Huntington Ingalls Industries (HII) Financial History

As part of our business strategy, we regularly review, identify, and evaluate potential investments, acquisitions, joint ventures, strategic partnerships and teaming or other collaborative arrangements.

Market volatility and adverse capital market conditions may affect our ability to access cost-effective sources of funding.

We can provide no assurance we will pay dividends or repurchase shares of our common stock.

In addition, our contracts with the U.S.

Certain provisions of our Certificate of Incorporation and Bylaws may have the effect of delaying, deterring, or preventing a change in control that stockholders might consider favorable.

Our intellectual property is also subject to challenge, invalidation, infringement, misappropriation, or circumvention by third parties.

We own patents, trademarks, copyrights, and other forms of intellectual property related to our business, and we license intellectual property rights to and from third parties.

In addition to future changes in tax laws, the amount of net deferred tax liabilities will change periodically as a result of a number of factors, including the measurement of our defined benefit pension plans, actual…

We may be liable for the misconduct of employees, agents, or others working with us or for us, including subcontractors and suppliers, due to their violations of applicable laws or regulations, including laws governin…

Our business and reputation may be adversely affected by the improper conduct of employees, agents, suppliers, subcontractors, business partners, or joint ventures in which we participate.

We may be subject to potential liabilities, including for personal injury and harm to human health, property damage, environmental harm, and reputational harm arising out of such incidents or hazardous activities and…

Our business may be affected by environmental impacts, including changing weather patterns or environmental conditions and evolving legal and regulatory requirements and stakeholder sentiment.

hazardous wastes.

The U.S.

We operate in a heavily regulated environment and are overseen and routinely audited by the U.S.

Acquisitions involve estimates, assumptions, and judgments to arrive at acquisition prices, which are allocated among acquired assets, including goodwill, based upon fair market values.

Our business is subject to significant disruption from natural disasters, environmental disasters, and other events outside of our control that could have a material adverse effect on our financial position, results o…

In addition, AI regulation is rapidly evolving worldwide as legislators and regulators increasingly focus on these powerful emerging technologies.

We utilize artificial intelligence, including generative artificial intelligence, machine learning, and similar tools and technologies that collect, aggregate, analyze, or generate data or other materials or content (…

We are also subject to disclosure and reporting obligations related to cybersecurity events.

We have experienced cybersecurity attacks and expect we will continue to experience additional attacks in the future.

Our information technology infrastructure is critical to the efficient operation of our business and essential to our ability to perform day-to-day operations.

We could be negatively impacted by security threats, including cybersecurity threats, and related disruptions.

We have taken certain actions intended to mitigate the risk related to our defined benefit pension plans including pension risk transfer transactions whereby we purchase group annuity contracts (“GACs”) from insurance…

Our pension and other postretirement benefit obligations, such as retiree health care costs, are dependent upon various estimates and assumptions, including discount rates, mortality and expected long-term rates of re…

Changes in key estimates and assumptions associated with postretirement benefit plans, such as discount rates and assumed long-term returns on assets, actual investment returns on our pension plan assets, and legislat…

others, increasing investment in our current shipyards, identifying and retaining additional qualified personnel, utilizing third parties to support production needs, and identifying efficiencies in our current produc…

Our costs to manufacture our products can increase over the terms of our contracts, including as a result of increases in material costs and wages.

We rely on third parties to provide raw materials, major components and sub-systems, hardware elements, and sub-assemblies for our products and to perform certain services we provide to our customers, in compliance wi…

to affect, our ability to successfully attract or retain personnel with the requisite skills or clearances.

A growing portion of our current workforce is nearing or eligible for retirement.

Our performance and growth is dependent upon our ability to identify, attract, train, and retain sufficient qualified personnel with the requisite skills in multiple areas, including: engineering, nuclear, trades and…

U.S.

Approximately 46% of our revenues in 2025 were generated under fixed-price incentive contracts, approximately 50% were generated under cost-type contracts, approximately 1% were generated under time and material contr…

significant increase in contract costs from our original cost estimates on one or more contracts could have a material adverse effect on our financial position, results of operations, or cash flows.

Our operating income is adversely affected when we incur certain contract costs or certain increases in contract costs that cannot be billed to customers.

Cost growth on flexibly priced contracts that does not result in higher contract prices reduces our profit and exposes us to the potential loss of future business.

We derive a portion of our revenues from programs with the U.S.

Although we are the only company currently capable of refueling nuclear-powered aircraft carriers, existing U.S.

We operate in a highly competitive environment and our competitors may have more financial capacity or other resource or capabilities.

Competition within our markets and bid protests may affect our ability to win new contracts and result in reduced revenues or market share.

The U.S.

Our industry has experienced, and we expect will continue to experience, changes to business practices resulting from, among other things, a greater focus on affordability, efficiencies, business systems, recovery of…

Changes to the U.S.

If estimated costs increase, particularly without comparable increases in revenue, our operating income can be adversely affected.

Demand for our products and services also can be affected by shifts in customer priorities resulting from changes in military strategy and planning.

In addition, pressures on, as well as laws and plans relating to, the federal budget, potential changes in the threat environment, priorities and defense spending, government efficiency efforts, the timing and substan…

If Congress is unable to pass appropriations bills before the beginning of a fiscal year, a continuing resolution can be enacted to provide stopgap funding for a specified period of time at a specified rate, often the…

As a U.S.

The U.S.

We depend on the U.S.

The payment of cash dividends and repurchases of our common stock are subject to limitations under applicable law and the discretion of our board of directors, considered in the context of current conditions, includin…

We can provide no assurance we will continue to increase our dividends or repurchase shares of our common stock.

If we fail to manage acquisitions, joint ventures, equity investments, and other transactions successfully or if acquired businesses or equity investments fail to perform as expected, our financial results, business,…

Tightening capital markets could also adversely affect the ability of our suppliers and subcontractors to obtain financing.

Market volatility and adverse capital market conditions may affect our ability to access cost-effective sources of funding and may expose us to risks associated with the financial viability of suppliers and subcontrac…

Our insurance coverage may be inadequate to cover all of our significant risks or our insurers may deny coverage of material losses we incur, which could adversely affect our profitability and financial position.

The exclusive forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage su…

Our Restated Bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the fed…

Our Restated Bylaws include an exclusive forum requirement for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for such di…

Anti-takeover provisions in our organizational documents and Delaware law, as well as regulatory requirements, could delay or prevent a change in control.

intellectual property.

We may be unable to adequately protect our intellectual property rights, which could affect our ability to compete.

We are subject to income and other taxes in the U.S.

Changes in tax laws and regulations or exposure to additional tax liabilities could adversely affect our financial results.

Our reputation and our ability to conduct business may be impacted by the improper conduct of employees, agents, suppliers, subcontractors or business partners.

Our nuclear operations subject us to environmental, regulatory, financial, and other risks.

Water Act, the facility or facilities involved in the violation could be placed by the EPA on a list of facilities that generally cannot be used in performing on U.S.

We are subject to investigations, claims, litigation, disputes and other legal proceedings that could ultimately be resolved against us.

contract payments upon its assessment that deficiencies exist with one or more of our business systems, which can have a material impact on the timing of our cash receipts.

As a U.S.

Changes in future business conditions could cause business investments, recorded goodwill, and/or purchased intangible assets to become impaired, resulting in losses and write-downs that would reduce our operating inc…

Our business could be negatively impacted if we are unsuccessful negotiating new collective bargaining agreements.

If an epidemic, pandemic or similar outbreak were to occur, we could incur similar impacts in the future, in connection with health epidemics, pandemics, or similar outbreaks, and related cost increases may not be ful…

The COVID-19 health crisis also created challenges for our suppliers relative to their workforces, access to necessary components, materials, and other supplies at reasonable prices, and access to support services, su…

We face various risks related to health epidemics, pandemics, and similar outbreaks, including global health crises like COVID-19.

We face risks related to health epidemics, pandemics, and similar outbreaks.

Our suppliers and subcontractors are also subject to natural and environmental disasters that could affect their ability to deliver products or services or otherwise perform their contracts.

Damage and disruption resulting from natural and environmental disasters may be significant.

We have significant operations located in regions of the United States that have been and may in the future be exposed to damaging storms, such as hurricanes and floods, the intensity and frequency of which are being…

Our business is subject to disruptions caused by natural disasters, environmental disasters, and other events that could have a material adverse effect on our financial position, results of operations, or cash flows.

frameworks for AI.

tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, data privacy, or other rights, or contracts to which we are a party.

We utilize artificial intelligence, which could expose us to liability or adversely affect our business, especially if we are unable to compete effectively with others in adopting artificial intelligence.

Our information technology infrastructure is critical to the efficient operation of our business and essential to our ability to perform day-to-day operations.

We could be negatively impacted by security threats, including cyber security threats, and related disruptions.

Changes in key estimates and assumptions associated with postretirement benefit plans, such as discount rates and assumed long-term returns on assets, actual investment returns on our pension plan assets, and legislat…

Many of our contracts include performance obligations that incorporate innovative designs, state-of-the-art manufacturing expertise, or new technologies, or otherwise are dependent upon factors not wholly within our c…

Our future success depends in part on our ability to increase our current and future shipbuilding capacity.

more of our suppliers or subcontractors are unable to provide agreed-upon products, materials, or services in a timely, compliant, and cost-effective manner, or they otherwise fail to satisfy contractual requirements.

Our earnings and profitability depend, in part, upon subcontractor performance and raw material and component availability and pricing.

We depend on the recruitment and retention of qualified personnel, and challenges associated with our ability to attract, train and retain such personnel have harmed and may continue to negatively impact our business.

renegotiate contracts on less favorable terms, be forced to pay penalties or liquidated damages, or suffer major losses if the customer exercises its right to terminate.

Our risk varies and our ability to recover costs on contracts with our U.S.

Cost growth on flexibly priced contracts that does not result in higher contract prices due from customers reduces our profit and exposes us to the potential loss of future business.

We have classified contracts with the U.S.

Our level of indebtedness and our ability to make payments on or service our indebtedness may adversely affect our financial and operating activities or our ability to incur additional debt.

Mission Technologies competes domestically and internationally against large A&D companies, primarily L3 Harris, Amentum, ManTech, Leidos, and, increasingly, small businesses serving the intelligence community.

Competition within our markets or an increase in bid protests may reduce our revenues and market share.

Changes to DoD business practices could have a material effect on DoD's procurement process and adversely impact our current programs and potential new awards.