General Dynamics Electric Boat Secures $1 Billion Contract Modification for Virginia-Class Submarine Materials

On March 25, 2025, General Dynamics Electric Boat, a business unit of General Dynamics (NYSE: GD), announced it has received a $1 billion undefinitized contract modification from the U.S. Department of Defense. The funding will allow the company to procure long lead time materials necessary for the construction of Virginia-class Block VI submarines.

Mark Rayha, president of General Dynamics Electric Boat, emphasized that the contract plays a vital role in supporting the submarine industrial base and ensuring suppliers can invest in capacity to meet the Navy’s growing demand. He highlighted the importance of consistent funding to reach the high-rate production goals required by the Navy.

The Virginia-class submarines are advanced nuclear-powered vessels designed for a wide range of missions, including anti-submarine warfare, surface ship warfare, and special operations. General Dynamics Electric Boat is the lead design yard and prime contractor for the program, constructing the submarines in partnership with HII’s Newport News Shipbuilding.

Electric Boat, based in Groton, Connecticut, employs over 24,000 people and specializes in the design, construction, repair, and modernization of nuclear submarines. General Dynamics, headquartered in Reston, Virginia, employs over 110,000 people globally and generated $47.7 billion in revenue in 2024.

General Dynamics Electric Boat Secures $1 Billion Contract for Submarine Materials

On March 25, 2025, General Dynamics Electric Boat, a division of General Dynamics, received a $1 billion undefinitized contract modification from the U.S. Department of Defense. The funding will allow the company to acquire long lead time materials needed for the construction of Virginia-class Block VI submarines.

Mark Rayha, president of Electric Boat, emphasized the importance of consistent funding to support the submarine industrial base and meet the Navy’s production demands. Virginia-class submarines are designed for a wide range of 21st-century missions, including anti-submarine warfare and special operations support. Electric Boat is the lead contractor for the class, working in partnership with HII’s Newport News Shipbuilding.

Electric Boat, based in Groton, Connecticut, employs over 24,000 people and specializes in designing and building nuclear submarines for the U.S. Navy. Its parent company, General Dynamics, headquartered in Reston, Virginia, is a major aerospace and defense firm with over 110,000 employees and $47.7 billion in revenue in 2024.

The board of directors of General Dynamics (NYSE: GD) today declared a regular quarterly dividend of $1.50 per share on the company's common stock, payable May 9, 2025, to shareholders of record on April 11, 2025. This is the 28th consecutive annual dividend increase authorized by the General Dynamics board and represents a 5.6% increase over last year's dividend.

General Dynamics reported strong fourth-quarter and full-year 2024 financial results, with steady revenue and earnings growth across all segments. Fourth-quarter net earnings increased by 14.2% to $1.1 billion on revenue of $13.3 billion, marking a 14.3% year-over-year increase. Diluted earnings per share (EPS) for the quarter reached $4.15, up 14% from the prior year.

For the full year, net earnings grew by 14.1% to $3.8 billion, with revenue rising by 12.9% to $47.7 billion. Diluted EPS for 2024 was $13.63, reflecting a 13.4% increase from 2023. The company ended the year with a backlog of $90.6 billion and an estimated total contract value of $144 billion, up 9.1% from the previous year.

Cash flow from operations remained strong, generating $2.2 billion in the fourth quarter—188% of net earnings—and $4.1 billion for the full year. The company invested $916 million in capital expenditures, repaid $500 million in fixed-rate notes, and returned $3 billion to shareholders through dividends and share repurchases.

Segment-wise, Aerospace led growth with a 36.4% increase in fourth-quarter revenue, supported by Gulfstream’s delivery of 47 aircraft. Marine Systems saw a 16.2% rise in revenue, while Combat Systems and Technologies posted smaller gains of 1.3% and 2.8%, respectively.

Key defense contracts included a $5.6 billion U.S. Air Force contract for modernizing Mission Partner Environments, a $2.2 billion U.S. Space Force contract for sustaining the MUOS satellite system, and $1.9 billion in U.S. Navy contracts related to Virginia-class submarines.

With a balanced book-to-bill ratio of 1-to-1 for the year, General Dynamics remains well-positioned for continued growth in 2025, driven by strong order activity and solid operational performance across all business segments.