# Newport News drives HII's shipbuilding margin gain Newport News' profitability improved as Ingalls' declined. HII raised its full-year shipbuilding sales outlook while holding its shipbuilding margin forecast steady. Published 2026-10-29 by TGOs. Canonical: https://tgos.io/news/2026/10/29/newport-news-drives-hiis-shipbuilding-margin-gain/ Using HII's definition, we calculate non-GAAP shipbuilding operating margin at 6.9% for the third quarter of 2026.[1] That compares with 5.9% a year earlier and 6.3% in the second quarter.[1] Newport News Shipbuilding supplied the improvement.[1] Its segment operating margin rose to 6.9% from 4.9% a year earlier.[1] Revenue grew 18.1%.[1] HII attributed the operating income increase primarily to Virginia-class submarine contract adjustments and incentives and higher submarine and aircraft carrier volumes.[1] The release gives no dollar value for the Virginia-class adjustments and incentives.[1] It therefore does not show how much of Newport News' profit improvement came from those items or higher volumes.[1] At Ingalls Shipbuilding, revenue grew 5.8%.[1] Segment operating margin fell to 6.7% from 7.9% a year earlier.[1] HII attributed the operating income decline primarily to lower performance in surface combatants.[1] HII received $32.4 billion in new contract awards during the quarter.[1] President and CEO Chris Kastner said that with those awards, HII has now secured approximately 90% of its expected shipbuilding revenue through 2030.[1] ## Why it matters HII raised its full-year shipbuilding revenue outlook to $10.5 billion to $10.7 billion.[1] Previously, it projected $10.2 billion to $10.4 billion.[1] Its shipbuilding operating margin forecast remains 6.0% to 6.5%.[1] ## Sources 1. HII third quarter 2026 results, Exhibit 99.1 to Form 8-K (Oct. 29, 2026) 2. HII second quarter 2026 results, Exhibit 99.1 to Form 8-K (July 30, 2026)