Oct 24 (Reuters) - U.S. defense company Northrop Grumman ( NOC )

on Thursday raised its 2024 profit forecast for the

second time, amid increased global defense spending prompted by

conflicts in the Middle East and the protracted Russia-Ukraine

war.

Geopolitical tensions have benefited arms manufacturers like

Lockheed Martin ( LMT ) and RTX, both of which also

raised their 2024 earnings outlook.

Northrop now expects its adjusted profit per share between

$25.65 and $26.05, compared with its previous forecast of $24.90

to $25.30 per share. The company kept its annual sales forecast

unchanged, projecting it to reach up to $41.4 billion.

"Sales remain on target for 5% growth this year and the

deliberate actions we are taking to improve margin rates have

resulted in further expansion this quarter," said CEO Kathy

Warden.

The company posted earnings per share of $7.00 for the third

quarter ended Sept. 30, up from $6.18 per share a year earlier.

Sales rose 2% to around $10 billion.

For 2025, the company said it expects margin dollars to grow

at a faster pace than sales. Northrop was facing cost challenges

on some of its fixed-price contracts due to inflation, strained

supply chains, and labor shortages.

The B-21 Raider program incurred losses on initial

production contracts and Northrop-managed Sentinel program,

aimed at replacing the aging intercontinental ballistic missile

system, had significantly exceeded its initial budget estimate.