HII Reports Third Quarter 2025 Results

Core Insights - HII reported third quarter 2025 revenues of $3.2 billion, a 16.1% increase from the same period in 2024, driven by growth in Newport News Shipbuilding, Ingalls Shipbuilding, and Mission Technologies [2][4] - Operating income for the third quarter was $161 million with an operating margin of 5.0%, compared to $82 million and 3.0% in the same quarter of 2024 [2][4] - Net earnings for the quarter were $145 million, up from $101 million in the third quarter of 2024, resulting in diluted earnings per share of $3.68, compared to $2.56 in the prior year [4][7] Financial Performance - Segment operating income for the third quarter was $179 million with a segment operating margin of 5.6%, compared to $97 million and 3.5% in the same quarter of 2024 [3][6] - New contract awards in the third quarter totaled $2.0 billion, increasing the total backlog to $55.7 billion as of September 30, 2025 [5][17] - Free cash flow for the quarter was $16 million, down from $136 million in the third quarter of 2024 [4][42] Segment Analysis Ingalls Shipbuilding - Revenues for Ingalls Shipbuilding in the third quarter were $828 million, a 24.7% increase from $664 million in the same period of 2024, primarily due to higher volumes in surface combatants [8][9] - Segment operating income was $65 million, up from $49 million, with a segment operating margin of 7.9% compared to 7.4% in the previous year [9] Newport News Shipbuilding - Newport News Shipbuilding reported revenues of $1.6 billion, a 14.5% increase from $1.4 billion in the same quarter of 2024, driven by higher volumes in submarines and aircraft carriers [10][11] - Segment operating income increased to $80 million from $15 million, with a segment operating margin of 4.9% compared to 1.1% in the prior year [11] Mission Technologies - Mission Technologies generated revenues of $787 million, an 11.0% increase from $709 million in the same quarter of 2024, attributed to higher volumes in various technology solutions [12][13] - Segment operating income was $34 million, slightly up from $33 million, with a segment operating margin of 4.3%, down from 4.7% in the previous year [13] Operational Highlights - The company completed builder's sea trials for the guided missile destroyer Ted Stevens (DDG 128) and initial sea trials of the Virginia-Class Submarine Massachusetts (SSN 798) [7][9][11] - HII achieved a book-to-bill ratio of 1.25x in the third quarter [17] Financial Outlook - The company updated its fiscal year 2025 outlook, projecting shipbuilding revenue between $9.0 billion and $9.1 billion, with an operating margin of 5.5% to 6.5% [16][17] - Mission Technologies revenue is expected to be between $3.0 billion and $3.1 billion, with a segment operating margin of approximately 4.5% [17]