Mike Stone

WASHINGTON (Reuters) – U.S. weapons maker Lockheed Martin Corp (NYSE: ) reduced its 2021 revenue estimates by 2.5%, to $67 billion, on Tuesday. It also stated that next year’s revenue may fall to $66 Billion as COVID-19 plagues its supply chain.

Many companies have been unable to ship and receive parts and supplies required to make a variety of products due to the pandemic. This has caused shortages and reduced inventories, which in turn, has hampered profits.

Lockheed’s poor outlook is just 66 days away from the year-end. This was after the company reassessed the five-year plan, Chief Executive Jim Taiclet stated in an earnings report. The statement shattered hopes that the United States’ largest arms manufacturer could fight the pandemic.

According to the CEO, this reassessment will result in a modest reduction in revenues in 2022 as well as a flat-to-low-single-digit rate of growth in segment operating profits over the next few year. Lockheed is focusing on next-generation weapon systems such hypersonic weapons research and returning cash shareholders.

The support of the defense industry may be in the near future as the congressional committees will begin their conference regarding the 2022 Defense Policy Act by Biden. This bill outlines higher spending.

Lockheed however raised its earnings per-share guidance for 2021 from $22.19 to $22.45, exceeding analyst expectations of $22.19. This was because operating profits rose 6.6% last year.

On Sept. 26, Lockheed reported that sales of aeronautics (the largest unit in Lockheed) fell 2% from the previous year, when many areas of the defense industry’s supply chains were affected by the pandemic.

From Sept. 26 to September 26, Lockheed made 90 F-35 delivery, with 36 of those occurring during the third quarter. Lockheed plans to deliver from 133 to 133 stealthy planes this year.

Lockheed expects to ship 151 to 150 fighter aircraft by 2022.

Lockheed’s third quarter revenue came in at $16 billion. This is 6.6% lower than the analyst estimate of $17.1 million, Refinitiv data show.