- General Dynamics posted stronger-than-expected Q2 results, supported by high demand in its marine and aerospace segments.
- Combat systems revenue dipped slightly due to a cancelled Pentagon contract and supply chain delays, but the full-year outlook remains positive.
- Gulfstream’s G800 jet received FAA and EASA certification, with aircraft deliveries and bookings increasing year-over-year.
- The company raised its annual revenue projection to $51.2 billion, with improved margins across key business segments.
General Dynamics reported better-than-expected profit and revenue for the second quarter, primarily driven by strong performance in its marine segment, which is involved in the production of Columbia- and Virginia-class submarines. The Aquatic Systems unit experienced a significant increase in revenue, driven by higher orders and a revised contract from the Pentagon. These developments reflect steady demand for defense systems amid ongoing global tensions, as reported by Reuters.
Strong Order Intake and Aerospace Growth
General Dynamics reported a healthy quarter across its key business segments, with strong order bookings signaling a robust pipeline for the months ahead. New orders in its defense segments were 2.4 times greater than billings, indicating firm demand. However, the combat systems segment experienced a slight revenue decline of 0.2%, primarily due to the Pentagon’s cancellation of the M10 Booker contract and ongoing supply chain issues. Despite this, annual revenue from the combat segment is still expected to reach $9.2 billion with a 14.5% margin.
The company’s aerospace segment demonstrated signs of solid recovery, with improved delivery rates and a resolution of earlier supply chain challenges. Gulfstream aircraft deliveries reached 38 units in the second quarter, up from 36 in the previous quarter and 37 a year earlier. The segment also secured certification for its new G800 jet from both the FAA and EASA. With a range of 8,200 nautical miles at Mach 0.85, the G800 is now the longest-range business jet in the world. Bookings in the aerospace unit were 1.3 times its billing, reflecting growing demand across the Gulfstream fleet.
On the financial front, General Dynamics posted an adjusted quarterly profit of $3.74 per share, outperforming analyst expectations of $3.53 per share, according to LSEG data. The company reaffirmed its full-year earnings guidance of $15.05 to $15.15 per share. Aerospace revenue rose 4.1% year-over-year and is forecast to hit $12.9 billion for the year, with a 13.5% operating margin.
Overall, General Dynamics reported total quarterly revenue of $1.3 billion, exceeding the estimated $1.23 billion, and projects full-year revenue of $51.2 billion with an operating margin of 10.3%.
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Source: Reuters
