Global Arms Industry Sees Unprecedented Growth Amid Rising Conflicts
The world's top 100 arms manufacturers achieved record-breaking revenues of $679 billion in 2024, marking a significant 5.9% increase from the previous year. This unprecedented growth comes as ongoing conflicts in Ukraine and Gaza continue to drive global demand for military equipment and weapons systems.
According to the latest report from the Stockholm International Peace Research Institute (SIPRI), the arms industry has experienced a remarkable 26% revenue growth over the past decade from 2015 to 2024. Researchers attribute this surge to heightened geopolitical tensions and increased military spending worldwide.
European Demand Surges Amid Security Concerns
Europe emerged as the primary driver of this growth, with regional arms revenues jumping by 13% to reach $151 billion. Lorenzo Scarazzato, a researcher with SIPRI's Military Expenditure and Arms Production Programme, confirmed that "last year global arms revenues reached the highest level ever recorded by SIPRI as producers capitalised on high demand."
The research highlights that European nations are significantly boosting their military capabilities in response to Russia's perceived threat following the invasion of Ukraine. Countries supporting Ukraine militarily are actively replenishing their depleted stockpiles while simultaneously pursuing broader military modernization programs.
Czech company Czechoslovak Group demonstrated the most dramatic growth, with revenues skyrocketing by 193% to $3.6 billion, largely benefiting from the Czech Ammunition Initiative supplying artillery shells to Ukraine.
American Dominance and Production Challenges
The United States maintains its position as the global leader in arms manufacturing, hosting 39 of the world's top 100 defense companies. American firms collectively generated $334 billion in revenue during 2024, representing nearly half of the global total.
Industry giants Lockheed Martin, RTX (formerly Raytheon Technologies), and Northrop Grumman continue to dominate the rankings. However, the report notes significant production challenges affecting major US defense programs, including the F-35 fighter jet and Columbia-class submarine, which face budget overruns and delivery delays.
Supply Chain Obstacles and Regional Variations
European arms manufacturers are confronting substantial supply chain difficulties as they attempt to meet escalating demand. Critical materials sourcing has become increasingly problematic, with companies like Airbus and France's Safran forced to find alternative suppliers after previously relying on Russia for half of their titanium requirements.
Chinese export restrictions on essential minerals have further complicated production, prompting warnings from major manufacturers including Thales and Rheinmetall about rising costs as they restructure their supply networks.
Meanwhile, Russian arms producers Rostec and United Shipbuilding Corporation defied international sanctions to achieve 23% revenue growth to $31.2 billion, though they face significant labor shortages and component deficiencies.
The Asia and Oceania region represented the only geographic area experiencing decline, with combined revenues dropping 1.2% to $130 billion. This decrease primarily resulted from corruption allegations in China that caused major arms contracts to be postponed or cancelled.
In contrast, Middle Eastern arms companies, particularly three Israeli firms, saw revenues grow by 16% to $16.2 billion, indicating that international backlash over Gaza conflict actions has not substantially impacted demand for Israeli military technology.
