President Trump signals imminent massive attack on Iran as defense contractors report record-breaking second-quarter earnings and backlogs.
President Trump stated that a decision to launch a "massive attack" on Iran is imminent, signaling a potential escalation in Middle East tensions. This move comes as the administration announced a record $1.5 trillion defense budget request for fiscal year 2027, representing a 44% increase in military spending. The defense sector is currently benefiting from a "wartime production posture" as global conflicts drive demand for weapons. Lockheed Martin reported second-quarter adjusted earnings of $7.94 per share, beating estimates by 10% and raising its full-year revenue outlook. Simultaneously, RTX Corporation reported adjusted earnings of $1.89 per share, exceeding expectations by 13.9% while reporting a 22% increase in its backlog. Northrop Grumman also reported a record-high backlog of $105 billion. These results suggest that the defense sector is well-positioned for long-term growth. While some investors initially feared a spending bubble, the robust earnings from major contractors indicate that high demand for interceptors and missiles will persist for years.