General Dynamics (GD) Q4 2025 earnings summary

Executive summary

• Fourth quarter 2025 delivered $4.17 EPS, $14.4B revenue, $1.1B net earnings; full-year 2025 saw revenue up 10.1% to $52.6B, net earnings up 11.3% to $4.21B, and EPS up 13.4% to $15.45.

• All segments posted revenue and operating earnings growth, led by Marine Systems and Aerospace.

• Company-wide backlog grew 30% year-over-year, ending 2025 at $118B, with a book-to-bill ratio of 1.5x for the year.

• Analyst consensus was exceeded for both the quarter and the year.

Financial highlights

• Q4 revenue: $14.4B (+7.8% YoY); full-year revenue: $52.6B (+10.1% YoY); net earnings: $1.14B in Q4, $4.21B for the year.

• Operating earnings for 2025 increased 11.7% to $5.36B; operating margin improved to 10.2%.

• Free cash flow for 2025 was $3.96B, 94% of net earnings.

• Year-end cash balance: $2.3B; net debt: $5.68B, down from $7.07B in 2024.

• Record backlog of $118B (+30% YoY); total estimated contract value at $179B (+24% YoY).

Outlook and guidance

• 2026 revenue expected at $54.3B–$54.8B, operating margin at 10.4%, and EPS between $16.10–$16.20.

• Aerospace revenue forecasted at $13.6B with 14% margin; Combat Systems at $9.6B–$9.7B revenue, 14.1% margin; Marine at $17.3B–$17.7B revenue, margin up 30 bps; Technologies at $13.8B revenue, 9.2% margin.

• Free cash flow conversion targeted at 100% of net income for 2026, despite higher CapEx.

• Management expects continued strong demand and robust order activity, supported by record backlogs and new contract awards.

• Management highlighted continued investment in capital expenditures, with $1.2B spent in 2025 and plans for increased investment in 2026.