Shares of Lockheed Martin (LMT) tumbled 5.79% in pre-market trading on Tuesday after the defense contractor reported second-quarter earnings that fell short of analysts' expectations and disclosed charges to address newly identified risks.

The company reported quarterly sales of $18.16 billion, missing the analyst consensus estimate of $18.63 billion by 2.55%. Earnings per share (EPS) came in at $1.46, which may not be directly comparable to analysts' estimates due to the special charges taken during the quarter. Net income for the period was $342 million, while free cash flow was negative $150 million.

In a statement, Lockheed Martin said, "We are taking a number of charges this quarter to address these newly identified risks." Despite the disappointing results, the company reaffirmed its 2025 guidance for sales and free cash flow, indicating confidence in its long-term outlook. However, investors seem to be focusing on the near-term challenges, as evidenced by the sharp stock decline.

The defense industry has been facing increasing scrutiny, with concerns that manned fighter jets such as Lockheed's F-35 might be de-emphasized as AI-powered drones gain prominence. This broader industry trend, coupled with the company's quarterly performance, appears to be weighing heavily on investor sentiment. As the market opens, all eyes will be on how Lockheed Martin addresses these challenges and reassures investors about its future prospects.