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GD NYSE· General Dynamics Corp
Earnings report Q4 2023

General Dynamics Reports 7.3% Increase in Revenue in Latest Quarter

Segments of Revenue

General Dynamics reported total revenue of $42.27 billion for the year ended December 31, 2023. The revenue was generated from two main segments: Products and Services. The Products segment contributed $24.60 billion, while the Services segment contributed $17.68 billion to the overall revenue.

Strengths

General Dynamics experienced a 7.3% increase in revenue in the latest quarter, driven by growth in each of its defense segments, particularly submarine construction and engineering in the Marine Systems segment. The Aerospace segment also contributed to the revenue growth, with a 0.6% increase. The company's strong performance in these segments reflects its ability to capture market demand and deliver high-quality products and services. General Dynamics' management highlighted the increase in demand for maintenance work, based on established maintenance cycles, a larger installed base of aircraft, and strong customer flight activity, as factors contributing to the growth in the Aerospace segment's revenue.

Challenges

Despite the overall revenue growth, General Dynamics faced some challenges in its Marine Systems and Combat Systems segments. The operating margin decreased in 2023 primarily due to supply-chain cost pressure in the Marine Systems segment and lower-margin artillery facilities expansion work in the Combat Systems segment. These challenges impacted the profitability of these segments and resulted in a slight decrease in the company's overall operating margin.

Noteworthy

It is worth mentioning that General Dynamics' Aerospace segment experienced a decrease in Gulfstream aircraft deliveries by 7.5% in the latest quarter. This decline in deliveries may have been influenced by various factors, such as market conditions, customer demand, or production constraints. However, the impact of this decline on the segment's overall revenue was mitigated by the increase in demand for maintenance work and a larger installed base of aircraft.

Summary

General Dynamics reported a 7.3% increase in revenue in the latest quarter, driven by growth in its defense segments, particularly submarine construction and engineering. The Aerospace segment also contributed to the revenue growth, despite a decline in Gulfstream aircraft deliveries. However, the company faced challenges in its Marine Systems and Combat Systems segments, resulting in a slight decrease in the overall operating margin. Overall, General Dynamics demonstrated its ability to capture market demand and deliver strong financial performance, while also addressing challenges in certain segments of its business.

Source documents

Form 10-K  filed on Feb 08, 2024
126 pages scanned

Reference data

Company financials Q4 revenue 11.67B
Analyst estimates Q4 EPS missed by -0.92%
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