No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - General Dynamics reported stronger-than-expected results for the second quarter of 2025 on Wednesday, driven by robust demand in its marine systems and aerospace businesses.
The US defence and aerospace group posted earnings of $3.74 per share, up 14.7% from a year earlier and ahead of analyst forecasts.
Revenue rose 8.9% to $13bn, also exceeding Wall Street expectations.
Operating earnings for the quarter reached $1.3bn, with a companywide operating margin of 10.0%, up 30 basis points from the same period last year.
All four segments delivered year-on-year revenue and earnings growth in the first half, and margins expanded 50 basis points over that period.
"Our strong cash flow and healthy backlog position us well to have a good second half," said chair and chief executive Phebe Novakovic.
Marine systems revenue jumped 22.2%, benefiting from a significant Pentagon contract modification worth $1.85bn and a newly-ratified union agreement at its submarine shipyard, which helped address labour constraints.
The aerospace division posted a 4.1% revenue increase, supported by the certification of its new G800 business jet and a rise in Gulfstream deliveries to 38 aircraft, up from 36 in the prior quarter.
GD's technologies segment grew revenue by 5.5%, while the combat systems unit dipped 0.2%, impacted by the cancellation of the M10 Booker programme and lingering supply chain challenges.
Order activity was particularly strong, with $28.3bn in new orders during the quarter, pushing the companywide book-to-bill ratio to 2.2-to-one.
The defence segments recorded a 2.4-to-one ratio, and aerospace 1.3-to-one.
Total backlog increased to $103.7bn, with total estimated contract value, including unfunded and option components, rising to $161.2bn.
Operating cash flow was $1.6bn, equivalent to 158% of net earnings.
The company paid $402m in dividends, invested $198m in capital expenditures, and cut debt by $897m.
It ended the quarter with $1.5bn in cash and $8.7bn in debt.
At 0935 EDT (1435 BST), shares in General Dynamics Corporation were up 5.73% in New York at $314.55.
Reporting by Josh White for Sharecast.com.