Northrop Grumman: America's Secret Weapon Against Foreign Tech Dependence

Northrop Grumman, a Virginia-based defense company, produces millions of semiconductor chips in the US each year. The chips are used in military aircraft, defense ground radar systems, and other technology. Production takes a couple of weeks, but the company can speed it up if needed. The chips can cost from a few cents to hundreds of thousands of dollars, depending on complexity. Northrop Grumman is in a good position to meet US semiconductor needs.

Northrop Grumman, a Virginia-based defense company, plays a significant role in the production of semiconductor chips for the U.S. military. The company manufactures millions of chips annually, with a focus on military aircraft, defense ground radar systems, and other advanced technologies. This production is vital for the national security of the United States.

The company's facility in Baltimore, Maryland, is equipped with state-of-the-art technology to produce these chips. The process involves creating "wafers" that contain thousands of microchips, which are then tested in a "clean room" before being cut out and used in various defense systems. Northrop Grumman's senior manager, Dave Shahin, emphasizes that these microelectronics are "the core of those national defense systems" [1].

The production of a chip typically takes a couple of weeks, but the company can expedite the process if there is a national security need. The cost of these chips varies greatly depending on their complexity, ranging from a few cents to hundreds of thousands of dollars [1]. Despite the high cost, the average price for these chips is in the tens to hundreds of dollars.

Northrop Grumman's commitment to producing chips entirely in the U.S. for many decades places it in a strong position to meet the semiconductor needs of the U.S. defense sector. This is particularly important given the ongoing discussions about potential tariffs on imported semiconductors from countries like Taiwan, China, and South Korea [1].

The company's recent financial performance reflects its strategic importance. As of July 2, 2025, Northrop Grumman's market capitalization hovered around $74.64 billion [1]. The company's diversified portfolio, which includes a broad range of military aircraft, defense weapons, and systems, further underscores its significance in the defense industry.

In addition to its semiconductor production, Northrop Grumman benefits from significant investments in defense technologies through the One Big Beautiful Bill Act (OBBBA). This act, signed into law on July 4, 2025, appropriates approximately $150 billion to support defense and national security priorities. The act includes investments in shipbuilding, nuclear technologies, and missile defense systems, among other sectors [2].

The combination of Northrop Grumman's semiconductor production capabilities and the substantial funding from OBBBA positions the company as a key player in the U.S. defense industrial base. This strategic alignment will likely shape DoD opportunities for years to come, providing Northrop Grumman with a robust platform for growth and innovation.

References:
[1] https://www.foxbusiness.com/technology/inside-northrop-grumman-facility-making-semiconductor-chips
[2] https://www.insidegovernmentcontracts.com/2025/07/one-big-beautiful-bill-act-makes-150b-investment-in-defense/