Western companies specializing in the production of missiles, including both offensive rockets and defensive interceptors, are experiencing a significant surge in new orders, according to a report by The Wall Street Journal. This increased demand is bolstering order books and backlogs across the defense industry, driven by ongoing global conflicts and the need to replenish strategic stockpiles. The development signals a robust period for major defense contractors.
Leading the financial gains, Lockheed Martin reported an 11% increase in its second-quarter missile sales. This growth was largely attributed to a rise in Hellfire missile deliveries. Similarly, Raytheon's (RTX) missile unit saw its revenue climb by 8%, propelled by higher sales of its Patriot equipment and NASAMS surface-to-air missile systems.
The heightened demand is a direct consequence of protracted conflicts, particularly the war in Ukraine and tensions in the Middle East, which have significantly drawn down existing Western missile supplies. The U.S. Army, for instance, has requested Lockheed Martin to quadruple its production of PAC-3 missiles for Patriot batteries. Boeing is also set to boost the production of small-diameter bombs.
Companies are actively working to meet this escalating need for both precision-guided munitions and advanced air defense systems. The Wall Street Journal noted that the industry expects backlogged orders for weaponry to reach record levels later this year. This surge is providing a substantial jolt to the entire defense supply chain, from raw materials to final assembly.
Despite the positive financial outlook, the rapid increase in orders presents challenges for manufacturers in scaling up production quickly. The report highlighted that while Western companies are seeing a surge, there are ongoing discussions about the pace of their production compared to some other nations. Nevertheless, the current geopolitical landscape continues to drive an unprecedented level of activity in the Western missile manufacturing sector.