Aerospace and defense company Huntington Ingalls (NYSE: HII) reported Q1 CY2026 results topping the market’s revenue expectations, with sales up 13.4% year on year to $3.10 billion. Its GAAP profit of $3.79 per share was 2.2% above analysts’ consensus estimates.

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“We made good progress on our 2026 operational initiatives in the first quarter. Shipbuilding throughput has continued to improve with meaningful year over year growth in the first quarter as our team remains focused on driving efficiency and expanding the industrial base network," said Chris Kastner, HII’s president and CEO.

Company Overview

Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE: HII) develops marine vessels and their mission systems and maintenance services.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Huntington Ingalls grew its sales at a mediocre 6.5% compounded annual growth rate. This fell short of our benchmark for the industrials sector and is a tough starting point for our analysis.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Huntington Ingalls’s recent performance shows its demand has slowed as its annualized revenue growth of 5.3% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

This quarter, Huntington Ingalls reported year-on-year revenue growth of 13.4%, and its $3.10 billion of revenue exceeded Wall Street’s estimates by 2.6%.

Looking ahead, sell-side analysts expect revenue to grow 2.3% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and suggests its products and services will face some demand challenges.

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Operating Margin

Huntington Ingalls’s operating margin has generally stayed the same over the last 12 months, averaging 5.4% over the last five years. This profitability was paltry for an industrials business and caused by its suboptimal cost structure.

Looking at the trend in its profitability, Huntington Ingalls’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, Huntington Ingalls generated an operating margin profit margin of 5%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Sadly for Huntington Ingalls, its EPS declined by 1.5% annually over the last five years while its revenue grew by 6.5%. However, its operating margin didn’t change during this time, telling us that non-fundamental factors such as interest and taxes affected its ultimate earnings.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Huntington Ingalls, its two-year annual EPS declines of 6.9% show it’s continued to underperform. These results were bad no matter how you slice the data.

In Q1, Huntington Ingalls reported EPS of $3.79, in line with the same quarter last year. This print beat analysts’ estimates by 2.2%. Over the next 12 months, Wall Street expects Huntington Ingalls’s full-year EPS of $15.36 to grow 18.1%.

Key Takeaways from Huntington Ingalls’s Q1 Results

We were impressed by how significantly Huntington Ingalls blew past analysts’ adjusted operating income expectations this quarter. We were also glad its revenue outperformed Wall Street’s estimates. Zooming out, we think this was a good print with some key areas of upside. The market seemed to be hoping for more, and the stock traded down 3% to $352.51 immediately following the results.

So do we think Huntington Ingalls is an attractive buy at the current price? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).