Huntington Ingalls Industries Reports Revenue Increase but Decline in Operating Income for Fiscal Year 2024

Huntington Ingalls Industries, Inc. (HII) reported a modest increase in sales and service revenues for the fiscal year ending December 31, 2024, totaling $11.54 billion, up from $11.45 billion in 2023. The company's operating income, however, saw a significant decline, dropping to $535 million from $781 million in the previous year, reflecting a 31% decrease. Net earnings also fell by 19%, amounting to $550 million compared to $681 million in 2023. The decrease in profitability was attributed to challenges related to labor availability, supply chain disruptions, and inflationary pressures, which adversely affected operational performance across its segments.

In terms of segment performance, the Ingalls Shipbuilding segment reported a slight revenue increase of 1% to $2.77 billion, while operating income plummeted by 42% to $211 million. The Newport News Shipbuilding segment experienced a 3% decline in revenues to $5.97 billion, with operating income decreasing by 35% to $246 million. Conversely, the Mission Technologies segment saw a 9% revenue increase to $2.94 billion, with operating income rising 15% to $116 million, driven by higher volumes in command, control, computers, communications, cyber, intelligence, surveillance, and reconnaissance (C5ISR) contracts.

HII's total backlog as of December 31, 2024, was approximately $48.7 billion, a slight increase from $48.1 billion in 2023. The backlog is primarily composed of U.S. Government contracts, with about 21% expected to be converted into sales in 2025. The company secured new contract awards totaling approximately $12.1 billion during the year, including significant contracts for the maintenance and overhaul of naval vessels. Additionally, HII announced the acquisition of W International, a South Carolina-based metal fabricator, for $140 million, which is expected to enhance its shipbuilding capabilities.

The company employed over 44,000 individuals as of the end of 2024, with approximately 45% covered by collective bargaining agreements. HII has maintained a stable workforce, with no work stoppages reported in over 25 years at Newport News and 17 years at Ingalls. However, the company continues to face challenges in attracting and retaining skilled labor, which is critical for meeting production demands and maintaining operational efficiency.

Looking ahead, HII anticipates continued pressure from inflation and supply chain issues, which may impact future profitability. The company is focused on mitigating these challenges through strategic workforce development initiatives and maintaining strong relationships with its suppliers. HII's management remains optimistic about its long-term growth prospects, supported by a robust backlog and ongoing investments in its shipbuilding capabilities.