General Dynamics Corporation Q1 2026 Earnings Recap

General Dynamics shares surged 9.8% post-earnings as the company delivered results that exceeded expectations across revenue, earnings, and cash flow, fueled by broad-based segment growth and a record backlog expansion.

Key Takeaways

• Revenue grew 10.3% to $13.5 billion, with every segment reporting year-over-year increases and Marine Systems leading on both revenue and operating earnings growth (+26.4%).
• Diluted EPS rose 12% to $4.10, with total net earnings of $1.125 billion; operating margin improved to 10.5%, up 10 basis points from last year.
• Operating cash flow was $2.2 billion, driving free cash flow to just under $2 billion — a 174% cash conversion rate — while the company repurchased $200 million in stock and paid $400 million in dividends.
• Backlog reached $131 billion, up 48% from the prior year and 11% sequentially, with order intake over $26 billion and a book-to-bill of 2:1; total estimated contract value rose to a record $188 billion.
• Capital expenditures increased more than 40% year-over-year to $203 million, with continued investment planned for shipyards to meet accelerating demand.