U.S. defense contractor General Dynamics beat Wall Street estimates on Wednesday, as buoyant military equipment demand helped overcome higher operating expenses.
Shares of the Reston, Virginia-based company were up about 2% before the bell.
The Pentagon has awarded lucrative contracts to U.S. defense companies to refill the depleted weapons stockpile in Ukraine. The recent arms aid packages have included artillery, air defense missiles and ground vehicles.
General Dynamics-manufactured weapons systems, munitions, and combat vehicles such as Abrams tanks have been essential to Ukraine’s operations.
The company’s book-to-bill ratio, a comparison of orders received to units shipped and billed, was 1.4 to 1.
Amid easing supply chains but a tight labor market, General Dynamics, in its effort to avert a strike, reached a tentative agreement with United Auto Workers (UAW) members over a new labor contract.
UAW members at the company make highly profitable military vehicles, including tanks and light armored vehicles, according to the union.
However, sales at the aerospace unit, which makes Gulfstream business jets, slumped 13.4% as supply chain challenges made it harder to deliver planes.
Gulfstream delivered 27 jets, much lower than the 35 jets it dispatched last year.
The company’s third-quarter profit was $3.04 per share, ahead of analyst estimates of $2.91 per share. Quarterly revenue rose 6% to $10.57 billion, beating estimates of $10.05 billion, according to LSEG data.
General Dynamics joined peer defense contractors Lockheed Martin and RTX to report better-than-expected quarterly results.
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