General Dynamics Corp ( GD ) shares are trading lower after the company reported second-quarter fiscal 2024 results.

Revenue for the quarter increased 18% year-over-year to $11.976 billion, beating the consensus of $11.438 billion. EPS of $3.26 (up 20.7% YoY) missed the consensus of $3.29.

Operating earnings rose 20.2% Y/Y to $1.156 billion, and the margin expanded 20 basis points Y/Y to 9.7%.

“This was a strong quarter overall, as reflected by solid growth in all key measures from a year ago. Our businesses continue to focus on disciplined execution of their programs, cost and schedule. In the Aerospace segment, we are continuing to ramp up the pace of our G700 deliveries and our defense businesses continued to grow, reflecting increased demand in response to the threat environment,” commented Phebe N. Novakovic, chairman and chief executive officer.

Revenue by segments: Aerospace $2.94 billion (+50.5% Y/Y), Marine Systems $3.45 billion (+12.9% Y/Y), Combat Systems $2.29 billion (+18.9% Y/Y) and Technologies $3.295 billion (+2.5% Y/Y).

GD’s net cash provided by operating activities in the quarter was $814 million, or 90% of net earnings.

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During the quarter, the company paid $389 million in dividends, invested $201 million in capital expenditures, and repurchased $34 million in shares, ending with $1.4 billion in cash.

The consolidated book-to-bill ratio for the quarter was 0.8-to-1. The company-wide backlog stood at $91.3 billion, with an estimated potential contract value of $38.5 billion. The total estimated contract value was $129.8 billion.

In the Aerospace segment, orders in the quarter totaled $2.7 billion, growing backlog to $20 billion (up 2.8% Y/Y). Defense segments, orders totaled $7.4 billion, with particular strength in Combat Systems, which had a book-to-bill ratio of 1.5-to-1.

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Outlook: General Dynamics ( GD ) CEO sees 2024 total revenue up $2 billion, but margins will shrink by 30 basis points versus previous guidance.

Price Action: GD shares traded lower by 5.69% at $277.71 at the last check Wednesday.