BAE Systems raises cash flow outlook as GCAP, missile orders grow

BAE Systems has raised its free cash flow forecast for 2026 to about £3 billion ($4 billion), up from its previous expectation of more than £2 billion ($2.7 billion), according to a market update published on November 12, 2026. 

Customer advances have helped boost the figure. The revised forecast takes into account payments already received but excludes any large advances that could arrive before the end of the year. Such payments also contributed to the £1.79 billion ($2.4 billion) in free cash flow BAE Systems reported for the first half of 2026. 

The company left its sales and earnings forecasts unchanged from July 2026. It still expects sales to grow by 8% to 10% from £30.7 billion ($40.7 billion) in 2025, underlying earnings before interest and tax (EBIT) by 10% to 12%, and underlying earnings per share (EPS) by 11% to 13%. 

Business remained strong across Electronic Systems, Air, and Platforms & Services, helping offset weaker growth and margins in Maritime. 

GCAP fighter contracts boost BAE Systems orders 

BAE Systems said it had secured £33 billion ($43.8 billion) in orders so far in 2026 and expects further agreements before the end of the year. At the same stage in 2025, it had reported more than £27 billion ($35.8 billion) in orders. 

The company booked about £1.6 billion ($2.1 billion) in orders related to the Global Combat Air Programme (GCAP), including its share of the £4.6 billion ($6.1 billion) contract awarded to Edgewing in July 2026. Its share of MBDA orders added approximately £1.5 billion ($2 billion). 

BAE Systems also listed a contract worth about A$1.3 billion ($890 million) for an Arctic over-the-horizon radar system Canada is buying from Australia. The Australian government valued the overall arrangement, signed on June 22, 2026, at A$2.5 billion ($1.7 billion) and described it as the country’s largest-ever defense export. 

In the US, the company received about $1 billion (€900 million) in additional funding for munitions programs, including APKWS precision guidance systems and THAAD infrared seekers. It also received about $800 million (€720 million) to continue full-rate production of Armored Multi-Purpose Vehicles for the US Army. 

Missile production and next-generation combat aircraft remain priorities 

BAE Systems said it supports 10 of the 12 US munitions programs prioritized for significantly increased production capacity.  

On March 25, 2026, it signed a seven-year framework agreement with the Pentagon to quadruple production capacity for the THAAD seeker it supplies to Lockheed Martin. In June 2026, Lockheed Martin received a contract worth up to $35 billion to quadruple THAAD interceptor output. 

In the UK, BAE Systems pointed to the Defence Investment Plan published on June 30, 2026, which it said reinforces investment in next-generation fighters and autonomous collaborative combat aircraft. At the Farnborough International Airshow in July 2026, the company unveiled Brontanax, a self-funded collaborative combat aircraft prototype. 

BAE Systems expects to return about £1.6 billion ($2.1 billion) to shareholders in 2026, including approximately £500 million ($660 million) in share buybacks. It will publish its full-year results on February 19, 2027. The post BAE Systems raises cash flow outlook as GCAP, missile orders grow appeared first on AeroTime.

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