Huntington Ingalls Industries (NYSE:HII) reported fourth-quarter results on Thursday that topped market expectations, although the shipbuilder’s shares declined more than 6% in pre-market trading as investors appeared to weigh other factors.
The company delivered adjusted earnings of $4.04 per share for the final quarter of 2025, beating analyst forecasts of $3.83. Revenue reached $3.5 billion, comfortably ahead of the $3.09 billion consensus estimate and marking a 15.7% increase compared with the same period in 2024. For the full year, HII generated revenue of $12.5 billion, representing an 8.2% rise year-on-year.
“We made solid progress on our operational initiatives in 2025 and enter 2026 with strong momentum,” said Chris Kastner, HII’s president and CEO. “With more than 40 ships at Ingalls and Newport News in active construction or modernization, our focus in 2026 is clear: We must build on this momentum, and continue to increase our shipbuilding throughput.”
During 2025, the company achieved several operational milestones, including delivering the Virginia-class submarine Massachusetts (SSN 798) and the guided missile destroyer Ted Stevens (DDG 128) to the U.S. Navy. HII also committed more than $400 million to capital investment projects throughout the year.
Operating performance improved across the business, with segment operating margin rising to 5.6% in the fourth quarter, up from 3.4% in the same period a year earlier. Free cash flow also strengthened significantly, reaching $800 million for 2025, compared with $40 million in 2024.
Looking ahead, HII forecasts shipbuilding revenue in the range of $9.7 billion to $9.9 billion for 2026, with expected operating margins of 5.5% to 6.5%. The company also anticipates generating free cash flow between $500 million and $600 million during the year.