Why Is Northrop Grumman Stock Falling on Wednesday?

Northrop Grumman Corp. (NYSE:NOC) stock is falling on Wednesday, after the U.S. Navy selected Boeing Co. (NYSE:BA) over Northrop to develop its next-generation carrier-based fighter jet, the F/A-XX.The contract is worth more than $20 billion, according to the Department of Defense, which announced the award on X on Wednesday.Reuters said the F/A-XX program could eventually be worth hundreds of billions of dollars as production ramps up and potential foreign orders materialize. Read Also: Anthropic IPO Filing Reveals a Major Vulnerability: Nearly 50% of Sales Flow Through Amazon and Google as Revenue Concentration Raises Risks: Report The Navy expects the first production aircraft to enter service in the 2030s, operating alongside more than 270 planned F-35Cs, while Super Hornets are expected to remain in service into the 2040s.What The F/A-XX Contract CoversThe Pentagon said the award covers multiple test aircraft for ground, airworthiness, systems and weapons-integration testing. Pentagon acquisition chief Michael Duffey said, “F/A-XX will dominate contested airspace, extend operational reach, and deliver a decisive combat advantage for the warfighter.”Boeing’s Second Fighter Win In Two YearsThe award follows Boeing’s 2025 win over Lockheed Martin for the Air Force’s F-47, a development contract also worth more than $20 billion.Boeing Defense CEO Steve Parker said investments in “new facilities uniquely suited to build multiple products with next-generation capabilities” leave the company ready to execute the program.Delays Give Way To Long-Term Fleet PlanThe Navy competition had faced repeated delays over engineering and supply-chain capacity.The Pentagon considered pushing the program back by as much as three years before Congress intervened, providing $750 million in 2025 legislation and another $1.4 billion for fiscal 2026.Lockheed Martin was eliminated from the competition in March 2025, leaving Boeing and Northrop as finalists.Defense ETFs With Northrop Grumman ExposureNorthrop Grumman has exposure across several defense-focused ETFs, including the Global X Defense Tech ETF (NYSE:SHLD), where it carries a 7.77% weighting and is down 9.36% year to date.In the WisdomTree Global Defense Fund (NASDAQ:WDGF), Northrop Grumman accounts for 4.94% of the portfolio, with the ETF down 5.14% year to date. Meanwhile, the State Street SPDR S&P Aerospace & Defense ETF (NYSE:XAR) has a 2.87% weighting in Northrop Grumman and is down 6.60% year to date.NOC Price Action: Northrop Grumman shares were down 3.87% at $485.10 at the time of publication on Wednesday. The stock is trading near its 52-week low of $479.02, according to Benzinga Pro data. Read Also: MU Stock Split Chatter Divides Traders Online Ahead of Earnings: 'Would It Make Sense' or Get 'Annihilated'? Image via Shutterstock