Boeing Secures Navy F/A-XX Fighter Jet Contract
The company won a $20 billion deal to build the Navy's new sixth-generation fighter jet.
Updated on Oct. 27, 2026 in Corporate Finance
Live Poll
Should defense contractors prioritize flexible contracts over fixed-price agreements to ensure long-term stability?
Boeing secured a $20 billion contract to build the Navy's sixth-generation F/A-XX fighter on September 29, 2026. This award coincides with a separate $2.38 billion Air Force order for 22 F-15EX Eagle II fighters.
Why it matters
Boeing is actively shifting its defense strategy by rejecting fixed-price contracts to avoid the financial losses that plagued its earlier KC-46 Pegasus program. The company is now prioritizing cost-plus agreements to stabilize its defense sector earnings.
Boeing reported $23 billion in defense revenue for the first three quarters of 2026, compared to $19.8 billion in the same period in 2025. Defense earnings rose to $710 million, up from $379 million in the prior year.
The players
Boeing
The company is a major American aerospace manufacturer and defense contractor that produces military aircraft, satellites, and weapons systems.
Kelly Ortberg
He serves as the CEO of Boeing and is currently tasked with overseeing the company's financial recovery and operational restructuring.
Ted Colbert
He is the former executive who led Boeing's defense, space, and security division until he was fired in September 2024.
The details
Boeing is moving to underwrite new programs through cost-plus contract types to mitigate risk and improve profitability. The company also achieved Milestone C approvals for its T-7 Red Hawk and MQ-25 Stingray programs throughout 2026.
Timeline
In 2022, Boeing reorganized its defense sector to address revenue and quality issues.
Boeing fired executive Ted Colbert in September 2024.
The Air Force selected Boeing to build the F-47 in March 2025.
Boeing won the F/A-XX and F-15EX contracts on September 29, 2026.
CEO Kelly Ortberg discussed the company outlook on October 27, 2026.
Market Dynamics
The transition toward cost-plus contracts serves as a direct response to the financial strain previously caused by the KC-46 Pegasus program's fixed-price model. This strategy aims to shield Boeing from cost overruns while positioning the company for sustained revenue growth.
Shareholders may view the shift to cost-plus contracting as a sign of improved risk management and potential margin stability in the defense sector. The company's projection of mid-single digit revenue growth provides a benchmark for evaluating future quarterly performance.
The takeaway
Boeing is attempting to stabilize its financial future by avoiding high-risk fixed-price military contracts. Investors should monitor whether these new cost-plus agreements effectively improve long-term defense profit margins.
Further reading
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Live Poll
Should defense contractors prioritize flexible contracts over fixed-price agreements to ensure long-term stability?
