Elbit Systems Achieves Record 2025 Revenues and Profit Amid Rising Regional Tensions

Elbit Systems announced its consolidated results for the fourth quarter and full year ended December 31, 2025, highlighting strong revenue growth, record profitability, and an expanded backlog, even as ongoing Middle East conflicts continue to shape regional defense demand.

The company reported full-year revenues of $7.94 billion, a 16% increase from $6.83 billion in 2024, driven by growth across multiple business segments, including C4I and Cyber, ISTAR and Electronic Warfare (EW), Land, Elbit Systems of America, and Aerospace. GAAP net income rose to $534.3 million, up from $321.1 million the previous year, while non-GAAP net income reached $598 million. GAAP diluted earnings per share (EPS) jumped to $11.39 from $7.18, with non-GAAP EPS at $12.75.

Fourth-quarter 2025 revenues totaled $2.15 billion, an 11.3% increase over the fourth quarter of 2024, with the strongest growth in ISTAR and EW (+39%) and Land systems (+22%), reflecting increased sales of maritime systems, electro-optic systems, ammunition, and munitions. C4I and Cyber systems grew 19%, primarily from radio and command-and-control systems in Europe and Israel, while Aerospace revenues declined 14% due to lower training and simulation sales in Europe compared to 2024.

Gross profit for the fourth quarter was $529.8 million (24.7% of revenues), up from $465.2 million in Q4 2024. Non-GAAP gross profit was $536.3 million (25% of revenues). Operating income rose to $192.5 million GAAP (9% of revenues) and $210.8 million non-GAAP (9.8%), with net income attributable to shareholders increasing to $168.2 million GAAP and $169.9 million non-GAAP.

Elbit’s full-year operating performance was supported by significant R&D investment exceeding $500 million, primarily in AI-enhanced systems, and by strategic capital expenditures to expand production capacity amid rising global demand. The company also secured notable contracts with the Israel Ministry of Defense (IMOD), including for Airborne High-Power Laser (HPL) pods for combat jets and HPL systems for helicopters.

Bezhalel Machlis, Elbit Systems’ President and CEO, stated: “Elbit Systems continues to meet its commitments to an expanding global customer base while strengthening its presence across Europe, the United States, and Asia. Our teams are playing a key role in providing the IMOD and IDF capabilities during ongoing regional operations and maintaining our position at the forefront of defense innovation.”

The company’s backlog reached $28.1 billion, a $5.5 billion increase over 2024, with roughly 72% of orders from international customers and 54% scheduled for completion in 2026–2027. Free cash flow exceeded $550 million, representing full cash conversion.

Elbit Systems’ performance has been significantly influenced by the protracted conflicts in the Middle East. The war that began on October 7, 2023, continued throughout most of 2025, with temporary ceasefires with Hamas, Hezbollah, and Iran providing intermittent relief. However, the recent escalation in early 2026—Israel and the U.S. launched a joint operation targeting Iran, followed by Iranian attacks on Israel and U.S. bases, and a Hezbollah strike on March 2, 2026—has created renewed operational and logistical pressures.

The conflicts have increased demand for Elbit Systems’ defense solutions, particularly from the IMOD, while simultaneously challenging the company’s global operations. Supply chain disruptions, rising transportation costs, material shortages, employee reserve call-ups, and attacks on facilities by anti-Israeli actors have required the company to adopt protective and contingency measures. Machlis noted that operational impacts had eased following earlier ceasefires but cautioned that the latest escalation could affect production and delivery timelines depending on the conflict’s trajectory.

Despite these challenges, Elbit Systems has maintained production continuity and strengthened inventories to meet demand. Analysts expect that heightened regional tensions will sustain elevated order volumes for Elbit Systems, reinforcing its strategic role in Israel’s defense infrastructure while supporting international clients.

The company’s robust financial performance, combined with increased orders amid geopolitical uncertainty, positions Elbit Systems for continued growth in 2026, although the ongoing conflicts inject a level of operational risk that remains difficult to quantify.