Europe’s biggest defence contractor reported better-than-expected underlying earnings of £3.32 billion for 2025, up 12% on 2024.
BAE Systems has set new records with its annual results amid a ramping-up in global defence spending as geopolitical uncertainty remains heightened.
Europe’s biggest defence contractor reported better-than-expected underlying earnings before interest and taxes of £3.32 billion for 2025, up 12% on the previous year, as sales jumped 10% to a record high of £30.66 billion.
The aerospace and weapons manufacturer said its order backlog also hit a record £83.6 billion as of the end of December while its order intake stood at £36.8 billion.
Chief executive Charles Woodburn said: “In a new era of defence spending, driven by escalating security challenges, we’re well-positioned to provide both the advanced conventional systems and disruptive technologies needed to protect the nations we serve now and into the future.
“With a record order backlog and continuing investment in our business to enhance agility, efficiency and capacity, we’re confident in our ability to keep delivering growth over the coming years.”
The firm forecast further growth in 2026, albeit at a slower pace, with the firm pencilling in underlying earnings growth of between 9% to 11% and sales to rise by between 7% and 9%.
BAE – which makes weapons ranging across missiles and artillery systems, tanks, planes and warships – has been boosted as countries worldwide increase spending on defence, with Europe in particular re-arming itself.
In the UK, Prime Minister Sir Keir Starmer said earlier this week that Britain needed to “go faster” in increasing military spending and is reportedly looking at accelerating plans to commit 3% of UK gross domestic product to defence.
BAE said notable orders last year include a contract from Turkey for 20 Typhoon aircraft, expected to be worth £4.6 billion to the firm and support 20,000 UK jobs, as well as an order from Norway for Type 26 frigates.
