Contract Acquisitions Increase 25 Percent to $6.3 Billion

 Sales Increase 2 Percent to $7.4 Billion

 Segment Operating Margin Increases 43 Percent to $696 Million

 Earnings per Share from Continuing Operations Up 9 Percent to $0.87
 after $0.20 per Share Legal Provision

 Cash from Operations Increases 8 Percent to $962 Million

 2006 and 2007 Guidance Provided
 

LOS ANGELES -- Oct. 24, 2006 -- Northrop Grumman Corporation (NYSE:NOC) third quarter 2006 income from continuing operations rose 5 percent to $306 million from $291 million in the third quarter of 2005. Third quarter 2006 earnings per diluted share from continuing operations increased 9 percent to $0.87 from $0.80 for the same period of 2005. Third quarter 2006 income from continuing operations includes a $112.5 million, or $0.20 per diluted share, pre-tax provision for the company's settlement offer to resolve all potential claims by the U.S. Department of Justice and a classified customer related to certain microelectronic parts produced by the Space and Electronics sector of the former TRW Inc.

Third quarter 2006 sales increased 2 percent to $7.4 billion from $7.3 billion in the third quarter of 2005. Third quarter operating results for 2006 and 2005 reflect the reclassification of certain operations from continuing to discontinued operations.

"Our four businesses delivered another very strong operating quarter, in line with our expectations," said Ronald D. Sugar, Northrop Grumman chairman and chief executive officer. "Contract acquisitions rose 25 percent and all four businesses ended the quarter with higher year-over-year backlog. Segment operating margin rose 43 percent, driven by higher sales in three of our four businesses and higher operating margin in all four businesses. Information & Services and Aerospace posted double-digit growth in operating margin and substantially higher margin rates. While we're disappointed to have a legal provision detract from the strong results, we believe this settlement offer is in the best interests of all the parties and our shareholders.

"We also had a great quarter from a cash perspective, generating nearly $1 billion in cash from operations. 2006 is shaping up to be another year in which Northrop Grumman delivers substantially higher margin and generates solid cash. Our strong financial performance continues to support our balanced cash deployment strategy and provides a solid foundation for 2007 and beyond," continued Sugar.

The company's third quarter 2006 segment operating margin increased 43 percent to $696 million from $486 million in the third quarter of 2005. All of the company's businesses -- Information & Services, Aerospace, Electronics and Ships -- generated higher operating profit in the 2006 third quarter than in the same period in 2005, with double-digit increases in operating margin in Information & Services, Aerospace and Ships. Third quarter 2005 results included a $150 million charge in Ships for Hurricane Katrina-related cost growth.

Third quarter 2006 unallocated expenses increased to $140 million from $42 million in the 2005 third quarter. In the third quarter of 2006, the company recorded a $112.5 million pre-tax provision for its settlement offer and associated expenses. As previously reported, in October 2005, the U.S. Department of Justice and a classified government customer notified the company of potential substantial claims relating to certain microelectronics parts produced by the Space and Electronics sector of the former TRW Inc. In the third quarter of 2006, the company and the customer commenced settlement discussions. While the company believes it acted appropriately in this matter, the company offered a settlement to resolve all potential claims, avoid litigation, and to recognize the value of the customer relationship. This quarter's pre-tax provision reflects the company's settlement offer and related expenses. The company is not able to predict the outcome of this matter at this time.

Operating margin increased 25 percent to $546 million from $438 million in the third quarter of 2005.

Net interest expense for the 2006 third quarter declined to $73 million from $93 million in the prior year period, primarily due to lower average debt outstanding in the 2006 period.

Other income/expense for the 2006 third quarter was income of $1 million compared with income of $94 million in the prior year period. The 2005 third quarter results included an $81 million pre-tax gain from the sale of a non-core equity holding.

The effective tax rate applied to income from continuing operations for the 2006 third quarter was 35.4 percent compared with 33.7 percent in the 2005 third quarter. The company now expects an effective tax rate of approximately 31 percent for 2006 compared with its prior guidance of 31 to 32 percent.

Net income for the 2006 third quarter increased 3 percent to $302 million, or $0.86 per diluted share, from $293 million, or $0.81 per diluted share, for the same period of 2005. Earnings per share are based on weighted average diluted shares outstanding of 351 million for the third quarter of 2006 and 362.2 million for the third quarter of 2005.

Contract acquisitions increased 25 percent to $6.3 billion in the third quarter of 2006 from $5 billion for the same period of 2005. All four businesses ended the quarter with higher funded backlog than in the prior year period, with Ships and Information & Services increasing 28 percent and 19 percent, respectively. Total backlog, which includes funded backlog and firm orders for which funding is not currently contractually obligated by the customer, increased 7 percent to $59.8 billion at Sept. 30, 2006 compared with $55.9 billion at Sept. 30, 2005.

Cash Measurements, Debt and Share Repurchases

Cash provided by operations in the third quarter of 2006 totaled $962 million compared with cash provided by operations of $891 million in the third quarter of 2005. Capital spending totaled $169 million in the 2006 third quarter, including $26 million for Hurricane Katrina capital expenditures at Ships, compared with total capital spending of $173 million in the 2005 third quarter. Since Aug. 29, 2005, hurricane-related insurance recoveries for damage, repair and restoration have totaled $264 million compared with total hurricane-related expenditures of $348 million.

Cash and cash equivalents were $1.5 billion at Sept. 30, 2006 compared with $1.6 billion at Dec. 31, 2005. During the first nine months of the year the company reduced total debt by approximately $500 million and repurchased $825 million of its common stock, including approximately 11.6 million shares under an Accelerated Share Repurchase agreement.

Under the $1.5 billion share repurchase authorization announced in October 2005, approximately $175 million remains. The company is presently evaluating the timing of the completion of this repurchase authorization. Common shares outstanding totaled 345.1 million at Sept. 30, 2006.

2006 and 2007 Guidance

For 2006, the company expects sales of approximately $30.2 billion compared with its prior guidance of approximately $30.5 billion, and earnings per share from continuing operations of $4.20 to $4.25 compared with its prior guidance of $4.35 to $4.45. The reduction to the company's guidance for 2006 earnings per share from continuing operations reflects the $0.20 per diluted share legal provision. In addition, as a result of the recently enacted Pension Protection Act of 2006, the company plans to pre-fund $800 million of its pension obligations in the fourth quarter of 2006. As a result of the planned pre-funding, the company now expects cash from operations of $1.5 to $1.8 billion compared with its prior guidance of $2.3 to $2.6 billion.

For 2007, the company expects sales in the range of $31 to $32 billion and earnings per share to increase to a range of $4.65 to $4.90. Earnings per share guidance for 2007 is based on no changes in the pension assumptions from 2006. Cash from operations is expected to increase to between $2.5 and $2.8 billion in 2007.

Business Results

Effective Jan. 1, 2006, the company established a new reportable segment, Technical Services, to leverage existing business strengths and synergies in logistics support, sustainment and technical services. On July 1, 2006, the company transferred additional business to Technical Services from Electronics, Integrated Systems, Mission Systems and Space Technology. Schedule 4 provides a reconciliation of these realignments, where applicable, with past financial reports.

The company categorizes its seven reporting segments into four businesses. The results of the Mission Systems, Information Technology and Technical Services segments are aggregated as Information & Services. The results of the Integrated Systems and Space Technology segments are aggregated as Aerospace, and the Electronic Systems segment is reported as Electronics. The Newport News and Ship Systems sectors are reported as Ships.

The company also revised its reporting of intercompany margin recognition and elimination for the company's operating segments. The operating information shown below includes intersegment sales and operating margin that eliminate in consolidation, as shown in Schedule 2.

  Information & Services
                                    Third Quarter ($ Millions)
                                2006                      2005
                              Operating  % of           Operating  % of
                      Sales    Margin   Sales   Sales    Margin   Sales
 Mission Systems     $1,234      $119    9.6%  $1,322      $99     7.5%
 Information
  Technology          1,039        95    9.1%     946       86     9.1%
 Technical Services     535        35    6.5%     378       22     5.8%
                     $2,808      $249    8.9%  $2,646     $207     7.8%
 

Information & Services sales increased 6 percent during the third quarter of 2006 due to higher sales in Technical Services and Information Technology, partially offset by lower sales in Mission Systems.

The 42 percent sales increase in Technical Services reflects new business, primarily from the Nevada Test Site program. Information Technology sales increased 10 percent due to higher volume in Defense, Intelligence, and Commercial, State & Local programs. Defense and Intelligence sales increases reflect higher volume on several existing programs, with the most notable being the Network Centric Solutions program. Higher Commercial, State & Local sales include revenue from new business, such as the Virginia and San Diego IT outsourcing programs. The sales decrease in Mission Systems reflects lower volume for the Intercontinental Ballistic Missile program and a restricted program.

The 20 percent year-over-year increase in Information & Services operating margin includes higher operating margin from all three segments. Mission Systems operating margin increased 20 percent due to favorable program performance and lower expense for amortization of purchased intangibles. Technical Services operating margin increased 59 percent, primarily due to higher sales volume and favorable program performance. Information Technology operating margin increased 10 percent due to higher sales volume.

  Aerospace

                                    Third Quarter ($ Millions)
                                2006                      2005
                              Operating  % of           Operating  % of
                      Sales    Margin   Sales   Sales    Margin   Sales
 Integrated Systems  $1,317      $137   10.4%  $1,400     $119     8.5%
 Space Technology       782        73    9.3%     842       72     8.6%
                     $2,099      $210   10.0%  $2,242     $191     8.5%
 

Third quarter 2006 Aerospace sales declined 6 percent from the third quarter of 2005. Integrated Systems sales decreased 6 percent due to lower volume from the E2-D Advanced Hawkeye and EA-18 Growler programs, partially offset by higher volume from the F/A-18 Hornet, F-35 Lightning II and restricted programs. Space Technology sales decreased 7 percent due to lower volume for the NPOESS weather satellite system and restricted programs. These declines were partially offset by higher sales for the Space Tracking and Surveillance System, Advanced Extremely High Frequency communications satellite and Airborne Laser programs.

Aerospace third quarter 2006 operating margin increased 10 percent from the third quarter of 2005 and includes higher operating margin at both Integrated Systems and Space Technology. Integrated Systems operating margin increased 15 percent over the prior year period due to higher volume and improved performance in the F/A-18 Hornet and F-35 Lightning II programs. Space Technology operating margin increased 1 percent due to the sale of a patent and improved performance in the Advanced Extremely High Frequency program.

  Electronics
                                     Third Quarter ($ Millions)
                                2006                      2005
                              Operating  % of           Operating  % of
                      Sales    Margin   Sales   Sales    Margin   Sales
                     $1,669      $195   11.7%  $1,583     $180    11.4%
 

Electronics third quarter 2006 sales increased 5 percent from the third quarter of 2005 primarily due to higher sales of automated flat sorting machines to the U.S. Postal Service, infrared countermeasures and navigation systems, partially offset by lower sales of bio-detection equipment. Third quarter 2005 sales include the results of Winchester Electronics and Interconnect Technologies, which were divested in 2006.

Electronics third quarter 2006 operating margin increased 8 percent from the third quarter of 2005, reflecting higher sales volume and lower expense for amortization of purchased intangibles.

  Ships
                                    Third Quarter ($ Millions)
                                2006                      2005
                              Operating  % of           Operating  % of
                      Sales    Margin   Sales   Sales    Margin   Sales
                     $1,238       $76    6.1%  $1,222     $(65)     --
 

Ships third quarter 2006 sales increased 1 percent from the third quarter of 2005 and included higher aircraft carrier sales, primarily driven by higher volume in the Vinson refueling program, as well as higher sales for the LHD and LHA(R) amphibious assault ships, DDG destroyers and Deepwater programs. Higher volume on these programs was offset by lower volume on the DDG 1000 program (formerly known as the DD(X) program).

Ships operating margin increased to $76 million from a loss of $65 million in the third quarter of 2005. Third quarter 2005 operating margin included a $150 million charge for Hurricane Katrina-related cost growth as well as a negative impact of approximately $15 million due to hurricane-related work delays.

Third Quarter 2006 Highlights

  -- New York City's Department of Information Technology and 
    Telecommunications  awarded Northrop Grumman a five-year $500 million 
    contract to provide the city's broadband public-safety wireless 
    network, the most comprehensive network of its kind. 

 -- The U.S. Joint Forces Command selected Northrop Grumman to continue 
    providing technology support to the Joint Warfighting Center in 
    Suffolk, Va. The initial two-year $218 million contract has a 
    potential value of $686 million over six years if all options are 
    exercised. 

 -- The U.S. Citizenship and Immigration Services, an agency within the 
    Department of Homeland Security, awarded Northrop Grumman a $357 
    million indefinite delivery, indefinite quantity contract to continue 
    providing biometric capture services in support of U.S. citizenship 
    applications and green card renewals.  The contract is for one base 
    year with four one-year options and has a potential value of $750 
    million over a five-year period.

 -- The U.S. Air Force awarded Northrop Grumman the first delivery order 
    of an indefinite delivery, indefinite quantity contract valued at a 
    potential of $49.5 million to deliver Large Aircraft Infrared 
    Countermeasures system hardware and support for the C-17 and C-130 
    transport aircraft. The total value of the five-year contract has an 
    expected ceiling of $3.2 billion.

 -- The U.S. Department of Homeland Security awarded Northrop Grumman a 
    contract to provide support engineering to help improve first 
    responder communications, assisting DHS in developing five-year 
    wireless communications requirements for the public safety community. 

 -- The U.S. Navy awarded Northrop Grumman a $95.8 million contract for 
    the detail design of the Navy's 21st century DDG 1000 destroyer. The 
    contract runs through Sept. 2007.  When fully funded, this design 
    contract will total more than $300 million and positions the company 
    for production.

 -- The U.S. Navy awarded Northrop Grumman a $135.8 million modification 
    to a previously awarded contract for the Fire Scout vertical takeoff 
    and landing tactical unmanned air vehicle program. 

 -- Northrop Grumman was awarded a five-year $110 million contract to 
    continue its support of the U.S. Army's Battle Command Training Branch 
    program. 

 -- Northrop Grumman received the first certification from the FAA for a 
    commercial anti-missile system on a Boeing MD-11 aircraft, under a 
    U.S. Department of Homeland Security program.  The Northrop Grumman 
    system has subsequently received FAA certification for the 
    Boeing MD-10 and 747 aircraft.

 -- Northrop Grumman rolled out the first production version of the new 
    RQ-4 Block 20 Global Hawk unmanned aerial reconnaissance system.

 -- Northrop Grumman's fire control and launch control equipment software, 
    developed for the U.S. Missile Defense Agency's (MDA) ground-based 
    midcourse defense system, successfully performed during MDA's Flight 
    Test 2 on Sept. 1, in which the interceptor successfully tracked and 
    subsequently destroyed the target warhead over the Pacific Ocean. 

 -- Reflecting the continuing recovery of its Gulf Coast operations, 
    Northrop Grumman accomplished two successful ship launches in one week 
    in September.  Shipbuilders from the company's Ship Systems sector 
    launched the U.S. Navy multipurpose amphibious assault ship Makin 
    Island (LHD 8) on Friday, Sept. 22 and one week later launched the 
    U.S. Coast Guard's first National Security Cutter, Bertholf 
    (WMSL 750).

 -- Northrop Grumman and the commonwealth of Virginia finalized their IT 
    infrastructure partnership contract. The 10-year contract is valued at 
    approximately $2 billion and includes cost reimbursable, fixed-price 
    and fixed-unit pricing contractual provisions.

 -- U.S. Customs and Border Protection, an agency of the Department of 
    Homeland Security, awarded Northrop Grumman a contract to provide 
    border security surveillance for land ports of entry along the 
    southwest U.S. border. The pilot program will offer total operational 
    security while facilitating the flow of legitimate trade and travel.
 

About Northrop Grumman

Northrop Grumman Corporation is a global defense company headquartered in Los Angeles, Calif. Northrop Grumman provides technologically advanced, innovative products, services and solutions in systems integration, defense electronics, information technology, advanced aircraft, shipbuilding and space technology. With more than 120,000 employees and operations in all 50 states and 25 countries, Northrop Grumman serves U.S. and international military, government and commercial customers.

Northrop Grumman will webcast its earnings conference call at 12 noon EDT on Oct. 24, 2006. A live audio broadcast of the conference call along with a supplemental presentation will be available on the investor relations page of the company's Web site at http://www.northropgrumman.com .

Note: Certain statements and assumptions in this release contain or are based on "forward-looking" information that Northrop Grumman Corporation (the "Company") believes to be within the definition in the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties, and include, among others, statements in the future tense, and all statements accompanied by terms such as "project," "expect," "estimate," "assume," "believe," "plan," "guidance" or variations thereof. This information reflects the Company's best estimates when made, but the Company expressly disclaims any duty to update this information if new data become available or estimates change after the date of this release.

Such "forward-looking" information includes, among other things, financial guidance regarding sales, segment operating margin, pension expense, employer contributions under pension plans and medical and life benefits plans, and cash flow, and is subject to numerous assumptions and uncertainties, many of which are outside the Company's control. These include the Company's assumptions with respect to future revenues; expected program performance and cash flows; returns on pension plan assets and variability of pension actuarial and related assumptions; the outcome of litigation and appeals; hurricane-related insurance recoveries; environmental remediation; divestitures of businesses; successful reduction of debt; performance issues with key suppliers and subcontractors; product performance and the successful execution of internal plans; successful negotiation of contracts with labor unions; effective tax rates and timing and amounts of tax payments; the results of any audit or appeal process with the Internal Revenue Service; and anticipated costs of capital investments, among other things.

The Company's operations are subject to various additional risks and uncertainties resulting from its position as a supplier, either directly or as subcontractor or team member, to the U.S. government and its agencies as well as to foreign governments and agencies; actual outcomes are dependent upon various factors, including, without limitation, the Company's successful performance of internal plans; government customers' budgetary constraints; customer changes in short-range and long-range plans; domestic and international competition in both the defense and commercial areas; product performance; continued development and acceptance of new products and, in connection with any fixed-price development programs, controlling cost growth in meeting production specifications and delivery rates; performance issues with key suppliers and subcontractors; government import and export policies; acquisition or termination of government contracts; the outcome of political and legal processes and of the assertion or prosecution of potential substantial claims by or on behalf of a U.S. government customer; natural disasters, including hurricanes affecting the Company's Gulf Coast shipyards and the associated risks underlying the Company's assumptions regarding achieving expected learning-curve progress, amounts and timing of recoveries under insurance contracts, availability of materials and supplies, continuation of the supply chain, contractual performance relief and the application of cost sharing terms, impacts of timing of cash receipts and the availability of other mitigating elements; terrorist acts; legal, financial, and governmental risks related to international transactions and global needs for military aircraft, military and civilian electronic systems and support, information technology, naval vessels, space systems, technical services and related technologies, as well as other economic, political and technological risks and uncertainties and other risk factors set out in the Company's filings from time to time with the Securities and Exchange Commission, including, without limitation, Company reports on Form 10-K and Form 10-Q.

Members of the news media may receive our releases via e-mail by registering at: http://www.northropgrumman.com/cgi-bin/regist_form.cgi

LEARN MORE ABOUT US: Northrop Grumman news releases, product information, photos and video clips are available on the Internet at: http://www.northropgrumman.com

  NORTHROP GRUMMAN CORPORATION        SCHEDULE 1
                        FINANCIAL HIGHLIGHTS
                  ($ in millions, except per share)
                            (unaudited)


                                    THIRD QUARTER        NINE MONTHS
                                 ------------------  ------------------
                                   2006    2005 (d)    2006    2005 (d)
                                 ------------------  ------------------
 OPERATING RESULTS HIGHLIGHTS
  Total contract
   acquisitions (a)              $ 6,267   $ 5,026   $26,656   $18,103
  Total sales                      7,433     7,291    22,127    22,400
  Total operating margin             546       438     1,832     1,654
  Income from continuing
   operations                        306       291     1,110     1,058
  Net income                         302       293     1,089     1,069
  Diluted earnings per share
   from continuing operations        .87       .80      3.15      2.90
  Diluted earnings per share         .86       .81      3.09      2.93

  Cash provided by continuing
   operations                        943       886     1,567     1,981
  Net cash provided by
   operating activities              962       891     1,485     1,967

 ---------------------------------------------------------------------

                                 SEPT 30,   DEC 31,
                                   2006     2005 (d)
                                 -------------------
 BALANCE SHEET HIGHLIGHTS
  Cash and cash equivalents      $ 1,463   $ 1,605
  Accounts receivable, net         3,690     3,553
  Inventoried costs, net           1,275     1,164
  Property, plant, and
   equipment, net                  4,437     4,403
  Total debt                       4,646     5,145
  Net debt (b)                     3,183     3,540
  Mandatorily redeemable
   preferred stock                   350       350
  Shareholders' equity            17,330    16,828
  Total assets                    34,055    34,214

  Net debt to capitalization
   ratio (c)                          14%       16%

 ---------------------------------------------------------------------

 (a)  Contract acquisitions represent orders received during the
      period for which funding has been contractually obligated by
      the customer.

 (b)  Total debt less cash and cash equivalents.

 (c)  Net debt divided by the sum of shareholders' equity and total
      debt.

 (d)  Certain prior year amounts have been reclassified to conform to
      the 2006 presentation.


                       NORTHROP GRUMMAN CORPORATION       SCHEDULE 2
                            OPERATING RESULTS
                    ($ in millions, except per share)
                              (unaudited)

                                    THIRD QUARTER       NINE MONTHS
                                 ------------------- ------------------
                                   2006     2005(a)    2006     2005(a)
                                 ------------------- ------------------
 Sales and Service Revenues
 Information & Services
   Mission Systems               $ 1,234   $ 1,322   $ 3,761   $ 3,774
   Information Technology          1,039       946     2,980     2,793
   Technical Services                535       378     1,288     1,154
                                 -------------------------------------
 Total Information & Services      2,808     2,646     8,029     7,721

 Aerospace
   Integrated Systems              1,317     1,400     4,116     4,036
   Space Technology                  782       842     2,502     2,580
                                 -------------------------------------
 Total Aerospace                   2,099     2,242     6,618     6,616

 Electronics                       1,669     1,583     4,783     4,875
 Ships                             1,238     1,222     3,808     4,323
 Other                                           9                  31
 Intersegment Eliminations          (381)     (411)   (1,111)   (1,166)
                                 -------------------------------------

                                 $ 7,433   $ 7,291   $22,127   $22,400
                                 =====================================

 Operating Margin and Net Income
 Information & Services
   Mission Systems               $   119   $    99   $   358   $   283
   Information Technology             95        86       265       244
   Technical Services                 35        22        88        64
                                 -------------------------------------
 Total Information & Services        249       207       711       591

 Aerospace
   Integrated Systems                137       119       426       375
   Space Technology                   73        72       225       213
                                 -------------------------------------
 Total Aerospace                     210       191       651       588

 Electronics                         195       180       543       536
 Ships                                76       (65)      273       144
 Other                                          (5)                (11)
 Intersegment Eliminations           (34)      (22)      (87)      (60)
                                 -------------------------------------

 Total segment operating
  margin (b)                         696       486     2,091     1,788


 Reconciliation to operating
  margin
   Unallocated expenses             (140)      (42)     (221)     (111)
   Net pension expense (c)            (2)       (4)      (24)      (13)
   Reversal of royalty income
    included above                    (8)       (2)      (14)      (10)
                                 -------------------------------------

 Operating margin                    546       438     1,832     1,654

 Interest income                      13         5        29        44
 Interest expense                    (86)      (98)     (263)     (287)
 Other, net                            1        94        (9)      183
                                 -------------------------------------

 Income from continuing
  operations before income
  taxes                              474       439     1,589     1,594

 Federal and foreign income
  taxes                              168       148       479       536
                                 -------------------------------------

 Income from continuing
  operations                         306       291     1,110     1,058

 Discontinued operations, net
  of tax                              (4)        2       (21)       11
                                 -------------------------------------


 Net income                      $   302   $   293   $ 1,089   $ 1,069
                                 =====================================

 Weighted average diluted
  shares outstanding, in
  millions                         351.0     362.2     352.1     364.7

 Diluted Earnings (Loss) Per
  Share

   Continuing operations         $   .87   $   .80   $  3.15   $  2.90
   Discontinued operations          (.01)      .01      (.06)      .03
                                 -------------------------------------
 Diluted Earnings Per Share      $   .86   $   .81   $  3.09   $  2.93
                                 =====================================

 ---------------------------------------------------------------------

 (a)  Certain prior year amounts have been reclassified to conform to
      the 2006 presentation.

 (b)  Management uses segment operating margin as an internal measure
      of financial performance for the individual business segments.
      This measure is not in accordance with accounting principles
      generally accepted in the United States of America (GAAP).

 (c)  Net pension expense reflects pension expense determined in
      accordance with GAAP less the pension expense included in the
      segment cost of sales to the extent that these costs are
      currently recognized under U.S. Government Cost Accounting
      Standards.


                    NORTHROP GRUMMAN CORPORATION        SCHEDULE 3
                    ADDITIONAL SEGMENT INFORMATION
                           ($ in millions)
                             (unaudited)


                        CONTRACT ACQUISITIONS(a)      FUNDED BACKLOG(b)
                  ----------------------------------  ----------------
                    THIRD QUARTER      NINE MONTHS      September 30,
                  ----------------  ----------------  ----------------
                    2006  2005 (c)    2006  2005 (c)    2006  2005 (c)
                  ----------------  ----------------  ----------------

 Information & 
  Services
   Mission 
    Systems       $ 1,022  $ 1,042  $ 3,861  $ 3,326  $ 2,506  $ 2,539
   Information 
    Technology      1,385      927    3,518    3,086    2,781    2,345
   Technical 
    Services          720      327    1,867      970    1,230      570
                  ----------------  ----------------  ----------------
 Total Information
  & Services        3,127    2,296    9,246    7,382    6,517    5,454

 Aerospace
   Integrated 
    Systems           704      782    4,252    3,338    3,848    3,924
   Space           
    Technology        488      362    2,859    1,972    1,317    1,141
                  ----------------  ----------------  ----------------
 Total Aerospace    1,192    1,144    7,111    5,310    5,165    5,065
                                     
 Electronics        1,678    1,445    5,118    4,494    6,630    6,386
 Ships                577      445    6,371    1,932    8,692    6,774
 Other                          13       (4)      42                38
 Intersegment 
  Eliminations       (307)    (317)  (1,186)  (1,057)    (567)    (462)
                  ----------------  ----------------  ----------------
 Total            $ 6,267  $ 5,026  $26,656  $18,103  $26,437  $23,255
                  ================  ================  ================


                  TOTAL BACKLOG, September 30, 2006
                  ---------------------------------
                      FUNDED   UNFUNDED(d)   TOTAL
                                            BACKLOG
                  ---------------------------------
 Information &
  Services
   Mission
    Systems           $ 2,506    $ 7,682    $10,188
   Information                            
    Technology          2,781      2,368      5,149
   Technical                              
    Services            1,230      3,431      4,661
                  ---------------------------------
 Total Information
  & Services            6,517     13,481     19,998
                                            
 Aerospace                                  
   Integrated                               
    Systems             3,848      5,946      9,794
   Space                                    
    Technology          1,317      8,391      9,708
                  ---------------------------------
 Total Aerospace        5,165     14,337     19,502
                                           
 Electronics            6,630      1,822      8,452
 Ships                  8,692      3,721     12,413
 Intersegment                              
  Eliminations           (567)                 (567)
                  ---------------------------------
 Total                $26,437    $33,361    $59,798
                  =================================

 (a)  Contract acquisitions represent orders received during the
      period for which funding has been contractually obligated by
      the customer.

 (b)  Funded backlog represents unfilled orders for which funding has
      been contractually obligated by the customer.

 (c)  Certain prior year amounts have been reclassified to conform to
      the 2006 presentation.

 (d)  Unfunded backlog represents firm orders for which funding is not
      currently contractually obligated by the customer. Unfunded
      backlog excludes unexercised contract options and unfunded
      Indefinite Delivery Indefinite Quantity contract awards.



                     NORTHROP GRUMMAN CORPORATION         SCHEDULE 4
                 REALIGNED SEGMENT OPERATING RESULTS
                           ($ in millions)
                             (unaudited)

                                   AS REPORTED(a)
               -------------------------------------------------------
                           2005                             2006 
               ---------------------------------------  --------------
                     Three Months Ended                 Three Months
                                                           Ended
 SALES AND                                     Total
  SERVICE      Mar 31  Jun 30  Sep 30  Dec 31   Year    Mar 31  Jun 30
  REVENUES     ---------------------------------------  --------------

 Information &
  Services
  Mission 
   Systems     $1,254  $1,271  $1,356  $1,279   $5,160  $1,264  $1,338
  Information 
   Technology(b)  880     967     946     978    3,771     948     993
  Technical 
   Services       274     286     276     267    1,103     275     300
               ---------------------------------------  --------------
 Total 
  Information 
  & Services    2,408   2,524   2,578    2,524  10,034   2,487   2,631
  
 Aerospace
  Integrated 
   Systems      1,287   1,391   1,417   1,474    5,569   1,437   1,397
  Space 
   Technology     863     875     842     815    3,395     855     865
               ---------------------------------------  --------------
 Total 
  Aerospace     2,150   2,266   2,259   2,289    8,964   2,292   2,262

 Electronics    1,547   1,769   1,595   1,743    6,654   1,509   1,635

 Ships          1,514   1,587   1,222   1,463    5,786   1,133   1,437

 Other             11      11       9      11       42                

 Intersegment 
  Eliminations   (328)   (350)   (372)   (363)  (1,413)   (328)   (364)
               =======================================  ==============
  Total Sales 
   and Service 
   Revenues    $7,302  $7,807  $7,291  $7,667  $30,067  $7,093  $7,601
               =======================================  ==============

 SEGMENT OPERATING MARGIN

 Information &
  Services
  Mission 
   Systems     $   93  $   99  $  101  $   94  $   387  $  117  $  132
  Information      76      82      86      84      328      84      86
  Technology(b)
  Technical 
   Services        12      14      17      17       60      13      16
               ---------------------------------------  --------------
 Total 
  Information 
  & Services      181     195     204     195      775     214     234
  
 Aerospace
  Integrated 
   Systems        142     117     120     126      505     149     142
  Space 
   Technology      67      74      72      61      274      71      81
               ---------------------------------------  --------------
 Total Aerospace  209     191     192     187      779     220     223

 Electronics      162     199     182     169      712     177     181

 Ships            107     102     (65)    105      249      68     129

 Other             (1)     (5)     (5)     (6)     (17)

 Intersegment 
  Eliminations    (20)    (18)    (22)    (24)     (84)    (26)    (25)
               =======================================  ==============
 Total Segment
  Operating 
  Margin(c)    $  638  $  664  $  486  $  626   $2,414  $  653  $  742
               =======================================  ==============


                                    REALIGNED
               -------------------------------------------------------
                           2005                             2006 
               ---------------------------------------  --------------
                     Three Months Ended                 Three Months
                                                           Ended
 SALES AND                                     Total
  SERVICE      Mar 31  Jun 30  Sep 30  Dec 31   Year    Mar 31  Jun 30
  REVENUES     ---------------------------------------  --------------

 Information & 
  Services     
  Mission      
   Systems     $1,221  $1,231  $1,322  $1,243   $5,017  $1,232  $1,295
  Information  
   Technology(b)  880     967     946     978    3,771     948     993
  Technical    
   Services       378     398     378     379    1,533     351     401
               ---------------------------------------  --------------
 Total         
  Information  
  & Services    2,479   2,596   2,646   2,600   10,321   2,531   2,689
               
 Aerospace     
  Integrated   
   Systems      1,265   1,371   1,400   1,453    5,489   1,416   1,383
  Space        
   Technology     863     875     842     815    3,395     855     865
               ---------------------------------------  --------------
 Total         
  Aerospace     2,128   2,246   2,242   2,268    8,884   2,271   2,248
               
 Electronics    1,537   1,755   1,583   1,727    6,602   1,504   1,611
               
 Ships          1,514   1,587   1,222   1,463    5,786   1,133   1,437
               
 Other             11      11       9      11       42
               
 Intersegment  
  Eliminations   (367)   (388)   (411)   (402)  (1,568)   (346)   (384)
               =======================================  ==============
  Total Sales  
   and Service 
   Revenues    $7,302  $7,807  $7,291  $7,667  $30,067  $7,093  $7,601
               =======================================  ==============
 SEGMENT OPERATING MARGIN

Information &  
 Services      
 Mission       
  Systems      $   90  $   94  $   99  $   91  $   374  $  113  $  125
 Information   
  Technology(b)    76      82      86      84      328      84      86
 Technical     
  Services         20      22      22      25       89      19      33
               ---------------------------------------  --------------
Total          
 Information   
 & Services       186     198     207     200      791     216     244
               
Aerospace      
 Integrated    
  Systems         140     116     119     124      499     148     141
 Space         
  Technology       67      74      72      61      274      71      81
               ---------------------------------------  --------------
Total Aerospace   207     190     191     185      773     219     222
               
Electronics       159     197     180     166      702     176     172
               
Ships             107     102     (65)    105      249      68     129
               
Other              (1)     (5)     (5)     (6)     (17)   
               
Intersegment   
 Eliminations     (20)    (18)    (22)    (24)     (84)    (26)    (25)
               =======================================  ==============
Total Segment  
 Operating     
 Margin(c)     $  638  $  664  $  486  $  626   $2,414  $  653  $  742
               =======================================  ==============

 (a) As reported in Schedule 4 of the First Quarter 2006 Earnings 
     Release.

 (b) Amounts have been adjusted due to the second quarter 2006 
     shutdown of the Enterprise Information Technology business 
     formerly reported in the Information Technology segment.  All 
     prior financial information has been reclassified to reflect 
     the business as discontinued operations.

 (c) Management uses segment operating margin as an internal measure 
     of financial performance for the individual business segments. 
     This measure is not in accordance with accounting principles 
     generally accepted in the United States of America (GAAP).
 
  CONTACT:  Dan McClain (Media) 
          Northrop Grumman Corporation
          (310) 201-3335

          Gaston Kent (Investors) 
          Northrop Grumman Corporation
          (310) 201-3423