Lockheed Martin (LMT) Risk Factor Changes

from historical practices or our stated expectations.

Our business may be adversely affected by the outcome of legal proceedings and other contingencies that cannot be predicted with certainty.

The increasing global regulatory focus on greenhouse gas (GHG) emissions and their potential impacts relating to climate change could result in laws, regulations or policies that significantly increase our direct and…

as a result of our historical activities and those of our predecessor companies.

We seek to obtain insurance coverage from established and reputable insurance carriers to the extent available in order to cover these risks and liabilities.

We have $11.3 billion of goodwill assets recorded on our consolidated balance sheet as of December 31, 2025 from previous acquisitions, which represents approximately 19% of our total assets.

For more information on how these factors could impact financial condition and results of operations, see “Critical Accounting Policies – Qualified Defined Benefit Pension Plans” in the MD&A and “Note 11 – Retirement…

In recent years, we have taken actions intended to reduce the size of our defined benefit pension plans including pension transactions whereby we purchase group annuity contracts (GACs) from insurance companies using…

We have made substantial cash contributions to our plans as required by the Employee Retirement Income Security Act of 1974 (ERISA), as amended, and in accordance with U.S.

Many of our employees and retirees participate in defined benefit pension plans.

Joint ventures and other noncontrolling investments operate under shared control with other parties.

In pursuing our business strategy, we routinely conduct discussions, evaluate companies, and enter into agreements regarding possible acquisitions, joint ventures, other investments and divestitures.

As an aerospace and defense company, we face a multitude of security threats, including cybersecurity threats ranging from attacks common to most industries, such as ransomware and denial-of-service, to attacks from m…

We own a substantial number of U.S.

International sales present risks that are different and potentially greater than those encountered in our U.S.

In addition, macroeconomic conditions could cause budgetary pressures for our government customers resulting in reductions or delays in spending, which could adversely impact our business.

Global conflicts, including those noted above, have significantly elevated global geopolitical tensions and security concerns and resulted in increased demand for some of our products and services.

Economic sanctions, export controls, and other trade restrictions, for instance those that the U.S.

If we fail in our development projects, if our new products or technologies fail to achieve customer acceptance, if competitors develop more capable technologies or offerings or develop new technologies or offerings o…

Many of the products and services we provide are highly engineered and involve sophisticated technologies with related complex manufacturing and systems integration processes.

We remain heavily dependent on our supply chain for sourcing contractually compliant components, which is outside of our direct control and is multi-tiered.

We are the prime contractor on most of our contracts and rely on other companies to provide materials, major components and products, and to perform a portion of the services that are provided to our customers.

complete, and many result in no adverse action against us.

Contract types primarily include fixed-price and cost-reimbursable contracts.

U.S.

We operate in a highly competitive industry and our competitors may have more extensive or more specialized engineering, technical, marketing and servicing capabilities than we do in certain areas.

Undefinitized Contract Action (UCA).

The F-35 program, which consists of multiple development, production and sustainment contracts, is our largest program and represented 27% of our total consolidated sales in 2025.

We derived 72% of our total consolidated sales from the U.S.

The increasing global regulatory focus on greenhouse gas (GHG) emissions and their potential impacts relating to climate change could result in laws, regulations or policies that significantly increase our direct and…

We seek to obtain insurance coverage from established and reputable insurance carriers to the extent available in order to cover these risks and liabilities.

Changes in U.S.

operations.

behalf who have access to export controlled, classified or other sensitive information could also adversely affect our business and reputation.

prevent or lessen the benefit of collaboration.

contract exceed total estimates of the transaction price.

Cash dividend payments and share repurchases are subject to limitations under applicable laws and the discretion of our Board of Directors and are determined after considering then-existing conditions, including earni…

We are subject to federal, state, local and foreign requirements for the protection of the environment, including those for discharge of hazardous materials and remediation of contaminated sites.

We are subject to income and other taxes in the U.S.

that our products or services infringe their intellectual property rights, which could result in costly and time-consuming disputes, subject us to damages and injunctions and adversely affect our ability to compete an…

announced programs.

Certain materials and component parts that go into making our products are imported into the U.S.

raised concerns about supply availability.

Government actions relating to rare earth minerals that are used in certain of our products, including U.S.

suspensions in product deliveries, remediation work on installed components, contract price adjustments and alternate supply sourcing, all of which could adversely affect our financial condition and results of operati…

U.S.

While the applicability and full impact of these initiatives on our business is uncertain, we are adapting to meet the changes in U.S.

In addition, the President recently issued an EO that could limit certain contractors performing work under critical defense weapons, supplies, and equipment contracts from issuing excessive dividends or owner distrib…

Executive Orders.