Huntington Ingalls Industries (HII) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenues rose to $3.42 billion, up 10.9–11% year-over-year, driven by strong growth at Newport News and Ingalls Shipbuilding.

• Net earnings increased to $208 million, with diluted EPS of $5.27, reflecting a 36.8–37% year-over-year rise.

• Segment operating income rose 30.2% to $224 million, with margin improvement to 6.6% from 5.6% year-over-year.

• Backlog reached $57.3 billion as of June 30, 2026, supported by $6.7–$10.7 billion in new contract awards in the first half.

• Five major ship deliveries are planned over the next 12 months, supporting increased throughput and operational momentum.

Financial highlights

• Newport News Shipbuilding revenue increased 15.3% to $1.85 billion; Ingalls Shipbuilding up 16.7% to $845 million.

• Mission Technologies revenue declined 3.9–4% to $760 million, but operating income rose 52.8–53% to $55 million.

• Free cash flow for Q2 2026 was negative $150 million, down from $730 million in Q2 2025, mainly due to working capital changes.

• Effective tax rate for Q2 was 18.1%, below prior guidance and down from 19.1% in Q2 2025.

• Dividends declared per share increased to $1.38 from $1.35 year-over-year.

Outlook and guidance

• FY26 shipbuilding revenue guidance raised to $10.2–$10.4 billion, with operating margin expected between 6.0% and 6.5%.

• Mission Technologies FY26 revenue expected at $3.0–$3.2 billion, with segment operating margin ~5% and EBITDA margin 8.4–8.6%.

• FY26 free cash flow outlook reaffirmed at $500–$600 million, with significant generation in Q4.

• Q3 2026 shipbuilding revenue expected at ~$2.6 billion, with operating margin similar to Q2.

• Medium-term revenue CAGR targeted at ~6%, aiming for $16B+ enterprise revenue by 2030.