Huntington Ingalls Industries

Huntington Ingalls Industries

HII was spun out of Northrop Grumman in 2011, but its shipbuilding legacy stretches back to 1886 via the Newport News Shipbuilding yard, which built seven of the first eight U.S. aircraft carriers. Mike Petters, who led the spin-off as CEO, handed the role to Chris Kastner in 2022, a company veteran who had run the Ingalls Shipbuilding division in Mississippi. The firm employs roughly 44,000 people, predominantly at its two main shipyards in Newport News, Virginia and Pascagoula, Mississippi, making it one of the largest manufacturing employers in the American South. Its primary customer is the U.S. Department of Defense, accounting for over 85% of annual revenue, with the balance split between allied naval programs and limited commercial nuclear services. The firm's strategy is essentially a single-program mandate executed across two colossal shipyards. HII is the sole builder of the Gerald R. Ford-class nuclear aircraft carrier (each costing approximately $13B) and the Virginia-class fast-attack submarine (as part of a duopoly with General Dynamics Electric Boat). It also constructs the America-class amphibious assault ships, the Arleigh Burke-class destroyer, and the San Antonio-class amphibious transport dock. The company generates roughly $11.5B in annual revenue, with a funded backlog that has recently exceeded $47B, providing decade-plus visibility on fielding the Navy's long-range shipbuilding plan. Recent notable milestones include the delivery of the amphibious transport dock Richard M. McCool Jr. (LPD 29) in April 2024 and the launch of the aircraft carrier John F. Kennedy (CVN 79) in the same period. The company operates three divisions in addition to Newport News and Ingalls shipbuilding: Mission Technologies, a growing technical services unit focused on C5ISR, unmanned systems, and nuclear management, which generates about $2.8B in annual revenue; and a smaller nuclear and environmental services segment. In April 2024, the firm completed its acquisition of the government services arm of Forcepoint, a cybersecurity company, to bulk up its Mission Technologies portfolio, a deal that signaled a push to diversify beyond the physical shipbuilding cycle into systems integration and intelligence work. Kastner has publicly committed to roughly $850M in capital expenditures across 2024 to modernize the shipyards, specifically to build robotic welding capacity and expand submarine module construction at Newport News. What delineates HII is its position as a policy-enabled monopoly within the world's most capitalized defense industrial base. It competes for contracts but does not compete for customers — the Navy's force structure requirements mandate HII's capacity be fully utilized. Unlike peers such as Lockheed Martin or General Dynamics, which balance multiple aircraft and land-system programs, HII's fate rises and falls on the nuclear shipbuilding account. This structural lock-in makes its business the single purest proxy for U.S. naval strategy available to public market investors.