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XBRL · SEC EDGAR2007–2025(19yr)| Metric | FY 2007 | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $27.2B | $29.3B | $32.0B | $32.5B | $32.7B | $31.5B | $31.2B | $30.9B | $31.5B | $31.4B | $31.0B | $36.2B | $39.4B | $37.9B | $38.5B | $39.4B | $42.3B | $47.7B | $52.5B | +10.1% |
| Gross Profit | $11.6B | $5.4B | $5.6B | $5.9B | $5.9B | $3.1B | $5.8B | $15.5B | $15.6B | $6.5B | $6.2B | $6.7B | $7.1B | — | — | — | — | — | — | — |
| Gross Margin | 42.5% | 18.3% | 17.6% | 18.2% | 17.9% | 9.9% | 18.5% | 50.3% | 49.6% | 20.6% | 20.2% | 18.6% | 17.9% | — | — | — | — | — | — | — |
| Operating Income | $3.1B | $3.7B | $3.7B | $3.9B | $3.8B | $833.0M | $3.7B | $3.9B | $4.2B | $4.3B | $4.2B | $4.5B | $4.6B | $4.1B | $4.2B | $4.2B | $4.2B | $4.8B | $5.4B | +11.7% |
| Operating Margin | 11.4% | 12.5% | 11.5% | 12.2% | 11.7% | 2.6% | 11.8% | 12.6% | 13.3% | 13.7% | 13.5% | 12.3% | 11.8% | 10.9% | 10.8% | 10.7% | 10.0% | 10.1% | 10.2% | +0.1pp |
| Net Income | $2.1B | $2.5B | $2.4B | $2.6B | $2.5B | -$332.0M | $2.4B | $2.5B | $3.0B | $3.0B | $2.9B | $3.3B | $3.5B | $3.2B | $3.3B | $3.4B | $3.3B | $3.8B | $4.2B | +11.3% |
| Net Margin | 7.6% | 8.4% | 7.5% | 8.1% | 7.7% | -1.1% | 7.6% | 8.2% | 9.4% | 9.4% | 9.4% | 9.2% | 8.9% | 8.4% | 8.5% | 8.6% | 7.8% | 7.9% | 8.0% | +0.1pp |
| Free Cash Flow | $2.5B | $2.6B | $2.5B | $2.6B | $2.8B | $2.2B | $2.7B | $3.2B | $1.9B | — | $3.4B | $2.5B | $2.0B | $2.9B | $3.4B | $3.5B | $3.8B | $3.2B | $4.0B | +23.9% |
| FCF Margin | 9.1% | 9.0% | 7.7% | 8.1% | 8.5% | 7.1% | 8.5% | 10.4% | 6.1% | — | 11.1% | 6.8% | 5.1% | 7.6% | 8.8% | 8.8% | 9.0% | 6.7% | 7.5% | +0.8pp |
| EPS (Diluted) | $5.08 | $6.17 | $6.17 | $6.81 | $6.87 | $-0.94 | $6.67 | $7.42 | $9.08 | $9.52 | $9.56 | $11.18 | $11.98 | $11.00 | $11.55 | $12.19 | $12.02 | $13.63 | $15.45 | +13.4% |
1. THE BIG PICTURE
General Dynamics is currently a study in contrast: it is winning more business than ever before, yet struggling to squeeze extra profit out of that growth. While General Dynamics ended 2025 with a massive $118 billion backlog—a 30% jump in a single year—net earnings remained essentially flat as operational friction in the Aerospace and Technologies segments offset a surge in submarine production (8-K). The central tension for investors is whether General Dynamics’s "low-cost provider" strategy can survive a period of aggressive capital investment and supply chain instability.
2. WHERE THE RISKS HIT HARDEST
General Dynamics’s "most sophisticated marine engineering expertise in the world" is its primary competitive moat, yet this strength is directly threatened by its dependency on a fragile network of 3,000 suppliers (10-K Item 1). If even a handful of these subcontractors fail to deliver components for the Columbia or Virginia-class programs, the resulting schedule delays trigger "contract performance" risks that eat directly into margins. Similarly, the Aerospace segment’s strategy of rolling out a massive new fleet—from the G400 to the G800—is entirely at the mercy of FAA certification timelines. Any regulatory bottleneck turns these high-tech jets from revenue drivers into expensive inventory sitting on the balance sheet.
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a company that is outgrowing its peers while being priced as a laggard. General Dynamics posted 10.1% revenue growth (TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter), significantly outperforming Lockheed Martin (+5.6%) and Northrop Grumman (+2.2%) (XBRL). However, this growth has come at a cost: General Dynamics poured $1.2 billion into capital expenditures in 2025 to support its massive backlog, which explains why operating earnings in the Aerospace and Technologies units actually fell during the fourth quarter despite stable or growing revenue (8-K). Unlike Boeing, which is struggling with negative margins, General Dynamics maintains a healthy 8.5% Free Cash Flow margin, the second-highest in its peer group. This cash generation allowed General Dynamics to retire $749 million in debt while still returning $2.2 billion to shareholders through dividends and buybacks.
4. IS IT WORTH IT AT THIS PRICE?
At 19.8x forward earnings, General Dynamics trades at a 26% discount to the peer median of 26.7x. This "cheapest in class" status appears unjustified given that General Dynamics’s 10.1% revenue growth is the second-highest among its major competitors. The market is currently pricing in a long-term growth rate of just 1.5% (CAPM analysis). This is a remarkably low bar for a company that just grew its total estimated contract value by 24% to $179 billion (8-K). The valuation discount likely reflects investor anxiety over the 70% revenue concentration with the U.S. government and the risk that "fixed-price" contracts could become loss-leaders if labor and material costs continue to fluctuate. However, with an implied EPSEPSEarnings Per Share — the company's net profit divided by its share count; the most common per-share profitability metric growth of 2.2% (including buybacks), the current price requires very little to go right for the investment to break even.
5. WHAT WOULD CHANGE THIS VIEW?
- Constructive if the Aerospace segment sees a sharp rebound in operating margins, signaling that the heavy investment phase for the G700 and G800 models has passed and FAA certifications are proceeding on schedule.
- Cautious if Marine Systems revenue growth slows or margins compress, which would indicate that the complexity of managing 3,000 suppliers for the Columbia-class program is overwhelming General Dynamics's "low-cost" operational model.
- Cautious if the U.S. government exercises its "termination for convenience" rights on any major platform, such as the Abrams tank or Virginia-class submarine, which would immediately invalidate the growth thesis built on the current backlog.
6. BOTTOM LINE
Structural Advantage: A near-monopoly on U.S. nuclear submarine engineering and a dominant, high-margin position in the global business jet market.
Bottom Line: General Dynamics is a high-growth defense powerhouse disguised as a value stock; the current valuation discount is a gift to investors willing to bet that its $118 billion backlog will eventually hit the bottom line.
1. Top 5 Material Risks
- U.S. Government Revenue Concentration: Approximately 70% of consolidated revenue is derived from the U.S. government. Changes in national security priorities, competing federal funding demands, or government shutdowns can lead to the reduction, delay, or termination of programs.
- Contract Termination Rights: U.S. government and many foreign contracts permit the customer to terminate agreements for convenience. While General Dynamics is generally entitled to payments for allowable costs and a proportionate share of fees for work performed, the termination of large programs could materially harm future revenue and earnings.
- Contract Performance Assumptions: Management’s ability to maintain earnings and margins depends on the accuracy of projections regarding labor productivity, work complexity, material availability, and schedule requirements. Significant changes in these variables can adversely affect contract profitability.
- Supplier and Subcontractor Performance: General Dynamics relies on third parties for materials, components, and subsystems, including semiconductors. Misconduct by suppliers or an inability to provide necessary items in a timely, cost-effective manner can disrupt operations and harm revenue and margins.
- Aerospace Segment Demand: The Aerospace segment is sensitive to changes in general economic conditions, the availability of credit, and pricing pressures. If customers default on existing contracts or demand for business-aviation products declines, the segment’s anticipated revenue and profitability could be materially reduced.
2. Company-Specific Risks
- Cybersecurity Threats: General Dynamics faces sophisticated, evolving threats to its IT infrastructure and proprietary information. While past disruptions have not had a material impact, future incidents could lead to regulatory actions, loss of business, or disqualification from sensitive government work.
- International Offset Requirements: Non-U.S. government customers often require "offsets," which are specific in-country purchase or manufacturing commitments. Failure to satisfy these financial or investment obligations can result in penalties and negatively impact future revenue and earnings.
- Goodwill Impairment: General Dynamics carries goodwill on its balance sheet from past acquisitions. A significant adverse change in the business climate for a reporting unit could trigger an impairment review, potentially leading to write-offs that affect General Dynamics’s financial condition.
- Pandemic-Related Disruptions: Public health developments, such as COVID-19, can cause facility closures, travel restrictions, and supply-chain disruptions. These events may increase costs that are not fully recoverable under existing contracts.
3. Regulatory/Legal Risks
- Government Audits and Investigations: General Dynamics operates in a highly regulated environment subject to routine audits of its internal control systems, including purchasing, estimating, and accounting. Allegations of improper activity can lead to civil or criminal penalties, forfeiture of profits, suspension of payments, or debarment from government contracting.
- International Trade and Compliance: Operations outside the U.S. are subject to complex laws, including the Foreign Corrupt Practices Act (FCPA) and International Traffic in Arms Regulations (ITAR). Failure to comply with these or with trade sanctions and export controls can result in the suspension of export privileges and material harm to earnings.
- Climate Change Regulation: Emerging requirements to mitigate global warming, such as carbon pricing or stricter greenhouse gas emission limits, could impose new costs and operational restrictions, potentially reducing margins.
4. Financial Impact Map
U.S. Government Revenue Concentration → Consolidated Revenue → 70% of total revenue is tied to U.S. government spending. Contract Performance Assumptions → Earnings and Margin → Profitability is directly tied to the accuracy of labor and material cost projections. Aerospace Segment Demand → Segment Revenue and Profitability → Sensitive to corporate and individual demand for business aircraft. Goodwill Impairment → Balance Sheet (Goodwill) → Future write-offs could result from adverse changes in the business climate for reporting units. Government Audits and Compliance → Earnings and Cash Flow → Audits can result in delayed payments, non-reimbursement of costs, or forfeiture of profits.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Jan 2026 | Dec 2025 |
| 8-K | Jan 2026 | — |
| 10-Q | Oct 2025 | Sep 2025 |
| 14A | Mar 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
General Dynamics awarded $15.4 billion Navy contract for Columbia-class submarine program
- ▸$15.4 billion contract awarded for Columbia-class submarine design and sustainment
- ▸Funding covers development costs through June 2035
- ▸Total program cost for 12 Columbia-class submarines estimated at $126.5 billion
- ▸General Dynamics responsible for 78% of each Columbia-class boat construction
- ▸Huntington Ingalls to build bow and stern sections as collaborator
General Dynamics Electric Boat unit wins $95M Navy submarine support contract
- ▸Contract value $95 million for submarine engineering and technical support
- ▸Work completion expected by June 2026
- ▸Services include design agent and planning yard support for U.S. Navy fleet
- ▸Primary work location in Groton, Connecticut
- ▸Supports operational, strategic, and attack submarine classes
General Dynamics awarded $15.38 billion Navy contract for Columbia-class submarine program
- ▸Awarded $15.38 billion Navy contract modification for Columbia-class submarines
- ▸Contract work includes design, sustainment, and lead yard services
- ▸Completion of contract scheduled for June 2035
- ▸Quarterly dividend increased by $0.09 to $1.59 per share
- ▸Dividend payable May 8 to shareholders of record on April 10
General Dynamics Enters Manufacturing Partnership to Expand U.S. Navy Submarine Production Capacity
- ▸Partnership targets increased U.S. submarine production throughput
- ▸Collaboration focuses on advanced manufacturing for Marine Systems segment
- ▸Initiative aims to address supply-chain bottlenecks in critical submarine components
- ▸Project supported by U.S. Navy-backed manufacturing startup
- ▸Quarterly dividend maintained at $1.59 per share
General Dynamics wins $15.38B Navy contract for Columbia-class submarine support through 2035
- ▸Contract value $15.38 billion for Columbia-class submarine support
- ▸Work includes design, lead yard services, and industrial base development
- ▸Project completion scheduled for June 2035
- ▸Primary work location in Groton, Connecticut
- ▸Contract awarded by Naval Sea Systems Command
General Dynamics Q4 revenue $14.38B, up 7.8% YoY, beats estimates by 4.1%
- ▸General Dynamics Q4 revenue $14.38B, +7.8% YoY, beat estimates by 4.1%
- ▸General Dynamics company-wide backlog grew 30% during fiscal year
- ▸Leonardo DRS Q4 revenue $1.06B, +8.1% YoY, beat estimates by 7%
- ▸Defense sector group Q4 revenues beat consensus estimates by 2.1%
- ▸General Dynamics shares down 3% since earnings report
General Dynamics raises quarterly dividend 6% to $1.59 per share
- ▸Quarterly dividend increased $0.09 to $1.59 per share
- ▸Payment date scheduled for May 8
- ▸Record date for dividend eligibility is April 10
- ▸Current dividend yield at 1.66% as of March 9
- ▸Maintains status as a dividend aristocrat with consistent growth