Arrow developer IAI sees profit double amid global demand for defense tech
Arrow developer IAI sees profit double amid global demand for defense tech
The Israel Aerospace Industries recorded a sharp increase across all reporting parameters and presented a record order backlog of $22.2 billion.
The war in Israel and the global wave of armament, particularly in the wake of the war in Ukraine, have positioned the Israel Aerospace Industries (IAI) for its strongest performance in history. The company recorded a sharp increase across all reporting parameters and presented a record order backlog of $22.2 billion.
The revenues of the government company increased by 13% in the second quarter compared to the same quarter last year, reaching $1.42 billion. Quarterly net profit jumped by 115% to $160 million.
For the first half of the year, IAI reported its most profitable half-year, with a net profit of $295 million—an 80% increase compared to the profit during the same period in 2023. Gross profit in the second quarter was $280 million, accounting for 20% of revenues, compared to 17% in the corresponding quarter. Operating profit for the quarter was $163 million, representing 11% of revenues, up from 7% in the same quarter last year.
The sector generating the highest revenue for IAI in the second quarter was missiles and space, with sales exceeding $600 million. Elta Systems, a subsidiary of IAI and a radar manufacturer, recorded sales of $340 million for the quarter.
In light of the ongoing conflict in Gaza and the north, and the significant defense procurement to support IDF needs, more than a third of IAI's sales for the quarter were recorded in the local market, totaling nearly $450 million. This is a substantial increase from about 27% of total sales directed to the local market before the war.
IAI is the developer and manufacturer of the Arrow 2 and Arrow 3 anti-missile defense systems, which were used to intercept ballistic missiles launched from Yemen and Iran. Additionally, the Barak MX defense system, also developed by IAI, is already deployed on the Navy's new missile ships and is designed to protect vital Israeli infrastructure, including gas rigs in the Mediterranean Sea.
In the first half of 2024, IAI's sales to the Israeli market amounted to nearly $1 billion, with the bulk of sales continuing to be recorded in the missile and space division and by Elta Systems.
