What it does
General Dynamics is an aerospace and defense company that designs, manufactures and supports business jets, military ships and submarines, combat vehicles, weapons and technology systems. Its customers include the U.S. government, allied governments, businesses and individual aircraft owners.
The company operates through four segments. Aerospace builds Gulfstream business jets and provides aircraft maintenance, management and other services through Gulfstream and Jet Aviation. Marine Systems designs and builds submarines and surface ships, principally for the U.S. Navy, and maintains and modernizes vessels after delivery.
Combat Systems makes and upgrades land vehicles, including the Abrams tank and Stryker vehicle, as well as munitions and weapon systems. Technologies supplies government customers with information technology services and defense electronics, including communications, cybersecurity and intelligence systems.
General Dynamics was founded in 1952 and is headquartered in Reston. Phebe Novakovic was chief executive during the third quarter of 2026; Danny Deep is scheduled to become CEO on January 1, 2027. The company had approximately 117,000 employees in 2025.
The businesses perform different roles for customers: they deliver finished aircraft and military platforms, provide components for other systems, and support equipment and networks after they enter service. Their work ranges from individual aircraft orders to government programs that can extend over many years.
How it makes money
General Dynamics earns revenue by delivering aircraft and military equipment, performing work on long-term contracts, and providing maintenance, technology and other services. Revenue was $52.6 billion in 2025 and $14.57 billion in the third quarter of 2026.
Aerospace sells Gulfstream jets and provides aircraft services. It generally recognizes new-aircraft revenue when the customer accepts a fully outfitted aircraft. Service revenue is recognized as work progresses or services are delivered. Aircraft earnings depend on selling prices, manufacturing and outfitting efficiency, the models delivered and the mix of services. New aircraft models typically have lower margins in their initial production lots.
Marine Systems earns revenue from constructing submarines and surface ships and from subsequent repair, modernization and support. Combat Systems produces and upgrades military vehicles, weapons and munitions. Technologies provides IT services and electronics for government and other defense programs. These businesses generally recognize revenue on long-term government contracts as work progresses, often using costs incurred relative to estimated total costs to measure that progress.
Government production contracts are primarily fixed-price: the company agrees to perform a defined scope of work for a set amount. Research, engineering, repair and other services are typically performed under cost-reimbursement or time-and-materials contracts. In the former, the customer reimburses contract costs and pays a fee; in the latter, the customer pays a fixed hourly labor rate and generally reimburses materials.
Aircraft maintenance, ship support, vehicle upgrades and IT services provide work beyond initial product delivery. Defense backlog includes both funded work and unfunded amounts the company considers likely to be funded, but future appropriations are not guaranteed.
Customers and how it sells
The U.S. government is General Dynamics’ principal customer. In 2025, it accounted for 68% of consolidated revenue; U.S. commercial customers accounted for 15%, non-U.S. government customers for 8%, and non-U.S. commercial customers for 9%.
The company’s U.S. government customers include the Department of War, the intelligence community and civilian agencies. It also sells to foreign governments through the U.S. foreign military sales program, under which the U.S. government contracts with and pays General Dynamics and assumes collection risk from the foreign customer.
Commercial business-jet customers include individuals and public and private companies across industries. Outside the United States, commercial revenue consists primarily of aircraft exports and worldwide aircraft services. Jet Aviation manages aircraft for owners and operates facilities serving aircraft operators on four continents.
The defense businesses also serve allied governments through exports and local operations. Combat Systems has operations in countries including Canada, the United Kingdom, Spain, Switzerland, Austria, Germany and Romania. The company provides submarine-program engineering and other support to allied navies.
Gulfstream’s aircraft installed base is concentrated in North America, while customers outside North America represented approximately 38% of its aircraft backlog on December 31, 2025.
Suppliers and costs
General Dynamics depends on suppliers and subcontractors for raw materials, components and subsystems; the U.S. government also supplies items for some programs. The company sometimes relies on only one or two sources, and supply networks can face price changes and capacity constraints. It uses long-term and company-wide agreements and negotiates flexible pricing terms in customer contracts to help manage supplier risks.
Gulfstream designs, develops and manufactures its large-cabin aircraft in Savannah, Georgia. A non-U.S. partner assembles its midsize aircraft, and Gulfstream and Jet Aviation facilities outfit the models. Most Aerospace operating costs relate to aircraft production and include labor, materials, subcontractors and overhead.
Electric Boat works with approximately 3,000 suppliers supporting submarine production. General Dynamics is sourcing torpedo tubes, air flasks, impulse tanks and auxiliary tanks from Anduril to add capacity for those components. The company has also invested in shipyard facilities and workforce training.
For defense contracts, labor, material and overhead costs contribute to the cost of work performed. Changes in estimated costs to complete a contract can affect its profitability, particularly when the contract value does not change correspondingly.
- Revenue$52.6B
- Cost of revenue−$44.6B
- Selling, general and administrative−$2.6B
- Operating income$5.4B
Competitive position
General Dynamics competes with defense contractors, specialized technology companies, shipyards and business-jet manufacturers and service providers. Customers consider factors including technical performance, reliability, cost, delivery, innovation and service. Major government programs can also require competitors to work together as partners or subcontractors.
The company identifies one primary Marine Systems competitor but does not name it; the two also work together on submarine programs. Combat Systems and Technologies face numerous competitors, while Gulfstream has several competitors for each aircraft product. It was reported on 16 October 2026 that Lockheed Martin and General Dynamics were peers. General Dynamics is also investing in rocket-motor capability to support Lockheed Martin as a customer.
Electric Boat is the prime contractor and lead shipyard on all Navy nuclear-powered submarine programs. Land Systems is the sole-source producer of the Abrams tank and Stryker vehicle. Our reading: these program positions provide substantial competitive protection while they last, although future government procurement choices remain important.
Gulfstream supports aircraft already in service through its maintenance network, and Combat Systems provides upgrades and support for vehicles in service worldwide. Our reading: installed equipment and support networks create a meaningful continuing customer relationship, but do not prevent customers from considering competing products and services.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Lockheed Martin Corporation | Defense peer; also a rocket-motor customer | Medium |
Growth opportunities
General Dynamics is expanding shipbuilding facilities, developing its workforce and working with the Navy to increase submarine supply-chain capacity. In the third quarter of 2026, the company reported awards of $29.5 billion for five additional Columbia-class submarines and $42.1 billion for nine additional Virginia-class submarines. It reported nearly $99 billion in new orders and a backlog of $220 billion for the quarter.
The company is also investing in new aircraft and support capacity. Gulfstream’s G800 entered service in 2025, while the G400 and G300 are in development. General Dynamics intends to deliver 200 aircraft in 2030 and expects suppliers to keep pace with the production ramp. It expects the growing aircraft fleet to increase demand for services.
In Combat Systems, the company is developing next-generation vehicles and expanding munitions production capacity. Its businesses are also investing in solid rocket motors and artillery production. In Technologies, the company provides government customers with cloud, cybersecurity, artificial intelligence and other modernization services, alongside defense electronics.
For 2026, General Dynamics expects revenue between $56.5 billion to $56.8 billion. The company also expects to continue investing in shipyards to support production and demand.
- $38.5BFY2021
- $39.4BFY2022
- $42.3BFY2023
- $47.7BFY2024
- $52.6BFY2025
Structural risks
- Government funding and priorities: U.S. government spending can change with political and national-security priorities. Contracts are not always fully funded at inception, and future work on multiyear programs depends on congressional appropriations. Government customers can also terminate contracts.
- Contract execution: Earnings depend on assumptions about labor productivity, materials, work complexity and schedules. Changes in those assumptions or inadequate management of contract risks can reduce profitability.
- Suppliers and workforce: Disruptions at suppliers, including cases where the company relies on one or two sources, can delay customer commitments. The company must also hire and retain qualified personnel for specialized engineering and manufacturing work.
- Business aviation demand and delivery: Aircraft demand can change with economic conditions, credit availability and pricing pressures. The company has identified a delivery gap between the phaseout of the G280 and introduction of the G300.
- Regulation and security: Government contracting is subject to audits and compliance requirements that can lead to delayed payments, penalties or restrictions. Cybersecurity incidents could disrupt operations, expose sensitive information or affect eligibility for future work.
Bottom line
Our reading
Our reading: General Dynamics combines government-funded defense programs with business aviation, giving it several sources of work but substantial exposure to U.S. budget decisions. Its established submarine and vehicle positions and large backlog support future activity, while supplier capacity, contract execution and the availability of appropriations determine how much of that work becomes revenue and profit.