Report reveals world's largest arms manufacturers saw a 5.9% increase in revenue last year, reaching a record high

STOCKHOLM Global arms manufacturers experienced a 5.9% rise in income from weapons and military services last year, fueled by ongoing conflicts in Ukraine and Gaza and increased defense budgets, according to a report published Monday. The Stockholm International Peace Research Institute (SIPRI) reported that the top 100 arms producers generated $679 billion in 2024, marking the highest revenue ever recorded.

The growth was primarily driven by companies based in Europe and the United States, although most regions saw increases except Asia and Oceania, where challenges in China's defense industry caused a slight decline. Of the 39 U.S. companies in the top 100, including Lockheed Martin, Northrop Grumman, and General Dynamics, 30 reported higher earnings, bringing total revenue to $334 billion, up 3.8%. SIPRI noted that major U.S.-led programs, such as the F-35 fighter jet, still face delays and cost overruns.

In Europe, 23 of the 26 companies outside Russia reported revenue growth, with total earnings rising 13% to $151 billion. Increased spending linked to the Ukraine conflict and perceived Russian threats contributed to the surge. Notable gains included the Czech Republic's Czechoslovak Group, whose revenue jumped 193% due in part to a government initiative supplying artillery shells to Ukraine, and Ukraine's JSC Ukrainian Defense Industry, which saw a 41% rise. European firms are expanding production capacities, but sourcing materials could become challenging, with supply chain adjustments for critical minerals complicated by Chinese export limits, according to SIPRI researcher Jade Guiberteau Ricard.

Russian companies Rostec and United Shipbuilding Corporation recorded a 23% rise in arms revenue, totaling $31.2 billion, despite sanctions causing component shortages. Domestic demand compensated for declining exports, although labor shortages remain an obstacle.

In the Middle East, the three Israeli companies included in the ranking achieved a 16% increase in revenue, reaching $16.2 billion. SIPRI researcher Zubaida Karim noted that global interest in Israeli arms remained strong despite the backlash over actions in Gaza, with many nations placing new orders.

Conversely, Asia and Oceania experienced a 1.2% revenue decrease to $130 billion, mainly due to a 10% drop in income among eight Chinese firms. Corruption scandals in Chinese defense procurement led to contract delays and cancellations, SIPRI reported.

Author: Sophia Brooks