Aerospace and defense company Huntington Ingalls (NYSE: HII) reported Q2 CY2026 results topping the market’s revenue expectations, with sales up 10.9% year on year to $3.42 billion. Its GAAP profit of $5.27 per share was 37.6% above analysts’ consensus estimates.
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Huntington Ingalls (HII) Q2 CY2026 Highlights:
- Revenue: $3.42 billion vs analyst estimates of $3.16 billion (10.9% year-on-year growth, 8.2% beat)
- EPS (GAAP): $5.27 vs analyst estimates of $3.83 (37.6% beat)
- Operating Margin: 6.1%, in line with the same quarter last year
- Free Cash Flow was -$153 million, down from $730 million in the same quarter last year
- Market Capitalization: $11.05 billion
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 is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, Huntington Ingalls’s sales grew at a mediocre 6.6% compounded annual growth rate over the last five years. This was below our standard for the industrials sector and is a rough starting point for our analysis.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Huntington Ingalls’s annualized revenue growth of 5.8% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak. 
This quarter, Huntington Ingalls reported year-on-year revenue growth of 10.9%, and its $3.42 billion of revenue exceeded Wall Street’s estimates by 8.2%.
Looking ahead, sell-side analysts expect revenue to grow 1.3% 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 see some demand headwinds.
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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.
Analyzing the trend in its profitability, Huntington Ingalls’s operating margin might have 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.
In Q2, Huntington Ingalls generated an operating margin profit margin of 6.1%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.
Sadly for Huntington Ingalls, its EPS declined by 1.9% annually over the last five years while its revenue grew by 6.6%. 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 shorter period to see if we are missing a change in the business.
For Huntington Ingalls, its two-year annual EPS declines of 5.7% show it’s continued to underperform. These results were bad no matter how you slice the data.
In Q2, Huntington Ingalls reported EPS of $5.27, up from $3.86 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Huntington Ingalls’s full-year EPS to grow 13.1% from $16.78 to $18.98.
Key Takeaways from Huntington Ingalls’s Q2 Results
It was good to see Huntington Ingalls beat analysts’ EPS expectations this quarter. We were also excited its revenue outperformed Wall Street’s estimates by a wide margin. Zooming out, we think this quarter featured some important positives. The stock traded up 12.3% to $315 immediately after reporting.
Sure, Huntington Ingalls had a solid quarter, but if we look at the bigger picture, is this stock a buy? 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).
