are also facing increasing competition for, and more limited access to various critical products, services and other supplies. In some instances, foreign companies may receive loans, subsidies and other assistance from their governments that may not be available to U.S. companies and foreign companies may be subject to fewer restrictions on technology transfer. For some products and services, some customers, including the DoD, are turning to commercial contractors, newer entrants to markets and non-traditional defense contractors, which may have lower cost or more agile operating structures and the ability to leverage changes in customer acquisition strategies (e.g., multiple awardees, short lifecycles). In addition, some customers continue to utilize small business contractors or determine to source work internally. Our success in competing depends, in part, on our ability to remain cost-competitive, respond to changes in customer acquisition strategies, accurately anticipate our customers’ needs and successfully effect our digital transformation strategy and adopt and integrate new digital technologies into our manufacturing, operations, and products and services.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
incentive-based fee arrangements; fixed price development or long-term production programs; different award criteria; and non-traditional contract provisions have affected and may in the future affect our profitability and predictability.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
We (including our subcontractors and others with whom we do business) also are subject to, and expected to perform in compliance with, a vast array of federal, state and local laws, regulations, contract terms and requirements related to our industry, our products and the businesses we operate, as well as those more broadly applicable to industry, such as securities laws and regulations. These requirements, whether specific to our industry or broadly applicable, can limit our ability to achieve our goals. If we are found to have violated any such requirements, or are found not to have acted responsibly, we may be subject to a wide array of actions, including contract modifications or termination; payment withholds; the loss of export/import privileges; administrative, civil or criminal judgments or penalties (including convictions, agreements, fines, damages and non-monetary relief); or suspension or debarment.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
Environmental matters may significantly impact our business and operations and present evolving risks and challenges. Environmental impacts, including climate change specifically, create short and long-term financial risks to our business globally. We have significant operations located in regions that have been, and may in the future be, exposed to significant weather events and other natural disasters. Increased worldwide focus on climate change has

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
led to legislative and regulatory efforts to combat both potential causes and adverse impacts of climate change, including regulation of greenhouse gas emissions. New or more stringent laws and regulations related to greenhouse gas emissions and other climate change related concerns have affected and will likely continue to affect us, our suppliers and our customers. The company has set a goal to achieve net zero greenhouse gas emissions in our operations by 2035 and is committed to working to achieve its climate change and other sustainability goals. We are working to identify opportunities to utilize alternatives to fossil-based energy sources, to decrease our greenhouse gas emissions, to reduce our consumption of water and generation of waste, and to ensure our compliance with environmental regulations where we operate, enhancing our record of environmental sustainability. However, the costs of doing so may be greater than expected, which could affect our ability to achieve our goals.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedRisk Factors
Cyber threats, both on premises and in the cloud, are complex, continuous and evolving and include, but are not limited to: malicious software, destructive malware, ransomware, targeting by more advanced and persistent

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
government spending more broadly. We anticipate that issues related to budgetary priorities and defense spending levels, the debt ceiling, and the spending caps imposed by the Fiscal Responsibility Act of 2023 (FRA), particularly with respect to discretionary spending, will continue to be a subject of considerable debate, with a potentially significant impact on our programs and the company.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

Show the other 11
RemovedMD&A
The political environment, federal budget, debt ceiling and regulatory environment, including potential tax reform, are expected to continue to be the subject of considerable debate, especially in light of the ongoing conflicts and heightened global tensions, the macroeconomic environment and political tensions. The results of those debates could have material impacts on defense spending broadly and the company’s programs in particular.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
recognized in the prior year upon the sale of our minority investment in an Australian business, and $76 million of higher interest expense on our long-term debt.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
The increase in 2024 unallocated corporate expense is primarily due to a $127 million increase in deferred state taxes associated with the prior year B-21 charge and the MTM adjustment, partially offset by lower intangible asset amortization and PP&E step-up depreciation and a loss recognized in the prior year in connection with the divestiture of a small international subsidiary.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
During 2024, the company reduced unfunded backlog by $1.6 billion and $0.7 billion related to terminations for convenience in our restricted space business and on the NGI program at Space Systems, respectively.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
During the fourth quarter of 2024, the company entered into an agreed Revenue Agent’s Report (“RAR”) for certain matters related to the company’s 2018-2020 federal income tax returns, largely related to our methods of accounting associated with the timing of revenue recognition and related costs under IRC Section 451(b). The company made a $956 million payment in December 2024, inclusive of associated interest, in connection with the agreed RAR. Refer to Note 6 to the financial statements for further information about our unrecognized tax benefits.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
Beginning in 2022, the Tax Cuts and Jobs Act of 2017 (“TCJA”) eliminated the option to deduct research and development expenditures in the current year and requires taxpayers to amortize them over five years pursuant to IRC Section 174. Our 2024 and 2023 cash from operations were reduced for federal estimated tax payments we made related to Section 174 of approximately $350 million and $500 million, respectively. In the future, Congress may consider legislation that would defer the amortization requirement to later years, possibly with retroactive effect. In the meantime, we expect to continue to make additional federal tax payments based on the current Section 174 tax law, which we estimate will reduce our 2025 cash from operations by approximately $230 million. The impact of Section 174 on our cash from operations depends on the amount of research and development expenditures incurred by the company and whether the IRS issues guidance on the provision which differs from our current interpretation, among other things.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
(1)Includes depreciation and amortization, non-cash lease expense, MTM benefit (expense), stock based compensation expense, deferred income taxes and net periodic pension and OPB income.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
Adjusted free cash flow, as reconciled in the table below, is a non-GAAP measure defined as net cash provided by or used in operating activities, less capital expenditures, plus proceeds from the sale of equipment to a customer (not otherwise included in net cash provided by or used in operating activities) and the after-tax impact of discretionary pension contributions, if any. Adjusted free cash flow includes proceeds from the sale of equipment to a customer as

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
Environmental Matters – We are subject to environmental laws and regulations in the jurisdictions in which we do or have done business. Factors that could result in changes to the assessment of probability, range of reasonably estimated costs and environmental accruals include: modification of planned remedial actions; changes in the estimated time required to conduct remedial actions; discovery of more or less extensive (or different) contamination

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
In addition to performing an annual goodwill impairment test, we may perform an interim impairment test if events occur or circumstances change that suggest goodwill in any of our reporting units may be impaired. Such indicators may include, but are not limited to, the loss of significant business, significant reductions in federal government appropriations or other significant adverse changes in industry or market conditions. During 2024, we determined there were no impairment indicators requiring us to perform an interim goodwill impairment test.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

RemovedMD&A
spending and cash flows for the reporting units over a multi-year period, as well as to determine the weighted-average cost of capital (WACC) used as a discount rate and terminal value assumptions. The WACC takes into account the relative weights of each component of our consolidated capital structure (equity and debt) and represents the expected cost of new capital adjusted as appropriate to consider lower risk profiles associated with longer-term contracts and barriers to market entry. The terminal value assumptions are applied to the final year of the discounted cash flow model. We use industry multiples (including relevant control premiums) of operating earnings to corroborate the fair values of our reporting units determined under the market valuation method of the income approach.

Read it in 10-K Jan 30, 2025 at sec.gov ↗

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