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General Dynamics' Q3 Earnings Surpass Estimates, Revenues Improve Y/Y
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Key Takeaways
General Dynamics reported Q3 earnings of $4.49 per share, beating estimates by 8.5% and rising 15.7%.
Revenues grew 12.9% to $14.57 billion, led by Marine Systems, while backlog doubled to $220.34 billion.
Free cash flow rose to $4.83 billion, as GD reduced debt by $500 million and paid $429 million in dividends.
General Dynamics Corporation (GD - Free Report) reported third-quarter 2026 earnings of $4.49 per share, which beat the Zacks Consensus Estimate of $4.14 by 8.5%. The bottom line increased 15.7% from $3.88 in the year-ago quarter, reflecting higher operating earnings and lower net interest expenses.
Total Revenues of GD
Revenues of $14.57 billion surpassed the consensus mark of $13.69 billion by 6.4% and rose 12.9% year over year. Growth across all four segments, led by Marine Systems, supported the top line. The company's total backlog reached $220.34 billion, increasing 100.6% year over year.
General Dynamics Corporation Price, Consensus and EPS Surprise
Aerospace revenues increased 9.3% year over year to $3.54 billion. Operating earnings surged 19.3% to $513 million. The segment's operating margin expanded 120 basis points (bps) to 14.5%, reflecting improved operational performance.
Marine Systems revenues advanced 21.1% year over year to $4.96 billion, driven by higher business volume across all shipyards. Operating earnings jumped 34.4% to $391 million from $291 million in the prior-year quarter. The segment's operating margin expanded 80 bps to 7.9%, supported by improved operational performance.
Combat Systems revenues increased 6% year over year to $2.39 billion. However, operating earnings declined 1.5% to $330 million from $335 million in the prior-year quarter. The segment's operating margin contracted 110 bps to 13.8%, indicating that higher revenues did not translate into improved profitability.
Technologies revenues rose 10.8% year over year to $3.68 billion. Operating earnings improved 5.8% to $346 million from $327 million a year ago. However, the operating margin declined 40 bps to 9.4%, reflecting slower earnings growth relative to revenues.
Operational Highlights of GD
Operating earnings totaled $1.53 billion, up 14.7% from the year-ago quarter's $1.33 billion. The operating margin expanded 20 bps to 10.5%.
Operating costs and expenses increased 12.6% year over year to $13.04 billion. Net interest expenses declined to $45 million from $74 million in the prior-year quarter.
Net earnings rose 16.1% to $1.23 billion from $1.06 billion a year ago, reflecting improved overall profitability.
Financial Condition of GD
As of Oct. 4, 2026, cash and cash equivalents totaled $4.39 billion compared with $2.33 billion as of Dec. 31, 2025.
Long-term debt totaled $6.26 billion, down from $7.01 billion as of 2025-end. Total debt was $7.02 billion, while net debt amounted to $2.63 billion.
During the first nine months of 2026, cash generated by operating activities totaled $5.75 billion compared with $3.56 billion in the year-ago period. Free cash flow increased to $4.83 billion from $3.01 billion.
During the third quarter, General Dynamics paid $429 million in dividends, invested $481 million in capital expenditures and reduced total debt by $500 million.
The Boeing Company (BA - Free Report) incurred an adjusted loss of 34 cents per share in the third quarter of 2026, wider than the Zacks Consensus Estimate of a loss of 21 cents. The reported figure improved from the year-ago quarter’s reported loss of $7.47 per share.
BA’s revenues amounted to $24.19 billion, which marginally missed the Zacks Consensus Estimate of $24.28 billion by 0.4%. However, the top line increased 3.9% from the year-ago quarter’s reported figure of $23.27 billion.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2026 adjusted earnings of $7.97 per share, which beat the Zacks Consensus Estimate of $7.49 by 6.4%. The bottom line increased 14.7% from the year-ago quarter's figure of $6.95.
LMT’s net sales were $20.71 billion, which beat the Zacks Consensus Estimate of $20.44 billion by 1.4%. The top line inched up 11.3% from $18.61 billion reported in the year-ago quarter.
Northrop Grumman Corporation (NOC - Free Report) reported third-quarter 2026 adjusted earnings of $7.89 per share, which beat the Zacks Consensus Estimate of $7.22 by 9.3%. The bottom line also increased 2.9% from the year-ago quarter’s level of $7.67.
NOC’s total sales of $11.12 billion beat the Zacks Consensus Estimate of $11.06 billion by 0.6%. The top line improved 6.7% from $10.42 billion reported in the year-ago quarter.
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General Dynamics' Q3 Earnings Surpass Estimates, Revenues Improve Y/Y
Key Takeaways
General Dynamics Corporation (GD - Free Report) reported third-quarter 2026 earnings of $4.49 per share, which beat the Zacks Consensus Estimate of $4.14 by 8.5%. The bottom line increased 15.7% from $3.88 in the year-ago quarter, reflecting higher operating earnings and lower net interest expenses.
Total Revenues of GD
Revenues of $14.57 billion surpassed the consensus mark of $13.69 billion by 6.4% and rose 12.9% year over year. Growth across all four segments, led by Marine Systems, supported the top line. The company's total backlog reached $220.34 billion, increasing 100.6% year over year.
General Dynamics Corporation Price, Consensus and EPS Surprise
General Dynamics Corporation price-consensus-eps-surprise-chart | General Dynamics Corporation Quote
GD’s Segmental Performance
Aerospace revenues increased 9.3% year over year to $3.54 billion. Operating earnings surged 19.3% to $513 million. The segment's operating margin expanded 120 basis points (bps) to 14.5%, reflecting improved operational performance.
Marine Systems revenues advanced 21.1% year over year to $4.96 billion, driven by higher business volume across all shipyards. Operating earnings jumped 34.4% to $391 million from $291 million in the prior-year quarter. The segment's operating margin expanded 80 bps to 7.9%, supported by improved operational performance.
Combat Systems revenues increased 6% year over year to $2.39 billion. However, operating earnings declined 1.5% to $330 million from $335 million in the prior-year quarter. The segment's operating margin contracted 110 bps to 13.8%, indicating that higher revenues did not translate into improved profitability.
Technologies revenues rose 10.8% year over year to $3.68 billion. Operating earnings improved 5.8% to $346 million from $327 million a year ago. However, the operating margin declined 40 bps to 9.4%, reflecting slower earnings growth relative to revenues.
Operational Highlights of GD
Operating earnings totaled $1.53 billion, up 14.7% from the year-ago quarter's $1.33 billion. The operating margin expanded 20 bps to 10.5%.
Operating costs and expenses increased 12.6% year over year to $13.04 billion. Net interest expenses declined to $45 million from $74 million in the prior-year quarter.
Net earnings rose 16.1% to $1.23 billion from $1.06 billion a year ago, reflecting improved overall profitability.
Financial Condition of GD
As of Oct. 4, 2026, cash and cash equivalents totaled $4.39 billion compared with $2.33 billion as of Dec. 31, 2025.
Long-term debt totaled $6.26 billion, down from $7.01 billion as of 2025-end. Total debt was $7.02 billion, while net debt amounted to $2.63 billion.
During the first nine months of 2026, cash generated by operating activities totaled $5.75 billion compared with $3.56 billion in the year-ago period. Free cash flow increased to $4.83 billion from $3.01 billion.
During the third quarter, General Dynamics paid $429 million in dividends, invested $481 million in capital expenditures and reduced total debt by $500 million.
GD’s Zacks Rank
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Release
The Boeing Company (BA - Free Report) incurred an adjusted loss of 34 cents per share in the third quarter of 2026, wider than the Zacks Consensus Estimate of a loss of 21 cents. The reported figure improved from the year-ago quarter’s reported loss of $7.47 per share.
BA’s revenues amounted to $24.19 billion, which marginally missed the Zacks Consensus Estimate of $24.28 billion by 0.4%. However, the top line increased 3.9% from the year-ago quarter’s reported figure of $23.27 billion.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2026 adjusted earnings of $7.97 per share, which beat the Zacks Consensus Estimate of $7.49 by 6.4%. The bottom line increased 14.7% from the year-ago quarter's figure of $6.95.
LMT’s net sales were $20.71 billion, which beat the Zacks Consensus Estimate of $20.44 billion by 1.4%. The top line inched up 11.3% from $18.61 billion reported in the year-ago quarter.
Northrop Grumman Corporation (NOC - Free Report) reported third-quarter 2026 adjusted earnings of $7.89 per share, which beat the Zacks Consensus Estimate of $7.22 by 9.3%. The bottom line also increased 2.9% from the year-ago quarter’s level of $7.67.
NOC’s total sales of $11.12 billion beat the Zacks Consensus Estimate of $11.06 billion by 0.6%. The top line improved 6.7% from $10.42 billion reported in the year-ago quarter.