Northrop Grumman’s stock plunged about 13% on April 22, 2025, after the defense contractor disclosed a $477 million loss on its B-21 stealth bomber program and cut its full-year profit forecast by roughly $3 per share.
Days later, attention shifted to Akamai Technologies, which posted its best week of gains since 2013 after landing a landmark AI cloud deal.
The back-to-back moves illustrate the diverging fortunes of two large-cap technology and defense names as investors weigh cost overruns in legacy government programs against a surge in commercial AI infrastructure spending.
How a B-21 Cost Overrun Erased Months of Gains for Northrop Grumman
Northrop Grumman reported first-quarter 2025 diluted earnings per share of $3.32, including a B-21 low-rate initial production loss provision of $2.74 per share.
Adjusted earnings of $6.06 per share missed analyst estimates of approximately $6.21 to $6.26.
The company booked a pretax loss of $477 million across the five LRIP options on the B-21 program at Aeronautics Systems.
The loss stemmed from higher manufacturing costs tied to a process change the company made to support an accelerated production ramp, as well as increases in the projected cost and quantity of general procurement materials.
Total Q1 2025 sales fell 6.5% year-over-year to $9.47 billion, short of a Wall Street estimate of about $9.95 billion.
Aeronautics Systems sales dropped 8% to $2.81 billion, weighed down by lower B-21 volume and a decrease in F-35 sustainment work.
Space Systems sales declined 18% to $2.57 billion, driven by the wind-down of the Next Generation Interceptor and other restricted space programs.
The company slashed full-year adjusted EPS guidance to a range of $24.95 to $25.35 per share, down from an earlier forecast of $27.85 to $28.25.
The consensus at the time stood near $28.08, meaning the new midpoint landed roughly $3 below Street expectations.
CEO Kathy Warden told analysts during the April 22, 2025 earnings call that the B-21 charge reflected a process change made to support higher production rates and increased material costs, adding that “the learning from these changes is now understood” and the company did not expect the issues to recur.
The stock hit its 52-week low of $450.13 on April 22, 2025. Intraday data from AAII placed the stock at $460.52 that day, a decline of approximately 13.3% from its prior close of $531.33.
A broader multi-day slide pushed losses toward 18% to 20% from March peaks, according to multiple market data sources, not the ~19% single-session drop described in some initial reports.
Not all the Q1 news was negative. Net awards for the quarter totaled $10.8 billion, and backlog set a new record at $92.8 billion. Northrop reaffirmed its 2025 guidance for sales and free cash flow.
What the $1.8 Billion Anthropic Deal Means for Akamai’s AI Pivot
While Northrop’s report cast a cloud over the defense sector, Akamai Technologies delivered starkly different news on May 7, 2026.
Akamai reported first-quarter 2026 total revenue of $1.074 billion, a 6% increase year-over-year, with Cloud Infrastructure Services revenue reaching $95 million up 40% year-over-year and security revenue rising 11% to $590 million.
Alongside the results, CEO Tom Leighton announced that a leading frontier model provider had committed $1.8 billion over seven years for Cloud Infrastructure Services, which he said validated Akamai’s position as a key infrastructure provider in the AI economy.
Akamai did not name the customer. Bloomberg subsequently reported, citing people familiar with the matter, that the partner was Anthropic. Anthropic declined to comment, and Akamai did not respond to a related request for comment. The contract represents the largest deal in Akamai’s history.
The market reacted sharply. Akamai shares gained 27% on May 8, closing at $148.38. The weekly gain reached 42%, the company’s best week since April 2013.
Craig-Hallum analyst Jeff Van Rhee upgraded AKAM to Buy from Hold on May 8, 2026, with a price target of $190, up from $100, calling the AI partnership a transformative departure from Akamai’s traditional content delivery and security focus.
Van Rhee said the deal was expected to push revenue growth from mid-single digits to double-digit percentages by 2027.
Note on the BofA upgrade claim: The original brief stated that Bank of America upgraded Akamai to Buy with a $175 price target. Research across multiple brokerage data sources did not confirm this action.
The $175 figure belongs to Susquehanna, which raised its price target to that level on May 11, 2026. No BofA upgrade of AKAM to Buy at $175 could be verified. The BofA claim is marked Unverified.
At least 10 brokerages raised price targets on Akamai following the earnings and deal announcement, including Piper Sandler, which lifted its target to $156 from $114 and noted the deal would require significant capital expenditure but generate solid multi-year returns.
What Comes Next for Both Companies
For Northrop Grumman, the key near-term milestone is the trajectory of B-21 production costs.
Management guided for mid-single-digit sequential sales growth in Q2 2025, followed by a ramp in the second half of the year tied to awards booked in Q4 2024 and new program wins.
The company’s next scheduled earnings release covered Q2 2025 results.
For Akamai, Craig-Hallum’s upgrade note flagged that the $1.8 billion deal calls for Akamai to invest approximately $800 million in cloud infrastructure over the next 18 months, a capital commitment investors will watch closely alongside margin trends.
The company’s Q2 2026 results are the next scheduled disclosure.
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