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GD · Q2 2026
Archived report (Q2 2026). Latest deep dive →
The quarter in brief
A defense compounder doing exactly what its backlog promises — revenue +8% with all four segments growing, operating margin up 40bp to 10.4%, EPS +13% — and demand still outrunning output: $20B of orders against $14.1B of revenue (1.4x book-to-bill) took backlog to a record $136.5B.
Net Earnings
$1,160M
up 14.4% y/y
Revenue
$14,094M
up 8.1% y/y
Operating Costs & Expenses
$12,634M
up 7.7% y/y
All figures in $M.
| Line item | Amount and change |
|---|---|
| Marine Systems | $4,660 · +10.4% |
| Aerospace (Gulfstream) | $3,525 · +15.1% |
| Technologies ≈ | $3,619 · +4.1% |
| Combat Systems | $2,290 · +0.3% |
| Revenue | $14,094 · +8.1% |
| Operating Costs & Expenses | $12,634 · +7.7% |
| Operating Earnings | $1,460 · +11.9% · 10.4% margin, +40bp |
| Interest, net | $49 · -44.3% |
| Other, net | $4 · vs +$15 |
| Pre-Tax Earnings | $1,407 · +14.2% |
| Income Tax | $247 · ETR 17.6% |
| Net Earnings | $1,160 · +14.4% · $4.24/sh diluted · 8.2% margin |
Verdict: a defense compounder doing exactly what its backlog promises — revenue +8% with all four segments growing, operating margin up 40bp to 10.4%, EPS +13% — and demand still outrunning output: $20B of orders against $14.1B of revenue (1.4x book-to-bill) took backlog to a record $136.5B.
Q2 operating cash flow $1.9B — 162% of net earnings. Dividends $429M; capex $234M; debt reduced by $498M to $7.5B; cash $4.3B. Total estimated contract value $186.9B (backlog $136.5B + $50.4B IDIQ/options).
Source and notation
* marks non-cash / ≈ estimated. Technologies segment revenue derived as the residual of total. Source: General Dynamics press release 8-K EX-99.1 (SEC EDGAR).
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<figure> <a href="https://whoreportstoday.com/t/gd/q2-2026"><img src="https://whoreportstoday.com/t/gd/q2-2026/sankey.png" alt="GD Q2 2026: where the revenue went" loading="lazy" style="max-width:100%;height:auto"></a> <figcaption>Source: <a href="https://whoreportstoday.com/t/gd/q2-2026">Who Reports Today</a>, licensed under <a href="https://creativecommons.org/licenses/by/4.0/">CC BY 4.0</a></figcaption> </figure>
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<a href="https://whoreportstoday.com/t/gd/q2-2026">GD Q2 2026 earnings chart (Who Reports Today)</a>
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- Book-to-bill of 1.4x company-wide (1.5x in Aerospace): $20B of new orders in one quarter against $14.1B of revenue — the growth is already sold, sitting in a record $136.5B backlog.
- Aerospace (Gulfstream) led with +15.1% revenue and 'noteworthy margin expansion' — the G700/G800 delivery ramp is finally converting backlog into earnings.
- Marine Systems +10.4% — submarine programs (Columbia, Virginia) keep scaling; Combat Systems was flat (+0.3%) after two years of European land-systems surge.
- Cash conversion was exceptional: $1.9B of operating cash flow = 162% of net earnings — progress payments on the order surge arrive ahead of the work.
- Interest expense nearly halved to $49M (net) as the company paid down $498M of debt in the quarter; total debt now $7.5B vs $4.3B cash.
- Operating margin of 10.4% (+40bp) is the quiet story: defense primes rarely expand margins during a production ramp.
- Effective tax rate ticked down to 17.6% from 17.7% — no games in the tax line; EPS growth (+13.4%) is almost all operational.
What distorts the picture in this report and what to watch beyond the headlines.
GD — General Dynamics is an aerospace and defense company that manufactures military vehicles, weapons systems, ships, and business jets.
It is headquartered in Reston, Virginia, and serves government and commercial customers worldwide.
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