Oct 22 (Reuters) - Defense contractor Lockheed Martin ( LMT )

on Tuesday joined rival RTX in lifting annual

profit and sales forecasts, driven by robust demand for military

equipment amid escalating global tensions.

The Bethesda, Maryland-based company now expects 2024 profit

per share of $26.65, above its earlier forecast of $26.10 to

$26.60.

It also sees full-year sales of $71.25 billion, slightly

above the midpoint of its earlier forecast of $70.50 billion to

$71.50 billion.

Conflicts in the Middle East and the protracted

Russia-Ukraine war have resulted in nations boosting their

defense spending, which has benefited arms manufacturers.

However, Lockheed's flagship F-35 program is facing

challenges, particularly due to delays in rolling out an upgrade

intended to enhance the fighter jet's processing capabilities.

The U.S. military, which had stopped accepting deliveries

due to the delay, resumed deliveries earlier this year with a

truncated upgrade, but is withholding the final $5 million

payment for each jet until the completion of the upgrade.

In the absence of reimbursements, Lockheed is forced to pay

for the parts of the F-35 jets to be delivered in 2026 and 2027.

This has diminished returns for the company's investors.

"Had the program been fully funded over this period of time

in the third quarter, we would have had sales closer to about 5%

growth." Lockheed CFO Jay Malave told Reuters in an interview.

The business that makes the F-35 jet posted a 3% decline in

sales in the third quarter.

Lockheed's per share profit stood at $6.80 for the third

quarter, compared with $6.73 a year earlier, on quarterly net

sales of $17.10 billion.

(Reporting by Pratyush Thakur in Bengaluru; Editing by Shinjini

Ganguli)