(Adds conference call comments)
July 18 (Reuters) - Lockheed Martin Corp, the Pentagon's No. 1 weapons supplier, on Tuesday reported better-than-expected quarterly profit and said it expects increased defense spending under U.S. President Donald Trump to underpin its earnings this year.
Lockheed's net income rose nearly 5 percent to $942 million, or $3.23 per share, in the second quarter, helping the company nudge its full-year profit forecast higher.
U.S. demand for F-35 jets has increased with the Pentagon announcing on July 10 that it would add 13 jets to its planned purchase of F-35s, but a detailed delivery schedule was not released.
Chief Executive Officer Marillyn Hewson told analysts on a conference call, "As you can see just with what's in the budget deliberations right now, with the adds that are coming forward on the F-35 for the various services ... we will still see potentially some upside."
Hewson is aiming to win a portion of six or seven multi-billion dollar contracts that are scheduled to be awarded this year, such as the new Air Force training jet, and a renewal of an $8 billion dollar logistics and maintenance contract to support U.S. special forces.
Net sales rose to $12.69 billion from $11.58 billion a year ago. Analysts expected $3.11 per share on revenue of $12.40 billion, according to Thomson Reuters I/B/E/S.
Lockheed raised its 2017 profit forecast to $12.30 to $12.60 per share, up from its forecast of $12.15 to $12.45 last quarter, but only 5 cents higher than the outlook it gave in January.
The company also raised its 2017 sales forecast to $49.8 billion to $51 billion, from $49.5 billion to $50.7 billion.
The stock settled at $287.81, down 0.2 percent, after hitting a new high of $292.54 early in the session.
Lockheed shares have gained about 15 percent this year through Monday's close. Trump promised during his election campaign to spend more on defense, and this has buoyed defense companies' stock prices.
Lockheed sells security and intelligence products including ships, planes, and missile systems to the U.S. intelligence community, the military and NASA. The U.S. government was about 70 percent of Lockheed's revenue in 2016. The company has been working to grow its international customer base which accounted for 27 percent of revenue last year.
Lockheed said sales at aeronautics, its largest segment, which makes the F-35 fighter jet and C-130 planes, rose 19.4 percent during the quarter.
The U.S. Department of Defense said on July 10 it plans to purchase 2,456 F-35 jets, up from 2,443. The price of the F-35 varies, but the 13 additional jets will all be the B-model, capable of short take-offs and vertical landings and used by the Marine Corps and the British Navy, and currently cost more than $120 million each.
The program, as it is currently outlined, would deliver the final jets in fiscal 2044 and have a total cost of more than a trillion dollars over its projected life.
The F-35 program is the Pentagon's costliest arms program and has been criticized by Trump and other U.S. officials for being too expensive.
Last quarter the Bethesda, Maryland-based weapons maker cut its earnings-per-share estimates for the first time in seven years following a one-time charge of 39 cents per share.
Lockheed bought back $500 million worth of shares and also distributed $525 million in dividends to shareholders. This represented 81 percent of the free cash flow from the quarter.
Lockheed said on the conference call that its order backlog at the end of the second quarter was $92.1 billion. (Reporting by Mike Stone in Washington and Rachit Vats in Bengaluru; Editing by Chris Sanders and Cynthia Osterman)