General Dynamics (GD): Forging The Backbone Of The US Military

The history of technological progress has always been tightly linked to defense technologies, as the military is usually the institution most willing to spend for top-level capacity, with little regard to cost. This has been especially true for the US military, whose strategy is centered around technological superiority converting into significant strategic advantages.

As global geopolitical tensions and conflicts are flaring all over the world, the USA is looking to increase its military budget from the already massive $1T to $1.5 T, and this was a decision taken in January 2026, before the recent escalation of the conflict with Iran.

As a result, the defense industry is expected to show expanding revenues, both from the increased production of existing designs and from being contracted by the Pentagon to develop new weapon platforms.

This has so far greatly benefited aerospace defense companies like Lockheed Martin (LMT -0.99%) and Northrop Grumman (NOC +0.32%) (follow the links for a dedicated investment report on each company). But wars are not won by air power alone, and capacity on the ground and at sea matter as much, if not more, as well as the production of sufficient ammunition, shells, missiles, etc.

This is why another one of the major defense companies, General Dynamics, will likely be the next one to become a major recipient of the Pentagon’s spending.

[securities_stock_chartsymbol=”GD”]

General Dynamics Overview

Swipe to scroll →

General Dynamics is a large defense conglomerate, with a history stretching as far as the early 1900s when one of its parent companies was contracted to build the US Navy’s first submarine. The company was incorporated under its current name in 1952 and has since built nearly every US Navy submarine.

While it had origins in building ships for the US military, a series of mergers and acquisitions also gave it a massive presence in land-based vehicles production, following a general trend of the consolidation of the defense industry into a handful of super-conglomerates.

Source: Gary Johnson

Today, the company is centered around its maritime and land weapon systems, with side activities in the production of private jets and various military-related IT systems.

While it operates in 45 countries, General Dynamics derives up to 72% of its revenues from the US government, with the rest overall coming from close allies of the USA, especially the UK, with the exception of the civilian jet business.

The company has around 117,000 employees, of which around 45,000 are engineers and technicians, and 32,000 are manufacturing and production workers.

In 2025, it generated $52.6B in revenues, with an operating margin of 10.2%

General Dynamics Equipment

Naval Products

The core of the company’s military activity, at least in terms of contract size, is the production of both surface vessels and submarines, as illustrated by its headquarters in Reston, Virginia.

Source: General Dynamics

Its historical core is the production of submarines at its subsidiary Electric Boat, notably the Virginia-class fast-attack and Columbia-class ballistic-missile submarines. This work is done in partnership with Huntington Ingalls Industries (HII +1.39%) (follow the link for a report on this company, which also produces US aircraft carriers).

The US Navy is planning a massive expansion of its capacity, especially reliant on the building of more Columbia and Virginia-class submarines.

Source: Congressional Budget Office

This is a crucial element of the US strategic planning, as it needs to keep up with an extremely quick build-up of naval forces by China.

Source: Next Big Future

In 1995, General Dynamics purchased the privately held Bath Iron Works shipyard in Bath, Maine, which added to its roster the production of guided-missile destroyers.

This includes the backbone of the US Navy surface fleet support fleet, the Arleigh Burke-class destroyers. The Arleigh Burke class has no less than 73 active ships as of October 2023, with nineteen more planned to enter service.

In 1998, the company acquired NASSCO, formerly National Steel and Shipbuilding Company. This shipyard specializes in building commercial cargo ships and auxiliary vessels. This is important as the US Navy has been notoriously short in vessels able to carry oil and ammunition, often having to rely on civilian service providers instead. For example, the company was awarded a contract worth $1.7B for the construction of T-AO 215 and T-AO 216, two new oilers.

Across all its naval branches, the company was awarded $29B in new awards in 2025.

Overall, this segment provides a strong visibility to the company, as most of the shipbuilding contracts are planned years or even decades in advance, leading to a remarkable $52.3B in backlog at the end of 2025.

Source: General Dynamics

Land-Based Products

Vehicles

This segment of the company is split between the US and European land systems and ammunition production. Part of this segment was partially acquired from the merging of Chrysler’s defense divisions (acquired in 1982) and General Motors’ defense divisions (acquired in 2003).

Source: General Dynamics

The US segment is by far the most important, producing some of the core US land military equipment.

The first is the 1,500-horsepower Abrams tank, whose first model started in the late 1970s and is still being upgraded and modernized to this day. It is one of the heaviest tanks in service worldwide, and more than 10,000 units were produced.

Source: General Dynamics

Another important vehicle is the Striker, whose various versions can carry troops, anti-drone weapons, a command station, etc. Around 4,900 Striker vehicles have been produced since 2000. GD also produces light armored vehicles for lighter troop transport.

Source: General Dynamics

Another important vehicle is the UK-made Ajax, poised to replace older and progressively obsolete armored fighting vehicles.

Besides the Ajax, the UK branch also has a series of other vehicles like the EAGLE truck and the Foxhound 4×4. The Madrid-headquartered GDELS subsidiary, with facilities in Switzerland, Germany, Austria, Romania, Denmark, and the Czech Republic, is also producing the tracked vehicle ASCOD and a selection of wheeled vehicles, mobile artillery, bridge trucks.

Ammunition

In a time of intense military operations around the world, the production of weapon systems and vehicles is only as useful as the production of ammunition to keep the military fighting. General Dynamics is a key provider of such materials:

• Ammunition, from small caliber for guns to large calibers for tanks and artillery.
• Missilesand missile sub-components.
• Composite materialsfor aerospace applications.
• Gun barrelsfor aircraft, ship defense systems, and tanks.
• Brushless DC motors
• Active protection systemfor armored vehicles.
• Propellant for artillery shells and missile starters.

Inventory might appear to be a weak link in the military strike against Iran and defense against incoming missiles. This issue is compounding over the previous depletion of inventories by the war in Ukraine.

So more orders to replace consumed ammunition, as well as likely a durably larger stockpile to rebuild in the years to come, are to be expected, and will likely make this segment of General Dynamics more important in the future.

“Analysts say that in a high-intensity war with a near-peer adversary like Iran — where multiple interceptors are often used to defeat a single incoming missile — even a year’s worth of production could be consumed in a matter of weeks, especially after recent drawdowns in Ukraine and the Middle East.”

“Sustained war with Iran could drain US missile stockpiles” – Yahoo Finance

The land vehicles & ammo subsidiary of General Dynamics has seen its order backlog explode at the end of 2025 to $27.2B, driven in large part by robust international demand piling on top of the US military’s demand.

Source: General Dynamics

IT systems & Technology

Military operations have become increasingly sophisticated and connected, tied to a complex “kill chain” that connects satellites, aircraft, air defense, ships, vehicles, and soldiers together. As a result, “cyber” is now considered a new domain of warfare alongside air, sea, land & space.

General Dynamics trusted position in the defense apparatus makes it a partner of choice to implement IT systems in the military for all leading telecom, tech giants and cybersecurity companies.

Source: General Dynamics

For example, it provides the US military with communication systems with encryption at the hardware level.

Source: General Dynamics

The company is also using its Cove AI and Luna AI to improve military IT operations and analyze data, including video and images from classified sources.

With autonomous weapons becoming more and more common and capable, a need to deter this threat is also direly needed. General Dynamics just launched DOGMA AI (Defense Operations Grid Mesh Accelerator) for this very purpose.

The solution is designed for a wide range of applications, including aerial threat detection, critical infrastructure protection, intelligence analysis, border security, natural disaster early warning systems, public safety awareness, transportation optimization, and smart city traffic monitoring.

“DOGMA will enable operators to act on information faster, anticipate emerging threats and maintain decision advantage. Agencies across the government can use this solution to support our nation’s most vital priorities.”

Lastly, the company is developing VITALS (Vehicle Intelligence Tools & Analytics for Logistics and Sustainment), a toolset using AI to improve durability and maintenance of military equipment. It can help with mechanical diagnostics, generate administrative forms, detect part consumption trends, create maintenance plans for the whole vehicle fleet, etc.

Civilian Jets

The Gulfstream line of private jets was acquired by General Dynamics in 1999 for $5.3B. As the company is launching a new family of aircraft with the G-300, new orders came in, with up to $10B in orders.

Source: General Dynamics

This segment also includes Jet Aviation, a service company providing maintenance, repairs, charters, sales, and other services for small jets.

This activity is a profitable one, with operating margins above 13%, with revenues going up following a global surge in demand for this category of airplane.

Robotic And Future Techs

As warfare and technology evolve, so does General Dynamics’ product line-up.

So far, drones have mostly been understood as small flying machines like those seen on the Ukrainian frontline. But increasingly, the idea of UGV (Unmanned Ground Vehicle) is making its way, especially as autonomous vehicles like self-driving cars are becoming increasingly common in civilian applications.

General Dynamics is proposing a few new platforms, with the first one being the S-MET and MUTT, which are designed to provide extra transport capacity for various payloads without requiring a human driver.

Source: General Dynamics

It is also developing a 10-ton tracked Robotic Combat Vehicle (TRX), which could be equipped with a multitude of different tools for combat operations, from SHORAD (short-range air defense) to earthwork, mine clearing, deployment of kamikaze drones, microwave weapons against flying drones, etc.

Source: General Dynamics

The R&D effort of the company relies on a few specialized centers:

• Mission Emerge Center for technologies directly linked to intelligence and defense missions.
• Emerge Innovation Center techs such as artificial intelligence/machine learning, cyber, 5G, software development, and cloud.
• The Cyber and Zero Trust Emerge Lab for cyberdefense.
• The 5G and Advanced Wireless Emerge Lab for advanced telecom.
• The DeepSky Lab for AI and high-performance computing.
• The Biometrics and Identity Lab for Homeland Security.

In addition to internally developed technologies at these Technology Labs, General Dynamics also relies on its Innovation Sourcing Network, an open supplier innovation ecosystem, to provide the company with new ideas from smaller companies. As such, General Dynamics can early on identify and integrate potentially useful new technology, and either license it or acquire the company in question to deploy it for military applications.

Conclusion

General Dynamics has been building many of the workhorses of the US military, from the Abrams and Striker vehicles, to the Arleigh Burke destroyers and Columbia & Virginia-class submarines. None of these is as “flashy” as the F-35 or aircraft carriers programs, but they end up representing the bulk of US military capability.

The company is also a key provider of military equipment to the EU through its local branches, which is re-arming quickly as the war in Ukraine enters its fifth year.

The company has massively invested in producing more equipment, which illustrates its management’s forward thinking.

“As we focus on execution of programs for our customers, we are also preparing aggressively for future growth, investing nearly $1.2 billion in capital expenditures in 2025 – with even more investments planned in the year ahead.”

Phebe N. Novakovic -General Dynamics Chairman and Chief Executive Officer.

Investors in the company have long benefited from a generous dividend program and share repurchases. While these might be put on hold at some point if the US military gets even more engaged in a new conflict, it will still certainly benefit from a situation where its main problem is just not making enough product to sell to satisfy an ever-mounting demand.

Latest General Dynamics (GD) Stock News and Developments