Total backlog increased from $48.1 billion in 2023 to $48.7 billion in 2024. The company expects approximately 21% of this backlog to be converted into sales during 2025.

In January 2025, the Company acquired substantially all of the assets of W International, a South Carolina-based complex metal fabricator specializing in the manufacture of shipbuilding structures, modules, and assemblies. The acquired manufacturing facility operates within the Newport News segment.

During the third quarter of 2024, the Company identified certain quality issues involving noncompliance with welding procedures at Newport News. The Company has commenced an investigation and disclosed the matter to the U.S. Government.

The company states that they continue to see uncertainty in the economy, their industry, and their company and that their results for the year were adversely affected by significant challenges relating to labor availability, their supply chain, and inflation, among other challenges.

The company derives substantially all of its revenue from the U.S. Government, making it vulnerable to changes in government spending and priorities.

The company's operating income is adversely affected when they incur certain contract costs or certain increases in contract costs that cannot be billed to customers.

The company has significant operations located in regions of the United States that have been and may in the future be exposed to damaging storms, such as hurricanes and floods, the intensity and frequency of which are being exacerbated by climate change, other impacts of climate change, including rising sea waters, and environmental disasters, such as oil spills.

The shipbuilding business operates in a highly competitive market, in part, due to the limited number of U.S. shipyards that compete for contracts to construct, overhaul, repair, maintain, and convert naval vessels.

The company may compete in the future with the same contractor and other shipyards to build new and different classes of ships, as well as ships for which they are currently the sole source, including expeditionary warfare and amphibious assault ships.

The company expects that it will need to increase its shipbuilding capacity to meet current and future production demands and is utilizing and may in the future utilize one or more strategies to increase such capacity including, among others, increasing investment in our current shipyards, identifying and retaining additional qualified personnel, utilizing third parties to support production needs and identifying efficiencies in our current production process to support increased production.

The company relies on third parties to provide raw materials, major components and sub-systems, hardware elements, and sub-assemblies for our products and to perform certain services we provide to our customers, in compliance with applicable laws and regulations, including applicable DoD cybersecurity requirements.

The company utilizes artificial intelligence, including generative artificial intelligence, machine learning, and similar tools and technologies that collect, aggregate, analyze, or generate data or other materials or content in connection with its business.

The board of directors authorized an increase in the quarterly cash dividend to $1.35 per share in November 2024. The company paid cash dividends totaling $206 million in 2024.

The board authorized an increase in the stock repurchase program to $3.8 billion in January 2024. The company repurchased 607,841 shares at an aggregate cost of $163 million in 2024.

For 2025, the company expects its capital expenditures for maintenance and sustainment to be approximately 1.5% of annual revenues and its discretionary capital expenditures to be approximately 2.0% to 2.5% of annual revenues.

Changes in environmental and climate-related laws or regulations, including regulations on greenhouse gas emissions, carbon pricing, energy taxes, product efficiency standards, mandatory disclosure obligations, and other requirements, could increase our operational and compliance expenditures and those of our suppliers, including increased energy and raw materials costs and costs associated with manufacturing changes.

The global geopolitical environment continues to be impacted by uncertainty, heightened tensions, and instability, all of which drive the increasing need for defense offerings, including those provided by our company. Adverse economic conditions in the United States and globally could also impact the business.