Naval Defense Surge: Why Aircraft Carrier Manufacturers Are Positioned for Strong Growth

The global defense sector is experiencing a fundamental shift as geopolitical tensions accelerate naval modernization investments. This trend is creating substantial opportunities for key suppliers in the shipbuilding ecosystem, with Huntington Ingalls Industries at the forefront of this expansion.

Market Momentum Driving Aircraft Carrier Demand

Defense analysts project the aircraft carrier market will expand at a compound annual growth rate of 12.75% through 2030, driven by nations worldwide strengthening maritime capabilities. This surge reflects a strategic pivot among governments seeking to enhance coastal protection and command-and-control operations across global waters.

HII stands uniquely positioned to capitalize on this tailwind. As the sole U.S. manufacturer of aircraft carriers and the nation’s premier shipbuilder, the company maintains a competitive moat that extends beyond current contracts into multi-decade defense spending cycles.

Recent Contract Win Signals Sustained Demand

HII’s Newport News Shipbuilding division recently secured an agreement valued at approximately $97.7 million to procure long-lead materials for the refueling and comprehensive overhaul of the USS Harry S. Truman (CVN 75). The project, slated for completion by September 2026, demonstrates the continuous stream of maintenance and modernization work supporting steady revenue visibility.

The contract’s scale reflects the complexity inherent in nuclear-powered carrier sustainment—work that requires decades of specialized expertise accumulated through building more than 31 carriers since 1933, including all active Nimitz-class vessels and the inaugural Gerald R. Ford-class platform.

The Broader Defense Supply Chain

Beyond shipbuilding, the aircraft carrier ecosystem supports a diverse range of specialized contractors supplying advanced systems and components:

Radar and Defense Systems: RTX Corporation’s Raytheon unit manufactures the SPY-6 radar family, providing air and missile defense across seven warship classes. The company targets 10.21% long-term earnings growth, with 2025 sales projections of $87.07 billion (up 7.8% year-over-year).

Naval Construction Capabilities: BAE Systems builds and maintains sophisticated warships globally, including the United Kingdom’s Queen Elizabeth-class carriers. The company forecasts 14.57% long-term earnings expansion, with 2025 sales estimated at $40.79 billion—a significant 63.3% increase.

Electronic Warfare Systems: Lockheed Martin deploys AN/SLQ-32 electronic warfare systems aboard all U.S. aircraft carriers, providing threat detection and anti-ship missile defense. LMT projects 11.94% long-term earnings growth with 2025 sales guidance of $74.44 billion (up 4.8%).

Stock Performance and Valuation Context

HII shares have appreciated 38% over the past six months, outpacing the broader defense industry’s 14.1% gain. This performance reflects investor confidence in the company’s contract backlog and long-term positioning within a structurally favorable defense spending environment.

Currently carrying a Zacks Rank of #3 (Hold), HII remains a core holding for investors seeking exposure to sustained naval modernization demand and the multi-decade maintenance cycles inherent to carrier operations.

The convergence of geopolitical necessity, aging naval fleet requirements, and next-generation platform development creates a compelling long-term thesis for companies embedded in aircraft carrier production and sustainment across the defense industrial base.