0001193125-14-155226 | 10-Q | XBRL Viewer

10,650

11,070

Cost of sales

Products

(7,339)

(7,671)

Services

(1,950)

(2,134)

^[1]

(30)

Other unallocated, net

(194)

Total cost of sales

(9,279)

(10,029)

Gross profit

1,371

1,041

Other income, net

Other non-operating income (expense), net

1,432

1,119

Interest expense

(86)

(92)

(2)

Earnings before income taxes

1,348

1,025

Income tax expense

(415)

(264)

Net earnings

$ 933

$ 761

Earnings per common share

Basic earnings per common share in USD

$ 2.92

$ 2.37

Diluted earnings per common share in USD

2.87

2.33

Cash dividends paid per common share

$ 1.33

$ 1.15

[1]

Severance charges during the quarter ended March 31, 2013 consisted of amounts, net of state tax benefits, associated with the elimination of certain positions at our IS&GS business segment (Note 8, under the caption "Restructuring Charges"). Severance charges for initiatives that are not significant are included in business segment operating profit.

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2014	Mar. 31, 2013
Net earnings	$ 933	$ 761
Other comprehensive income (loss), net of tax
Recognition of previously deferred postretirement benefit plan amounts	167	254
Other, net	(3)	(43)
Other comprehensive income (loss), net of tax	164	211
Comprehensive income	$ 1,097	$ 972

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Regulation S-X (SX)
-Number 210
-Section 03
-Paragraph 19
-Article 5

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Adjustments to reconcile net earnings to net cash provided by operating activities:

Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 30, 2014	Dec. 31, 2013
Current assets
Cash and cash equivalents	$ 3,264	$ 2,617
Receivables, net	6,255	5,834
Inventories, net	2,949	2,977
Deferred income taxes	1,135	1,088
Other current assets	631	813
Total current assets	14,234	13,329
Property, plant, and equipment, net	4,612	4,706
Goodwill	10,370	10,348
Deferred income taxes	2,782	2,850
Other noncurrent assets	4,921	4,955
Total assets	36,919	36,188
Current liabilities
Accounts payable	1,942	1,397
Customer advances and amounts in excess of costs incurred	6,197	6,349
Salaries, benefits, and payroll taxes	1,722	1,809
Other current liabilities	2,134	1,565
Total current liabilities	11,995	11,120
Accrued pension liabilities	9,438	9,361
Other postretirement benefit liabilities	902	902
Long-term debt, net	6,152	6,152
Other noncurrent liabilities	3,632	3,735
Total liabilities	32,119	31,270
Stockholders' equity
Common stock, $1 par value per share	315	319
Additional paid-in capital
Retained earnings	13,922	14,200
Accumulated other comprehensive loss	(9,437)	(9,601)
Total stockholders' equity	4,800	4,918
Total liabilities and stockholders' equity	$ 36,919	$ 36,188

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 30, 2014	Dec. 31, 2013
Common stock, par value (in USD per share)	$ 1	$ 1

Consolidated Statements of Cash Flows - USD ($)
$ in Millions

3 Months Ended

Mar. 30, 2014

Mar. 31, 2013

Operating activities

Net earnings

$ 933

$ 761

Depreciation and amortization

237

232

Stock-based compensation

Changes in operating assets and liabilities:

^[1]

Receivables, net

(423)

(384)

Inventories, net

Accounts payable

545

Customer advances and amounts in excess of costs incurred

(152)

(98)

Postretirement benefit plans

320

493

Income taxes

584

862

Net cash provided by operating activities

(21)

2,100

2,085

Investing activities

Capital expenditures

(103)

(106)

Net cash used for investing activities

(23)

(42)

(126)

(148)

Financing activities

Repurchases of common stock

(1,106)

(461)

Proceeds from stock option exercises

197

Dividends paid

(444)

(371)

Net cash used for financing activities

(1,327)

(770)

Net change in cash and cash equivalents

647

1,167

Cash and cash equivalents at beginning of period

2,617

1,898

Cash and cash equivalents at end of period

$ 3,264

$ 3,065

[1]

Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss
Beginning Balance at Dec. 31, 2012	$ 39	$ 321		$ 13,211	$ (13,493)
Net earnings	761			761
Other comprehensive income, net of tax	211				211
Repurchases of common stock	(477)	(5)	$ (139)	(333)
Dividends declared	(371)			(371)
Stock-based awards and ESOP activity	141	2	139
Ending Balance at Mar. 31, 2013	304	318		13,268	(13,282)
Beginning Balance at Dec. 31, 2013	4,918	319		14,200	(9,601)
Net earnings	933			933
Other comprehensive income, net of tax	164				164
Repurchases of common stock	(1,106)	(7)	(316)	(783)
Dividends declared	(428)			(428)
Stock-based awards and ESOP activity	319	3	$ 316
Ending Balance at Mar. 30, 2014	$ 4,800	$ 315		$ 13,922	$ (9,437)

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

BASIS OF PRESENTATION

3 Months Ended

Mar. 30, 2014

BASIS OF PRESENTATION

NOTE 1 – BASIS OF PRESENTATION

We prepared these consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information, the instructions to Form 10-Q, and Article 10 of U.S. Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. We followed the accounting policies disclosed in the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013 (2013 Form 10-K) filed with the SEC.

In the opinion of management, these consolidated financial statements reflect all adjustments that are of a normal recurring nature necessary for a fair presentation of our results of operations, financial condition, and cash flows for the interim periods presented. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We base these estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates. Significant estimates inherent in the preparation of our consolidated financial statements include, but are not limited to, accounting for sales and cost recognition, postretirement benefit plans, environmental receivables and liabilities, evaluation of goodwill and other assets for impairment, income taxes including deferred tax assets, fair value measurements, and contingencies. The consolidated financial statements include the accounts of subsidiaries we control and variable interest entities if we are the primary beneficiary. We eliminate intercompany balances and transactions in consolidation. We have reclassified certain amounts in the prior period to conform to the current year presentation.

We close our books and records on the last Sunday of the calendar quarter to align our financial closing with our business processes, which was on March 30 for the first quarter of 2014 and March 31 for the first quarter of 2013. The consolidated financial statements and tables of financial information included herein are labeled based on that convention. This practice only affects interim periods, as our fiscal year ends on December 31.

The results of operations for the interim periods presented are not necessarily indicative of results to be expected for the full year or future periods. Unless otherwise noted, we present all per share amounts cited in these consolidated financial statements on a “per diluted share” basis. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2013 Form 10-K.

The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.

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EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE

3 Months Ended

Mar. 30, 2014

NOTE 2 – EARNINGS PER COMMON SHARE

The weighted average number of shares outstanding used to compute earnings per common share were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013

Weighted average common shares outstanding for basic computations		319.1		321.7
Weighted average dilutive effect of equity awards		6.0		4.6

Weighted average common shares outstanding for diluted computations		325.1		326.3

We compute basic and diluted earnings per common share by dividing net earnings by the respective weighted average number of common shares outstanding for the periods presented. Our calculation of diluted earnings per common share also includes the dilutive effects for the assumed vesting of outstanding restricted stock units and exercise of outstanding stock options based on the treasury stock method.

The computation of diluted earnings per common share excluded 6.4 million stock options for the quarter ended March 31, 2013 because their inclusion would have been anti-dilutive, primarily due to their exercise prices exceeding the average market prices of our common stock. There were no anti-dilutive stock options for the quarter ended March 30, 2014.

BUSINESS SEGMENT INFORMATION

3 Months Ended

Mar. 30, 2014

BUSINESS SEGMENT INFORMATION

NOTE 3 – BUSINESS SEGMENT INFORMATION

We operate in five business segments: Aeronautics, Information Systems & Global Solutions (IS&GS), Missiles and Fire Control, Mission Systems and Training (MST), and Space Systems. We organize our business segments based on the nature of the products and services offered.

Net sales of our business segments exclude intersegment sales as these activities are eliminated in consolidation. Intercompany transactions are generally negotiated under terms and conditions that share many similar characteristics (e.g., contract structures, funding profiles, target cost values, contract progress reports) with our third-party contracts, primarily with the U.S. Government.

Operating profit of our business segments includes our share of earnings or losses from equity method investees because the operating activities of the equity method investees are closely aligned with the operations of our business segments. United Launch Alliance (ULA), which is part of our Space Systems business segment, is our primary equity method investee. Operating profit of our business segments excludes the FAS/CAS pension adjustment described below; expense for stock-based compensation; the effects of items not considered part of management’s evaluation of segment operating performance, such as charges related to significant severance actions (Note 8, under the caption “Restructuring Charges”) and goodwill impairments; gains or losses from divestitures; the effects of certain legal settlements; corporate costs not allocated to our business segments; and other miscellaneous corporate activities. These items are included in the reconciling item “Unallocated, net” between operating profit from our business segments and our consolidated operating profit.

Our business segments’ results of operations include pension expense only as calculated under U.S. Government Cost Accounting Standards (CAS), which we refer to as CAS cost. We recover CAS cost through the pricing of our products and services on U.S. Government contracts and, therefore, the CAS cost is recognized in each of our business segments’ net sales and cost of sales. Since our consolidated financial statements must present pension expense calculated in accordance with the financial accounting standards (FAS) requirements under GAAP, which we refer to as FAS pension expense, the FAS/CAS pension adjustment increases or decreases the CAS pension expense recorded in our business segments’ results of operations to equal the FAS pension expense. As a result, to the extent that CAS cost exceeds FAS pension expense, which occurred for the quarter ended March 30, 2014, we have FAS/CAS pension income and, conversely, to the extent FAS pension expense exceeds CAS cost, which occurred for the quarter ended March 31, 2013, we have FAS/CAS pension expense.

Summary operating results for each of our business segments were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013
Net sales
Aeronautics	$	3,386	$	3,186
Information Systems & Global Solutions		1,910		2,106
Missiles and Fire Control		1,867		1,988
Mission Systems and Training		1,628		1,830
Space Systems		1,859		1,960
Total net sales	$	10,650	$	11,070

Operating profit
Aeronautics	$	393	$	379
Information Systems & Global Solutions		174		189
Missiles and Fire Control		358		344
Mission Systems and Training		250		201
Space Systems		254		230
Total business segment operating profit		1,429		1,343
Unallocated, net
FAS/CAS pension adjustment
FAS pension expense		(313)		(487)
Less: CAS cost		399		366
FAS/CAS pension income (expense)^(a)		86		(121)
Severance charges ^(b)		—		(30)
Stock-based compensation		(48)		(53)
Other, net		(35)		(20)
Total unallocated, net		3		(224)
Total consolidated operating profit	$	1,432	$	1,119

Intersegment sales
Aeronautics	$	27	$	50
Information Systems & Global Solutions		176		190
Missiles and Fire Control		87		53
Mission Systems and Training		315		227
Space Systems		27		23
Total intersegment sales	$	632	$	543

^(a)

The change in the FAS/CAS pension adjustment from expense to income between the periods was due to lower FAS pension expense in 2014 primarily as a result of the increase in the discount rate used in the measurement of our GAAP postretirement benefit plan obligations at the end of 2013, and incrementally higher CAS costs in 2014 as a result of phasing in the CAS Harmonization rules as discussed in our 2013 Form 10-K.

^(b)

Severance charges during the quarter ended March 31, 2013 consisted of amounts, net of state tax benefits, associated with the elimination of certain positions at our IS&GS business segment (Note 8, under the caption “Restructuring Charges”). Severance charges for initiatives that are not significant are included in business segment operating profit.

Total assets for each of our business segments were as follows (in millions):


	March 30, 2014		December 31, 2013
Assets
Aeronautics	$	5,892	$	5,821
Information Systems & Global Solutions		5,834		5,798
Missiles and Fire Control		4,065		4,159
Mission Systems and Training		6,450		6,512
Space Systems		3,776		3,522
Total business segment assets		26,017		25,812
Corporate assets ^(a)		10,902		10,376
Total assets	$	36,919	$	36,188

^(a)	Corporate assets primarily include cash and cash equivalents, deferred income taxes, environmental receivables, and investments held in a separate trust to fund certain of our non-qualified deferred compensation plans.

Our Aeronautics business segment includes our largest program, the F-35 Lightning II Joint Strike Fighter, an international multi-role, multi-variant, stealth fighter aircraft. Net sales for the F-35 program represented approximately 16% and 15% of our total consolidated net sales for the quarters ended March 30, 2014 and March 31, 2013.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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POSTRETIREMENT BENEFIT PLANS

INVENTORIES, NET

3 Months Ended

Mar. 30, 2014

INVENTORIES, NET

NOTE 4 – INVENTORIES, NET

Inventories, net consisted of the following (in millions):


	March 30, 2014		December 31, 2013
Work-in-process, primarily related to long-term contracts and programs in progress	$	7,080	$	7,073
Less: customer advances and progress payments		(4,866)		(4,834)
		2,214		2,239
Other inventories		735		738
Total inventories, net	$	2,949	$	2,977

POSTRETIREMENT BENEFIT PLANS

3 Months Ended

Mar. 30, 2014

NOTE 5 – POSTRETIREMENT BENEFIT PLANS

The components of our pretax net periodic benefit costs for our qualified defined benefit pension plans and retiree medical and life insurance plans were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013
Qualified defined benefit pension plans
Service cost	$	243	$	286
Interest cost		488		450
Expected return on plan assets		(660)		(622)
Recognized net actuarial losses		221		353
Amortization of prior service cost		21		20
Total net periodic benefit cost	$	313	$	487
Retiree medical and life insurance plans
Service cost	$	5	$	7
Interest cost		31		29
Expected return on plan assets		(36)		(36)
Recognized net actuarial losses		6		11
Amortization of prior service cost (credit)		1		(5)
Total net periodic benefit cost	$	7	$	6

The recognized net actuarial losses and the amortization of prior service cost (credit) in the table above, as well as similar costs related to our other postretirement benefit plans, reflect costs that were recorded as a component of net periodic benefit cost for the period. These costs totaled $167 million (net of $91 million of tax expense) for the quarter ended March 30, 2014 and $254 million (net of $139 million of tax expense) for the quarter ended March 31, 2013, which are recorded on our Statements of Comprehensive Income as an increase to comprehensive income.

We determine funding requirements for our defined benefit pension plans in a manner consistent with CAS and the Employee Retirement Income Security Act of 1974 (ERISA), as amended by the Pension Protection Act of 2006. There were no contributions to either our qualified defined benefit pension plans or our retiree medical and life insurance plans during the quarters ended March 30, 2014 and March 31, 2013. We currently plan to make total contributions of $1.0 billion related to our qualified defined benefit pension plans in 2014, of which contributions of $515 million were made early in the second quarter of 2014. We do not expect to make any contributions to our retiree medical and life insurance plans in 2014.

LEGAL PROCEEDINGS AND CONTINGENCIES

3 Months Ended

Mar. 30, 2014

LEGAL PROCEEDINGS AND CONTINGENCIES

NOTE 6 – LEGAL PROCEEDINGS AND CONTINGENCIES

We are a party to or have property subject to litigation and other proceedings that arise in the ordinary course of our business, including matters arising under provisions relating to the protection of the environment, and are subject to contingencies related to certain businesses we previously owned. These types of matters could result in fines, penalties, compensatory or treble damages or non-monetary relief. We believe the probability is remote that the outcome of each of these matters, including the legal proceedings discussed below, will have a material adverse effect on the Corporation as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings in any particular interim reporting period. Among the factors that we consider in this assessment are the nature of existing legal proceedings and claims, the asserted or possible damages or loss contingency (if estimable), the progress of the case, existing law and precedent, the opinions or views of legal counsel and other advisers, our experience in similar cases and the experience of other companies, the facts available to us at the time of assessment, and how we intend to respond to the proceeding or claim. Our assessment of these factors may change over time as individual proceedings or claims progress.

Although we cannot predict the outcome of legal or other proceedings with certainty, GAAP requires us to disclose an estimate of the reasonably possible loss or range of loss or make a statement that such an estimate cannot be made for contingencies where there is at least a reasonable possibility that a loss may have been incurred. We have a thorough process to determine an estimate of the reasonably possible loss or range of loss before we conclude and disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below in our discussion of legal proceedings, a reasonably possible loss or range of loss associated with any individual legal proceeding cannot be estimated.

Legal Proceedings

On April 24, 2009, we filed a declaratory judgment action against the New York Metropolitan Transportation Authority and its Capital Construction Company (collectively, the MTA) asking the U.S. District Court for the Southern District of New York to find that the MTA is in material breach of our agreement based on the MTA’s failure to provide access to sites where work must be performed and customer-furnished equipment necessary to complete the contract. The MTA filed an answer and counterclaim alleging that we breached the contract, and subsequently terminated the contract for alleged default. The primary damages sought by the MTA are the cost to complete the contract and potential re-procurement costs. While we are unable to estimate the cost of another contractor to complete the contract and the costs of re-procurement, we note that our contract with the MTA had a total value of $323 million, of which $241 million was paid to us. We dispute the MTA’s allegations and are defending against them. Additionally, following an investigation, our sureties on a performance bond related to this matter, who were represented by independent counsel, concluded that the MTA’s termination of the contract was improper. Finally, our declaratory judgment action was later amended to include claims for monetary damages against the MTA. A bench trial of this matter is scheduled to begin on July 7, 2014.

On August 28, 2003, the U.S. Department of Justice (DOJ) filed complaints in partial intervention in two lawsuits filed under the civil qui tam provisions of the False Claims Act in the U.S. District Court for the Western District of Kentucky, United States ex rel. Natural Resources Defense Council, et al., v. Lockheed Martin Corporation, et al., and United States ex rel. John D. Tillson v. Lockheed Martin Energy Systems, Inc., et al. The DOJ alleges that we committed violations of the Resource Conservation and Recovery Act at the Paducah Gaseous Diffusion Plant by not properly handling, storing, and transporting hazardous waste and that we violated the False Claims Act by misleading Department of Energy officials and state regulators about the nature and extent of environmental noncompliance at the plant. The complaint does not allege a specific calculation of damages. On April 16, 2013, the parties attended a settlement conference ordered by the magistrate judge. The conference focused on the parties’ sharply differing views of the merits of the case and did not significantly contribute to our understanding of the damages sought. Accordingly, we cannot estimate the reasonably possible loss, or range of loss, which could be incurred if the plaintiffs were to prevail in the allegations, but believe that we have substantial defenses. We dispute the allegations and are defending against them.

Environmental Matters

We are involved in environmental proceedings and potential proceedings relating to soil and groundwater contamination, disposal of hazardous waste, and other environmental matters at several of our current or former facilities, or at third-party sites where we have been designated as a potentially responsible party (PRP). A substantial portion of environmental costs will be included in our net sales and cost of sales in future periods pursuant to U.S. Government regulations. At the time a liability is recorded for future environmental costs, we record a receivable for estimated future recovery considered probable through the pricing of products and services to agencies of the U.S. Government, regardless of the contract form (e.g., cost-reimbursable, fixed-price). We continuously evaluate the recoverability of our environmental receivables by assessing, among other factors, U.S. Government regulations, our U.S. Government business base and contract mix, and our history of receiving reimbursement of such costs. We include the portion of those environmental costs expected to be allocated to our non-U.S. Government contracts, or that is determined to be unallowable for pricing under U.S. Government contracts, in our cost of sales at the time the liability is established.

At March 30, 2014 and December 31, 2013, the aggregate amount of liabilities recorded relative to environmental matters was $1.0 billion and $997 million, most of which are recorded in other noncurrent liabilities on our Balance Sheets. We have recorded receivables totaling $874 million and $863 million at March 30, 2014 and December 31, 2013, most of which are recorded in other noncurrent assets on our Balance Sheets, for the estimated future recovery of these costs, as we consider the recovery probable based on the factors previously mentioned. We project costs and recovery of costs over approximately 20 years.

Environmental cleanup activities usually span several years, which makes estimating liabilities a matter of judgment because of uncertainties with respect to assessing the extent of the contamination as well as such factors as changing remediation technologies and continually evolving regulatory environmental standards. There are a number of former operating facilities that we are monitoring or investigating for potential future remediation. We perform quarterly reviews of the status of our environmental remediation sites and the related liabilities and receivables. Additionally, in our quarterly reviews we consider these and other factors in estimating the timing and amount of any future costs that may be required for remediation activities and record a liability when it is probable that a loss has occurred and the loss can be reasonably estimated. The amount of liability recorded is based on our estimate of the costs to be incurred for remediation at a particular site. We do not discount the recorded liabilities, as the amount and timing of future cash payments are not fixed or cannot be reliably determined. We reasonably cannot determine the extent of our financial exposure in all cases as, although a loss may be probable or reasonably possible, in some cases it is not possible at this time to estimate the loss or reasonably possible loss or range of loss.

We also are pursuing claims for recovery of costs incurred or contribution to site cleanup costs against other PRPs, including the U.S. Government, and are conducting remediation activities under various consent decrees and orders relating to soil, groundwater, sediment, or surface water contamination at certain sites of former or current operations. Under an agreement related to our Burbank and Glendale, California, sites, the U.S. Government reimburses us an amount equal to approximately 50% of expenditures for certain remediation activities in its capacity as a PRP under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).

California and the U.S. Environmental Protection Agency (U.S. EPA) are each evaluating the need to regulate hexavalent chromium in drinking water, distinct from the current California standard which regulates total chromium, of which hexavalent chromium is a component. On April 15, 2014, the California Department of Public Health submitted its final regulation which, if it becomes enforceable, will separately regulate hexavalent chromium and sets the maximum level at 10 parts per billion (ppb). If the new standard remains at 10 ppb, it will not have a material impact on our existing remediation costs in California. However, we cannot predict the outcome of California’s regulatory proceedings and expect that environmental groups and the regulated community may each institute litigation opposing the new standard.

In addition, California is also reevaluating its existing drinking water standard with respect to a second contaminant, perchlorate, and the U.S. EPA is also considering whether to regulate that contaminant in drinking water. If substantially lower standards are adopted, in either California or at the federal level, for perchlorate or, if the U.S. EPA were to adopt a standard for hexavalent chromium lower than 10 ppb, we expect a material increase in our estimates for environmental liabilities and the related assets for the portion of the increased costs that are probable of future recovery in the pricing of our products and services for the U.S. Government. The amount that would be allocable to our non-U.S. Government contracts or that is determined to be unallowable for pricing under U.S. Government contracts would be expensed, which may have a material effect on our earnings in any particular interim reporting period.

Letters of Credit, Surety Bonds, and Third-Party Guarantees

We have entered into standby letters of credit, surety bonds, and third-party guarantees with financial institutions and other third parties primarily relating to advances received from customers and the guarantee of future performance on certain contracts. Letters of credit and surety bonds generally are available for draw down in the event we do not perform. In some cases, we may guarantee the contractual performance of third parties such as venture partners. We had total outstanding letters of credit, surety bonds, and third-party guarantees aggregating $2.5 billion and $2.4 billion at March 30, 2014 and December 31, 2013.

At March 30, 2014 and December 31, 2013, third-party guarantees totaled $804 million and $696 million, of which approximately 90% related to guarantees of contractual performance of ventures to which we currently are or previously were a party. This amount represents our estimate of the maximum amount we would expect to incur upon the contractual non-performance of the venture partners. In addition, we generally have cross-indemnities in place that may enable us to recover amounts that may be paid on behalf of a venture partner. We believe our current and former venture partners will be able to perform their obligations, as they have done through March 30, 2014, and that it will not be necessary to make payments under the guarantees. In determining our exposures, we evaluate the reputation, technical capabilities, and credit quality of our current and former venture partners.

United Launch Alliance

In connection with our 50% ownership interest of ULA, we and The Boeing Company (Boeing) have each received distributions from ULA, including distributions of $527 million that we and Boeing have each received (since ULA’s formation in December 2006) which are subject to agreements between us, Boeing, and ULA, whereby, if ULA does not have sufficient cash resources or credit capacity to make required payments under the inventory supply agreement it has with Boeing, both we and Boeing would provide to ULA, in the form of an additional capital contribution, the level of funding required for ULA to make those payments. Any such capital contributions would not exceed the amount of the distributions subject to the agreements. Based on current expectations of ULA’s cash flow needs, we currently believe that ULA should have sufficient operating cash flows and credit capacity, including access to its $560 million revolving credit agreement from third-party financial institutions, to meet its obligations such that we would not be required to make a contribution under these agreements.

In addition, both we and Boeing have cross-indemnified each other for guarantees by us and Boeing of the performance and financial obligations of ULA under certain launch service contracts. We believe ULA will be able to fully perform its obligations, as it has done through March 30, 2014, and that it will not be necessary to make payments under the cross-indemnities or guarantees.

FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 30, 2014

FAIR VALUE MEASUREMENTS

NOTE 7 – FAIR VALUE MEASUREMENTS

Assets and liabilities measured and recorded at fair value on a recurring basis consisted of the following (in millions):


	March 30, 2014						December 31, 2013
	Total		Level 1		Level 2		Total		Level 1		Level 2
Assets
Equity securities	$	103	$	103	$	—	$	77	$	77	$	—
Mutual funds		562		562		—		613		613		—
U.S. Government securities		229		—		229		238		—		238
Other securities		128		—		128		131		—		131
Derivatives		21		—		21		28		—		28
Liabilities
Derivatives		14		—		14		23		—		23

Substantially all assets measured at fair value, other than derivatives, represent investments classified as trading securities held in a separate trust to fund certain of our non-qualified deferred compensation plans and are recorded in other noncurrent assets on our Balance Sheets. The fair values of equity securities and mutual funds are determined by reference to the quoted market price per unit in active markets multiplied by the number of units held without consideration of transaction costs. The fair values of U.S. Government and other securities are determined using model-derived valuations in which all significant inputs are observable in active markets. The fair values of derivative instruments, which consist of foreign currency exchange forward and interest rate swap contracts, primarily are determined based on the present value of future cash flows using model-derived valuations that use observable inputs such as interest rates, credit spreads, and foreign currency exchange rates. We did not have any transfers of assets or liabilities between levels of the fair value hierarchy during the quarter ended March 30, 2014.

We use derivative instruments principally to reduce our exposure to market risks from changes in foreign currency exchange rates and interest rates. We do not enter into or hold derivative instruments for speculative trading purposes. We transact business globally and are subject to risks associated with changing foreign currency exchange rates. We enter into foreign currency hedges such as forward and option contracts that change in value as foreign currency exchange rates change. These contracts hedge forecasted foreign currency transactions in order to mitigate fluctuations in our earnings and cash flows associated with changes in foreign currency exchange rates. We designate foreign currency hedges as cash flow hedges. We also are exposed to the impact of interest rate changes primarily through our borrowing activities. For fixed rate borrowings, we may use variable interest rate swaps, effectively converting fixed rate borrowings to variable rate borrowings in order to reduce the amount of interest paid. These swaps are designated as fair value hedges. For variable rate borrowings, we may use fixed interest rate swaps, effectively converting variable rate borrowings to fixed rate borrowings in order to mitigate the impact of interest rate changes on earnings. These swaps are designated as cash flow hedges. We may also enter into derivative instruments that are not designated as hedges and do not qualify for hedge accounting, which are intended to mitigate certain economic exposures.

The aggregate notional amount of our outstanding foreign currency hedges at March 30, 2014 and December 31, 2013 was $1.1 billion and $1.0 billion. The aggregate notional amount of our outstanding interest rate swaps at March 30, 2014 and December 31, 2013 was $1.3 billion and $1.2 billion. Derivative instruments did not have a material impact on net earnings and comprehensive income during the quarters ended March 30, 2014 and March 31, 2013. Substantially all of our derivatives are designated for hedge accounting.

In addition to the financial instruments listed in the table above, we hold other financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and debt. The carrying amounts for cash and cash equivalents, accounts receivable, and accounts payable approximated their fair values. The estimated fair value of our outstanding debt was $7.6 billion and $7.4 billion at March 30, 2014 and December 31, 2013, and the outstanding principal amount was $7.0 billion at both March 30, 2014 and December 31, 2013, excluding unamortized discounts of $880 million and $882 million. The estimated fair values of our outstanding debt were determined based on quoted prices for similar instruments in active markets (Level 2 inputs).

OTHER

3 Months Ended

Mar. 30, 2014

OTHER

NOTE 8 – OTHER

Changes in Estimates

Accounting for contracts using the percentage-of-completion method requires judgment relative to assessing risks, estimating contract sales and costs (including estimating award and incentive fees and penalties related to performance), and making assumptions for schedule and technical issues. Due to the number of years it may take to complete many of our contracts and the scope and nature of the work required to be performed on those contracts, the estimation of total sales and costs at completion is complicated and subject to many variables and, accordingly, is subject to change. When adjustments in estimated total contract sales or estimated total costs are required, any changes from prior estimates are recognized in the current period for the inception-to-date effect of such changes. When estimates of total costs to be incurred on a contract exceed estimates of total sales to be earned, a provision for the entire loss on the contract is recorded in the period in which the loss is determined.

Many of our contracts span several years and include highly complex technical requirements. At the outset of a contract, we identify and monitor risks to the achievement of the technical, schedule, and cost aspects of the contract, and assess the effects of those risks on our estimates of total costs to complete the contract. The estimates consider the technical requirements (e.g., a newly-developed product versus a mature product), the schedule and associated tasks (e.g., the number and type of milestone events), and costs (e.g., material, labor, subcontractor, and overhead). The initial profit booking rate of each contract considers risks surrounding the ability to achieve the technical requirements, schedule, and costs in the initial estimated total costs to complete. Profit booking rates may increase during the performance of the contract if we successfully retire risks surrounding the technical, schedule, and cost aspects of the contract. Conversely, our profit booking rates may decrease if the estimated total costs to complete the contract increase. All of the estimates are subject to change during the performance of the contract and may affect the profit booking rate.

In addition, comparability of our segment sales, operating profit, and operating margins may be impacted by changes in profit booking rates on our contracts accounted for using the percentage-of-completion method of accounting. Segment operating profit and margins may also be impacted, favorably or unfavorably, by other matters such as the resolution of contractual matters; restructuring charges, except for significant severance actions as mentioned below; cost recoveries on all restructuring charges; reserves for disputes; asset impairments; and insurance recoveries; among others. Our consolidated net adjustments not related to volume, including net profit booking rate adjustments and other matters, increased segment operating profit, net of state income taxes, by approximately $525 million and $470 million for the quarters ended March 30, 2014 and March 31, 2013. These adjustments increased net earnings by approximately $340 million ($1.05 per share) and $305 million ($.93 per share) for the quarters ended March 30, 2014 and March 31, 2013.

Stockholders’ Equity

Repurchases of Common Stock

During the quarter ended March 30, 2014, we repurchased 7.0 million shares of our common stock for $1.1 billion. We had total remaining authorization of $2.5 billion for future common share repurchases under our program as of March 30, 2014. As we repurchase our common shares, we reduce common stock for the $1 of par value of the shares repurchased, with the excess purchase price over par value recorded as a reduction of additional paid-in capital. If additional paid-in capital is reduced to zero, we record the remainder of the excess purchase price over par value as a reduction of retained earnings.

Restricted Stock Unit and Performance Stock Unit Grants

In January 2014, we granted certain employees approximately 0.7 million restricted stock units (RSUs) with a grant-date fair value of $146.85 per RSU. The grant-date fair value of these RSUs is equal to the closing market price of our common stock on the grant date less a discount to reflect the delay in payment of dividend-equivalent cash payments that are made only upon vesting, which is generally three years from the grant date. We recognize the grant-date fair value of RSUs, less estimated forfeitures, as compensation expense ratably over the requisite service period, which is shorter than the vesting period if the employee is retirement eligible on the date of grant or will become retirement eligible before the end of the vesting period.

In January 2014, we also granted certain employees performance stock units (PSUs) with an aggregate target award of approximately 0.2 million shares of our common stock. The PSUs vest three years from the grant date based on continuous service, with the number of shares earned (0% to 200% of the target award) depending upon the extent to which we achieve certain financial and market performance targets measured over the period from January 1, 2014 through December 31, 2016. About half of the PSUs were valued at $146.85 per PSU in a manner similar to RSUs discussed above as the financial targets are based on our operating results. We recognize the grant-date fair value of these PSUs, less estimated forfeitures, as compensation expense ratably over the vesting period based on the number of awards expected to vest at each reporting date. The remaining PSUs were valued at $134.15 per PSU using a Monte Carlo model as the performance target is related to our total shareholder return relative to our peer group. We recognize the grant-date fair value of these awards, less estimated forfeitures, as compensation expense ratably over the vesting period.

Dividends

We declared cash dividends totaling $428 million ($1.33 per share) and $371 million ($1.15 per share) for the quarters ended March 30, 2014 and March 31, 2013.

Accumulated Other Comprehensive Loss

Changes in the balance of accumulated other comprehensive loss (AOCL), net of tax, consisted of the following (in millions):


	Postretirement Benefit Plans		Other, net		AOCL
Balance at December 31, 2012	$	(13,532)	$	39	$	(13,493)
Other comprehensive loss before reclassifications		—		(40)		(40)
Amounts reclassified from AOCL
Net actuarial losses ^(a)		244		—		244
Prior service cost ^(a)		10		—		10
Other		—		(3)		(3)
Total reclassified from AOCL		254		(3)		251
Total other comprehensive income (loss)		254		(43)		211
Balance at March 31, 2013	$	(13,278)	$	(4)	$	(13,282)

Balance at December 31, 2013	$	(9,649)	$	48	$	(9,601)
Other comprehensive loss before reclassifications		—		(4)		(4)
Amounts reclassified from AOCL
Net actuarial losses ^(a)		153		—		153
Prior service cost ^(a)		14		—		14
Other		—		1		1
Total reclassified from AOCL		167		1		168
Total other comprehensive income (loss)		167		(3)		164
Balance at March 30, 2014	$	(9,482)	$	45	$	(9,437)

^(a)	Amounts related to our postretirement benefit plans that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented (Note 5).

Income Taxes

Our effective income tax rates were 30.8% and 25.8% for the quarters ended March 30, 2014 and March 31, 2013. The rates for both periods benefited from tax deductions for U.S. manufacturing activities and for dividends paid to our defined contribution plans with an employee stock ownership plan feature. Additionally, our effective tax rate for the quarter ended March 31, 2013 benefited from $46 million ($.14 per share) in U.S. research and development (R&D) tax credits, which included the full-year 2012 credits and one quarter of the 2013 credits. The American Taxpayer Relief Act, enacted in January 2013, reinstated the R&D tax credit for 2012 and 2013. The R&D tax credit expired on December 31, 2013 and, therefore, we will not recognize its benefits in 2014 unless and until legislation is enacted.

We received net tax refunds of approximately $200 million and $540 million during the quarters ended March 30, 2014 and March 31, 2013, primarily attributable to our tax-deductible pension contributions made during the quarters ended December 31, 2013 and 2012.

Restructuring Charges

Fourth Quarter 2013 Action

In November 2013, we committed to a plan to close and consolidate certain facilities and reduce our total workforce by approximately 4,000 positions within our IS&GS, MST, and Space Systems business segments. This plan resulted from a strategic review of our facilities capacity and future workload projections and is intended to better align our organization and cost structure and improve the affordability of our products and services given the changes in U.S. Government spending as well as the rapidly changing competitive and economic landscape.

We expect to incur total accelerated costs (e.g., accelerated depreciation expense related to long-lived assets at the sites to be closed) and incremental costs (e.g., relocation of equipment and other employee related costs) of approximately $15 million, $50 million, and $135 million at our IS&GS, MST, and Space Systems business segments through the completion of this plan in 2015. As of March 30, 2014, we have incurred costs of approximately $30 million, inclusive of amounts incurred during the quarter ended March 30, 2014. The accelerated and incremental costs are recorded as incurred in cost of sales on our Statement of Earnings and included in the respective business segment’s results of operations.

During the quarter ended December 31, 2013, we incurred severance charges of $171 million, net of state tax benefits, of which $53 million, $37 million, and $81 million related to our IS&GS, MST, and Space Systems business segments. Upon separation, terminated employees receive lump-sum severance payments primarily based on years of service. As of March 30, 2014, we have paid approximately $50 million in severance payments associated with this action, including approximately $35 million paid during the quarter ended March 30, 2014. The remaining severance payments are expected to be paid through the middle of 2015.

We expect to recover a substantial amount of the restructuring charges through the pricing of our products and services to the U.S. Government and other customers, with the impact included in the respective business segment’s results of operations.

First Quarter 2013 Action

During the quarter ended March 31, 2013, we recorded severance charges totaling $30 million, net of state tax benefits, related to our IS&GS business segment, which reduced our net earnings by $19 million ($.06 per share). These severance actions resulted from a strategic review of this business segment to better align our cost structure with changing economic conditions and also reflect changes in program lifecycles. The charges consisted of severance costs associated with the planned elimination of certain positions through either voluntary or involuntary actions. Upon separation, terminated employees received lump-sum severance payments primarily based on years of service, all of which were paid in 2013.

EARNINGS PER COMMON SHARE (Tables)

3 Months Ended

Mar. 30, 2014

Schedule of Weighted Average Shares Outstanding Used to Compute Earnings Per Common Share

The weighted average number of shares outstanding used to compute earnings per common share were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013

Weighted average common shares outstanding for basic computations		319.1		321.7
Weighted average dilutive effect of equity awards		6.0		4.6

Weighted average common shares outstanding for diluted computations		325.1		326.3

BUSINESS SEGMENT INFORMATION (Tables)

3 Months Ended

Mar. 30, 2014

Summary of Financial Information for Each Business Segment

Summary operating results for each of our business segments were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013
Net sales
Aeronautics	$	3,386	$	3,186
Information Systems & Global Solutions		1,910		2,106
Missiles and Fire Control		1,867		1,988
Mission Systems and Training		1,628		1,830
Space Systems		1,859		1,960
Total net sales	$	10,650	$	11,070

Operating profit
Aeronautics	$	393	$	379
Information Systems & Global Solutions		174		189
Missiles and Fire Control		358		344
Mission Systems and Training		250		201
Space Systems		254		230
Total business segment operating profit		1,429		1,343
Unallocated, net
FAS/CAS pension adjustment
FAS pension expense		(313)		(487)
Less: CAS cost		399		366
FAS/CAS pension income (expense) ^(a)		86		(121)
Severance charges ^(b)		—		(30)
Stock-based compensation		(48)		(53)
Other, net		(35)		(20)
Total unallocated, net		3		(224)
Total consolidated operating profit	$	1,432	$	1,119

Intersegment sales
Aeronautics	$	27	$	50
Information Systems & Global Solutions		176		190
Missiles and Fire Control		87		53
Mission Systems and Training		315		227
Space Systems		27		23
Total intersegment sales	$	632	$	543

^(a)

^(b)

Severance charges during the quarter ended March 31, 2013 consisted of amounts, net of state tax benefits, associated with the elimination of certain positions at our IS&GS business segment (Note 8, under the caption “Restructuring Charges”). Severance charges for initiatives that are not significant are included in business segment operating profit.

Total assets for each of our business segments were as follows (in millions):


	March 30, 2014		December 31, 2013
Assets
Aeronautics	$	5,892	$	5,821
Information Systems & Global Solutions		5,834		5,798
Missiles and Fire Control		4,065		4,159
Mission Systems and Training		6,450		6,512
Space Systems		3,776		3,522
Total business segment assets		26,017		25,812
Corporate assets ^(a)		10,902		10,376
Total assets	$	36,919	$	36,188

^(a)	Corporate assets primarily include cash and cash equivalents, deferred income taxes, environmental receivables, and investments held in a separate trust to fund certain of our non-qualified deferred compensation plans.

INVENTORIES, NET (Tables)

3 Months Ended

Mar. 30, 2014

Inventories

Inventories, net consisted of the following (in millions):


	March 30, 2014		December 31, 2013
Work-in-process, primarily related to long-term contracts and programs in progress	$	7,080	$	7,073
Less: customer advances and progress payments		(4,866)		(4,834)
		2,214		2,239
Other inventories		735		738
Total inventories, net	$	2,949	$	2,977

POSTRETIREMENT BENEFIT PLANS (Tables)

3 Months Ended

Mar. 30, 2014

Components of Pretax Net Periodic Benefit Costs

The components of our pretax net periodic benefit costs for our qualified defined benefit pension plans and retiree medical and life insurance plans were as follows (in millions):


	Quarters Ended
	March 30, 2014		March 31, 2013
Qualified defined benefit pension plans
Service cost	$	243	$	286
Interest cost		488		450
Expected return on plan assets		(660)		(622)
Recognized net actuarial losses		221		353
Amortization of prior service cost		21		20
Total net periodic benefit cost	$	313	$	487
Retiree medical and life insurance plans
Service cost	$	5	$	7
Interest cost		31		29
Expected return on plan assets		(36)		(36)
Recognized net actuarial losses		6		11
Amortization of prior service cost (credit)		1		(5)
Total net periodic benefit cost	$	7	$	6

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 30, 2014

Fair Value, Assets and Liabilities Measured on Recurring Basis

Assets and liabilities measured and recorded at fair value on a recurring basis consisted of the following (in millions):


	March 30, 2014						December 31, 2013
	Total		Level 1		Level 2		Total		Level 1		Level 2
Assets
Equity securities	$	103	$	103	$	—	$	77	$	77	$	—
Mutual funds		562		562		—		613		613		—
U.S. Government securities		229		—		229		238		—		238
Other securities		128		—		128		131		—		131
Derivatives		21		—		21		28		—		28
Liabilities
Derivatives		14		—		14		23		—		23

OTHER (Tables)

3 Months Ended

Mar. 30, 2014

Accumulated Other Comprehensive Loss

Changes in the balance of accumulated other comprehensive loss (AOCL), net of tax, consisted of the following (in millions):


	Postretirement Benefit Plans		Other, net		AOCL
Balance at December 31, 2012	$	(13,532)	$	39	$	(13,493)
Other comprehensive loss before reclassifications		—		(40)		(40)
Amounts reclassified from AOCL
Net actuarial losses ^(a)		244		—		244
Prior service cost ^(a)		10		—		10
Other		—		(3)		(3)
Total reclassified from AOCL		254		(3)		251
Total other comprehensive income (loss)		254		(43)		211
Balance at March 31, 2013	$	(13,278)	$	(4)	$	(13,282)

Balance at December 31, 2013	$	(9,649)	$	48	$	(9,601)
Other comprehensive loss before reclassifications		—		(4)		(4)
Amounts reclassified from AOCL
Net actuarial losses ^(a)		153		—		153
Prior service cost ^(a)		14		—		14
Other		—		1		1
Total reclassified from AOCL		167		1		168
Total other comprehensive income (loss)		167		(3)		164
Balance at March 30, 2014	$	(9,482)	$	45	$	(9,437)

^(a)	Amounts related to our postretirement benefit plans that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented (Note 5).

Schedule of Weighted Average Shares Outstanding Used to Compute Earnings Per Common Share (Detail) - shares shares in Millions	3 Months Ended
	Mar. 30, 2014	Mar. 31, 2013
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items]
Weighted average common shares outstanding for basic computations	319.1	321.7
Weighted average dilutive effect of equity awards	6.0	4.6
Weighted average common shares outstanding for diluted computations	325.1	326.3

Earnings Per Common Share - Additional Information (Detail) shares in Millions	3 Months Ended
	Mar. 31, 2013 shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock options excluded from the computation of diluted earnings per common share, because their inclusion would have been anti-dilutive	6.4

Business Segment Information - Additional Information (Detail) - Segment	3 Months Ended
	Mar. 30, 2014	Mar. 31, 2013
Segment Reporting Information [Line Items]
Number of business segments	5
F-35 program \| Aeronautics
Segment Reporting Information [Line Items]
Program net sales as percent of total net sales	16.00%	15.00%

Summary of Financial Information for Each Business Segment (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 30, 2014

Dec. 31, 2013

Mar. 31, 2013

FAS/CAS pension income (expense)

$ 10,650

$ 11,070

Less: CAS cost

399

366

^[1]

(121)

$ (171)

(30)

^[2]

Stock-based compensation

(48)

(53)

(35)

(20)

Total unallocated, net

(224)

1,432

1,119

Qualified defined benefit pension plans

36,919

36,188

Information Systems & Global Solutions

FAS pension expense

(313)

(487)

Mission Systems and Training

(53)

(37)

Space Systems

(81)

Business segments

1,429

1,343

Business segments | Aeronautics

26,017

25,812

3,386

3,186

393

379

Business segments | Information Systems & Global Solutions

5,892

5,821

1,910

2,106

174

189

Business segments | Missiles and Fire Control

5,834

5,798

1,867

1,988

358

344

Business segments | Mission Systems and Training

4,065

4,159

1,628

1,830

250

201

Business segments | Space Systems

6,450

6,512

1,859

1,960

254

230

3,776

3,522

Intersegment elimination

Intersegment elimination | Aeronautics

632

543

Intersegment elimination | Information Systems & Global Solutions

Intersegment elimination | Missiles and Fire Control

176

190

Intersegment elimination | Mission Systems and Training

Intersegment elimination | Space Systems

315

227

$ 23

Corporate

Increase in segment operating profit, net of state taxes, from the impact of changes in net profit booking rate adjustments and other matters

^[3]

$ 10,902

$ 10,376

[1]	The change in the FAS/CAS pension adjustment from expense to income between the periods was due to lower FAS pension expense in 2014 primarily as a result of the increase in the discount rate used in the measurement of our GAAP postretirement benefit plan obligations at the end of 2013, and incrementally higher CAS costs in 2014 as a result of phasing in the CAS Harmonization rules as discussed in our 2013 Form 10-K.
[2]	Severance charges during the quarter ended March 31, 2013 consisted of amounts, net of state tax benefits, associated with the elimination of certain positions at our IS&GS business segment (Note 8, under the caption "Restructuring Charges"). Severance charges for initiatives that are not significant are included in business segment operating profit.
[3]	Corporate assets primarily include cash and cash equivalents, deferred income taxes, environmental receivables, and investments held in a separate trust to fund certain of our non-qualified deferred compensation plans.

Inventories (Detail) - USD ($) $ in Millions	Mar. 30, 2014	Dec. 31, 2013
Inventory [Line Items]
Work-in-process, primarily related to long-term contracts and programs in progress	$ 7,080	$ 7,073
Less: customer advances and progress payments	(4,866)	(4,834)
Inventory for long term contracts or programs net of customer advances and progress payments	2,214	2,239
Other inventories	735	738
Total inventories, net	$ 2,949	$ 2,977

Components of Pretax Net Periodic Benefit Costs (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2014	Mar. 31, 2013
Qualified defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 243	$ 286
Interest cost	488	450
Expected return on plan assets	(660)	(622)
Recognized net actuarial losses	221	353
Amortization of prior service cost (credit)	21	20
Total net periodic benefit cost	313	487
Retiree medical and life insurance plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	5	7
Interest cost	31	29
Expected return on plan assets	(36)	(36)
Recognized net actuarial losses	6	11
Amortization of prior service cost (credit)	1	(5)
Total net periodic benefit cost	$ 7	$ 6

Postretirement Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Apr. 23, 2014	Mar. 30, 2014	Mar. 31, 2013
Defined Benefit Plan Disclosure [Line Items]
Recognition of previously deferred postretirement benefit plan amounts		$ 167	$ 254
Recognition of previously deferred postretirement benefit plan amounts, tax		91	$ 139
Qualified defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Planned defined benefit plan contributions by employer in current fiscal year		$ 1,000
Qualified defined benefit pension plans \| Subsequent Event
Defined Benefit Plan Disclosure [Line Items]
Contributions made by the employer	$ 515

Legal Proceedings and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended	87 Months Ended
	Mar. 30, 2014	Mar. 30, 2014	Dec. 31, 2013	Apr. 24, 2009
Site Contingency [Line Items]
Liabilities recorded relative to environmental matters	$ 1,000	$ 1,000	$ 997
Environmental costs eligible for future recovery	$ 874	874	863
Time period environmental costs and recovery of environmental costs are projected over, years	20 years
Percentage of expenditures that are reimbursed for certain remediation activities	50.00%
Outstanding letters of credit, surety bonds, and third-party guarantees	$ 2,500	2,500	2,400
Third-party guarantees outstanding	$ 804	$ 804	$ 696
Percentage of total guarantees that relate to guarantees of contractual performance of joint ventures	90.00%	90.00%	90.00%
N.Y. Metropolitan Transportation Authority
Site Contingency [Line Items]
Contract value				$ 323
Contract payments received to date	$ 241	$ 241
United Launch Alliance
Site Contingency [Line Items]
Percentage of ownership interest in affiliated entity	50.00%	50.00%
Dividends that are subject to contingency		$ 527
Revolving line of credit	$ 560	$ 560

Fair Value, Assets and Liabilities Measured on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Millions	Mar. 30, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	$ 21	$ 28
Derivative liabilities	14	23
Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	103	77
Mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	562	613
U.S. Government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	229	238
Other securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	128	131
Fair value, inputs, level 1 \| Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	103	77
Fair value, inputs, level 1 \| Mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	562	613
Fair value, inputs, level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	21	28
Derivative liabilities	14	23
Fair value, inputs, level 2 \| U.S. Government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	229	238
Fair value, inputs, level 2 \| Other securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of investments measured on recurring basis	$ 128	$ 131

Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Millions	Mar. 30, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair values of debt instruments	$ 7,600	$ 7,400
Outstanding principal amount of debt instrument	7,000	7,000
Unamortized discount on long-term debt	880	882
Foreign currency contracts \| Designated as hedges
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Aggregate notional amount of derivatives	1,100	1,000
Interest rate swaps \| Designated as hedges
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Aggregate notional amount of derivatives	$ 1,300	$ 1,200

Other - Additional Information (Detail)
$ / shares in Units, shares in Millions, $ in Millions

1 Months Ended

3 Months Ended

5 Months Ended

Jan. 31, 2014

$ / shares

Nov. 30, 2013

Employee

Mar. 30, 2014

USD ($)

$ / shares

Dec. 31, 2013

USD ($)

$ / shares

Mar. 31, 2013

USD ($)

$ / shares

Mar. 30, 2014

USD ($)

$ / shares

$ 525

$ 470

Increase in net earnings from the impact of changes in net profit booking rate adjustments and other matters

$ 340

$ 305

Increase in diluted earnings per share from the impact of changes in net profit booking rate adjustments and other matters | $ / shares

$ 1.05

$ 0.93

Number of shares repurchased under share repurchase program | shares

7.0

Value of stock repurchased under share repurchase program

$ 1,106

$ 477

Remaining authorized repurchase amount under share repurchase program

$ 2,500

Common stock par value, per share | $ / shares

$ 1

Additional paid-in capital

Dividends declared

$ 428

$ 371

Dividends declared, per share (in USD) | $ / shares

$ 1.33

$ 1.15

Effective income tax rates

30.80%

25.80%

Recognized tax benefit for the impact of the tax credit

$ 46

Increase in diluted earnings per share due to R&D tax credit | $ / shares

$ 0.14

Tax refunds received, net of payments made

$ 200

$ 540

Accelerated and incremental costs incurred

Reduction in net earnings due to severance charges

171

^[1]

Severance payments

$ 50

$ 19

Decrease in diluted earnings per share due to severance charges | $ / shares

$ 0.06

Information Systems & Global Solutions, Mission Systems & Training, and Space Systems

Number of employees terminated | Employee

4,000

Information Systems & Global Solutions

Information Systems & Global Solutions | Incremental expected costs as a result of the November 2013 restructuring plan

Expected total accelerated and incremental costs

Mission Systems and Training

Mission Systems and Training | Incremental expected costs as a result of the November 2013 restructuring plan

Expected total accelerated and incremental costs

Space Systems

Space Systems | Incremental expected costs as a result of the November 2013 restructuring plan

$ 81

Expected total accelerated and incremental costs

$ 135

Restricted Stock Units (RSUs)

Number of stock units, granted, in shares | shares

0.7

Average grant date fair value per unit | $ / shares

$ 146.85

Number of years over which equity awards vest

3 years

Performance Stock Units (PSUs)

Number of stock units, granted, in shares | shares

0.2

Number of years over which equity awards vest

3 years

Performance Stock Units (PSUs) | Minimum

Range of shares that can be earned from stock awards, as a percentage of the target award

0.00%

Performance Stock Units (PSUs) | Maximum

Range of shares that can be earned from stock awards, as a percentage of the target award

200.00%

Performance Stock Units (PSUs) | Half Of PSUs Granted In Period

Average grant date fair value per unit | $ / shares

$ 146.85

Performance Stock Units (PSUs) | Remaining Half Of PSUs Granted In Period

Average grant date fair value per unit | $ / shares

$ 134.15

[1]

Changes in Balance of Accumulated Other Comprehensive Loss (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 30, 2014

Mar. 31, 2013

Accumulated Other Comprehensive Income (Loss) [Line Items]

Beginning balance

$ (9,601)

$ (13,493)

Other comprehensive loss before reclassifications

(4)

(40)

Net actuarial losses

^[1]

153

244

Prior service cost

^[1]

Other

(3)

Total reclassified from AOCL

168

251

Other comprehensive income (loss), net of tax

164

211

Ending balance

(9,437)

(13,282)

Postretirement Benefit Plan Adjustments

Accumulated Other Comprehensive Income (Loss) [Line Items]

Beginning balance

(9,649)

(13,532)

Net actuarial losses

^[1]

153

244

Prior service cost

^[1]

Total reclassified from AOCL

167

254

Other comprehensive income (loss), net of tax

167

254

Ending balance

(9,482)

(13,278)