Huntington Ingalls Beats Earnings Estimates by $1.12 a Share as Revenue Hits Record
Key Facts
Huntington Ingalls Industries reported on October 29 record revenue of $3.5 billion in the third quarter of its 2026 fiscal year, net income of $217 million and diluted earnings per share of $5.48, according to a company statement. Earnings per share were $1.12 above Investing.com’s estimate of $4.36, while revenue topped the consensus estimate of $3.38 billion. Compared with the third quarter of 2025, revenue rose from $3.2 billion, net income from $145 million and earnings per share from $3.68. Detailed company figures showed revenue of $3.537 billion, up 10.8% year over year from $3.192 billion. Operating income rose 52.8% to $246 million from $161 million, and the operating margin increased to 7.0% from 5.0% a year earlier.
Results varied across the shipbuilding units, with Newport News Shipbuilding posting revenue of $1.910 billion, up 18.1% year over year. Ingalls Shipbuilding revenue rose 5.8% to $876 million, driven mainly by higher amphibious assault ship production volumes, according to an HII statement. But higher revenue at Ingalls did not prevent operating income from declining due to surface combatant ships, according to the company’s results presentation. By contrast, Newport News and Mission Technologies improved, showing that stronger overall indicators were not evenly distributed across the businesses. The company’s overall operating margin rose to 7.0%, while operating income increased to $246 million, compared with 5.0% and $161 million, respectively, in the year-earlier quarter.
On liquidity, net cash from operating activities was $520 million in the quarter, and free cash flow was $429 million. The respective figures were $118 million and $16 million in the third quarter of 2025, according to the company statement. HII maintained its 2026 fiscal-year free cash flow outlook at $500 million to $600 million, the range announced with its first-quarter results. The guidance puts free cash flow generated during the quarter in the context of the company’s full-year forecast. The company also raised its 2026 shipbuilding revenue outlook to $10.5–$10.7 billion, while keeping its operating margin forecast for the business at 6.0–6.5%.
HII secured $32.4 billion in new contracts during the quarter, bringing year-to-date new contract awards to $43.1 billion as of September 30, 2026. Chief Executive Chris Kastner said contracts won during the quarter cover about 90% of expected shipbuilding revenue through 2030. He added that the company’s focus “is entirely on executing shipbuilding work,” pointing to the revenue visibility provided by the contracts. That contractual coverage puts execution at the forefront of the company’s progress, as it raised its shipbuilding revenue outlook and kept the margin guidance for the business unchanged. HII announced on October 21 that it would increase its quarterly cash dividend to $1.41 a share, up $0.03 from $1.38 in each of the previous four quarters; the dividend is payable December 11 to shareholders of record on November 27.