General Dynamics reported nearly $12.91 billion in revenue for the third quarter of 2025, alongside increased submarine production, as indicated during the company’s earnings call on Friday. However, concerns regarding the impact of a prolonged government shutdown tempered these gains.

CEO Phebe Novakovic provided an outlook, stating, “On a company-wide basis, we see annual revenue of around $52 billion and margins of around 10.3 percent.” Despite this positive forecast, she cautioned, “Let me remind you that we’re in the midst of a government shutdown with no end in sight. The longer it lasts, the more it will impact us, particularly the shorter cycle businesses.” She emphasized the difficulties in making accurate forecasts in the current environment.

The consequences of the government shutdown have already begun to affect government workers responsible for contracts. Novakovic noted, “On contracts, in some instances, the contracting people have been sent home. So, that will push contracting into whatever week, quarter, or month that the government resumes.” She highlighted that the company is assessing the situation on a rolling basis, acknowledging the uncertainty around the shutdown’s duration.

If the shutdown continues into next year, multiple lines of business may run out of funding, thereby compounding the company’s challenges. Novakovic concluded, “So, there’s an awful lot of uncertainty, and in that uncertain environment, I think we’re taking a prudent approach.”

In the shipbuilding sector, General Dynamics saw approximately $4.1 billion in revenue growth in the third quarter, which represents an increase of about $497 million compared to the same period last year. This boost was attributed to “increased throughput” in the production of Columbia-class and Virginia-class submarines.

Additionally, the company reported steady progress in building the first Columbia-class submarine, expecting all major modules to be delivered to the Electric Boat facility in Groton, Connecticut. Novakovic stated, “The first Columbia is about 60 percent complete. By the end of this year, we’ll have all the major modules at Groton ready for assembly and test.” She also noted the rigorous testing program ahead and emphasized the collaborative efforts with the Navy and supply chain partners, indicating that the upcoming year will be pivotal for the project.