General Dynamics beat Wall Street expectations for fourth-quarter revenue Wednesday, as a tense global political climate sustained demand for its military equipment even as supply-chain pressures drove up costs.
Escalating tensions between China and the Philippines, the Russia-Ukraine war and conflicts in the Middle East have boosted orders for U.S. defense firms such as General Dynamics, Lockheed Martin and RTX's defense arm Raytheon.
General Dynamics' Combat Systems unit, which makes tanks, posted a 14.8% rise in revenue from a year earlier.
However, pandemic-related disruptions in labor and ongoing supply-chain snags are hampering efforts to deliver on these record weapons orders and increasing expenses.
Analysts have also raised concerns that supply-related risks are unlikely to dissipate quickly.
Net earnings at the Reston, Virginia-based defense contractor came in at $3.64 per share, below analysts' average estimates of $3.68, according to LSEG data.
The company's quarterly revenue increased 7.5% to $11.7 billion. Analysts on average were expecting $11.4 billion.
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