Revenue from the sale of arms and military services by the 100 largest global arms-producing companies is set to reach a record $679 billion in 2024, according to new data released by the Stockholm International Peace Research Institute (SIPRI).
The organization said in a report published on Monday that revenue generated by companies from the sale of military goods and services to domestic and foreign customers increased by 5.9 percent compared to the previous year due to the Gaza and Ukraine wars, as well as global and regional geopolitical tensions and persistently high military spending.
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The bulk of the global increase was attributed to companies based in Europe and the United States, but there were year-on-year increases in all regions except Asia and Oceania, where Chinese arms industry issues drove down the regional total.
Lockheed Martin, Northrop Grumman and General Dynamics lead the pack in the US, where combined arms revenues of arms companies in the top 100 are projected to grow 3.8 percent to $334 billion in 2024, with 30 of the 39 US companies in the ranking increasing their revenues.
However, SIPRI said major projects such as the F-35 fighter jet, Columbia and Virginia class submarines and Sentinel intercontinental ballistic missile are being affected due to widespread delays and budget overruns.
Elon Musk’s SpaceX joins the list of top global military manufacturers for the first time, with its weapons revenue more than doubling to $1.8 billion by 2023.
Excluding Russia, there were 26 arms companies in the top 100 based in Europe, and 23 of them reported growth in revenue from arms and equipment sales. Their total arms revenues increased 13 percent to $151 billion.
Czech company Czechoslovak Group reported the fastest percentage growth in arms revenues of any Top 100 company in 2024, after increasing revenue by making artillery shells for Ukraine by 193 percent to $3.6 billion.
As Ukraine faces continued Russian aggression in its eastern regions, the country’s JSC Ukrainian Defense Industries has increased its arms revenues by 41 percent to $3 billion.
The SIPRI report said European arms companies are investing in new production capacity to fight Russia, but it warned that sourcing materials – particularly in terms of reliance on critical minerals – could pose an “increasing challenge” as China also tightens export controls.
Rostec and United Shipbuilding Corporation are the only two Russian arms companies in the ranking, and they increased their combined arms revenues by 23 percent to $31.2 billion despite being hit by Western-led sanctions over the Ukraine war.
Last year, arms makers in Asia and Oceania recorded $130bn in revenue, despite a 1.2 per cent decline compared to 2023.
The regional decline was due to a combined 10 percent decline in arms revenues among the eight Chinese arms companies in the ranking, most prominently a 31 percent decline in arms revenues at NORINCO, China’s primary producer of land systems.
“Multiple allegations of corruption in Chinese arms procurement have led to major arms contracts being postponed or canceled in 2024,” said Nan Tian, director of SIPRI’s military expenditure and arms production program. “This deepens uncertainty about the status of China’s military modernization efforts and when new capabilities will be realized.”
But sales at Japanese and South Korean arms makers rose on strong demand from European and domestic customers amid rising tensions over Taiwan and North Korea.
Combined arms revenues of the five Japanese companies in the ranking rose 40 percent to $13.3 billion, while revenues of the four South Korean producers rose 31 percent to $14.1 billion. South Korea’s largest arms company, Hanwha Group, projects 42 percent growth in 2024, with more than half coming from arms exports.
Israel profits from Gaza massacre
According to SIPRI, for the first time nine of the top 100 arms companies were based in the Middle East. The nine companies are expected to generate a combined revenue of $31 billion in 2024, representing regional growth of 14 percent.
As the United Arab Emirates faces international accusations of fueling the devastating war in Sudan, the institute said its regional figures exclude Emirates-based EDGE Group due to a lack of revenue data for 2023. The UAE rejects the allegations.
The three Israeli arms companies in the ranking increased their combined arms revenues by 16 percent to $16.2 billion amid the ongoing genocidal war on Gaza that has killed nearly 70,000 Palestinians and destroyed most of the besieged territory.
Elbit Systems made a profit of $6.28 billion, followed by Israel Aerospace Industries with $5.19 billion and Rafael Advanced Defense Systems with $4.7 billion.
SIPRI said there has been an international increase in interest in Israeli unmanned aerial vehicles and counter-drone systems. Rafale’s surge was linked to Iran, as demand for the company’s air defense systems increased to “unprecedented levels” following Iran’s massive retaliatory strikes against Israel in April and October 2024, which used ballistic missiles and drones.
Five Turkish companies were in the top 100 – this is also a record. Their combined arms revenues were $10.1 billion, an increase of 11 percent.
Baykar, which, among other things, makes advanced drones recently sold to Ukraine, expects to derive 95 percent of its $1.9 billion arms revenue in 2024 from exports to other countries.
Military companies from the United Kingdom, France, Germany, Italy, India, Taiwan, Norway, Canada, Spain, Poland and Indonesia were also in the ranking.
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