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What changed in General Dynamics's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of General Dynamics's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+242 added−243 removedSource: 10-K (2025-02-07) vs 10-K (2024-02-08)

Top changes in General Dynamics's 2024 10-K

242 paragraphs added · 243 removed · 197 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

77 edited+19 added−24 removed66 unchanged
Biggest changeWe also operate a 24/7 year-round customer support center and offer on-call Gulfstream aircraft technicians ready to deploy around the world for customer service requirements under our Field and Airborne Support Team (FAST) rapid-response unit. 5 In addition to expanding the reach of Gulfstream’s aircraft maintenance network outside the United States, Jet Aviation provides a comprehensive suite of innovative aircraft services for aircraft owners and operators around the world.
Biggest changeWe continue to invest in these maintenance, repair and overhaul (MRO) facilities and inventory to accommodate fleet growth. We also operate a 24/7 year-round customer support center and offer on-call Gulfstream aircraft technicians ready to deploy around the world for customer service requirements under our Field and Airborne Support Team (FAST) rapid-response unit.
Over the past decade, we have invested in our business to create, renew or expand our portfolio of products and services across our businesses. This includes product development investments in Aerospace to bring to market an all-new lineup of business jet aircraft, capital investments in Marine Systems to support significant growth in U.S.
Over the past decade, we have invested to create, renew or expand our portfolio of products and services across our businesses. This includes product development investments in Aerospace to bring to market an all-new lineup of business jet aircraft, capital investments in Marine Systems to support significant growth in U.S.
These include advanced fire-control and weapon launch systems, tactical control systems, specialized hardware and software solutions for acoustics, cybersecurity, torpedo guidance and other core capabilities that are essential for submarine modernization with U.S. and allied forces. Mission Systems also continues to invest in autonomous capabilities both undersea and in the air.
These include advanced fire-control and weapon launch systems, tactical control systems, specialized hardware and software solutions for acoustics, cybersecurity, and torpedo guidance, and other core capabilities that are essential for submarine modernization with U.S. and allied forces. Mission Systems also continues to invest in autonomous capabilities both undersea and in the air.
The 10 highly lethal, survivable and mobile direct-fire combat vehicle melds recently developed and battle-tested designs to dominate ground threats on the multi-domain battlefield. Combat Systems provides similar capabilities for U.S. allies and partners through export opportunities and through our operations in several countries around the world, including Canada, the United Kingdom, Spain, Switzerland, Austria, Germany and Romania.
The highly lethal, survivable and mobile direct-fire combat vehicle melds recently developed and battle-tested designs to dominate ground threats on the multi-domain battlefield. Combat Systems provides similar capabilities for U.S. allies and partners through export opportunities and through our operations in several countries around the world, including Canada, the United Kingdom, Spain, Switzerland, Austria, Germany and Romania.
We also operate one of the world’s largest custom completion and refurbishment centers for both narrow- and wide-body aircraft and perform modifications, upgrades and lifecycle sustainment support for various government fleets. We continue to grow our global footprint through acquisitions, expansions and significant renovations in strategic business aviation markets most frequented by these customers.
We also operate one of the world’s largest custom completion and refurbishment centers for both narrow- and wide-body aircraft and perform modifications, upgrades and lifecycle sustainment support for various government fleets. We continue to grow our global footprint through acquisitions, expansions and significant renovations in strategic business aviation markets most 5 frequented by these customers.
NASSCO conducts full-service maintenance and surface-ship repair operations in Navy fleet concentration areas in San Diego, California; Norfolk, Virginia; Bremerton, Washington; and Mayport, Florida. Electric Boat provides submarine maintenance and modernization services in a variety of U.S. locations, and Bath Iron Works provides lifecycle support services for Navy surface ships in both U.S. and overseas ports.
NASSCO conducts full-service maintenance and surface-ship repair operations in Navy fleet concentration areas in San Diego, California; Norfolk, Virginia; Bremerton, Washington; and Mayport, Florida. Electric Boat provides submarine maintenance and modernization services in a variety of U.S. locations, and Bath Iron Works provides lifecycle support services for Navy surface ships in U.S. and overseas ports.
Based on information currently available and current U.S. government policies relating to cost recovery, we do not expect continued compliance with environmental regulations, including costs associated with changes in environmental and climate change laws or regulations, to have a material impact on our 20 results of operations, financial condition or cash flows.
Based on information currently available and current U.S. government policies relating to cost recovery, we do not expect continued compliance with environmental regulations, including costs associated with changes in environmental and climate change laws or regulations, to have a material impact on our results of operations, financial condition or cash flows.
Gulfstream also offers operators the ability to achieve carbon-neutral travel by facilitating the 6 purchase of carbon-offset credits. In addition to actively expanding the availability of SAF at its FBO locations, Jet Aviation allows customers to purchase SAF at locations where it is not available through a book-and-claim system.
Gulfstream also offers operators the ability to achieve carbon-neutral travel by facilitating the purchase of carbon-offset credits. In addition to actively expanding the availability of SAF at its FBO locations, Jet Aviation allows customers to purchase SAF at locations where it is not available through a book-and-claim system.
Ten of the boats in Block V will include the Virginia Payload Module, an 84-foot Electric Boat-designed-and-built hull section that adds four additional payload tubes, more than tripling the strike capacity of these submarines and providing unique capabilities to support special missions.
Ten of the planned boats in Block V will include the Virginia Payload Module, an 84-foot Electric Boat-designed-and-built hull section that adds four additional payload tubes, more than tripling the strike capacity of these submarines and providing unique capabilities to support special missions.
For additional information relating to the impact of environmental matters, see Note M to the Consolidated Financial Statements in Item 8. AVAILABLE INFORMATION We file reports and other information with the Securities and Exchange Commission (SEC) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the Exchange Act).
For additional information relating to the impact of environmental matters, see Note M to the Consolidated Financial Statements in Item 8. 19 AVAILABLE INFORMATION We file reports and other information with the Securities and Exchange Commission (SEC) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the Exchange Act).
We have invested significant capital over the past several years in expanded and modernized facilities at Electric Boat to support the growth in submarine construction, and will work with our Navy 7 customer on any additional construction needs that could develop in light of increased submarine demand.
We have invested significant capital over the past several years in expanded and modernized facilities at Electric Boat to support the growth in submarine construction, and will work with our Navy customer on any additional construction needs that could develop in light of increased submarine demand.
The Aerospace segment competes worldwide in the business jet aircraft services market primarily on the basis of quality, price and timeliness. While competition for each type of service varies somewhat, the segment faces a number of competitors of varying sizes for each of its offerings. 17 INTELLECTUAL PROPERTY We develop technology, manufacturing processes and systems-integration practices.
The Aerospace segment competes worldwide in the business jet aircraft services market primarily on the basis of quality, price and timeliness. While competition for each type of service varies somewhat, the segment faces a number of competitors of varying sizes for each of its offerings. 16 INTELLECTUAL PROPERTY We develop technology, manufacturing processes and systems-integration practices.
We have earned our reputation through: • superior aircraft design, quality, performance, safety and reliability; • technologically advanced flight deck and cabin systems; and • industry-leading customer support. 3 We believe the key to long-term value creation in the business jet industry is steady investment in new aircraft models and technologies and in customer service capabilities.
We have earned our reputation through: • superior aircraft design, manufacturing excellence, quality, performance, safety and reliability; • technologically advanced flight deck and cabin systems; and • industry-leading customer support. 3 We believe the key to long-term value creation in the business jet industry is steady investment in new aircraft models and technologies and in customer service capabilities.
Our training and development efforts focus on ensuring that our people are appropriately trained on critical job skills as well as on leadership behaviors that are consistent with our Ethos. We conduct rigorous succession planning exercises to ensure that key positions have the appropriate level of 18 bench strength to provide for future key positions and leadership transitions.
Our training and development efforts focus on ensuring that our people are appropriately trained on critical job skills as well as on leadership behaviors that are consistent with our Ethos. We conduct rigorous succession planning exercises to ensure that key positions have the appropriate level of 17 bench strength to provide for future key positions and leadership transitions.
With approximately 50 locations throughout North America, Europe, the Middle East and the Asia-Pacific region, our offerings include maintenance, completion, aircraft management, charter, staffing and fixed-base operator (FBO) services. Jet Aviation manages approximately 300 business aircraft globally on behalf of individuals and corporate owners.
With approximately 50 locations throughout North America, Europe, the Middle East and the Asia-Pacific region, our offerings include maintenance, completion, aircraft management, charter, staffing and fixed-base operator (FBO) services. Jet Aviation manages approximately 310 business aircraft globally on behalf of individuals and corporate owners.
The mid-cabin G280 is assembled by a non-U.S. partner. All models are outfitted in Gulfstream’s U.S. facilities. As Gulfstream’s aircraft portfolio and customer base have grown and become increasingly global in reach over the years, we have invested in our facilities and operations around the world.
The mid-cabin G280 is assembled by a non-U.S. partner. All models are outfitted in Gulfstream’s and Jet Aviation’s facilities. As Gulfstream’s aircraft portfolio and customer base have grown and become increasingly global in reach over the years, we have invested in our facilities and operations around the world.
For a supplemental discussion of segment performance and backlog, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7. AEROSPACE Our Aerospace segment is recognized as a leading producer of business jets and the standard bearer in new technology aircraft, aircraft repair, support and completion services.
For a supplemental discussion of segment performance and backlog, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7. AEROSPACE Our Aerospace segment is recognized as a leading producer of business jets and the standard bearer in new technology aircraft, aircraft repair, customer support and custom completion services.
Land Systems is the sole-source producer of two foundational products central to the U.S. Army’s warfighting capabilities — the Abrams main battle tank and Stryker wheeled combat vehicle. Both of these platforms are core components of the multi-domain, joint war fight envisioned on the battlefield of the future.
Land Systems is the sole-source producer of two foundational products central to the U.S. Army’s warfighting capabilities — the Abrams main battle tank and Stryker wheeled combat vehicle. Both of these platforms are core components of the multi-domain, joint war fight in practice today and envisioned on the battlefield of the future.
The U.S. Space Development Agency (SDA) selected Mission Systems to establish the ground operations and integration segment for Tranche 1 of the National Defense Space Architecture by building ground entry points and operations centers, as well as providing network operations and systems integration services for the SDA’s next tranche of proliferated low-earth orbit satellites.
Space Development Agency (SDA) selected Mission Systems to establish the ground operations and integration segment for Tranche 1 and 2 of the National Defense Space Architecture by building ground entry points and operations centers, as well as providing network operations and systems integration services for the SDA’s next tranche of proliferated low-Earth orbit satellites.
Additionally, we have developed the Tracked Robot 10-ton (TRX) prototype, a medium-sized, semi-autonomous combat vehicle that enables critical battlefield roles, such as direct and indirect fire, autonomous resupply, reconnaissance and other battlefield missions. 11 On December 31, 2023, the installed base for our major vehicle programs, as well as the quantity and scheduled final delivery date of vehicles and vehicle upgrades in backlog were as follows: Complementing these military-vehicle offerings, OTS designs, develops and produces a comprehensive array of sophisticated weapon systems for ground forces.
Additionally, we have developed the Tracked Robot 10-ton (TRX) prototype, a medium-sized, semi-autonomous combat vehicle that enables critical battlefield roles, such as direct and indirect fire, autonomous resupply, reconnaissance and other battlefield missions. 10 On December 31, 2024, the installed base for our major vehicle programs, as well as the quantity and scheduled final delivery date of vehicles and vehicle upgrades in backlog were as follows: Complementing these military-vehicle offerings, OTS designs, develops and produces a comprehensive array of sophisticated weapon systems and munitions.
In addition, we support a variety of manned and unmanned aerial vehicle (UAV) platforms with mission-critical processing and security subsystems on both modern combat and ISR aircraft as well as emerging capabilities like the Collaborative Combat Aircraft. Revenue for the Technologies segment was 31% of our consolidated revenue in 2023, 32% in 2022 and 33% in 2021.
In addition, we support a variety of manned aircraft and unmanned aerial vehicle (UAV) platforms with mission-critical processing and security subsystems on both modern combat and ISR aircraft as well as emerging capabilities like the Collaborative Combat Aircraft. Revenue for the Technologies segment was 27% of our consolidated revenue in 2024, 31% in 2023 and 32% in 2022.
In support of our Navy customer’s significant increase in demand for submarines and surface ships, we are making substantial investments to expand our facilities, grow and train our workforce, and expand our supply chain. The resulting increase in capacity and capabilities will support the unprecedented growth expected in our shipbuilding business, particularly submarines, over the next two decades.
In support of our Navy customer’s significant increase in demand for submarines and surface ships, we have made substantial investments to expand our facilities, grow and train our workforce, and expand our supply chain. The resulting increase in capacity and capabilities will support the unprecedented growth expected in our shipbuilding business, particularly submarines, over the next two decades.
For information on the advantages and disadvantages of each of these contract types, see Note B to the Consolidated Financial Statements in Item 8. U.S. COMMERCIAL Our U.S. commercial revenue was $5.8 billion in 2023, $5.7 billion in 2022 and $4.8 billion in 2021, which represented 14%, 15% and 12% of our consolidated revenue in each of the respective years.
For information on the advantages and disadvantages of each of these contract types, see Note B to the Consolidated Financial Statements in Item 8. U.S. COMMERCIAL Our U.S. commercial revenue was $6.7 billion in 2024, $5.8 billion in 2023 and $5.7 billion in 2022, which represented 14%, 14% and 15% of our consolidated revenue in each of the respective years.
Our revenue from non-U.S. government and commercial customers was $6.1 billion in 2023, $6 billion in 2022 and $6.8 billion in 2021, which represented 14% of our consolidated revenue in 2023, 15% in 2022 and 18% in 2021. We conduct business with customers around the world.
Our revenue from non-U.S. government and commercial customers was $8 billion in 2024, $6.1 billion in 2023 and $6 billion in 2022, which represented 17% of our consolidated revenue in 2024, 14% in 2023 and 15% in 2022. We conduct business with customers around the world.
Accordingly, the program has received the highest possible rating from the government’s Defense Priorities and Allocations System. These submarines will provide strategic deterrent capabilities for decades, with the first boat scheduled for delivery in 2027 to begin replacement of the current Ohio-class ballistic-missile submarine fleet as it reaches the end of its service life.
Accordingly, the program has received the highest possible rating from the government’s Defense Priorities and Allocations System. These submarines will provide strategic deterrent capabilities for decades, with the first boat expected to deliver in 2028 to begin replacement of the current Ohio-class ballistic-missile submarine fleet as it reaches the end of its service life.
While the installed base of aircraft is concentrated in North America, orders from 16 customers outside North America represent a significant portion of our aircraft business with approximately 40% of the Aerospace segment’s aircraft backlog on December 31, 2023. COMPETITION Several factors determine our ability to compete successfully in the defense and business aviation markets.
While the installed base of aircraft is concentrated in North America, orders from 15 customers outside North America represent a significant portion of our aircraft business with approximately 43% of the Aerospace segment’s aircraft backlog on December 31, 2024. COMPETITION Several factors determine our ability to compete successfully in the defense and business aviation markets.
We listen to our people to assess areas of concern and levels of engagement. 2023 WORKFORCE STATISTICS • Approximately 84% of our employees are based in the United States, of which roughly 70% are white, 30% are people of color, 19% are veterans of the U.S. armed forces and 8% have self-reported having a disability.
We listen to our people to assess areas of concern and levels of engagement. 2024 WORKFORCE STATISTICS • Approximately 84% of our employees are based in the United States, of which roughly 69% are white, 31% are people of color, 19% are veterans of the U.S. armed forces and 8% have self-reported having a disability.
Our Unmanned Undersea Vehicle (UUV) Manufacturing and Assembly Center of Excellence provides manufacturing, assembly, integration and testing capabilities for Mission Systems’ Knifefish and Bluefin Robotics UUVs, as well as the Hammerhead program for the Navy.
Our Unmanned Undersea Vehicle (UUV) Manufacturing and Assembly Center of Excellence provides manufacturing, assembly, integration and testing capabilities for Mission Systems’ Bluefin Robotics UUVs, as well as the Hammerhead and MEDUSA programs for the Navy.
We have completed fielding these vehicles for the second of nine Army brigades, as well as for the Army’s Ranger Regiment. In addition, coordination continues with the Army for next-generation upgrades to the platform and new uses for the vehicle.
We have completed fielding these vehicles for four of the current eight Army brigades, as well as for the Army’s Ranger Regiment. In addition, coordination continues with the Army for next-generation upgrades to the platform and new uses for the vehicle.
In support of allied navies, we offer program management, planning, engineering and design support for submarine construction programs. Revenue for the Marine Systems segment was 29% of our consolidated revenue in 2023, 28% in 2022 and 27% in 2021.
In support of allied navies, we offer program management, planning, engineering and design support for submarine construction programs. 8 Revenue for the Marine Systems segment was 30% of our consolidated revenue in 2024, 29% in 2023 and 28% in 2022.
The Technologies segment leverages its scale, partnerships and deep knowledge of its customers’ missions and challenges to bring innovation to those customers across a portfolio of thousands of contracts. While no individual contract is material to the segment’s results, the following highlights provide a sampling of the value of this business.
The Technologies segment leverages its scale, partnerships and deep knowledge of its customers’ missions and challenges to bring innovation to those customers across a portfolio of thousands of contracts. While no individual contract is material to the segment’s results, the following highlights provide a sampling of the value of this business. In the defense market, GDIT is modernizing the U.S.
Revenue by major products and services was as follows: Year Ended December 31 2023 2022 2021 Nuclear-powered submarines $ 8,631 $ 7,310 $ 7,117 Surface ships 2,698 2,561 2,328 Repair and other services 1,132 1,169 1,081 Total Marine Systems $ 12,461 $ 11,040 $ 10,526 9 COMBAT SYSTEMS Our Combat Systems segment is a premier manufacturer and integrator of land combat solutions worldwide, including wheeled and tracked combat vehicles, weapons systems and munitions.
Revenue by major products and services was as follows: Year Ended December 31 2024 2023 2022 Nuclear-powered submarines $ 10,392 $ 8,631 $ 7,310 Surface ships 2,819 2,698 2,561 Repair and other services 1,132 1,132 1,169 Total Marine Systems $ 14,343 $ 12,461 $ 11,040 COMBAT SYSTEMS Our Combat Systems segment is a premier manufacturer and integrator of land combat solutions worldwide, including wheeled and tracked combat vehicles, weapons systems and munitions.
Our investment included development of a new wing, new avionics, 4 new fuselage and new ergonomically designed larger interiors, as well as systems and technologies to improve the manufacturing process and quality of the platform.
Our investment in the development of these aircraft included a new wing, new avionics, new fuselage and new ergonomically designed larger interiors, as well as systems and technologies to improve the manufacturing process and quality of the aircraft.
Since 2019, Jet Aviation has uploaded more than 10 million gallons of blended SAF to its customers. Revenue for the Aerospace segment was 20% of our consolidated revenue in 2023, 22% in 2022 and 21% in 2021.
Since 2019, Jet Aviation has uploaded more than 11 million gallons of blended SAF to its customers. Revenue for the Aerospace segment was 24% of our consolidated revenue in 2024, 20% in 2023 and 22% in 2022.
HUMAN CAPITAL MANAGEMENT Our company is a global community of approximately 111,600 employees dedicated to our Ethos of transparency, trust, honesty and alignment.
HUMAN CAPITAL MANAGEMENT Our company is a global community of approximately 117,000 employees dedicated to our Ethos of transparency, trust, honesty and alignment.
Revenue by major products and services was as follows: Year Ended December 31 2023 2022 2021 Aircraft manufacturing $ 5,710 $ 5,876 $ 5,864 Aircraft services 2,911 2,691 2,271 Total Aerospace $ 8,621 $ 8,567 $ 8,135 MARINE SYSTEMS Our Marine Systems segment is the leading designer and builder of nuclear-powered submarines and a leader in surface combatant and auxiliary ship design and construction for the U.S.
Revenue by major products and services was as follows: Year Ended December 31 2024 2023 2022 Aircraft manufacturing $ 7,811 $ 5,710 $ 5,876 Aircraft services 3,438 2,911 2,691 Total Aerospace $ 11,249 $ 8,621 $ 8,567 6 MARINE SYSTEMS Our Marine Systems segment is the leading designer and builder of nuclear-powered submarines and a leader in surface combatant and auxiliary ship design and construction for the U.S.
Of our U.S. government revenue, fixed-price contracts accounted for 53% in 2023, 56% in 2022 and 57% in 2021; cost-reimbursement contracts accounted for 41% in 2023, 38% in 2022 and 36% in 2021; and time-and-materials contracts accounted for 6% in 2023 and 2022, and 7% in 2021.
Of our U.S. government revenue, fixed-price contracts accounted for 51% in 2024, 53% in 2023 and 56% in 2022; cost-reimbursement contracts accounted for 43% in 2024, 41% in 2023 and 38% in 2022; and time-and-materials contracts accounted for 6% in 2024, 2023 and 2022.
Land Systems continues to develop upgrades and enhancements to this highly versatile and combat-proven platform to address the Army’s evolving operational needs. We are currently fielding an enhanced Stryker platform that includes the double-V-hull for survivability, increased power, improved cross-country mobility and an advanced digital, in-vehicle network.
The Stryker is an eight-wheeled, medium-weight combat vehicle that combines lethality, mobility and survivability. Land Systems continues to develop upgrades and enhancements to this highly versatile and combat-proven platform to address the Army’s evolving operational needs. We are currently fielding a Stryker platform that includes enhanced survivability, increased power, improved cross-country mobility and an advanced digital, in-vehicle network.
Our revenue from the U.S. government was as follows: Year Ended December 31 2023 2022 2021 DoD $ 24,720 $ 22,250 $ 21,386 Non-DoD 4,711 4,808 4,862 Foreign military sales (FMS)* 896 633 598 Total U.S. government $ 30,327 $ 27,691 $ 26,846 % of total revenue 72 % 70 % 70 % * In addition to our direct non-U.S. sales, we sell to non-U.S. governments through the FMS program.
Our revenue from the U.S. government was as follows: Year Ended December 31 2024 2023 2022 DoD $ 27,191 $ 24,720 $ 22,250 Non-DoD 4,810 4,711 4,808 Foreign military sales (FMS)* 1,063 896 633 Total U.S. government $ 33,064 $ 30,327 $ 27,691 % of total revenue 69 % 72 % 70 % * In addition to our direct non-U.S. sales, we sell to non-U.S. governments through the FMS program.
In 2023, OTS received awards to expand its existing metal parts production capacity from 18,000 to 86,000 rounds per month by 2025 and expand existing propellant capacity from 4 million to 16 million pounds per year by 2028 while establishing capacity for 155mm load, assemble, and pack (LAP) to 50,000 rounds per month by 2025.
OTS is expanding its existing metal parts production capacity from 36,000 to 86,000 rounds per month in 2025 and its existing propellant capacity from 5 million to 16 million pounds per year by 2028 while establishing capacity for 155mm load, assemble, and pack (LAP) of 50,000 rounds per month in 2025.
Revenue by major products and services was as follows: Year Ended December 31 2023 2022 2021 IT services $ 8,459 $ 8,195 $ 8,069 C5ISR solutions 4,463 4,297 4,388 Total Technologies $ 12,922 $ 12,492 $ 12,457 CUSTOMERS In 2023, 72% of our consolidated revenue was from the U.S. government, 14% was from U.S. commercial customers, 8% was from non-U.S. government customers and the remaining 6% was from non-U.S. commercial customers. 15 U.S.
Revenue by major products and services was as follows: Year Ended December 31 2024 2023 2022 IT services $ 8,761 $ 8,459 $ 8,195 C5ISR solutions 4,366 4,463 4,297 Total Technologies $ 13,127 $ 12,922 $ 12,492 CUSTOMERS In 2024, 69% of our consolidated revenue was from the U.S. government, 14% was from U.S. commercial customers, 10% was from non-U.S. government customers and the remaining 7% was from non-U.S. commercial customers. 14 U.S.
Leveraging our rapid prototyping expertise and customer intimacy, we continue to expand the mission capabilities of this platform, including an air defense mission package (M-SHORAD), a state-of-the-art electronic warfare suite, a high-energy laser, a high-power microwave, and several command post options.
We continue to expand the mission capabilities of this platform, including an air defense mission package (Sergeant Stout, formerly known as M-SHORAD), a state-of-the-art electronic warfare suite, a high-energy laser, a high-power microwave and several command post options.
Our products and solutions are built into platforms and integrated systems on which our customers rely. The business’ portfolio includes both prime contract programs with government customers as well as subcontract positions with large platform providers to develop and integrate technologies to make their systems smarter and more secure.
The business’ portfolio includes both prime contract programs with government customers as well as subcontract positions with large platform providers to develop and integrate technologies to make their systems smarter and more secure.
We are also subject to regulations governing investments, exchange controls, repatriation of earnings and import-export control. BUSINESS JET AIRCRAFT The Aerospace segment is subject to FAA regulation in the United States and other similar aviation regulatory authorities internationally, including the Civil Aviation Administration of Israel (CAAI), the European Aviation Safety Agency (EASA) and the Civil Aviation Administration of China (CAAC).
BUSINESS JET AIRCRAFT The Aerospace segment is subject to FAA regulation in the United States and other similar aviation regulatory authorities internationally, including the Civil Aviation Administration of Israel (CAAI), the European Aviation Safety Agency (EASA) and the Civil Aviation Administration of China (CAAC).
The segment is organized into two business units — Information Technology (GDIT) and Mission Systems. Together they serve a wide range of military, intelligence, federal civilian and state customers with a diverse portfolio that includes: • consulting, technology solutions and mission-support services; • mobile communication, computers, command-and-control and cyber (C5) mission systems; and • intelligence, surveillance and reconnaissance (ISR) solutions.
The segment is organized into two business units — Information Technology (GDIT) and Mission Systems — with a diverse portfolio that includes: • consulting, technology solutions and mission-support services; • mobile communication, computers, command-and-control and cyber (C5) mission systems; and • intelligence, surveillance and reconnaissance (ISR) solutions. Over the past decade, the U.S.
We have developed the Multi-Utility Tactical Transport (MUTT), a semi-autonomous robotic platform that can be equipped with an array of modular mission payloads for use alongside dismounted soldiers. This platform was selected as the Army’s first robotic vehicle program of record and is officially designated as the Small Multipurpose Equipment Transport (S-MET).
We have developed semi-autonomous robotic platforms that can be equipped with an array of modular mission payloads for use alongside dismounted soldiers. The Army’s first robotic vehicle program of record, the Small Multipurpose Equipment Transport (S-MET), is based on a Land Systems-developed autonomous vehicle.
RAW MATERIALS AND SUPPLIERS We depend on suppliers and subcontractors for raw materials, components and subsystems. Our U.S. government customer is a supplier for some of our programs. These supply networks can experience price fluctuations and capacity constraints, which can put pressure on our costs.
Our U.S. government customer is a supplier for some of our programs. These supply networks can experience price fluctuations and capacity constraints, which can put pressure on our costs. Effective management and oversight of suppliers and subcontractors is an important element of our successful performance.
As a result, the G500 and G600 are faster, more fuel efficient, and have greater cabin volume, reduced emissions, more range and improved flight controls compared with the aircraft they are replacing. These aircraft hold more than 90 city-pair speed records, and at year-end 2023, cumulative deliveries for the aircraft totaled over 250.
As a result, the G500 and G600 are faster, more fuel efficient, and have greater cabin volume, reduced emissions, more range and improved flight controls compared with the aircraft they replaced. At year-end 2024, cumulative deliveries of the G500 and G600 aircraft totaled more than 300.
Equal to the commitment of capital is our commitment to developing our Electric Boat workforce. While the steepest portion of our personnel ramp is behind us, we still expect the Electric Boat workforce to continue to grow to enable sustained production of one Columbia-class submarine plus two Virginia-class submarines per year and have the capacity to support additional AUKUS-related demand.
While the steepest portion of our personnel ramp is behind us, we still expect the Electric Boat workforce to continue to grow to enable sustained production of one Columbia-class submarine plus up to two Virginia-class submarines per year as the submarine industrial base expands to support that pace.
Additionally, OTS maintains a leading position providing 12 missile subsystems in support of U.S. tactical and strategic missiles, provisioning both legacy and next-generation missiles with critical aerostructures, control actuators, high-performance warheads, and cutting-edge hypersonic rocket cases. Revenue for the Combat Systems segment was 20% of our consolidated revenue in 2023, 18% in 2022 and 19% in 2021.
OTS is the systems integrator for the next generation of artillery solutions in support of the Army’s Indirect Fire Modernization objectives. Additionally, OTS maintains a leading position providing missile subsystems in support of U.S. tactical and strategic missiles, provisioning both legacy and next- 11 generation missiles with critical aerostructures, control actuators, high-performance warheads, and cutting-edge hypersonic rocket cases.
These clean-sheet (i.e., all-new) aircraft replace the G450 and G550 models, whose combined family has an installed base of more than 1,650 aircraft around the world.
The G500 and G600 entered service in 2018 and 2019, respectively. These clean sheet aircraft replaced the G450 and G550 models, whose combined family has an installed base of more than 1,650 aircraft around the world.
The remaining 16% of our workforce is based internationally in over 65 countries with the primary concentrations being in North America and Europe. Approximately 22% of our workforce is represented by collective bargaining agreements.
The remaining 16% of our workforce is based internationally in over 65 countries with the primary concentrations being in North America and Europe. Approximately 21% of our workforce is represented by collective bargaining agreements. • Our global workforce is 76% male and 24% female, and our senior leadership teams across the business are represented by 75% males and 25% females.
Over the past decade, the U.S. Department of Defense (DoD), the intelligence community and federal civilian agencies have increasingly prioritized technology solutions as a critical element of their missions, transforming technology resources from back-office support functions to a strategic priority for this customer community.
Department of Defense (DoD), the intelligence community and federal civilian agencies have increasingly prioritized technology solutions as a critical element of their missions, transforming technology resources from back-office support functions to a strategic priority. Expanded cyber threats and the demand for advanced warfighter connectivity have accelerated these trends, adding urgency to required technology investments.
Land Systems is producing 399 new LAVs for the Canadian army in eight variants, including ambulances, command posts, maintenance and recovery vehicles, and troop-carrying vehicles, as well as upgrading its existing fleet. Land Systems is also producing the British Army’s Ajax armored fighting vehicle, a next-generation, medium-weight tracked combat vehicle.
Land Systems is producing 449 new LAVs for the Canadian army in eight variants, including ambulances, command posts, maintenance and recovery vehicles, and troop-carrying vehicles, as well as upgrading Canada’s existing fleet.
Along with strong contributions from the states of Connecticut and Rhode Island, we continue to invest in the training and tools necessary for our employees to deliver these next-generation submarines to the Navy on time and on budget.
Along with strong contributions from the states of Connecticut and Rhode Island, we continue to invest in the training and tools necessary for our skilled employees to deliver these next-generation submarines to the Navy. We continue to work with our growing network of approximately 3,000 suppliers to support the growth related to concurrent production of the two submarine programs.
The FAR and CAS subject us to audits and other government reviews covering issues such as cost, performance, internal controls and accounting practices relating to our contracts. NON-U.S. REGULATORY Our non-U.S. operations are subject to the applicable government regulations and procurement policies and practices, as well as U.S. policies and regulations.
In addition, the FAR addresses the allowability of our costs, while the CAS addresses the allocation of those costs to contracts. The FAR and CAS subject us to audits and other government reviews 18 covering issues such as cost, performance, internal controls and accounting practices relating to our contracts. NON-U.S.
The next model to join the Gulfstream lineup is the ultra-long-range, ultra-large-cabin G700. It combines our most spacious cabin with our advanced Symmetry Flight Deck, the industry’s most technologically advanced flight deck, which we launched on our G500 and G600 aircraft, and the superior high-speed performance of all-new engines to create best-in-class capabilities.
The most recent addition to the in-service Gulfstream fleet is the ultra-long-range, ultra-large-cabin G700, which entered service following U.S. Federal Aviation Administration (FAA) certification in March 2024. It combines our most spacious cabin with our advanced Symmetry Flight Deck, the industry’s most technologically advanced flight deck, and the superior high-speed performance of all-new engines to create best-in-class capabilities.
Revenue by major products and services was as follows: Year Ended December 31 2023 2022 2021 Military vehicles $ 5,036 $ 4,581 $ 4,699 Weapons systems, armament and munitions 2,442 2,024 2,006 Engineering and other services 790 703 646 Total Combat Systems $ 8,268 $ 7,308 $ 7,351 TECHNOLOGIES Our Technologies segment provides a full spectrum of services, technologies and products to an expanding market that increasingly seeks solutions combining leading-edge electronic hardware with specialized software.
Revenue by major products and services was as follows: Year Ended December 31 2024 2023 2022 Military vehicles $ 5,101 $ 5,036 $ 4,581 Weapons systems, armament and munitions 2,932 2,442 2,024 Engineering and other services 964 790 703 Total Combat Systems $ 8,997 $ 8,268 $ 7,308 TECHNOLOGIES Our Technologies segment provides a full spectrum of services, technologies and products to a wide range of military, intelligence, federal civilian and state customers.
NASSCO has also designed and built crude oil and product tankers and container and cargo ships for commercial customers, satisfying Jones Act requirements that ships carrying cargo between U.S. ports be built in U.S. shipyards. 8 On December 31, 2023, backlog for our major ship construction programs and the scheduled final delivery date of ships currently in backlog were as follows: In addition to design and construction activities, our Marine Systems segment provides comprehensive post-delivery services to modernize and extend the service life of these and other Navy ships.
On December 31, 2024, backlog for our major ship construction programs and the scheduled final delivery date of ships currently in backlog were as follows: In addition to design and construction activities, our Marine Systems segment provides comprehensive post-delivery services to modernize and extend the service life of these and other Navy ships.
Along with an industry partner, we are currently working on Blocks IV and V in the program, with 16 Virginia-class submarines in our backlog scheduled for delivery through 2032.
Construction is scheduled to span two decades, and the value of the Navy’s program of record is in excess of $125 billion. The Navy procures Virginia-class submarines in multi-boat blocks. Along with an industry partner, we are currently working on Blocks IV and V in the program, with 14 Virginia-class submarines in our backlog scheduled for delivery through 2032.
For all federal government entities, the FAR regulates the phases of any product or service acquisition, including: • acquisition planning; • competition requirements; • contractor qualifications; • protection of source selection and supplier information; and • acquisition procedures. 19 In addition, the FAR addresses the allowability of our costs, while the CAS addresses the allocation of those costs to contracts.
For example, the DoD implements the FAR through the Defense Federal Acquisition Regulation Supplement (DFARS). For all federal government entities, the FAR regulates the phases of any product or service acquisition, including: • acquisition planning; • competition requirements; • contractor qualifications; • protection of source selection and supplier information; and • acquisition procedures.
OTS produces next-generation weapon and defense systems for shipboard, aircraft and ground applications, including high-speed Gatling guns for all U.S. fighter aircraft (such as the F-35 Joint Strike Fighter) and combat vehicle active protection systems.
OTS produces next-generation weapon and defense systems for shipboard, aircraft and ground applications, including high-speed Gatling guns for all U.S. fighter aircraft, and combat vehicle active protection systems. OTS’s munitions portfolio covers the full breadth of naval, air and ground forces applications across all calibers and weapon platforms for the U.S. government and its non-U.S. partners.
Operating thousands of complex digital modernization programs across the federal government, GDIT’s expansive portfolio includes cloud services, cybersecurity, network modernization, AI, application development, high-performance computing, and 5G and next-generation wireless communications. Mission Systems is a defense electronics manufacturer and integrator for C5ISR applications in all domains.
Operating thousands of complex digital modernization programs across the federal government, GDIT’s expansive portfolio includes cloud services, cybersecurity, network modernization, artificial intelligence/machine learning (AI/ML), application development, high-performance computing, and 5G and next-generation wireless communications. In 2024, GDIT acquired Iron EagleX, Inc., further expanding its portfolio of mission solutions in AI/ML, cyber, software development and cloud services.
OTS’s munitions portfolio covers the full breadth of naval, air and ground forces applications across all calibers and weapon platforms for the U.S. government and its non-U.S. partners. Globally, we maintain a market-leading position in the supply of Hydra-70 rockets, bomb bodies, large-caliber tank ammunition, medium-caliber ammunition, military propellants, mortar and a 155mm artillery suite of ammunition.
Globally, we maintain a market-leading position in the supply of Hydra-70 rockets, large-caliber tank ammunition, medium-caliber ammunition, military propellants, mortar and a 155mm artillery suite of ammunition.
The result is a significant increase in federal information technology (IT) modernization and technology spending in recent years and a shift to large-scale, end-to-end, highly engineered solutions that require a broad array of integrated technology services and hardware offerings to meet these customer demands.
The result is a significant increase in federal information technology (IT) modernization and technology spending in recent years and a shift to large-scale, end-to-end, highly engineered solutions to meet the ever-changing information-systems and mission-support needs of these customers. GDIT and Mission Systems share a common defense, intelligence and federal civilian customer base and increasingly go to market together.
Army customer to adapt elements of advanced resilient radio frequency (RF) to address battlefield realities such as jamming, spoofing, cyberattacks and lack of ground connectivity. For the Canadian army we were recently selected to provide the Land Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) system. Mission Systems continues to help advance our nation’s position in the space domain.
Given our deep product innovation experience, we were recently selected to build the Next Generation Survival radio for the U.S. Joint Forces. For the Canadian Army, we provide the Land Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) system. 13 Mission Systems continues to help advance our nation’s position in the space domain. The U.S.
These Type 1 National Security Agency (NSA)-certified products and capabilities provide needed protection for classified voice, video and data in-transit or at-rest in all domains. Capabilities range from enterprise systems to embedded applications required for terrestrial, airborne or space environments. We are working with our U.S.
Mission Systems develops and manufactures high-assurance encryption products that are widely deployed to protect national security systems, data and networks against persistent threats. These Type 1 National Security Agency (NSA)-certified products and capabilities provide needed protection for classified voice, video and data in-transit or at-rest in all domains.
We expect the G700 to enter service following certification from the U.S. Federal Aviation Administration (FAA) in early 2024. In 2021, we introduced two new aircraft, the ultra-long-range, ultra-large-cabin G800 and large-cabin G400, completing a nearly two-decade effort to develop an all-new family of Gulfstream aircraft.
In 2021, we introduced two new aircraft, the ultra-long-range, ultra-large-cabin G800 and the large-cabin G400, completing a nearly two decade effort to develop an all new family of Gulfstream aircraft. 4 Both aircraft feature our industry-leading high-speed range and efficiency, safety enhancements, and our advanced Symmetry Flight Deck.
In 2022, we were awarded a low-rate initial production (LRIP) contract for the Army’s M10 Booker combat vehicle (formerly known as Mobile Protected Firepower) — the first ground combat vehicle to transition from prototype to production in 40 years. The M10 Booker vehicle will enhance the relevance of Infantry Brigade Combat Teams in large-scale combat operations against near-peer threats.
We are in low-rate initial production (LRIP) of the Army’s M10 Booker combat vehicle — the first newly developed Army ground combat vehicle to transition from prototype to production in 45 years. The M10 Booker will enhance the capability and lethality of Infantry Brigade Combat Teams in combat 9 operations.
The segment’s highly skilled workforce is one of its key differentiators and comprises approximately 40,000 employees, including technologists, engineers, mission experts and cleared personnel dedicated to solving the toughest security and technology challenges facing the United States and its allies. GDIT develops tailorable digital solutions and services developed specifically to meet mission needs in our customers’ operating environments.
The segment’s highly skilled workforce comprises approximately 40,000 employees, including technologists, engineers, mission experts and cleared personnel critical to solving the toughest security and technology challenges facing the United States and its allies. GDIT provides digital consulting services, modernizes large-scale IT enterprises, and deploys the latest technologies to optimize and protect customer networks, data and information.
During 2023, the diversity profile of our workforce continued to improve across our businesses, as we hired more than 23,400 individuals of which 73% were male and 27% were female. For our approximately 19,400 U.S.-based hires in 2023, 60% were white and 40% were people of color.
During 2024, we hired more than 23,800 individuals of which 74% were male and 26% were female. For our approximately 19,400 U.S.-based hires in 2024, 58% were white and 42% were people of color. RAW MATERIALS AND SUPPLIERS We depend on suppliers and subcontractors for raw materials, components and subsystems.
For the National Geospatial-Intelligence Agency (NGA), GDIT is providing hybrid cloud services, including commercial clouds and data centers, and innovative IT design, engineering, implementation and operations support services to the NGA and its mission partners.
Under the User Facing and Data Center Services (UDS) contract for the National Geospatial-Intelligence Agency (NGA), GDIT is providing hybrid cloud services, and innovative IT design, engineering, implementation and operations support services. We are supporting NGA in the development of their new headquarters in St. Louis, Missouri, and are committed to supporting the St.
The following represents Gulfstream’s current product line, along with the maximum range, maximum speed, cabin length (excluding baggage), and total number of city-pair speed records held for each aircraft: The most recent additions to the in-service Gulfstream fleet are two large-cabin aircraft, the G500 and G600, which entered service in 2018 and 2019, respectively.
The following represents Gulfstream’s current product line, along with the maximum range, maximum speed, cabin length (excluding baggage), and total number of city-pair speed records held for each aircraft: Gulfstream’s in-service aircraft hold 405 city-pair speed records, more than any other business jet manufacturer, including the National Aeronautic Association’s polar and westbound around-the-world speed records.
In 2023, we were awarded a contract from the Navy for construction of three Flight III DDG-51 destroyers. We have a total of 12 ships in backlog scheduled for delivery through 2032. NASSCO specializes in Navy auxiliary and support ships and is currently building the Expeditionary Sea Base (ESB), which serves as an afloat forward-staging base for U.S.
Bath Iron Works builds the Arleigh Burke-class (DDG-51) guided-missile destroyer and manages modernization and lifecycle support for all Navy destroyers. In 2023, we were awarded a contract from 7 the Navy for construction of three Flight III DDG-51 destroyers. We have a total of 11 ships in backlog scheduled for delivery through 2032.
The G400 will join a market segment in which Gulfstream has not participated for several decades. Both aircraft will enter service following FAA certification. The ultra-long-range, ultra-large-cabin G650 and G650ER continue to generate significant customer interest, with approximately 550 aircraft of this family currently operating in 55 countries.
The G400 is a clean-sheet (i.e., all new) design developed in concert with the G500 and G600, thus expanding the commonality across the Gulfstream family of aircraft. The G400 will join a market segment in which Gulfstream has not participated for several decades. Both aircraft will enter service following FAA certification.
Marines and special operations forces, and the John Lewis-class (T-AO-205) fleet replenishment oiler. Work on the two ESBs in backlog will continue into 2026, while the seven T-AO-205 ships currently in backlog have deliveries planned into 2028.
Work on the final ESB in backlog will continue into 2026, while the six T-AO-205 ships currently in backlog have deliveries planned into 2028 . In 2024, NASSCO received an award for the tenth ship of this class with options to build up to seven additional T-AO-205 ships.
GDIT and Mission Systems share the same defense, intelligence and federal civilian customer base and increasingly go to market together to meet the ever-changing information-systems and mission-support needs of these customers. In addition, with the convergence of digital technologies, the two businesses benefit from significant complementary offerings and solution sets.
In addition, with the convergence of digital technologies, the two businesses benefit from significant complementary offerings and solution sets. We make strategic investments in new and emerging technologies and partner with commercial companies to bring solutions to our customers that combine leading-edge technologies with an intimate knowledge of customers’ mission needs.
Removed
Both aircraft combine our industry-leading high-speed range and efficiency, safety enhancements, and our advanced Symmetry Flight Deck. The G800 is Gulfstream’s longest-range aircraft, with an 8,000 nautical mile range at Mach 0.85. The G400 is a clean-sheet design developed in concert with the G500 and G600, thus expanding the commonality across the Gulfstream family of aircraft.
Added
The G800 is Gulfstream’s longest-range aircraft, with an 8,000 nautical mile range at Mach 0.85. The G800 replaces the G650 and G650ER, which currently operate in 55 countries with more than 580 aircraft of this family in service.
Removed
Since the first G650 entered service in 2012, its capabilities and reliability have led to significant sales and expansion of our installed base around the globe. Gulfstream’s current product line holds more than 355 city-pair speed records, more than any other business jet manufacturer, led by the G650ER, which holds the National Aeronautic Association’s polar and westbound around-the-world speed records.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCustomer demand can be affected by a number of factors, including changes in general economic conditions, the availability and cost of credit, pricing pressures and trends in capital goods markets. An adverse change in customer demand for our business-aviation products and services could materially affect our future revenue and earnings.
Biggest changeThe business jet market is driven by the demand for business-aviation products and services by corporate, individual and government customers in the United States and around the world. Customer demand can be affected by a number of factors, including changes in general economic conditions, the availability and cost of credit, pricing pressures and trends in capital goods markets.
Our ability to perform our obligations to our customers, and our future revenue, earnings and margin, may be materially adversely affected if (1) any one or more of our suppliers is unable to provide the agreed-upon materials, or perform the agreed-upon services in a timely and cost-effective manner, or engages in misconduct or other improper activities or (2) we are unable to otherwise obtain necessary materials, components, subsystems or services in a timely and cost-effective manner.
Our ability to perform our obligations to our customers, and our future revenue, earnings and margin, may be materially adversely affected if (1) any one or more of our suppliers is unable to or otherwise fails to, provide the agreed-upon materials or perform the agreed-upon services in a timely and cost-effective manner, or engages in misconduct or other improper activities or (2) we are unable to otherwise obtain necessary materials, components, subsystems or services in a timely and cost-effective manner.
Accordingly, our performance depends in part on our ability to continue to develop, manufacture and provide innovative products and services and bring those offerings to market quickly at cost-effective prices. Many of our new products must meet extensive and time-consuming regulatory requirements that are often outside our control and may result in unanticipated delays.
Accordingly, our performance depends in part on our ability to continue to develop, manufacture and provide innovative products and services and bring those offerings to market quickly at 22 cost-effective prices. Many of our new products must meet extensive and time-consuming regulatory requirements that are often outside our control and may result in unanticipated delays.
In 2023, approximately 70% of our consolidated revenue was from the U.S. government. Levels of U.S. defense spending may be impacted by numerous factors, such as the domestic political environment, changes in national and international priorities, and threats to national security. Competing demands for federal funds can pressure various areas of spending.
Approximately 70% of our consolidated revenue was from the U.S. government. Levels of U.S. defense spending may be impacted by numerous factors, such as the domestic political environment, changes in national and international priorities, and threats to national security. Competing demands for federal funds can pressure various areas of spending.
Our success depends in part on our ability to develop new products and technologies and maintain a qualified workforce to meet the needs of our customers. Many of the products and services we provide involve sophisticated technologies and engineering, with related complex manufacturing and system-integration processes. Our customers’ requirements change and evolve 23 regularly.
Our success depends in part on our ability to develop new products and technologies and maintain a qualified workforce to meet the needs of our customers. Many of the products and services we provide involve sophisticated technologies and engineering, with related complex manufacturing and system-integration processes. Our customers’ requirements change and evolve regularly.
This budget proposes funding levels for every federal agency and is the result of months of policy and program reviews throughout the executive branch. For the remainder of the year, the Appropriations and Authorization Committees of the Congress review the president’s budget proposals and establish the funding levels for the upcoming fiscal year.
This budget proposes funding levels for every federal agency and is typically the result of months of policy and program reviews throughout the executive branch. For the remainder of the year, the Appropriations and Authorization Committees of the Congress typically review the president’s budget proposals and establish the funding levels for the upcoming fiscal year.
However, future threats could have a materially adverse impact on our company by, among other things, causing harm to our business, financial condition, results of operations or 25 reputation; disrupting our operations; exposing us to potential liability, regulatory actions and loss of business; and challenging our eligibility for future work on sensitive or classified systems for government customers.
However, future threats could have a materially adverse impact on our company by, among other things, causing harm to our business, financial condition, results of operations or 24 reputation; disrupting our operations; exposing us to potential liability, regulatory actions and loss of business; and challenging our eligibility for future work on sensitive or classified systems for government customers.
Therefore, actual future results and trends 26 may differ materially from what is forecast in forward-looking statements due to a variety of factors, including the risk factors discussed in this Form 10-K. All forward-looking statements speak only as of the date of this report or, in the case of any document incorporated by reference, the date of that document.
Therefore, actual future results and trends may differ materially from what is forecast in forward-looking statements due to a variety of factors, including the risk factors discussed in this Form 10-K. 25 All forward-looking statements speak only as of the date of this report or, in the case of any document incorporated by reference, the date of that document.
If we do not satisfy these financial or offset requirements, our future revenue and earnings may be materially adversely affected. 24 Risks Relating to Our Acquisitions and Similar Investment Activities We have made and expect to continue to make investments, including acquisitions and joint ventures, that involve risks and uncertainties.
If we do not satisfy these financial or offset requirements, our future revenue and earnings may be materially adversely affected. 23 Risks Relating to Our Acquisitions and Similar Investment Activities We have made and expect to continue to make investments, including acquisitions and joint ventures, that involve risks and uncertainties.
Any such effects could materially adversely affect our ability to perform on our contracts. Any cost increases that result from these effects may not be fully recoverable on our contracts or adequately covered by insurance.
Any such effects could materially adversely affect our ability to perform on our contracts. Any cost increases that result from these effects may not be fully recoverable on our contracts or adequately covered by insurance. Global climate change could negatively affect our business.
Other outbreaks of contagious diseases, including new variants of COVID-19, or other adverse public health developments in countries where we operate or our customers are located, could similarly adversely affect our business, results of operations and financial condition in the future. Global climate change could negatively affect our business.
Other outbreaks of contagious diseases, including new variants of COVID-19, or other adverse public health developments in countries where we operate or our customers are located, could similarly adversely affect our business.
The accounting for our contracts requires assumptions and estimates about these conditions and events. These projections and estimates assess, among other things: • the productivity and availability of labor; • the complexity of the work to be performed; • the cost and availability of materials and components; and • schedule requirements.
These projections and estimates assess, among other things: • the productivity and availability of labor; • the complexity of the work to be performed; • the cost and availability of materials and components; and • schedule requirements.
Our U.S. government revenue is funded by agency budgets that operate on an October-to-September fiscal year. Early each calendar year, the President of the United States presents to the Congress the budget for the upcoming fiscal year.
U.S. government contracts are not always fully funded at inception, and any funding is subject to disruption or delay. Our U.S. government revenue is funded by agency budgets that operate on an October-to-September fiscal year. Early each calendar year, the President of the United States presents to the Congress the budget for the upcoming fiscal year.
In addition, reputational harm could result if allegations of impropriety were made. In some cases, audits may result in disputes with the respective government agency that can result in negotiated settlements, arbitration or litigation. Moreover, new laws, regulations or standards, or 22 changes to existing ones, can increase our performance and compliance costs and reduce our revenue and earnings.
In addition, reputational harm could result if allegations of impropriety were made. In some cases, audits may result in disputes with the respective government agency that can result in negotiated settlements, arbitration or litigation.
In addition, if customers default on existing contracts and the contracts are not replaced, the segment’s anticipated revenue and profitability could be reduced materially. Earnings and margin depend on our ability to perform on our contracts. When agreeing to contractual terms, our management team makes assumptions and projections about future conditions and events.
An adverse change in customer demand for our business-aviation products and services could materially affect our future revenue and earnings. In addition, if customers default on existing contracts and the contracts are not replaced, the segment’s anticipated revenue and profitability could be reduced materially. Earnings and margin depend on our ability to perform on our contracts.
Decreases in U.S. government defense and other spending or 21 changes in spending allocation or priorities could result in one or more of our programs being reduced, delayed or terminated, which could impact our financial performance.
Decreases in U.S. government defense and other spending or changes in spending allocation or priorities could result in one or more of our programs being reduced, delayed or terminated, which could impact our financial performance. 20 For additional information relating to U.S. government budget and funding matters, see the Business Environment section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7.
Misconduct by suppliers, such as a failure to comply with procurement regulations or engaging in unauthorized activities, may harm our future revenue, earnings and margin. We sometimes rely on only one or two sources of supply, and any disruption in our supply chain could have an adverse effect on our ability to meet our customer commitments.
Misconduct by suppliers, such as a failure to comply with procurement regulations or engaging in unauthorized activities, may harm our future revenue, earnings and margin.
Removed
For additional information relating to U.S. government budget and funding matters, see the Business Environment section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7. U.S. government contracts are not always fully funded at inception, and any funding is subject to disruption or delay.
Added
Moreover, new laws, regulations or standards, or changes to existing ones, can increase our performance and compliance costs and reduce our revenue and earnings. 21 Our Aerospace segment is subject to changing customer demand for business aircraft.
Removed
Our Aerospace segment is subject to changing customer demand for business aircraft. The business jet market is driven by the demand for business-aviation products and services by corporate, individual and government customers in the United States and around the world.
Added
When agreeing to contractual terms, our management team makes assumptions and projections about future conditions and events. The accounting for our contracts requires assumptions and estimates about these conditions and events.
Added
We sometimes rely on only one or two sources of supply, and any disruption in our supply chain could have an adverse effect on our ability to meet our customer commitments and could adversely affect our business, results of operations and financial condition.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFrom time to time, as appropriate under our overall cybersecurity program, we engage third-party experts to support the assessment of cyber related risks, including to conduct cyber penetration testing. 27 See Item 1A—Risk Factors above for additional discussion of various risks related to cybersecurity that are reasonably likely to have a material impact on our company, including our business strategy, results of operations or financial condition.
Biggest changeSee Item 1A—Risk Factors above for additional discussion of various risks related to cybersecurity that are reasonably likely to have a material impact on our company, including our business strategy, results of operations or financial condition. 26
Added
From time to time, as appropriate under our overall cybersecurity program, we engage third-party experts to support the assessment of cyber related risks, including to conduct cyber penetration testing.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLeonards, United Kingdom. A summary of floor space by segment on December 31, 2023, follows: (Square feet in millions) Company-owned Facilities Leased Facilities Government-owned Facilities Total Aerospace 5.7 10.1 0.5 16.3 Marine Systems 8.8 4.8 — 13.6 Combat Systems 6.7 5.6 4.9 17.2 Technologies 3.1 7.3 0.9 11.3 Total square feet 24.3 27.8 6.3 58.4
Biggest changeLeonards, United Kingdom. A summary of floor space by segment on December 31, 2024, follows: (Square feet in millions) Company-owned Facilities Leased Facilities Government-owned Facilities Total Aerospace 5.5 10.1 0.5 16.1 Marine Systems 9.0 5.4 — 14.4 Combat Systems 6.7 6.6 4.9 18.2 Technologies 2.2 7.7 0.9 10.8 Total square feet 23.4 29.8 6.3 59.5
Petersburg and Tallahassee, Florida; Marion, Illinois; Saco, Maine; Sterling Heights, Michigan; Lima, Ohio; Eynon, Scranton and Wilkes-Barre, Pennsylvania; Garland and Mesquite, Texas; Joint Base Lewis-McChord, Washington; Vienna, Austria; Le Gardeur, London and Valleyfield, Canada; Kaiserslautern, Germany; Madrid, Sevilla and Trubia, Spain; Bürglen, Kreuzlingen, and Tägerwilen, Switzerland; Merthyr Tydfil, United Kingdom. • Technologies – Daleville, Alabama; Scottsdale, Arizona; Orlando, Florida; Bossier City, Louisiana; Annapolis Junction, Maryland; Dedham, Pittsfield and Taunton, Massachusetts; Bloomington, Minnesota; Rensselaer, New York; Greensboro, North Carolina; Chesapeake and Marion, Virginia; multiple locations in Northern Virginia; Ottawa, Canada; Oakdale and St.
Petersburg and Tallahassee, Florida; Marion, Illinois; Saco, Maine; Sterling Heights, Michigan; Lincoln, Nebraska; Lima, Ohio; Eynon, Scranton and Wilkes-Barre, Pennsylvania; Garland and Mesquite, Texas; Joint Base Lewis-McChord, Washington; Vienna, Austria; Le Gardeur, London and Valleyfield, Canada; Kaiserslautern, Germany; Madrid, Sevilla and Trubia, Spain; Bürglen, Kreuzlingen and Tägerwilen, Switzerland; Merthyr Tydfil, United Kingdom. • Technologies – Daleville, Alabama; Scottsdale, Arizona; Orlando, Florida; Bossier City, Louisiana; Annapolis Junction, Maryland; Dedham, Pittsfield and Taunton, Massachusetts; Bloomington, Minnesota; Rensselaer, New York; Greensboro, North Carolina; Chesapeake and Marion, Virginia; multiple locations in Northern Virginia; Ottawa, Canada; Oakdale and St.
On December 31, 2023, our segments had material operations at the following locations: • Aerospace – Mesa and Scottsdale, Arizona; Van Nuys, California; West Palm Beach, Florida; Brunswick and Savannah, Georgia; Cahokia, Illinois; Westfield, Massachusetts; Teterboro, New Jersey; New York, New York; Tulsa, Oklahoma; Dallas and Fort Worth, Texas; Appleton, Wisconsin; Sydney, Australia; Beijing, China; Mexicali, Mexico; Singapore; Basel, Switzerland; Farnborough, United Kingdom. • Marine Systems – San Diego, California; Groton and New London, Connecticut; Jacksonville, Florida; Honolulu, Hawaii; Bath and Brunswick, Maine; Middletown and North Kingstown, Rhode Island; Norfolk and Portsmouth, Virginia; Bremerton, Washington; Mexicali, Mexico. • Combat Systems – Anniston, Alabama; East Camden, Arkansas; Healdsburg, California; Crawfordsville, St.
On December 31, 2024, our segments had material operations at the following locations: • Aerospace – Mesa and Scottsdale, Arizona; Van Nuys, California; West Palm Beach, Florida; Brunswick and Savannah, Georgia; Cahokia, Illinois; Westfield, Massachusetts; Teterboro, New Jersey; New York, New York; Tulsa, Oklahoma; Dallas and Fort Worth, Texas; Appleton, Wisconsin; Sydney, Australia; Mexicali, Mexico; Singapore; Basel, Switzerland; Farnborough, United Kingdom. • Marine Systems – San Diego, California; Groton and New London, Connecticut; Jacksonville, Florida; Bath and Brunswick, Maine; Middletown and North Kingstown, Rhode Island; Norfolk and Portsmouth, Virginia; Bremerton, Washington; Mexicali, Mexico. • Combat Systems – Anniston, Alabama; East Camden, Arkansas; Healdsburg, California; Crawfordsville, St.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeNovakovic – Chairman and Chief Executive Officer since January 2013; President and Chief Operating Officer, May 2012 - December 2012; Executive Vice President, Marine Systems, May 2010 - May 2012; Senior Vice President, Planning and Development, July 2005 - May 2010; Vice President, Strategic Planning, October 2002 - July 2005 66 Mark C.
Biggest changeNovakovic – Chairman and Chief Executive Officer since January 2013; President and Chief Operating Officer, May 2012 - December 2012; Executive Vice President, Marine Systems, May 2010 - May 2012; Senior Vice President, Planning and Development, July 2005 - May 2010; Vice President, Strategic Planning, October 2002 - July 2005 67 David Paddock – Vice President of the company and President of General Dynamics Land Systems since April 2024; Vice President of the company and President of Jet Aviation, July 2019 - April 2024; Senior Vice President, Regional Operations USA of Jet Aviation, January 2015 - July 2019 57 Mark Rayha – Vice President of the company and President of Electric Boat Corporation since December 2024; Senior Vice President and Chief Operating Officer of Electric Boat Corporation, September 2023 - December 2024; Vice President and Chief Financial Officer of Electric Boat Corporation, July 2021 - September 2023; Vice President, Finance of Electric Boat Corporation, January 2020 - July 2021; Vice President and Chief Financial Officer of General Dynamics Mission Systems, January 2015 - January 2020 58 Robert E.
Brady – Vice President of the company and President of General Dynamics Mission Systems since January 2019; Vice President, Engineering of General Dynamics Mission Systems, January 2015 - December 2018; Vice President, Engineering of General Dynamics C4 Systems, May 2013 - December 2014; Vice President, Assured Communications Systems of General Dynamics C4 Systems, August 2004 - May 2013 61 Mark L.
Brady – Vice President of the company and President of General Dynamics Mission Systems since January 2019; Vice President, Engineering of General Dynamics Mission Systems, January 2015 - December 2018; Vice President, Engineering of General Dynamics C4 Systems, May 2013 - December 2014; Vice President, Assured Communications Systems of General Dynamics C4 Systems, August 2004 - May 2013 62 Mark L.
Gallopoulos – Senior Vice President, General Counsel and Secretary since January 2010; Vice President and Deputy General Counsel, July 2008 - January 2010; Managing Partner of Jenner & Block LLP, January 2005 - June 2008 64 M.
Gallopoulos – Senior Vice President, General Counsel and Secretary since January 2010; Vice President and Deputy General Counsel, July 2008 - January 2010; Managing Partner of Jenner & Block LLP, January 2005 - June 2008 65 M.
Smith – Executive Vice President, Marine Systems, since July 2019; Vice President of the company and President of Jet Aviation, January 2014 - July 2019; Vice President and Chief Financial Officer of Jet Aviation, July 2012 - January 2014 56 PART II
Smith – Executive Vice President, Marine Systems, since July 2019; Vice President of the company and President of Jet Aviation, January 2014 - July 2019; Vice President and Chief Financial Officer of Jet Aviation, July 2012 - January 2014 57 PART II
Moss – Vice President and Controller since April 2017; Staff Vice President, Internal Audit, May 2015 - March 2017; Staff Vice President, Accounting, August 2010 - May 2015 60 Phebe N.
Moss – Vice President and Controller since April 2017; Staff Vice President, Internal Audit, May 2015 - March 2017; Staff Vice President, Accounting, August 2010 - May 2015 61 Phebe N.
Set forth below is information regarding our executive officers as of February 8, 2024 (references are to positions with General Dynamics Corporation, unless otherwise noted): Name, Position and Office Age Jason W.
Set forth below is information regarding our executive officers as of February 7, 2025 (references are to positions with General Dynamics Corporation, unless otherwise noted): Name, Position and Office Age Jason W.
Amy Gilliland – Senior Vice President of the company since April 2015; President of General Dynamics Information Technology since September 2017; Deputy for Operations of General Dynamics Information Technology, April 2017 - September 2017; Senior Vice President, Human Resources and Administration, April 2015 - March 2017; Vice President, Human Resources, February 2014 - March 2015; Staff Vice President, Strategic Planning, January 2013 - February 2014; Staff Vice President, Investor Relations, June 2008 - January 2013 49 Kevin M.
Amy Gilliland – Senior Vice President of the company since April 2015; President of General Dynamics Information Technology since September 2017; Deputy for Operations of General Dynamics Information Technology, April 2017 - September 2017; Senior Vice President, Human Resources and Administration, April 2015 - March 2017; Vice President, Human Resources, February 2014 - March 2015; Staff Vice President, Strategic Planning, January 2013 - February 2014; Staff Vice President, Investor Relations, June 2008 - January 2013 50 Kimberly A.
Kuryea – Senior Vice President, Human Resources and Administration since April 2017; Vice President and Controller, September 2011 - March 2017; Chief Financial Officer of General Dynamics Advanced Information Systems, November 2007 - August 2011; Staff Vice President, Internal Audit, March 2004 - October 2007 56 29 William A.
Kuryea – Senior Vice President and Chief Financial Officer since February 2024; Senior Vice President, Human Resources and Administration, April 2017 - April 2024; Vice President and Controller, September 2011 - March 2017; Chief Financial Officer of General Dynamics Advanced Information Systems, November 2007 - August 2011; Staff Vice President, Internal Audit, March 2004 - October 2007 57 28 William A.
Burns – Vice President of the company and President of Gulfstream Aerospace Corporation since July 2015; Vice President of the company since February 2014; President, Product Support of Gulfstream Aerospace Corporation, June 2008 - June 2015 64 Danny Deep – Vice President of the company and President of General Dynamics Land Systems since April 2020; Chief Operating Officer of General Dynamics Land Systems, September 2018 - April 2020; Vice President of General Dynamics Land Systems – Canada, January 2011 - September 2018 54 Gregory S.
Burns – Vice President of the company and President of Gulfstream Aerospace Corporation since July 2015; Vice President of the company since February 2014; President, Product Support of Gulfstream Aerospace Corporation, June 2008 - June 2015 65 Danny Deep – Executive Vice President, Combat Systems, since April 2024; Vice President of the company and President of General Dynamics Land Systems, April 2020 - April 2024; Chief Operating Officer of General Dynamics Land Systems, September 2018 - April 2020; Vice President of General Dynamics Land Systems – Canada, January 2011 - September 2018 55 Gregory S.
Aiken – Executive Vice President, Technologies and Chief Financial Officer since January 2023; Senior Vice President and Chief Financial Officer, January 2014 - December 2022; Vice President of the company and Chief Financial Officer of Gulfstream Aerospace Corporation, September 2011 - December 2013; Vice President and Controller, April 2010 - August 2011; Staff Vice President, Accounting, July 2006 - March 2010 51 Christopher J.
Aiken – Executive Vice President, Technologies since February 2024; Executive Vice President, Technologies and Chief Financial Officer, January 2023 - February 2024; Senior Vice President and Chief Financial Officer, January 2014 - December 2022; Vice President of the company and Chief Financial Officer of Gulfstream Aerospace Corporation, September 2011 - December 2013; Vice President and Controller, April 2010 - August 2011; Staff Vice President, Accounting, July 2006 - March 2010 52 Shane A.
Removed
Graney – Vice President of the company and President of Electric Boat Corporation since October 2019; Vice President of the company and President of NASSCO, January 2017 - October 2019; Vice President and General Manager of NASSCO, November 2013 - January 2017 60 Kimberly A.
Added
Berg – Senior Vice President, Human Resources and Administration since February 2024; Senior Vice President, Planning and Development, January 2022 - February 2024; Executive Vice President of Princeton Theological Seminary, 2016 - January 2022 53 Christopher J.
Removed
Roualet – Executive Vice President, Combat Systems, since March 2013; Vice President of the company and President of General Dynamics Land Systems, October 2008 - March 2013; Senior Vice President and Chief Operating Officer of General Dynamics Land Systems, July 2007 - October 2008 65 Robert E.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOn December 31, 2023, 4.7 million shares remained authorized by our board of directors for repurchase.
Biggest changeOn December 4, 2024, our board of directors (Board) authorized management to repurchase up to 10 million additional shares of the company’s outstanding stock. We repurchased 4.8 million shares in the fourth quarter of 2024. On December 31, 2024, 9.2 million shares remained authorized by the Board for repurchase.
For additional information relating to our purchases of common stock during the past three years, see Note N to the Consolidated Financial Statements in Item 8. 31 The following performance graph compares the cumulative total return to shareholders on our common stock, assuming reinvestment of dividends, with similar returns for the Standard & Poor’s 500 Index and the Standard & Poor’s Aerospace & Defense Index, both of which include General Dynamics.
For additional information relating to our purchases of common stock during the past three years, see Note N to the Consolidated Financial Statements in Item 8. 30 The following performance graph compares the cumulative total return to shareholders on our common stock, assuming reinvestment of dividends, with similar returns for the Standard & Poor’s 500 Index and the Standard & Poor’s Aerospace & Defense Index, both of which include General Dynamics.
ITEM 5. MARKET FOR THE COMPANY’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the New York Stock Exchange under the trading symbol “GD.” On January 28, 2024, there were approximately 9,000 holders of record of our common stock.
ITEM 5. MARKET FOR THE COMPANY’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the New York Stock Exchange under the trading symbol “GD.” On January 26, 2025, there were approximately 9,000 holders of record of our common stock.
Cumulative Total Return Based on Investments of $100 Beginning December 31, 2018 (Assumes Reinvestment of Dividends) (in per-share amounts) ITEM 6. [RESERVED] 32
Cumulative Total Return Based on Investments of $100 Beginning December 31, 2019 (Assumes Reinvestment of Dividends) (in per-share amounts) ITEM 6. [RESERVED] 31
We did not make any unregistered sales of equity securities in 2023. 30 The following table provides information about our fourth-quarter purchases of equity securities that are registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended: Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Number of Shares That May Yet Be Purchased Under the Program Period Total Number of Shares Average Price per Share Shares Purchased Pursuant to Share Buyback Program 10/2/23-10/29/23 — $ — — — 10/30/23-11/26/23 — — — — 11/27/23-12/31/23 — — — — Shares Delivered or Withheld Pursuant to Restricted Stock Vesting* 10/2/23-10/29/23 — — 10/30/23-11/26/23 480 239.65 11/27/23-12/31/23 139 248.25 619 241.58 * Represents shares withheld by, or delivered to, us pursuant to provisions in agreements with recipients of restricted stock granted under our equity compensation plans that allow us to withhold, or the recipient to deliver to us, the number of shares with a fair value equal to the statutory tax withholding due upon vesting of the restricted shares.
We did not make any unregistered sales of equity securities in 2024. 29 The following table provides information about our fourth-quarter purchases of equity securities that are registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended: Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Number of Shares That May Yet Be Purchased Under the Program Period Total Number of Shares Average Price per Share Shares Purchased Pursuant to Share Buyback Program 9/30/24-10/27/24 82,385 $ 303.44 82,385 3,942,747 10/28/24-11/24/24 1,285,352 291.74 1,285,352 2,657,395 11/25/24-12/31/24 3,417,696 270.93 3,417,696 9,239,699 Shares Delivered or Withheld Pursuant to Restricted Stock Vesting* 9/30/24-10/27/24 130 299.96 10/28/24-11/24/24 — — 11/25/24-12/31/24 33 279.39 4,785,596 277.08 * Represents shares withheld by, or delivered to, us pursuant to provisions in agreements with recipients of restricted stock granted under our equity compensation plans that allow us to withhold, or the recipient to deliver to us, the number of shares with a fair value equal to the statutory tax withholding due upon vesting of the restricted shares.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

80 edited+21 added−18 removed59 unchanged
Biggest changeThe contract including options has a maximum potential value of $420. • $220 from the Navy to provide in-service support of systems and components on the USS Jimmy Carter (SSN 23). • A contract from the Navy for the construction of three Flight III DDG-51 destroyers. 43 The following represents the Marine Systems segment’s total estimated contract value by major program on December 31, 2023: COMBAT SYSTEMS The Combat Systems segment’s backlog consists of a mix of U.S. and international combat vehicles, weapons systems and munitions programs.
Biggest changeThe contract including options has a maximum potential value of $1.1 billion. • $770 from the Navy for lead yard services, development studies, design and engineering efforts, procurement and delivery of initial spare parts to support maintenance availabilities for Virginia-class submarines. • $530 from the Navy to provide maintenance, modernization and repair services for the DDG-51 destroyer, USS Hartford Los Angeles-class submarine and Wasp-class amphibious assault ship programs. • $455 from the Navy to provide engineering, technical, design and planning yard support services for operational strategic and attack submarines. • $255 for future technology development on the next-generation attack submarine, SSN(X), program for the Navy. • $115 for advanced nuclear plant studies (ANPS) in support of the Columbia-class submarine program. • $55 from the Navy to support non-nuclear maintenance on submarines based at the New England Naval Submarine Support Facility. 42 The following represents the Marine Systems segment’s total estimated contract value by major program on December 31, 2024: COMBAT SYSTEMS The Combat Systems segment’s backlog consists of a mix of U.S. and international combat vehicles, weapons systems and munitions programs.
We employ judgment in making our estimates, but they are based on historical experience, currently available information and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates. We 50 believe our judgment is applied consistently and produces financial information that fairly depicts our results of operations for all periods presented.
We employ judgment in making our estimates, but they are based on historical experience, currently available information and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates. We believe our judgment is applied consistently and produces financial information that fairly depicts our results of operations for all periods presented.
BUSINESS ENVIRONMENT GLOBAL EVENTS The coronavirus (COVID-19) pandemic caused significant disruptions to national and global economies and government activities, including supply chain and staffing challenges. Additionally, in response to the Russian invasion of Ukraine, the United States and several other countries imposed economic and trade sanctions, export controls and other restrictions (collectively, global sanctions) targeting Russia and Belarus.
BUSINESS ENVIRONMENT GLOBAL EVENTS The coronavirus (COVID-19) pandemic caused significant disruptions to national and global economies and government activities, including supply chain and staffing challenges. Additionally, in response to the Russian invasion of Ukraine, the United States and several other countries imposed economic and trade sanctions, export controls and other restrictions targeting Russia and Belarus.
Average debt and average shareholders’ equity excluding accumulated other comprehensive loss are calculated using the 49 respective balances at the end of the preceding year and the respective balances at the end of each of the four quarters of the year presented. ROIC excludes goodwill impairments and non-economic accounting changes as they are not reflective of company performance.
Average debt and average shareholders’ equity excluding accumulated other comprehensive loss are calculated using the respective balances at the end of the preceding year and the respective balances at the end of each of the four quarters of the year presented. ROIC excludes goodwill impairments and non-economic accounting changes as they are not reflective of company performance.
The key assumption is the interest rates used to discount estimated future pension benefits. We base the discount rates on a current yield curve developed from a portfolio of high-quality, 52 fixed-income investments with maturities consistent with the projected benefit payout period.
The key assumption is the interest rates used to discount estimated future pension benefits. We base the discount rates on a current yield curve developed from a portfolio of high-quality, fixed-income investments with maturities consistent with the projected benefit payout period.
Net operating profit after taxes is defined as net earnings plus after-tax interest and amortization expense, calculated using the statutory federal income tax rate. Average invested capital is defined as the sum of the average debt and average shareholders’ equity excluding accumulated other comprehensive loss.
Net operating profit after taxes is defined as net earnings plus after-tax interest and amortization expense, calculated using the 48 statutory federal income tax rate. Average invested capital is defined as the sum of the average debt and average shareholders’ equity excluding accumulated other comprehensive loss.
When determining the approach to be used, we consider the current facts and circumstances of each 51 reporting unit as well as the excess of each reporting unit’s estimated fair value over its carrying value based on our most recent quantitative assessments.
When determining the approach to be used, we consider the current facts and circumstances of each reporting unit as well as the excess of each reporting unit’s estimated fair value over its carrying value based on our most recent quantitative assessments.
The preparation of financial statements in accordance with GAAP requires that we make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period.
The preparation of financial statements in accordance with GAAP requires that we make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue 49 and expenses during the reporting period.
Our reporting units are consistent with our operating segments in Note O to the Consolidated Financial Statements in Item 8. We use both qualitative and quantitative approaches when testing goodwill for impairment.
Our reporting 50 units are consistent with our operating segments in Note O to the Consolidated Financial Statements in Item 8. We use both qualitative and quantitative approaches when testing goodwill for impairment.
For discussion of our contract estimates, the assumptions used, and the impact of changes in estimates, see Footnote B to the Consolidated Financial Statements in Item 8. Consistent with industry practice, we classify assets and liabilities related to long-term contracts as current, even though some of these amounts may not be realized within one year.
For discussion of our contract estimates, the assumptions used, and the impact of changes in estimates, see Note B to the Consolidated Financial Statements in Item 8. Consistent with industry practice, we classify assets and liabilities related to long-term contracts as current, even though some of these amounts may not be realized within one year.
The following discussion of our financial condition and results of operations for 2023 compared with 2022 should be read in conjunction with our Consolidated Financial Statements included in Item 8, while a discussion of 2022 compared with 2021 can be found in Item 7 of our annual report on Form 10-K for the year ended December 31, 2022.
The following discussion of our financial condition and results of operations for 2024 compared with 2023 should be read in conjunction with our Consolidated Financial Statements included in Item 8, while a discussion of 2023 compared with 2022 can be found in Item 7 of our annual report on Form 10-K for the year ended December 31, 2023.
On December 31, 2023, we had no commercial paper outstanding, but we maintain the ability to access the commercial paper market in the future. Separately, we have a $4 billion committed bank credit facility for general corporate purposes and working capital needs and to support our commercial paper issuances.
On December 31, 2024, we had no commercial paper outstanding, but we maintain the ability to access the commercial paper market in the future. Separately, we have a $4 billion committed bank credit facility for general corporate purposes and working capital needs and to support our commercial paper issuances.
The following represents the Combat Systems segment’s total estimated contract value by market on December 31, 2023: TECHNOLOGIES The Technologies segment’s backlog consists of thousands of contracts and task orders across a mix of U.S. and non-U.S. government and commercial customers. These contracts can be shorter-cycle or span multiple years, but commonly include a small, initially funded order.
The following represents the Combat Systems segment’s total estimated contract value by market on December 31, 2024: TECHNOLOGIES The Technologies segment’s backlog consists of thousands of contracts and task orders across a mix of U.S. and non-U.S. government and commercial customers. These contracts can be shorter-cycle or span multiple years, but commonly include a smaller, initially funded order.
BACKLOG AND ESTIMATED POTENTIAL CONTRACT VALUE Our total backlog, including funded and unfunded portions, was $93.6 billion on December 31, 2023, compared to $91.1 billion at the end of 2022. Our total backlog is equal to our remaining performance obligations under contracts with customers as discussed in Note B to the Consolidated Financial 40 Statements in Item 8.
BACKLOG AND ESTIMATED POTENTIAL CONTRACT VALUE Our total backlog, including funded and unfunded portions, was $90.6 billion on December 31, 2024, compared to $93.6 billion at the end of 2023. Our total backlog is equal to our remaining performance obligations under contracts with customers as discussed in Note B to the Consolidated Financial Statements in Item 8.
The contract including options has a maximum potential value of $450. 46 The following represents the Technologies segment’s total estimated contract value by customer on December 31, 2023: LIQUIDITY AND CAPITAL RESOURCES We place a strong emphasis on cash flow generation, which is underpinned by an operating discipline focused on cost control and working capital management.
The contract including options has a maximum potential value of $345. 45 The following represents the Technologies segment’s total estimated contract value by customer on December 31, 2024: LIQUIDITY AND CAPITAL RESOURCES We place a strong emphasis on cash flow generation, which is underpinned by an operating discipline focused on cost control and working capital management.
The effect of a 25-basis-point increase or decrease in the discount rate assumption on the December 31, 2023, pension benefit obligation is ($317) or $332, respectively. As described in Note S to the Consolidated Financial Statements in Item 8, our contractual arrangements with the U.S. government provide for the recovery of benefit costs for our government retirement plans.
The effect of a 25-basis-point increase or decrease in the discount rate assumption on the December 31, 2024, pension benefit obligation is ($261) or $272, respectively. 51 As described in Note S to the Consolidated Financial Statements in Item 8, our contractual arrangements with the U.S. government provide for the recovery of benefit costs for our government retirement plans.
Geographically, U.S. customers represented 68% of the segment’s orders in 2023 and 59% of the segment’s backlog on December 31, 2023, demonstrating continued strong domestic demand. 41 The following represents Gulfstream aircraft (in units) in backlog by region on December 31, 2023: DEFENSE SEGMENTS The total backlog in our defense segments represents the estimated remaining sales value of work to be performed under firm contracts.
Geographically, U.S. customers represented 54% of the segment’s orders in 2024 and 56% of the segment’s backlog on December 31, 2024, demonstrating continued strong domestic demand. 40 The following represents Gulfstream aircraft (in units) in backlog by region on December 31, 2024: DEFENSE SEGMENTS The total backlog in our defense segments represents the estimated remaining sales value of work to be performed under firm contracts.
The actual amount of funding received in the future may be higher or lower than our estimate of potential contract value. Total backlog in our defense segments was $73.2 billion on December 31, 2023, compared with $71.6 billion at year-end 2022. In 2023, the total book-to-bill ratio in our defense segments was slightly above 1-to-1.
The actual amount of funding received in the future may be higher or lower than our estimate of potential contract value. Total backlog in our defense segments was $70.9 billion on December 31, 2024, compared with $73.2 billion at year-end 2023. In 2024, the total book-to-bill ratio in our defense segments was 1-to-1.
Therefore, our estimated potential contract value of $28 billion is an important indicator of future orders and revenue. In 2023, approximately 80% of the segment’s orders were from additional work on IDIQ contracts or the exercise of options.
Therefore, our estimated potential contract value of $34 billion is an important indicator of future orders and revenue. In 2024, approximately 75% of the segment’s orders were from additional work on IDIQ contracts or the exercise of options.
We currently plan to repay these notes at maturity using cash on hand, potentially supplemented by commercial paper or other borrowings. For additional information regarding our debt obligations, including scheduled debt maturities and interest rates, see Note K to the Consolidated Financial Statements in Item 8.
Fixed-rate notes of $750 mature in both April and May 2025. We currently plan to repay these notes at maturity using cash on hand, potentially supplemented by commercial paper or other borrowings. For additional information regarding our debt obligations, including scheduled debt maturities and interest rates, see Note K to the Consolidated Financial Statements in Item 8.
Estimated potential contract value in our defense segments was $37.9 billion on December 31, 2023, compared with $35.9 billion at year-end 2022. 42 MARINE SYSTEMS The Marine Systems segment’s backlog consists of very long-term submarine and surface ship construction programs, as well as numerous engineering and repair contracts.
Estimated potential contract value in our defense segments was $52.2 billion on December 31, 2024, up 37.8% compared with $37.9 billion at year-end 2023. 41 MARINE SYSTEMS The Marine Systems segment’s backlog consists of very long-term submarine and surface ship construction programs, as well as numerous engineering and repair contracts.
The following is a discussion of our major operating, investing and financing activities in 2023 and 2022, as classified on the Consolidated Statement of Cash Flows in Item 8: Year Ended December 31 2023 2022 Net cash provided by operating activities $ 4,710 $ 4,579 Net cash used by investing activities (941) (1,489) Net cash used by financing activities (3,094) (3,471) OPERATING ACTIVITIES Cash provided by operating activities was $4.7 billion in 2023 compared with $4.6 billion in 2022 .
The following is a discussion of our major operating, investing and financing activities in 2024 and 2023, as classified on the Consolidated Statement of Cash Flows in Item 8: Year Ended December 31 2024 2023 Net cash provided by operating activities $ 4,112 $ 4,710 Net cash used by investing activities (953) (941) Net cash used by financing activities (3,369) (3,094) OPERATING ACTIVITIES Cash provided by operating activities was $4.1 billion in 2024 compared with $4.7 billion in 2023 .
The Congress has not yet passed a defense appropriations bill for the government’s current fiscal year. However, the government has been operating under a continuing resolution (CR) that provides funding for some federal agencies through March 1, 2024, and other federal agencies through March 8, 2024.
The Congress has not yet passed a defense appropriations bill for the government’s current fiscal year. However, the government has been operating under a continuing resolution (CR) that provides funding for some federal agencies through March 14, 2025.
We record a charge against earnings when a liability associated with claims or pending or threatened litigation is probable and when our exposure is reasonably estimable. The ultimate resolution of our exposure related to these matters may change as further facts and circumstances become known. Retirement Plans.
We record a liability associated with claims or pending or threatened litigation when it is probable a loss has been incurred and the amount is reasonably estimable. The ultimate resolution of our exposure related to these matters may change as further facts and circumstances become known. Retirement Plans.
The vehicle programs are generally long-term franchise programs, while the weapons systems and munitions programs tend to be shorter-term in nature. The segment’s backlog was up 9.7% from year-end 2022 to $14.5 billion. The segment’s estimated potential contract value was $6.2 billion on December 31, 2023, compared with $5.4 billion at year-end 2022.
The vehicle programs are generally long-term franchise programs, while the weapons systems and munitions programs tend to be shorter-term in nature. The segment’s backlog was up 16.8% from year-end 2023 to $17 billion. The segment’s estimated potential contract value was $8.6 billion on December 31, 2024, compared with $6.2 billion at year-end 2023.
The following table reconciles the free cash flow with net cash provided by operating activities, as classified on the Consolidated Statement of Cash Flows in Item 8: Year Ended December 31 2023 2022 2021 Net cash provided by operating activities $ 4,710 $ 4,579 $ 4,271 Capital expenditures (904) (1,114) (887) Free cash flow $ 3,806 $ 3,465 $ 3,384 Cash flows as a percentage of net earnings: Net cash provided by operating activities 142 % 135 % 131 % Free cash flow 115 % 102 % 104 % Return on Invested Capital.
The following table reconciles free cash flow with net cash from operating activities, as classified on the Consolidated Statement of Cash Flows in Item 8: Year Ended December 31 2024 2023 2022 Net cash provided by operating activities $ 4,112 $ 4,710 $ 4,579 Capital expenditures (916) (904) (1,114) Free cash flow $ 3,196 $ 3,806 $ 3,465 Cash flows as a percentage of net earnings: Net cash provided by operating activities 109 % 142 % 135 % Free cash flow 85 % 115 % 102 % Return on Invested Capital.
ROIC is calculated as follows: Year Ended December 31 2023 2022 2021 Net earnings $ 3,315 $ 3,390 $ 3,257 After-tax interest expense 315 309 340 After-tax amortization expense 201 235 254 Net operating profit after taxes $ 3,831 $ 3,934 $ 3,851 Average invested capital $ 31,258 $ 31,260 $ 32,270 Return on invested capital 12.3 % 12.6 % 11.9 % CASH REQUIREMENTS The following is a discussion of how we expect to meet the future cash requirements from known contractual and other obligations.
ROIC is calculated as follows: Year Ended December 31 2024 2023 2022 Net earnings $ 3,782 $ 3,315 $ 3,390 After-tax interest expense 310 315 309 After-tax amortization expense 191 201 235 Net operating profit after taxes $ 4,283 $ 3,831 $ 3,934 Average invested capital $ 32,451 $ 31,258 $ 31,260 Return on invested capital 13.2 % 12.3 % 12.6 % CASH REQUIREMENTS The following is a discussion of how we expect to meet the future cash requirements from known contractual and other obligations.
AEROSPACE Aerospace funded backlog represents primarily new aircraft orders for which we have definitive purchase contracts and deposits from customers. Unfunded backlog consists of agreements to provide future aircraft maintenance and support services. The Aerospace segment ended 2023 with backlog of $20.5 billion, up 4.8% from $19.5 billion at year-end 2022.
AEROSPACE Aerospace funded backlog represents primarily new aircraft orders for which we have definitive purchase contracts and deposits from customers. Unfunded backlog consists of agreements to provide future aircraft maintenance and support services. The Aerospace segment ended 2024 with backlog of $19.7 billion.
Our investing activities include cash paid for capital expenditures and business acquisitions; purchases, sales and maturities of marketable securities; and proceeds from asset sales. Capital Expenditures. The primary use of cash for investing activities in both years was capital expenditures. Capital expenditures were $904 in 2023 and $1.1 billion in 2022.
INVESTING ACTIVITIES Cash used by investing activities was $953 in 2024 and $941 in 2023. Our investing activities include cash paid for capital expenditures and business acquisitions; purchases, sales and maturities of marketable securities; and proceeds from asset sales. Capital Expenditures. The primary use of cash for investing activities in both years was capital expenditures.
In the fourth quarter of 2023, we completed qualitative assessments for our Aerospace, Marine Systems and Combat Systems reporting units as the estimated fair values of each of the reporting units significantly exceeded the respective carrying values based on our most recent quantitative assessments, which were performed in the fourth quarter of 2018.
Our Aerospace, Marine Systems and Combat Systems reporting units’ estimated fair values significantly exceeded their respective carrying values based on our most recent quantitative assessments, which were performed in the fourth quarter of 2018.
Navy ship engineering, repair and other services $ 784 U.S. Navy ship construction 637 Total increase $ 1,421 Revenue from U.S. Navy ship construction and engineering was up in 2023 due primarily to increased volume on the Columbia-class submarine program.
Navy ship engineering, repair and other services 357 Total increase $ 1,882 Revenue from U.S. Navy ship construction and engineering was up in 2024 due primarily to increased volume on the Columbia-class and Virginia-class submarine programs.
This emphasis gives us the flexibility for prudent capital deployment, while allowing us to step down debt over time, and preserves a strong balance sheet for future opportunities.
This emphasis gives us the flexibility for prudent capital deployment, while allowing us to maintain an appropriate debt level, and preserves a strong balance sheet for future opportunities.
Within our defense segments, the COVID-19 pandemic resulted in supply chain challenges and impacted the regional availability of skilled labor, which we continue to experience, particularly in our Marine Systems segment. The Russia-Ukraine conflict and increased threat environment has created additional demand for our products and services, particularly in our Combat Systems segment.
Within our defense segments, the COVID-19 pandemic resulted in supply chain challenges that continue to impact our Marine Systems segment. The Russia-Ukraine conflict and increased threat environment have created additional demand for certain of our products and services, particularly in our Combat Systems segment.
We expect 2024 net interest expense to be approximately $320. PROVISION FOR INCOME TAX, NET Our effective tax rate increased to 16.8% in 2023 from 16% in 2022. For further discussion, including a reconciliation of our effective tax rate from the statutory federal rate, see Note D to the Consolidated Financial Statements in Item 8.
PROVISION FOR INCOME TAX, NET Our effective tax rate was 16.7% in 2024 and 16.8% in 2023. For further discussion, including a reconciliation of our effective tax rate from the statutory federal rate, see Note D to the Consolidated Financial Statements in Item 8.
STATEMENT OF EARNINGS INFORMATION Year Ended December 31 2023 Revenue $ 16,276 Operating costs and expenses, excluding G&A (14,316) Net earnings 773 53 BALANCE SHEET INFORMATION December 31, 2023 December 31, 2022 Cash and equivalents $ 986 $ 540 Other current assets 5,012 4,279 Noncurrent assets 4,506 4,164 Total assets $ 10,504 $ 8,983 Short-term debt and current portion of long-term debt $ 503 $ 1,250 Other current liabilities 2,890 3,392 Long-term debt 8,700 9,189 Other noncurrent liabilities 3,281 3,814 Total liabilities $ 15,374 $ 17,645 The summarized balance sheet information presented above includes the funded status of the company’s primary qualified U.S. government pension plans as the parent has the ultimate obligation for the plans.
STATEMENT OF EARNINGS INFORMATION Year Ended December 31 2024 Revenue $ 18,701 Operating costs and expenses, excluding G&A (16,638) Net earnings 785 52 BALANCE SHEET INFORMATION December 31, 2024 December 31, 2023 Cash and equivalents $ 474 $ 986 Other current assets 5,187 5,012 Noncurrent assets 4,841 4,506 Total assets $ 10,502 $ 10,504 Short-term debt and current portion of long-term debt $ 1,500 $ 503 Other current liabilities 3,016 2,890 Long-term debt 7,210 8,700 Other noncurrent liabilities 3,170 3,281 Total liabilities $ 14,896 $ 15,374 The summarized balance sheet information presented above includes the funded status of the company’s primary qualified U.S. government pension plans as the parent has the ultimate obligation for the plans.
Overall, the segment’s margin decreased 50 basis points compared with 2022 due to program mix. 2024 Outlook We expect the Technologies segment’s 2024 revenue to increase to $13 billion with operating margin of around 9.5%. CORPORATE Corporate operating costs totaled $160 in 2023 and $118 in 2022 and consisted primarily of equity-based compensation expense.
Overall, the segment’s margin increased 30 basis points compared with 2023 due to strong operating performance. 37 2025 Outlook We expect the Technologies segment’s 2025 revenue to increase to approximately $13.5 billion with operating margin of approximately 9.2%. CORPORATE Corporate operating costs totaled $139 in 2024 and $160 in 2023 and consisted primarily of equity-based compensation expense.
Corporate operating costs are expected to be approximately $125 in 2024.
Corporate operating costs are expected to be approximately $150 in 2025.
CONSOLIDATED OVERVIEW 2023 IN REVIEW • Strong operating performance: ◦ Record-high revenue of $42.3 billion, an increase of 7.3% from 2022 ◦ Operating earnings of $4.2 billion with sequential growth throughout the year ◦ Record-high cash provided by operating activities of $4.7 billion, or 142% of net earnings • Record-high year-end backlog of $93.6 billion increased $2.5 billion, or 2.7%, from 2022, driven by significant order activity during the year supporting our long-term growth expectations: ◦ Strong Gulfstream aircraft order activity, including orders across all aircraft models ◦ Several significant contract awards received in our defense segments, including $3 billion of combined awards from the U.S.
CONSOLIDATED OVERVIEW 2024 IN REVIEW • Strong operating performance: ◦ Revenue of $47.7 billion, an increase of 12.9% from 2023 ◦ Operating earnings of $4.8 billion, an increase of 13% from 2023, with sequential growth throughout the year ◦ Diluted earnings per share of $13.63, up 13.4% from 2023 ◦ Cash provided by operating activities of $4.1 billion, or 109% of net earnings • Backlog of $90.6 billion, supporting our long-term growth expectations: ◦ Strong Gulfstream aircraft order activity, including orders across all aircraft models ◦ Several significant contract awards received in our defense segments, including $3.7 billion of combined awards from the U.S.
Additionally, we evaluate the reasonableness of each reporting unit’s fair value by comparing the fair value to peer companies and recent relevant market transactions.
Additionally, we evaluate the reasonableness of each reporting unit’s fair value by comparing the fair value to peer companies and recent relevant market transactions. In the fourth quarter of 2024, we completed qualitative assessments for each of our reporting units.
In 2024, we expect net other income to be approximately $50. INTEREST, NET Net interest expense was $343 in 2023 and $364 in 2022, reflecting the repayment of our scheduled debt maturities in 2023 and 2022. See Note K to the Consolidated Financial Statements in Item 8 for additional information regarding our debt obligations, including interest rates.
INTEREST, NET Net interest expense was $324 in 2024 and $343 in 2023. See Note K to the Consolidated Financial Statements in Item 8 for additional information regarding our debt obligations, including interest rates. We expect 2025 net interest expense to be consistent with 2024.
Our qualitative assessments did not present indicators of impairment for the reporting units. In the fourth quarter of 2023, we also completed a qualitative assessment for our Technologies reporting unit as its estimated fair value exceeded its carrying value by approximately 25% at the time of our last quantitative assessment in the fourth quarter of 2022.
Our Technologies reporting unit’s estimated fair value exceeded its carrying value by approximately 25% at the time of our last quantitative assessment in the fourth quarter of 2022. Our qualitative assessments this year did not present indicators of impairment. Commitments and Contingencies.
On December 31, 2023, estimated potential contract value in the Aerospace segment was $451. Demand for Gulfstream aircraft remains strong across customer types and geographic regions, generating orders from public and privately held companies, individuals, and governments around the world.
Demand for Gulfstream aircraft remains strong across customer types and geographic regions, generating orders from public and privately held companies, individuals, and governments around the world.
The disruptions caused by these events continue to impact global economies and businesses. The primary impact to our business is supply chain challenges, including inflationary pressures.
Lastly, the impact of the conflict in the Middle East continues to evolve. The disruptions caused by these events continue to impact global economies and businesses, including ours. The primary impact to our business is supply chain challenges, including availability of parts, quality escapes and inflationary pressures.
We evaluate a variety of capital deployment options based on current market conditions and our long-term outlook, and we believe agility is a key component of our capital deployment strategy as market conditions change over time. Our capital deployment priorities include investments in our products and services to drive long-term growth, a predictable dividend, strategic acquisitions and opportunistic share repurchases.
We evaluate a variety of capital deployment options based on current market conditions and our long-term outlook, and we believe agility is a key component of our capital deployment strategy as market conditions change over time.
A new aircraft model typically has lower margins in its initial production lots, and then margins generally increase as we realize efficiencies in the production process. 34 Additional factors affecting the segment’s earnings and margin include the volume, mix and profitability of services work performed, the market for pre-owned aircraft, and the level of general and administrative (G&A) and net research and development (R&D) costs incurred by the segment.
Additional factors affecting the segment’s earnings and margin include the volume, mix and profitability 33 of services work performed, the market for pre-owned aircraft, and the level of general and administrative (G&A) and net research and development (R&D) costs incurred by the segment.
When the government operates under a CR, all programs of record are funded at the prior year’s appropriated levels until the current year appropriations bill is signed into law. Therefore, the U.S.
When the government operates under a CR, all programs of record are funded at the prior year’s appropriated levels until the current year appropriations bill is signed into law. Therefore, the U.S. Department of Defense (DoD) is prohibited from starting new programs or increasing funding on existing programs unless there is an exception for the program included in the CR.
Cash dividends paid were $1.4 billion in 2023 and 2022. Share Repurchases. Our Board from time to time authorizes management to repurchase outstanding shares of our common stock on the open market. We paid $434 and $1.2 billion in 2023 and 2022, respectively, to repurchase our outstanding shares.
Our Board from time to time authorizes management’s repurchase of outstanding shares of our common stock on the open market. On December 4, 2024, the Board authorized management to repurchase up to 10 million additional shares of the company’s outstanding stock. We paid $1.5 billion and $434 in 2024 and 2023, respectively, to repurchase our outstanding 47 shares.
TECHNOLOGIES Year Ended December 31 2023 2022 Variance Revenue $ 12,922 $ 12,492 $ 430 3.4 % Operating earnings 1,202 1,227 (25) (2.0) % Operating margin 9.3 % 9.8 % 38 Operating Results The increase in the Technologies segment’s revenue in 2023 consisted of the following: Information technology (IT) services $ 264 C5ISR* solutions 166 Total increase $ 430 * Command, control, communications, computers, cyber, intelligence, surveillance and reconnaissance The Technologies segment’s revenue was up due primarily to strong demand for IT services and the acquisition of a C5ISR solutions business in 2022.
TECHNOLOGIES Year Ended December 31 2024 2023 Variance Revenue $ 13,127 $ 12,922 $ 205 1.6 % Operating earnings 1,260 1,202 58 4.8 % Operating margin 9.6 % 9.3 % Operating Results The increase in the Technologies segment’s revenue in 2024 consisted of the following: Information technology (IT) services $ 302 C5ISR* solutions (97) Total increase $ 205 * Command, control, communications, computers, cyber, intelligence, surveillance and reconnaissance The Technologies segment’s revenue increased in 2024 due primarily to strong demand for IT services, including the ramp-up of new programs, offset partially by C5ISR solutions program timing and the ramp-down of legacy programs.
We believe cash generated by operating activities, supplemented by commercial paper issuances, is sufficient to satisfy our short- and long-term liquidity needs. An additional potential source of capital is the issuance of long-term debt in capital market transactions. 47 We ended 2023 with a cash and equivalents balance of $1.9 billion compared with $1.2 billion at the end of 2022.
An additional potential source of capital is the issuance of long-term debt in capital market transactions. 46 We ended 2024 with a cash and equivalents balance of $1.7 billion compared with $1.9 billion at the end of 2023.
The following table details the backlog and estimated potential contract value of each segment at the end of 2023 and 2022: Funded Unfunded Total Backlog Estimated Potential Contract Value Total Estimated Contract Value December 31, 2023 Aerospace $ 19,557 $ 897 $ 20,454 $ 451 $ 20,905 Marine Systems 30,141 15,755 45,896 3,647 49,543 Combat Systems 13,816 721 14,537 6,236 20,773 Technologies 8,961 3,779 12,740 28,011 40,751 Total $ 72,475 $ 21,152 $ 93,627 $ 38,345 $ 131,972 December 31, 2022 Aerospace $ 19,077 $ 439 $ 19,516 $ 685 $ 20,201 Marine Systems 26,246 19,453 45,699 3,672 49,371 Combat Systems 12,726 525 13,251 5,364 18,615 Technologies 9,100 3,571 12,671 26,889 39,560 Total $ 67,149 $ 23,988 $ 91,137 $ 36,610 $ 127,747 For additional information about our major products and services in backlog see the Business discussion contained in Item 1.
Our total estimated contract value, which combines total backlog with estimated potential contract value, was $144 billion on December 31, 2024. 39 The following table details the backlog and estimated potential contract value of each segment at the end of 2024 and 2023: Funded Unfunded Total Backlog Estimated Potential Contract Value Total Estimated Contract Value December 31, 2024 Aerospace $ 18,895 $ 798 $ 19,693 $ 1,132 $ 20,825 Marine Systems 30,530 9,288 39,818 9,560 49,378 Combat Systems 16,142 838 16,980 8,647 25,627 Technologies 9,577 4,529 14,106 34,029 48,135 Total $ 75,144 $ 15,453 $ 90,597 $ 53,368 $ 143,965 December 31, 2023 Aerospace $ 19,557 $ 897 $ 20,454 $ 451 $ 20,905 Marine Systems 30,141 15,755 45,896 3,647 49,543 Combat Systems 13,816 721 14,537 6,236 20,773 Technologies 8,961 3,779 12,740 28,011 40,751 Total $ 72,475 $ 21,152 $ 93,627 $ 38,345 $ 131,972 For additional information about our major products and services in backlog see the Business discussion contained in Item 1.
Capital expenditures include equipment and facility enhancements to support new and existing programs across our businesses. FINANCING ACTIVITIES Cash used by financing activities was $3.1 billion in 2023 and $3.5 billion in 2022. Financing activities include the use of cash for repurchases of common stock, payment of dividends, and debt and commercial paper repayments.
Capital expenditures were $916 in 2024 and $904 in 2023. Capital expenditures include equipment and facility enhancements to support new and existing programs across our businesses. FINANCING ACTIVITIES Cash used by financing activities was $3.4 billion in 2024 and $3.1 billion in 2023.
In our Aerospace segment, supply chain challenges have paced our ability to ramp up production in response to strong customer demand for our aircraft and have caused out-of-sequence manufacturing, which increases costs and decreases operational efficiency. This includes the Israel-Hamas war’s impact on our Israel-based supplier of mid-cabin aircraft.
In our Aerospace segment, supply chain challenges paced our ability to ramp up production at the rate we like in response to strong customer demand for our aircraft, causing out-of-sequence manufacturing that increased costs and decreased operational efficiency. In addition, the conflict in the Middle East impacted the delivery schedule for our Israel-based supplier of mid-cabin aircraft.
We expect the segment’s operating margin to be approximately 15%. MARINE SYSTEMS Year Ended December 31 2023 2022 Variance Revenue $ 12,461 $ 11,040 $ 1,421 12.9 % Operating earnings 874 897 (23) (2.6) % Operating margin 7.0 % 8.1 % Operating Results The increase in the Marine Systems segment’s revenue in 2023 consisted of the following: U.S.
MARINE SYSTEMS Year Ended December 31 2024 2023 Variance Revenue $ 14,343 $ 12,461 $ 1,882 15.1 % Operating earnings 935 874 61 7.0 % Operating margin 6.5 % 7.0 % Operating Results The increase in the Marine Systems segment’s revenue in 2024 consisted of the following: U.S. Navy ship construction $ 1,525 U.S.
We do not anticipate the current CR having a material impact on our results of operations, financial condition or cash flows.
In addition, the CR included an exception allowing the DoD to obligate funds for the construction of the second submarine under the existing Columbia-class submarine contract. We do not anticipate the current CR having a material impact on our results of operations, financial condition or cash flows.
Navy for advance procurement and other work for the Virginia-class submarine program 35 Year Ended December 31 2023 2022 Variance Revenue $ 42,272 $ 39,407 $ 2,865 7.3 % Operating costs and expenses (38,027) (35,196) (2,831) 8.0 % Operating earnings 4,245 4,211 34 0.8 % Operating margin 10.0 % 10.7 % Our consolidated revenue increased in 2023 driven by growth in each of our defense segments, particularly submarine construction and engineering in our Marine Systems segment.
Navy for advance procurement and other work for the Virginia-class submarine program 34 Year Ended December 31 2024 2023 Variance Revenue $ 47,716 $ 42,272 $ 5,444 12.9 % Operating costs and expenses (42,920) (38,027) (4,893) 12.9 % Operating earnings 4,796 4,245 551 13.0 % Operating margin 10.1 % 10.0 % Our consolidated revenue increased in 2024 driven by growth across all segments, including double digit percentage growth in our Aerospace and Marine Systems segments.
The Combat Systems segment’s operating margin decreased 80 basis points compared with 2022 driven primarily by lower-margin artillery facilities expansion work. 2024 Outlook We expect the Combat Systems segment’s 2024 revenue to increase to approximately $8.5 billion with operating margin of approximately 14.4%.
The Combat Systems segment’s operating margin increased 30 basis points compared with 2023 driven by favorable contract mix. 2025 Outlook We expect the Combat Systems segment’s 2025 revenue to increase to approximately $9.1 billion with operating margin of approximately 14.5%.
In 2023, the primary driver of the increase in service operating costs was the change in volume described above. G&A EXPENSES As a percentage of revenue, G&A expenses decreased to 5.7% in 2023 compared with 6.1% in 2022 due to growth in revenue. We expect G&A expenses as a percentage of revenue in 2024 to be generally consistent with 2023.
Ship services revenue increased due to higher volume on the Columbia-class submarine program. The primary drivers of the increase in service operating costs were the changes in volume on the programs described above. G&A EXPENSES As a percentage of revenue, G&A expenses decreased to 5.4% in 2024 compared with 5.7% in 2023 due to growth in revenue.
Cash flows in 2023 were also affected positively by a decrease in unbilled receivables due to the receipt of progress payments on large international vehicle contracts in our Combat Systems segment. INVESTING ACTIVITIES Cash used by investing activities was $941 in 2023 and $1.5 billion in 2022.
Cash flows in 2023 were affected positively by a decrease in unbilled receivables due to the receipt of progress payments on large international vehicle contracts in our Combat Systems segment and an increase in customer deposits driven by Gulfstream aircraft orders, offset partially by an increase in inventory due primarily to the ramp-up in production of new Gulfstream aircraft models.
For the Aerospace segment, results are analyzed by specific types of products and services, consistent with how the segment is managed. For the defense segments, the discussion is based on markets and the lines of products and services offered with a supplemental discussion of specific contracts and programs when significant to the results.
For the defense segments, the discussion is based on markets and the lines of products and services offered with a supplemental discussion of specific contracts and programs when significant to the results. Additional information regarding our segments can be found in Note O to the Consolidated Financial Statements in Item 8.
In May and August 2023, we repaid fixed-rate notes of $750 and $500, respectively, and in November 2022, we repaid fixed-rate notes of $1 billion, all at their respective scheduled maturities using cash on hand. Fixed-rate notes of $500 mature in November 2024.
On December 31, 2024, 9.2 million shares remained authorized by our Board for repurchase, representing 3.4% of our total shares outstanding. Debt Issuances and Repayments. In November 2024, we repaid fixed-rate notes of $500, and in May and August 2023, we repaid fixed-rate notes of $750 and $500, respectively, all at their respective scheduled maturities using cash on hand.
Weapons systems and munitions revenue was up due to increased demand and facility expansion efforts associated with increased artillery production. Revenue from U.S. military vehicles increased due primarily to higher volume on the U.S. Army’s M10 Booker combat vehicle program (formerly known as Mobile Protected Firepower).
Revenue from U.S. military vehicles was up in 2024 due primarily to higher volume on the U.S. Army’s M10 Booker combat vehicle program.
The segment’s total estimated contract value was $40.8 billion on December 31, 2023, compared with $39.6 billion at year-end 2022. 45 Significant contract awards in the Technologies segment during 2023 include: • An IDIQ contract to provide full spectrum security support services to protect mission critical infrastructure for the U.S. Air Force.
The segment’s total estimated contract value was $48.1 billion on December 31, 2024, up 18.1% compared with $40.8 billion at year-end 2023. 44 Significant contract awards in the Technologies segment during 2024 include: • $50 from the U.S.
OTHER INFORMATION PRODUCT AND SERVICE REVENUE AND OPERATING COSTS Year Ended December 31 2023 2022 Variance Revenue: Products $ 24,595 $ 23,022 $ 1,573 6.8 % Services 17,677 16,385 1,292 7.9 % Operating Costs: Products $ (20,591) $ (18,981) $ (1,610) 8.5 % Services (15,009) (13,804) (1,205) 8.7 % The increase in product revenue in 2023 consisted of the following: Ship construction $ 637 Military vehicle production 503 Weapons systems and munitions 430 Other, net 3 Total increase $ 1,573 Ship construction revenue increased due primarily to higher volume on the Columbia-class submarine program.
OTHER INFORMATION PRODUCT AND SERVICE REVENUE AND OPERATING COSTS Year Ended December 31 2024 2023 Variance Revenue: Products $ 28,635 $ 24,595 $ 4,040 16.4 % Services 19,081 17,677 1,404 7.9 % Operating Costs: Products $ (24,332) $ (20,591) $ (3,741) 18.2 % Services (16,020) (15,009) (1,011) 6.7 % The increase in product revenue in 2024 consisted of the following: Aircraft manufacturing $ 2,101 Ship construction 1,525 Weapons systems and munitions 509 Other, net (95) Total increase $ 4,040 Aircraft manufacturing revenue increased due to additional aircraft deliveries.
Orders in 2023 reflected strong demand across our portfolio of products and services, including orders for all models of Gulfstream aircraft. The segment’s book-to-bill ratio (orders divided by revenue) was 1.2-to-1 in 2023. Beyond total backlog, estimated potential contract value represents primarily options and other agreements with existing customers to purchase new aircraft and long-term aircraft services agreements.
Orders in 2024 reflected strong demand across our portfolio of products and services, including orders for all models of Gulfstream aircraft. The segment’s book-to-bill ratio (orders divided by revenue) was 1-to-1 in 2024, even as revenue grew by more than 30% year over year.
Significant contract awards in the Combat Systems segment during 2023 include: • $1.7 billion for various munitions and ordnance. The awards have a maximum potential value of $3.2 billion. • $1 billion from the U.S. Army to establish additional capacity for 155mm projectile metal parts and M795 load, assemble and pack (LAP) production and artillery propellant.
Significant contract awards in the Combat Systems segment during 2024 include: • $2 billion for various munitions and ordnance. These contracts have a maximum potential value of $3.2 billion. • An IDIQ contract to provide medium-caliber ammunition cartridges for the U.S. Army.
The primary driver of cash inflows in both years was net earnings. Cash flows in both periods were affected positively by an increase in customer deposits driven by Gulfstream aircraft orders, offset partially by an increase in inventory due primarily to new aircraft models awaiting certification from the U.S. Federal Aviation Administration (FAA).
The primary driver of cash flows in both years was net earnings. Cash flows in 2024 were affected negatively by growth in operating working capital, particularly driven by the ramp-up in production of new Gulfstream aircraft models, offset partially by an increase in customer deposits driven by Gulfstream aircraft orders in our Aerospace segment.
In total, the Aerospace segment’s operating margin increased 50 basis points in 2023 to 13.7%. 2024 Outlook We expect the Aerospace segment’s 2024 revenue to increase to approximately $12 billion due to an increase in new aircraft deliveries to approximately 160, including the entry into service of the new G700 aircraft.
Aircraft services operating earnings were higher in 2024 due to higher volume. G&A/other expenses increased in 2024 consistent with the growth in the business. In total, the Aerospace segment’s operating margin decreased 70 basis points in 2024. 2025 Outlook We expect the Aerospace segment’s 2025 revenue to increase to approximately $12.7 billion with operating margin of approximately 13.7%.
The segment’s backlog and estimated potential contract value remained steady compared with year-end 2022. Significant contract awards in the Marine Systems segment during 2023 include: • $1.7 billion from the U.S.
The segment’s total estimated contract value remained steady compared with year-end 2023. Significant contract awards in the Marine Systems segment during 2024 include: • $780 from the U.S. Navy for the construction of an additional John Lewis-class (T-AO-205) fleet replenishment oiler.
The award including options has a maximum potential value of $770. • $755 from the Army to upgrade Abrams main battle tanks to the system enhancement package version 3 (SEPv3) configuration and provide system and sustainment technical support services for the Abrams program. 44 • $305 to produce light armored vehicles (LAVs) and provide the associated spares and logistics support services for Colombia. • $260 from the Army for the second phase of low-rate initial production (LRIP) of the M10 Booker Combat Vehicle. • $230 to provide maintenance and modernization for the Leopard fleet of vehicles for the Spanish Ministry of Defence. • $205 to produce Abrams main battle tanks in the SEPv3 configuration for Poland, bringing the total firm backlog for the program to $1.1 billion.
The contracts have a maximum potential value of $1.1 billion. 43 • $350 from the Army for Abrams main battle tank upgrades, engineering and logistics support services, and system and sustainment technical support services. • $325 from the Army for the third phase of the low-rate initial production (LRIP) of the M10 Booker Combat Vehicle. • $325 from the Canadian government to produce armored combat support vehicles (ACSVs). • $285 to produce Abrams main battle tanks in the system enhancement package version 3 (SEPv3) configuration for Romania. • $280 from the Army to produce Stryker Sgt.
Our financing activities also include proceeds received from debt and commercial paper issuances and employee stock option exercises. Dividends. On March 8, 2023, our board of directors (Board) declared an increased quarterly dividend of $1.32 per share, the 26th consecutive annual increase. Previously, the Board had increased the quarterly dividend to $1.26 per share in March 2022.
On March 6, 2024, our board of directors (Board) declared an increased quarterly dividend of $1.42 per share, the 27th consecutive annual increase. Previously, the Board had increased the quarterly dividend to $1.32 per share in March 2023. Cash dividends paid were $1.5 billion in 2024 and $1.4 billion in 2023. Share Repurchases.
The increase in service revenue in 2023 consisted of the following: Ship services $ 784 IT services 264 Aircraft services 220 Other, net 24 Total increase $ 1,292 Services revenue increased in 2023 due to a higher volume of engineering work on the Columbia-class submarine program, increased demand for IT services and additional aircraft maintenance work.
The increase in service revenue in 2024 consisted of the following: Aircraft services $ 527 C5ISR solutions/IT services 493 Ship services 357 Other, net 27 Total increase $ 1,404 38 Aircraft services revenue increased due to additional maintenance work. C5ISR solutions and IT services revenue was up due to higher volume, including the ramp-up of new programs.
The Marine Systems segment’s operating margin decreased 110 basis points in 2023 due to supply chain impacts to the Virginia-class submarine schedule and cost growth on the Arleigh Burke-class (DDG-51) guided-missile destroyer program. 2024 Outlook We expect the Marine Systems segment’s 2024 revenue to increase to approximately $12.8-12.9 billion with operating margin of approximately 7.6%. 37 COMBAT SYSTEMS Year Ended December 31 2023 2022 Variance Revenue $ 8,268 $ 7,308 $ 960 13.1 % Operating earnings 1,147 1,075 72 6.7 % Operating margin 13.9 % 14.7 % Operating Results The increase in the Combat Systems segment’s revenue in 2023 consisted of the following: International military vehicles $ 474 Weapons systems and munitions 430 U.S. military vehicles 56 Total increase $ 960 Revenue from international military vehicles increased in 2023 due to higher volume on several wheeled and tracked vehicle contracts, including the sale of the Abrams main battle tank to U.S. allies and partners.
The Virginia-class program has been impacted by supplier quality issues and late supply chain deliveries causing cost growth and schedule delays. 2025 Outlook We expect the Marine Systems segment’s 2025 revenue to increase to approximately $15 billion with operating margin of approximately 6.8%. 36 COMBAT SYSTEMS Year Ended December 31 2024 2023 Variance Revenue $ 8,997 $ 8,268 $ 729 8.8 % Operating earnings 1,276 1,147 129 11.2 % Operating margin 14.2 % 13.9 % Operating Results The increase in the Combat Systems segment’s revenue in 2024 consisted of the following: Weapons systems and munitions $ 509 U.S. military vehicles 218 International military vehicles 2 Total increase $ 729 Weapons systems and munitions revenue increased in 2024 due to heightened demand for artillery products.
AEROSPACE Year Ended December 31 2023 2022 Variance Revenue $ 8,621 $ 8,567 $ 54 0.6 % Operating earnings 1,182 1,130 52 4.6 % Operating margin 13.7 % 13.2 % Gulfstream aircraft deliveries (in units) 111 120 (9) (7.5) % Operating Results The increase in the Aerospace segment’s revenue in 2023 consisted of the following: Aircraft services $ 220 Aircraft manufacturing (166) Total increase $ 54 Aircraft services revenue was higher in 2023 due to an increase in demand for maintenance work based on established maintenance cycles, a larger installed base of aircraft, and strong customer flight activity.
AEROSPACE Year Ended December 31 2024 2023 Variance Revenue $ 11,249 $ 8,621 $ 2,628 30.5 % Operating earnings 1,464 1,182 282 23.9 % Operating margin 13.0 % 13.7 % Gulfstream aircraft deliveries (in units) 136 111 25 22.5 % Operating Results The increase in the Aerospace segment’s revenue in 2024 consisted of the following: Aircraft manufacturing $ 2,101 Aircraft services 527 Total increase $ 2,628 Aircraft manufacturing revenue increased in 2024 due primarily to the number and mix of aircraft deliveries, including our ultra-long-range, ultra-large-cabin G700 aircraft, which began deliveries in the second quarter of 2024 following U.S.
Military vehicle production revenue was up due primarily to higher volume on several international wheeled and tracked vehicle contracts. Weapons systems and munitions revenue was up due to increased demand and facility expansion efforts associated with increased artillery 39 production.
Ship construction revenue was up due primarily to higher volume on the Columbia-class and Virginia-class submarine programs. Weapons systems and munitions revenue increased due to heightened demand for artillery products.
In 2023, product operating costs increased at a higher rate than revenue due to supply chain impacts and cost growth within our Marine Systems segment.
In 2024, product operating costs increased at a higher rate than revenue due to supplier quality issues and late supply chain deliveries on the Virginia-class Block IV contract within our Marine Systems segment and additional costs associated with initial deliveries of G700 aircraft due to out of station work caused by supplier quality escapes and late delivery of components in our Aerospace segment.
The contracts, including options, have a maximum potential value of $1.5 billion. • $1.3 billion from the Navy for long-lead materials and advance construction for Block V and long-lead materials for Block VI Virginia-class submarines. • $720 from the Navy to provide maintenance and modernization services for the DDG-51 destroyer, San Antonio-class amphibious transport dock and Wasp-class amphibious assault ship programs.
The contract including options for an additional seven T-AO-205 oilers has a maximum potential value of more than $6.7 billion. • $2.9 billion from the Navy for long-lead materials for Block V and Block VI Virginia-class submarines. • $205 from the Navy for planning yard services for the Arleigh Burke-class (DDG-51) guided-missile destroyer program.
OTHER, NET Net other income was $82 in 2023 and $189 in 2022 and represents primarily the non-service components of pension and other post-retirement benefits. The decrease in pension income was driven primarily by higher interest rates and a change in investment mix in one of our plans due to its improved funded status.
We expect G&A expenses as a percentage of revenue in 2025 to be generally consistent with 2024. OTHER, NET Net other income was $68 in 2024 and $82 in 2023 and represents primarily the non-service components of pension and other post-retirement benefits. In 2025, we expect net other income to be approximately $50.
For 2024, we anticipate a slightly higher full-year effective tax rate of approximately 17.5%. The increase in our effective tax rate in 2023 and the expected increase in 2024 are due principally to higher taxes on foreign earnings.
For 2025, we expect a full-year effective tax rate of approximately 17.5%, generally consistent with our original expectations for 2024 before declining due to certain U.S. and foreign tax credits and benefits and other timing items.
The contract has a maximum potential value of $2.5 billion. • $130 to provide flight simulation and training services for the Army. The contract has a maximum potential value of $1.7 billion. • An IDIQ contract to provide mission command training and technical support services for the Army.
The contract including options has a maximum potential value of $2 billion. • Two contracts from the Canadian government for the Logistics Vehicle Modernization (LVM) program to provide a new fleet of light and heavy armored vehicles and logistics support services for the Canadian Army. These contracts including options have a maximum potential value of $1.9 billion.
The contract has a maximum potential value of $480. • A contract from the Centers for Medicare and Medicaid Services (CMS) to continue operating and modernizing the agency’s Healthcare Integrated General Ledger Accounting System (HIGLAS) application.
These contracts including options have a maximum potential value of $480. • $235 from the Centers for Medicare and Medicaid Services (CMS) to provide cloud services and software tools and to support the Benefits Coordination & Recovery Center.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA 10% unfavorable rate movement in our portfolio of forward exchange contracts would have resulted in the following hypothetical, incremental pretax losses: (Dollars in millions) 2023 2022 Recognized $ (107) $ (133) Unrecognized (74) (90) These losses would be offset by corresponding gains in the remeasurement of the underlying transactions being hedged.
Biggest changeA 10% unfavorable rate movement in our portfolio of forward exchange contracts would have resulted in the following hypothetical, incremental pretax losses: (Dollars in millions) 2024 2023 Recognized $ (36) $ (107) Unrecognized (180) (74) These losses would be offset by corresponding gains in the remeasurement of the underlying transactions being hedged.
A 10% unfavorable interest rate movement would not have a material impact on the fair value of our fixed-rate debt. Commodity Price and Investment Risk. See Note Q to the Consolidated Financial Statements in Item 8 for a discussion of commodity price and investment risk. 54
A 10% unfavorable interest rate movement would not have a material impact on the fair value of our fixed-rate debt. Commodity Price and Investment Risk. See Note Q to the Consolidated Financial Statements in Item 8 for a discussion of commodity price and investment risk. 53
We believe these foreign currency forward exchange contracts and the offsetting underlying commitments, when taken together, do not create material market risk. Interest Rate Risk. On December 31, 2023, we had $9.3 billion principal amount of fixed-rate debt. Our fixed-rate debt obligations are not putable, and we do not trade these securities in the market.
We believe these foreign currency forward exchange contracts and the offsetting underlying commitments, when taken together, do not create material market risk. Interest Rate Risk. On December 31, 2024, we had $8.8 billion principal amount of fixed-rate debt. Our fixed-rate debt obligations are not putable, and we do not trade these securities in the market.
We had notional forward exchange contracts outstanding of $5.7 billion and $6.9 billion on December 31, 2023 and 2022, respectively.
We had notional forward exchange contracts outstanding of $6.2 billion and $5.7 billion on December 31, 2024 and 2023, respectively.

Other GD 10-K year-over-year comparisons