Overview
- Trump said he will not permit defense firms to issue dividends or repurchase shares and declared executives should earn no more than $5 million until companies build new plants, speed deliveries, and improve maintenance.
- Shares of Lockheed Martin, Northrop Grumman, General Dynamics and RTX fell on the remarks, with some losses later pared after Trump separately proposed a $1.5 trillion defense budget for fiscal 2027.
- The White House has not released a mechanism to implement the restrictions, and reporting indicates an executive order or the use of federal contracting terms is under consideration.
- Defense Secretary Pete Hegseth publicly backed the push for greater capacity and faster output after months of Pentagon criticism over delays and cost overruns on major programs.
- Trump singled out Raytheon/RTX as least responsive to Pentagon needs and warned the company could face limits on future business if it does not increase investment and production.