Huntington Ingalls, the largest U.S. shipbuilder, cut its revenue forecast for 2024 due to supply chain problems, uncertainty over navy agreements and labor shortages. This sent its shares down by roughly 7% in premarket.

The company expects that shipbuilding revenues, which are the focus of both of its three divisions will be at the lower end its previously estimated range of $8,8 billion to $9,1 billion.

Huntington expected to reach a deal with the U.S. Navy in the second half 2024 for Virginia-class Block V, Block VI and Columbia class submarines.

The CEO of the company, Chris Kastner, stated that "some uncertainty arose about the timing" of the agreement. This led the company to revise its assumptions regarding profitability and cash flows.

Huntington Ingalls is unable to take advantage of the growing demand for aircraft carriers and submarines fueled by China’s expanding naval footprint, and global tensions. This is due to its persistent difficulties in retaining shipyard workers.

Huntington's third-quarter profit per share was $2.56 compared to $3.70 a year earlier. The revenue also fell 2.4%, to $2.7 billion. (Reporting and editing by Vijay Kishore in Bengaluru, Pratyush Takur in Bengaluru)

(source: Reuters)