Huntington Ingalls Industries Q4 Earnings Call Highlights

Core Insights - Huntington Ingalls Industries (HII) reported a strong performance in 2025, with revenue reaching $12.5 billion, an increase of 8.2% year-over-year, and diluted earnings per share of $15.39, driven by improved shipbuilding throughput and hiring efforts [3][6][4] Financial Performance - Q4 revenue was $3.5 billion, reflecting a 16% year-over-year increase, with all three segments showing margin improvement [7][6] - Net earnings for Q4 were $159 million, up from $123 million a year earlier, with diluted EPS increasing to $4.04 from $3.15 [8][6] - Management raised medium-term shipbuilding growth guidance to approximately 6%, with 2026 shipbuilding revenue expected to be between $9.7 billion and $9.9 billion [5][18] Operational Highlights - HII achieved a 14% year-over-year increase in shipbuilding throughput in 2025, with over 6,600 shipbuilders hired [2][6] - The company expects to deliver two ships in 2026—SSN 800 and LPD-30—and complete preliminary acceptance of CVN 79 [13][14] Segment Performance - Ingalls reported Q4 revenue of $889 million, a 21% increase year-over-year, while Newport News had Q4 revenue of $1.9 billion, up 19% [10][12] - Mission Technologies surpassed $3 billion in revenue for the first time in 2025, with an operating margin improvement to 5% from 3.9% [15][17] Future Outlook - For 2026, HII expects free cash flow of $500 million to $600 million and capital expenditures of approximately $500 million to $600 million [19][22] - The company emphasized the importance of timely contract negotiations for Virginia-class and Columbia-class submarines in the first half of 2026 to avoid production risks [20][21]