Nasdaq falls 2% intraday as Lockheed Martin raises annual outlook
Key Facts
The Nasdaq Composite fell 2% at midday on Thursday, October 22, 2026, Eastern time, according to the Associated Press, as artificial intelligence stocks came under pressure over investment financing and high valuations. The agency linked weakness in those shares to concerns about rising borrowing costs to fund data centers and chips, in a session that also saw oil prices rise. Concerns encompassed AI companies' share prices as well as the cost of the funds they need to carry out their investments. Lockheed Martin, meanwhile, was among the companies reporting earnings that exceeded market expectations, according to the agency. Its shares rose during the session following the results announcement, helping limit market losses as the company raised its annual forecasts for sales, earnings per share and free cash flow.
Lockheed Martin said in its earnings release that third-quarter 2026 sales totaled $20.7 billion, compared with $18.6 billion in the corresponding period of 2025. The company described its sales performance in the results presentation as "11% year-over-year growth." Diluted earnings per share for the quarter were $7.97, according to the release, providing another measure of quarterly performance alongside revenue. The company had reported earnings per share of $6.95 in the previous year's third-quarter results. The comparison with the corresponding period thus showed increases in both sales and earnings per share, while the earnings beat reported by the Associated Press supported the shares during trading.
In its updated 2026 outlook, the company raised its expected annual sales range to about $80–82 billion. That compares with the $79.75–81.75 billion range announced in its July outlook, with both the lower and upper ends of expected sales raised. Lockheed Martin also increased its annual diluted earnings per share estimate to about $30.35–30.75. Its previous forecast called for earnings of between $29.95 and $30.65 per share, according to the comparison in the company's release. The revision also covered free cash flow, with the expected range now about $7.8–8 billion for the year. That is above the $7–7.2 billion range in the July outlook, extending the revision across expected revenue, earnings and cash generation.
By segment, Lockheed Martin's results presentation showed Aeronautics sales grew 13% year over year in the third quarter. The company attributed the growth to higher F-35 production volumes and sustainment work, one of the drivers of the increase in total sales during the period. Missiles and Fire Control posted sales growth of 24% year over year, outpacing Aeronautics. The company linked the segment's performance to higher production on the "PAC-3," "THAAD," "GMLRS" and "PrSM" programs. Against that backdrop, the backlog reached a record $292.0 billion at the end of the third quarter of 2026, compared with $179 billion reported by the company in its results for the corresponding period of 2025.
In energy markets, Brent crude rose 2.2% to $111.19 a barrel during Thursday's trading, according to the Associated Press. The gains came amid concerns related to the war with Iran and disruption to the global energy sector's return to normal. The agency cited rising oil prices among the pressures surrounding U.S. stocks, alongside concerns about financing AI investments. On the energy data calendar, the U.S. Energy Information Administration sets the regular release of its weekly oil inventory report for Wednesday at 10:30 a.m. Eastern time. The next event on the monetary policy calendar is the Federal Open Market Committee meeting scheduled for October 27–28, 2026, according to the Federal Reserve's calendar.