Oceaneering International, Inc. (OII Quick QuoteOII - Free Report) recently announced a major win for its Aerospace and Defense Technologies (ADTech) segment, a $33 million single-award fixed-price IDIQ contract to deliver critical support equipment for Virginia Class Submarines. Awarded by the Naval Surface Warfare Center Philadelphia Division (“NSWCPD”), this strategic contract sets Oceaneering’s continued position as a trusted partner in the defense sector and reflects its advanced engineering capabilities in underwater technologies.

Virginia Class Submarine Support Contract Overview

The newly awarded IDIQ contract will span a five-year ordering period, with options that, if fully exercised, will bring the total value of the agreement to approximately $33 million. Beginning in June 2025, this agreement mandates the production of work platforms designed specifically for maintenance operations on Virginia Class Submarines' sail and vertical payload tubes. These platforms are integral for routine and mission-critical repairs and inspections, enhancing the operational readiness of the U.S. Navy’s submarine fleet.

This follow-on contract was secured through a competitive bidding process, further highlighting Oceaneering’s ability to deliver innovative, cost-effective and technically superior solutions that meet the stringent demands of the Department of Defense.

Strategic Significance of Virginia Class Submarines

Virginia Class Submarines signify the backbone of the U.S. Navy’s attack submarine force. Designed for deep-ocean and littoral missions, these nuclear-powered submarines are equipped with cutting-edge stealth, surveillance and weapons systems. The sail and vertical payload tubes are essential features of the Virginia Class, enabling versatile mission deployment capabilities ranging from anti-submarine warfare to intelligence gathering.

Maintenance access to these components is highly technical, requiring customized work platforms that must adhere to precise specifications. OII’s role in supplying this support equipment ensures these advanced submarines remain mission-ready and operationally secure across global theaters.

OII’s Aerospace and Defense Technologies Segment

The ADTech segment of OII has been a cornerstone in delivering engineered solutions to complex defense requirements. Focusing in unmanned systems, specialized tooling, automation and maritime support technologies, ADTech leverages its legacy in subsea engineering to serve military platforms.

By combining aerospace precision with deep-sea expertise, OII’s ADTech unit brings innovation to every deal, including this high-value IDIQ contract for the NSWCPD. The ability to custom-manufacture equipment with exact tolerances and reliability under extreme environmental conditions is what sets OII apart from competitors in the defense contracting space.

OII’s Engineering and Manufacturing Excellence

As part of this contract, OII will fabricate work platforms using high-grade materials and advanced manufacturing processes at its dedicated facilities. These platforms must support both the structural integrity and safety standards required for personnel working in and around the submarine’s hull.

With this award, OII reaffirms its position as a preferred vendor for precision-engineered military equipment, capable of meeting U.S. Navy expectations for both delivery timelines and performance standards.

Enhancing U.S. Naval Maintenance Capabilities

The NSWCPD's choice to engage OII for a second consecutive contract highlights the contractor’s proven track record. OII has demonstrated its ability to consistently meet or exceed contractual obligations under previous engagements, particularly in the submarine support domain.

These platforms are not just tools, they are force multipliers for the U.S. Navy, enabling faster, safer and more efficient maintenance procedures. This directly contributes to extended deployment cycles, reduced downtime and enhanced mission capability for Virginia Class attack submarines.

Contract Scope and Deliverables

The scope of this IDIQ contract awarded to OII encompasses the complete lifecycle of the Virginia Class Submarine support equipment, from concept and design to final delivery and integration. OII is tasked with engineering, fabricating and delivering highly specialized work platforms tailored to the unique structural and functional requirements of the submarine's sail and vertical payload tubes. These platforms must comply with stringent military specifications and naval engineering standards, ensuring both operational effectiveness and personnel safety during maintenance procedures.

Each deliverable is subject to rigorous quality assurance protocols, with OII expected to uphold exact tolerances and consistency in production. In addition to manufacturing the equipment, the company is also responsible for logistical planning, ensuring timely delivery and seamless installation aboard naval vessels. Engineering support does not end upon delivery, OII is also committed to providing detailed lifecycle documentation, including technical manuals, maintenance guidelines and field support services. This comprehensive approach ensures that the Navy has access to continuous technical assistance and sustained performance from the delivered systems throughout their operational use.

Impact on OII’s Strategic Growth

This $33 million award adds significant weight to OII’s growing defense portfolio. It strengthens revenue visibility for the ADTech segment while opening doors for long-term contracts with other divisions of the U.S. Department of Defense. The nature of the IDIQ agreement provides OII with operational flexibility and predictable income across the five-year contract term.

With this deal, OII continues to expand its footprint in the defense sector, aligning with strategic objectives to diversify revenue streams beyond traditional offshore energy services.

Outlook and Industry Position

This contract reinforces OII’s capabilities in supporting next-generation military hardware. As naval technologies evolve, the demand for modular, scalable and high-durability support systems is expected to grow. OII is uniquely positioned to meet that demand, with cross-disciplinary expertise in subsea, automation and defense systems integration.

Furthermore, success in this engagement may lead to additional opportunities supporting Columbia Class submarines, aircraft carriers and unmanned surface vessels, each of which requires similarly complex support infrastructure.

Conclusion: A Landmark Win for OII and Naval Operations

Securing this five-year $33 million contract from the Naval Surface Warfare Center Philadelphia Division is a significant win for OII. This highlights the company's strong track record as a dependable provider of defense solutions and its advanced engineering capabilities in supporting the Virginia Class Submarine program. With this contract, OII will play an essential role in ensuring these submarines remain fully mission-ready. The award also reinforces the company's dedication to delivering high-performance equipment, maintaining strict manufacturing standards and contributing to the overall strength and efficiency of U.S. naval operations.

OII's Zacks Rank & Other Key Picks

Currently, OII has a Zacks Rank #2 (Buy).

Investors interested in the energy sector might look at some other top-ranked stocks like Subsea 7 (SUBCY Quick QuoteSUBCY - Free Report) , which sports a Zacks Rank #1 (Strong Buy), Paramount Resources Ltd. (PRMRF Quick QuotePRMRF - Free Report) and RPC, Inc. (RES Quick QuoteRES - Free Report) , each holding a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.