Gulfstream full-year revenue grows 16.5%YoY to $13bn

Gulfstream has made its first G800 customer delivery. (Photocredit: Gulfstream).

General Dynamics (GD) share price fell $10 per share to as low as $349.79 at the market open on February 28th after it posted its second best quarter since 2008 owing to double-digit revenue growth in marine and aerospace segments.

“In aerospace for the year, we experienced continuing growth of both revenue and earnings, continuing strong demand for Gulfstream aircraft, overall strength in Gulfstream service business and continued growth and performance improvement at Jet Aviation,” said General Dynamics’ chairperson and CEO Phebe Novakovic. Jet Aviation is company’s maintenance and FBO arm.

Revenues from General Dynamics’ aerospace segment, which manufacturers Gulfstream business jets, grew 16.5%YoY to $13.1bn owing to strong sales and better aftermarket services revenue. New aircraft sales were up 21%YoY on higher G700 deliveries and G800 entry into service, said the company while adding that the revenues from aircraft services were up 7%.

This stellar growth in 2025 is on top of the company’s 30.5% jump in 2024 over 2023. This was driven largely in part by higher deliveries. Gulfstream full-year deliveries amounted to 158 – up 22 from 2024’s tally. Breakdown showed GD delivered 136 large-cabin with 22 mid-cabin Gulfstream aircraft in 2025.

“The delivery of the G700 and G800 and their performance in customer hands is driving increased demand for them, which we experienced in the quarter. We continue to see improved interest across all models in all sales jurisdictions. Interestingly, the overall number of prospects in all areas continues to increase,” said Novakovic.

The company also expanded its operating margin by 30 basis points to 13.3% of the revenue during the year with operating earnings clocking in at $1.75bn on absolute basis. This was 19.3% higher than 2024 figures.

Fourth quarter results show strong growth

In the quarter, Aerospace revenue hit $3.8bn and earnings of $481m, representing a 1.2% increase from last year owing to high base in the fourth quart of 2024.

“While the earning numbers are very good on a stand-alone basis, they do not compare favorably to a standout fourth quarter in the prior year, aided by a number of discrete positive items that were significant increments to earnings,” said Novakovic.

While revenues inched up slightly, operating earnings for the aerospace segment were down 17.8%YoY. This resulted in operating margin shrinking to 12.7% of the revenue compared to 15.6% in the corresponding period of last year.

“The margin issue was the G600 product line, which had $75m less in earnings,” said Danny Deep, company’s president, during the earnings call.

“That was attributable to the delivery of 3 fewer aircraft in the quarter, a $21m variance in liquidated damages with favorable settlements in the prior year’s quarter, some higher overhead than in the prior quarter and the imposition of tariffs in this quarter, but not in the fourth quarter of 2024. If we adjust for these items, the earnings and margin rate on the G600 are very similar for both quarters.”

He further added that on a year-over-year basis, earnings on the G500, Gulfstream Services and Jet Aviation were down modestly.  However, Deep added that earnings for the G800 more than replaced the G650 earnings on the same basis. “The G700 also experienced higher earnings despite two fewer deliveries. Obviously, margins are improving nicely on that product.”

Positive momentum from G800 launch continued to reflect in the company’s backlog in the aerospace segment. The segment’s backlog reached $21.8bn. The segment’s orders at the end of 2025 stood $15.5bn – with $5bn in the fourth quarter. This translated to book-to-bill ratio of 1.3x in the quarter and 1.2x during the year under review.

Outlook

Novakovic remained upbeat about 2026 anticipating a $500m growth in aerospace revenues to $13.6bn. She said the company expects operating margin to increase around 14% of the revenue translating to operating earnings of around $1.9bn in absolute terms.

In terms of deliveries, the company said it expects Gulfstream deliveries to be around 160 with a little upside, fairly close to 2025.

“To wrap up, as we go into 2026, we feel very good about our business and the prospects for the year,” said Novakovic.