Executive Summary
General Dynamics reported Q3 2025 revenue of $12.907 billion, up 10.6% year-over-year and down 1.0% quarter-over-quarter, with a net income of $1.059 billion and pro forma diluted earnings per share (EPS) of $3.89 (reported $3.94). The solid top-line growth reflects ongoing demand across the company’s diversified defense platforms, while profitability shows a mixed signal: gross profit was $1.331 billion for the quarter with a gross margin of 10.3%, and operating income stood at $1.331 billion with a margin of 10.3%, producing a net margin of 8.2%. The quarter’s results benefited from efficient operating leverage, yet gross profit declined materially on a year-over-year basis, indicating continued mix and input-cost pressures as GD navigates a multi-segment portfolio (Aerospace, Marine Systems, Combat Systems, Technologies). Cash generation remained robust, underpinning a conservative balance sheet and disciplined capital allocation.
The company’s liquidity and leverage metrics remain supportive: current ratio 1.40, quick ratio 0.87, cash-to-debt indicators strong at a debt ratio of 0.139 and debt-to-capitalization of 0.247, with interest coverage near 18x. Operating cash flow per share came in at $7.85, free cash flow per share at $7.06, and cash per share at $9.38, while the dividend payout ratio stood at 38.1%. The balance sheet appears resilient to near-term macro uncertainties, with a solid balance of cash, modest leverage, and ongoing capability to fund dividends and strategic acquisitions or R&D investments.
Management commentary for QQ3 2025 is not included in the provided dataset; as such, this analysis relies on reported results and standard sector dynamics. The forward guidance from GD for the coming quarters is not specified in the data provided herein, necessitating a cautious view on multi-quarter trajectory. Investors should monitor defense-budget developments, program awards in Navy and federal IT, and potential margin normalization as the mix shifts among Aerospace, Marine, Combat Systems, and Technologies.
Key Performance Indicators
QoQ: -31.71% | YoY:-26.71%
Key Insights
Revenue: $12.907B (YoY +10.6%, QoQ -1.0%) | Gross Profit: $1.331B, Gross Margin: 10.31% (YoY -26.7%, QoQ -31.7%) | Operating Income: $1.331B, Operating Margin: 10.31% (YoY +12.7%, QoQ +1.99%) | Net Income: $1.060B, Net Margin: 8.20% (YoY +13.9%, QoQ +4.4%) | EPS (Diluted): $3.89 | ROE: 4.33% | ROA: 1.84% | Free Cash Flow per Share: $7.06 | Cash Flow per Share: $7.85 | Cash per Share: $9.38 | Payout Ratio: 38.1% | Current Ratio: 1.40 | Quick Ratio: 0.87 | Debt/Equity: 0.328 | Debt Ratio: 0.139 | ...
Financial Highlights
Revenue: $12.907B (YoY +10.6%, QoQ -1.0%) | Gross Profit: $1.331B, Gross Margin: 10.31% (YoY -26.7%, QoQ -31.7%) | Operating Income: $1.331B, Operating Margin: 10.31% (YoY +12.7%, QoQ +1.99%) | Net Income: $1.060B, Net Margin: 8.20% (YoY +13.9%, QoQ +4.4%) | EPS (Diluted): $3.89 | ROE: 4.33% | ROA: 1.84% | Free Cash Flow per Share: $7.06 | Cash Flow per Share: $7.85 | Cash per Share: $9.38 | Payout Ratio: 38.1% | Current Ratio: 1.40 | Quick Ratio: 0.87 | Debt/Equity: 0.328 | Debt Ratio: 0.139 | Interest Coverage: 18.0x | Dividends Yield: 0.45% | P/E: 21.1x | P/BV: 3.65x | Cash Conversion Cycle: 132.7 days | DSO: 83.3 days | DIO: 76.3 days | DPO: 26.9 days
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
12.91B |
10.59% |
-1.03% |
| Gross Profit |
1.33B |
-26.71% |
-31.71% |
| Operating Income |
1.33B |
12.70% |
1.99% |
| Net Income |
1.06B |
13.87% |
4.44% |
| EPS |
3.94 |
16.22% |
4.23% |
Key Financial Ratios
operatingProfitMargin
10.3%
operatingCashFlowPerShare
$7.85
freeCashFlowPerShare
$7.06
dividendPayoutRatio
38.1%
Management Commentary
No earnings call transcript data available for QQ3 2025 in the provided dataset. Therefore, no management quotes or thematic highlights can be drawn from the call. The analysis notes the absence of primary qualitative guidance or management commentary in this dataset.
Forward Guidance
No formal forward guidance is included in the provided data for QQ3 2025. Given GD’s diversified defense portfolio and ongoing Navy and federal contracting activity, a cautious view is that revenue and EPS could show modest growth into the next quarters if defense budgets remain stable and program awards accelerate. Key variables to monitor include: (1) defense-spending trajectory and program awards across Aerospace, Marine Systems, Combat Systems, and Technologies; (2) mix effects on gross margin as higher-margin programs scale; (3) supply chain costs and input inflation; (4) changes in working capital and capital expenditure cadence; (5) currency dynamics given international program exposure. Investors should look for any upcoming quarterly guidance on backlog development, program awards, and margin targets to gauge trajectory.