General Dynamics Beats Estimates, Bolstered by Munitions Demand
General Dynamics Corp. (GD) surpassed Wall Street's quarterly profit expectations, buoyed by ongoing demand for military equipment amid geopolitical tensions.
The Virginia-based defense contractor reported a 14% surge in Q4 profit to $4.15 per share, exceeding analysts' consensus of $4.05 per share, as per data from Refinitiv.
Robust global demand for weapons and military equipment persisted during the quarter, driven by the ongoing conflict in Ukraine and heightened tensions in the Middle East.
However, investors remain cautious amid concerns over potential defense budget cuts under the newly established Department of Government Efficiency (DOGE), headed by Elon Musk.
Despite these concerns, some analysts suggest that President Trump's recent remarks on acquiring Greenland and taking over the Panama Canal could bode well for increased defense spending.
General Dynamics' weapons systems and military vehicles segment saw a 1.3% revenue increase for the quarter ended December 31st. Its nuclear-powered submarine segment, meanwhile, recorded a 16.2% revenue growth.
Despite the strong earnings, the company's shares experienced a 1.6% decline in pre-market trading.