HII Q1 Earnings Surpass Estimates, Revenues Increase Y/Y
Huntington Ingalls Industries, Inc.HII posted first-quarter 2026 earnings of $3.79 per share, matching the year-ago level and topping the Zacks Consensus Estimate of $3.70 by 2.4%.
Total Revenues
Quarterly revenues came in at $3.10 billion, up 13.4% year over year and ahead of the consensus mark of $3.02 billion by 2.7%.
The quarter reflected higher volumes across the business, led by aircraft carrier, submarine and naval nuclear support services work.
HII also booked $4.0 billion of new contract awards in the period, lifting total backlog to $54.0 billion as of March 31, 2026.
Huntington Ingalls Industries, Inc. Price, Consensus and EPS Surprise
Huntington Ingalls Industries, Inc. price-consensus-eps-surprise-chart | Huntington Ingalls Industries, Inc. Quote
Operational Performance
Huntington Ingalls reported segmental operating income of $172 million compared with $171 million in the first quarter of 2025. The segmental operating margin contracted 70 basis points from the prior-year figure to 5%.
HII Segmental Performance
Newport News Shipbuilding remained the largest contributor in the quarter. Segment revenues rose to $1.67 billion from $1.40 billion a year earlier, driven by higher volumes in aircraft carriers, submarines and naval nuclear support services. Segment operating income edged up to $88 million from $85 million, while segment operating margin declined to 5.3% from 6.1%, reflecting contract adjustments and lower performance in aircraft carrier construction.
Ingalls Shipbuilding delivered solid growth as well. Segment revenues increased to $725 million from $637 million, primarily on higher surface combatant volumes. Segment operating income improved to $49 million from $46 million, but segment operating margin narrowed to 6.8% from 7.2% as lower performance in amphibious assault ships partially offset the benefits of stronger volume.
Mission Technologies posted steadier gains. Segment revenues were $748 million compared with $735 million a year ago, supported by higher volumes in All-Domain Operations, Unmanned Systems and Global Security, partially offset by lower volumes in Warfare Systems. Segment operating income declined to $35 million from $40 million and segment operating margin eased to 4.7% from 5.4%, mainly due to lower equity income from nuclear and environmental joint ventures.
Financial Update
Cash flow remained seasonally pressured in the first quarter. Net cash used in operating activities was $390 million and free cash flow was negative $461 million, essentially unchanged from the prior-year period. Net capital expenditures totaled $71 million in the quarter, including $74 million of capex additions and $3 million of grant proceeds.
On capital deployment, HII paid $54 million in dividends and did not repurchase shares during the quarter. The company ended March 2026, with $216 million in cash and cash equivalents.
2026 Guidance
Management reaffirmed its full-year expectations and maintained its medium-term growth framework. For 2026, HII continues to project shipbuilding revenues of $9.70-$9.90 billion with a shipbuilding operating margin of 5.5-6.5%.
Mission Technologies revenues are still expected at $3.0-$3.2 billion, with segment operating margin around 5% and EBITDA margin of 8.4-8.6%.
The company also reiterated free cash flow guidance of $500-$600 million and capital expenditures of 4-5% of sales.
Zacks Rank
Huntington Ingalls currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
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