Why is Leonardo stock sliding today?

Leonardo stock fell 3.2% to trade at €49.485 after the Italian aerospace and defence group published its nine-month 2026 financial results, triggering a "sell the news" reaction even as the underlying numbers came in ahead of expectations.

The company reported nine-month revenue up 14.2% to €15.35 billion, EBITA up 37.7% to €1.30 billion, and adjusted net profit surging 74.2% to €812 million, while its order backlog surpassed €60 billion for the first time — a milestone CEO Lorenzo Mariani described as confirming the validity of the group’s development path.

The disappointment centred on the scope of the guidance revision: while Leonardo raised its full-year new orders forecast to approximately €29.5 billion from €28.2 billion, it kept revenue guidance at €22.1 billion and EBITA guidance at €2.21 billion unchanged, leaving bulls who had anticipated a broader upgrade — including Bank of America, which had reiterated a Buy rating ahead of the print — without the incremental catalyst needed to sustain the stock’s prior gains.

Additional pressure came from management disclosures that cash absorption in the Aerostructures segment would only gradually recover, and that the Comac programme, while viewed as an opportunity, would not feature in the five-year strategic plan.

On the broader market front, the FTSE MIB had already risen sharply the prior session after Democrats secured majorities in both chambers of the US Congress, but defence stocks specifically underperformed on that day as reduced geopolitical risk premium weighed on the sector — a headwind that carried into today’s session.

A new contract announced today for the Rheinmetall-Leonardo joint venture provided a modest positive offset but was insufficient to reverse the selling pressure, while the full investor conference call — scheduled for 4:00pm CET — had not yet taken place, leaving the market to react to the written results alone.

Taken together, the combination of a strong but not transformative earnings release, unchanged core guidance, specific segment concerns, and a sector-wide de-rating following the US midterm outcome created the conditions for today’s sharp pullback, with the stock trading well below its 52-week high of €66.26 even as the underlying operational trajectory remains broadly intact.