Both of the Falls Church-based companies cautioned that the automatic spending cuts related to the sequester could take a greater toll on their bottom lines in the future, but they were upbeat about their performance so far and raised their profit expectations for the rest of the year.
General Dynamics’ profit grew about 1 percent during the second quarter to $640 million, while revenue was flat. Northrop Grumman’s profit increased 1.7 percent during the quarter, reaching $488 million, while revenue grew slightly to $6.3 billion.
Their results largely echoed those of Bethesda-based Lockheed Martin, the country’s largest defense contractor, which reported a 10 percent jump in quarterly profits Tuesday and raised its profit expectations for the year.
The defense industry had warned that sequestration would have dire consequences for the industry — and the economy overall. But, so far, the industry has weathered the budget cuts with far more ease than expected. Many, including Northrop and General Dynamics, have gradually shrunk their workforce in the past few years in anticipation of spending cuts, helping them manage the current budget woes.