Leonardo DRS Inc, a leading defense technology company, saw its stock plummet 5.03% in pre-market trading on Friday. This sharp decline followed the company's fourth quarter 2024 earnings report, which revealed disappointing financial results and a muted outlook for the year ahead.

The Q4 earnings call highlighted a few key factors contributing to the stock's plunge:

• While revenue grew 6% year-over-year in Q4 and 14% for the full year 2024, the company's adjusted EBITDA margin expansion fell short of expectations, rising only 100 basis points in Q4 and 90 basis points for the full year.
• The company's 2025 guidance provided a revenue growth range of 6% to 9% and adjusted EBITDA margin expansion of just 30 to 50 basis points, lower than analysts' expectations.
• Despite strong order bookings and a robust backlog, concerns were raised about the potential impact of the new administration's policies, including a possible shift towards fixed-price contracts and a focus on accelerating innovation and speed of delivery.

However, the earnings call also highlighted some positive developments, such as the company's growing international business, investments in research and development, and the Navy's commitment to support the expansion of DRS' Charleston facility, which could drive future growth in the electric power and propulsion segment.