Lockheed Built a Money Machine That Runs on a Jet That Can't Fly Most of the Time

Picture a fleet of the most advanced fighter jets ever built, and then picture that on any given day in 2025, fewer than half of them could fly a mission at all.⁵ That is not a hypothetical. The F-35's fleet-wide mission capable rate fell to 44% in FY2025, and the share able to perform all their missions dropped to 25%.⁵ (GAO-26-108113 was published June 11, 2026, covering FY2025 performance data gathered during an audit conducted January 2025 through June 2026.) You would expect a supplier paid to keep those jets ready to be in trouble. Instead, that supplier has built one of the most durable revenue machines in the defense industry - precisely because the jets keep breaking.

The official story is that the F-35 anchors Lockheed Martin because it is a great airplane that everyone wants to buy. The real story is quieter and stranger: the airplane is roughly a quarter of Lockheed's revenue and flat,¹ while the thing that actually locks the customer in is the part nobody markets - the spare parts, the data, and the software that keep a chronically unreliable fleet limping forward.

The anchor isn't the jet. It's everything the jet can't do without.

Here is the thesis a smart friend could repeat at dinner: Lockheed isn't anchored by selling F-35s - it's anchored by owning the F-35's bloodstream. The aircraft is built around proprietary logistics, parts pipelines, and maintenance data that the government does not fully control. So once a country buys the jet, it has also bought a decades-long dependency on Lockheed to keep it alive. The buy is the front door. The sustainment is the trap.

Look at the numbers and the shape of the business comes into focus. The DoD's 2023 estimate puts the F-35's total cost at $2.1 trillion across a 94-year lifecycle running to 2088.³ Most people read that as Lockheed's payday. It isn't - the figure includes fuel, personnel, depot repair, and inflation, and the Joint Program Office itself notes roughly $1 trillion of it is just inflation adjustment.³ But buried inside the total is the part that does matter: sustainment alone is now estimated at nearly $1.58 trillion, a 44% jump from the 2018 estimate of $1.1 trillion, driven by the Pentagon extending the jet's service life to 2088 and by relentless reliability failures.⁴ The less reliable the fleet, the bigger the sustainment tail. The bigger the tail, the deeper the dependency.

Paid to keep them flying, even as they fall out of the sky

The cleanest evidence that this is a trap and not a partnership is what happens when the product fails. The mission capable rate didn't drift - it collapsed, from 67% in FY2021 to 44% in FY2025, while the full mission capable rate fell from 38% to 25%.⁵ Those numbers sit nowhere near the 80% targets the services set; the Air Force's F-35A managed 51.9% in 2023 against an 80% minimum.⁶ And yet, from 2020 through 2023, Lockheed was paid more than $114 million in incentive fees even as readiness stagnated or got worse.⁵ A normal supplier loses the contract when the product underperforms. Lockheed got bonuses.

Why doesn't the Pentagon just route around it? Because it can't easily. Take it apart and the mechanism is plain: the government bought a weapon system whose logistics nervous system Lockheed designed and operates. The parts network, the maintenance software, the data on what's broken and why - the dependency is structural, not contractual. The Pentagon knows this, which is why it has been trying to claw back control, even formally pausing performance-based logistics negotiations in late 2023 after the Office of the Secretary of Defense determined the proposed PBL contract did not meet Congressional certification requirements.⁹ The frustration is the proof. You don't fight that hard to escape a vendor you could simply replace.

The bill for harvesting one account: the next two fighters

Here is where the anchor metaphor turns dark. An anchor holds you in place - which is exactly the danger when the fleet starts to move. In March 2025, the Air Force awarded its sixth-generation NGAD fighter, the F-47, to Boeing. Then Lockheed was dropped from the Navy's F/A-XX competition too, leaving it shut out of both next-generation manned fighter programs at once.⁷ Wall Street read the signal instantly: Bank of America, Melius, and RBC Capital all downgraded the stock to neutral.⁷ Two decades of harvesting the F-35 account, and the company that built the last dominant fighter was not chosen to build the next one.

The 'Ferrari F-35' pitch - upgrade the existing chassis toward sixth-generation capability rather than build a new jet - is exactly the move you'd expect from a company whose strategy has become defending the installed base.⁸ It may even work. But notice what it concedes. Lockheed isn't proposing to win the future; it's proposing to make its anchor good enough that the future doesn't fully leave it behind. And tellingly, it won't even protest the F-47 award.⁸ When the incumbent stops fighting for the next contract and starts optimizing the last one, you are watching a money machine, not a frontier.

But isn't a 60-year captive customer the best business in the world?

The fair objection is that this read is too cynical. A recurring revenue stream attached to thousands of jets flying through 2088 is, by any normal standard, an extraordinary business - the kind every company wishes it had.⁴ And there's truth there: a customer who can't leave is the dream, and Lockheed engineered one. The honest counter, though, is that captivity cuts both ways. The F-35 revenue isn't growing - it was 27% of sales in 2022 and 26% in both 2023 and 2024, with 2023 F-35 sales actually falling $400 million on lower production volume.²¹ A flat, defended account is not a growth engine; it's a plateau you defend. And the deeper risk is that optimizing one account is a different muscle than winning the next one. Lockheed got very good at the first and, in 2025, discovered it had let the second atrophy. The anchor held the ship perfectly still while the fleet sailed on without it.

Lockheed makes its money the way a landlord does with a building no one else can manage - serenely indifferent to whether the tenants are happy, because the tenants cannot leave. It needs only one thing from the world: that thousands of F-35s keep needing parts, data, and patches for the next sixty years, and they will. The genius was never the airplane. It was standing in the one place the customer can't route around - the bloodstream of a fleet that breaks. And the cost of that genius arrived in 2025, in two contracts Lockheed didn't win, with a message a money machine is the last to hear: the place you can't be replaced is also the place you stop being asked to lead.