Name: General Dynamics Corp. (NYSE:GD) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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General Dynamics Corp., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Products	23,130)	20,149)	19,016)	19,885)	20,280)
Services	16,220)	16,044)	11,957)	11,468)	11,189)
Revenue	39,350)	36,193)	30,973)	31,353)	31,469)
Products	(18,569)	(15,894)	(14,799)	(15,443)	(15,871)
Services	(13,722)	(13,584)	(9,987)	(9,661)	(9,468)
Cost of revenue	(32,291)	(29,478)	(24,786)	(25,104)	(25,339)
Gross profit	7,059)	6,715)	6,187)	6,249)	6,130)
General and administrative (G&A)	(2,411)	(2,258)	(2,010)	(1,940)	(1,952)
Operating earnings	4,648)	4,457)	4,177)	4,309)	4,178)
Interest expense	(472)	(374)	(117)	(99)	(98)
Interest income	12)	18)	14)	8)	15)
Interest, net	(460)	(356)	(103)	(91)	(83)
Other, net	14)	(16)	3)	13)	7)
Earnings from continuing operations before income tax	4,202)	4,085)	4,077)	4,231)	4,102)
Provision for income tax, net	(718)	(727)	(1,165)	(1,169)	(1,137)
Earnings from continuing operations	3,484)	3,358)	2,912)	3,062)	2,965)
Discontinued operations, net of tax	—)	(13)	—)	(107)	—)
Net earnings	3,484)	3,345)	2,912)	2,955)	2,965)

Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

Revenue exhibited a period of relative stagnation between 2015 and 2017, followed by a significant acceleration in growth during 2018 and 2019. Total revenue increased from 31.47 billion in 2015 to 39.35 billion in 2019, representing a notable expansion in the company's top-line performance toward the end of the period.

Revenue Composition and Growth: The growth in total revenue was primarily driven by the Services segment, which grew steadily from 11.19 billion in 2015 to 16.22 billion in 2019. In contrast, the Products segment experienced a slight decline between 2015 and 2017 before recovering and growing to 23.13 billion by 2019. This suggests a strategic shift or market demand increase favoring service-based offerings.
Operating Profitability: Gross profit showed a gradual upward trend, rising from 6.13 billion in 2015 to 7.06 billion in 2019. Operating earnings followed a similar trajectory, increasing from 4.18 billion to 4.65 billion over the same period. While general and administrative expenses rose from 1.95 billion to 2.41 billion, the growth in gross profit was sufficient to maintain an upward trend in operating income.
Financial Expenses and Debt Service: A significant increase in interest expense is observed, rising from 98 million in 2015 to 472 million in 2019. This represents a substantial increase in the cost of borrowing or an expansion of the debt load, which increasingly offset the gains made at the operating level. Net interest costs widened considerably, particularly after 2017.
Net Earnings and Taxation: Net earnings increased from 2.97 billion in 2015 to 3.48 billion in 2019. This growth in the bottom line was supported not only by operating performance but also by a marked reduction in the provision for income tax, which fell from 1.14 billion in 2015 to 718 million in 2019. This reduction in tax expense mitigated the impact of the rising interest costs on the final net income.

Overall, the financial trend is characterized by strong revenue growth in the latter years, driven by the Services sector, and an improvement in net earnings. However, the rising trend in interest expenses indicates an increasing financial burden that is currently being offset by operational growth and a lower effective tax burden.

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