Some are fighting, others are fighting... The world's leading defense companies expect orders to double by 2026 due to Russia's invasion of Ukraine and worsening situation in the Middle East

🌍 This article is also available in RU , UK

2 min read

The British publication Financial Times actively studies the market of defense goods and services, and also predicts the volume of orders received by defense sector companies. With the beginning of the full-scale invasion of Russia into Ukraine and the complication of the situation in the Middle East, this topic has become relevant and important.

Ukraine became the largest arms importer in Europe in 2019-2023 and the fourth in the world after the Russian invasion in 2022.

.......

Last year, 2023, Ukraine was 8th in the world in terms of military spending, which grew by 51% to $64.8 billion and accounted for 58% of total government spending.

Analysts expect the world's top 15 defense companies to double their order book by the end of 2026, reaching $52 billion. FT forecast published by the publication Forbes Ukraine. Financial Times forecasts are based on data from Vertical Research Partners.

Half of all orders will come from the top five US defence companies, while European leaders such as BAE Systems, Rheinmetall and Saab are also expecting significant increases in orders.

Aerospace and defense companies are expected to generate record cash over the next three years, driven by increased orders for new weapons as geopolitical tensions rise. The top 15 defense contractors forecast combined free cash flow of $52 billion by 2026, nearly double what they were in 2021.

U.S. defense contractors expect cash flow to increase to $26 billion by the end of 2026, more than double 2021 levels. European defense giants such as BAE Systems, Rheinmetall and Saab predict cash flow increases of more than 40%.

In response to Russia's invasion of Ukraine and the worsening situation in the Middle East and Asia, governments around the world are increasing their military budgets.

In the US, for example, recent aid laws for Ukraine, Taiwan and Israel provide almost $13 billion in arms production for major defence companies such as Lockheed Martin, RTX, Northrop Grumman, Boeing and General Dynamics, as well as their suppliers. The UK has invested £7.6 billion in military aid to Ukraine over the past three years, including replenishing stockpiles.

According to the Stockholm International Peace Research Institute (SIPRI), in 2023, global defense spending increased by 6.8%, reaching $2.4 trillion. Russia increased military spending by 24% to $109 billion.

.......