For defense primes, 2020 was a stress test of whether government demand could absorb a pandemic. Northrop Grumman's 2020 Form 10-K answers part of that question with its backlog table: the filing reports backlog as of December 31, 2020 and 2019, split into funded and unfunded components, consistent with its definition of backlog as future sales on firm orders.
The funded line is the one that matters for the next several quarters. It reflects orders for which appropriations have been made and money obligated — revenue the company can recognize as it performs. The unfunded line is the longer runway: firm orders not yet appropriated, which signal program continuity but carry appropriations timing risk.
The structural point is that defense backlog is counter-cyclical. While commercial sectors saw demand evaporate in 2020, Northrop's government customer base kept funding multi-year programs across aeronautics, defense systems and space. That is why the funded backlog held — the spending that underwrites it is set by appropriations, not by the macro cycle.
The forward read entering 2021: track book-to-bill and the funded share of total backlog. A funded share that keeps pace with a growing total is the cleanest sign the runway is real and near-term. Filing on sec.gov; index via EdgarBeast.