Workers assemble a Leonardo AW139 helicopter on the production floor of the Leonardo plant in Varese, Italy, Thursday, March 20, 2025.
Bloomberg | Bloomberg | fake images
Italian defense company leonardo It said Thursday that it is “positioned on a strong growth path” as European defense companies stand to gain business from the war in Iran, as they have been boosted by the war in Ukraine.
Leonardo revealed plans to double its profits by 2030, the day after the German arms maker Rheinmetall It predicted that its sales could grow up to 45% this year, as both companies have a record order book.
Leonardo CEO Roberto Cingolani told investors that warfare was “becoming faster and more dangerous” and warned of the rise of hybrid threats that “increase uncertainty and operational complexity.”
Rheinmetall said it was in a “privileged position” to arm the United States amid the war in Iran, and its chief executive, Armin Papperger, told investors that “over the next 10 years, there will be a huge need” for its products.
Rheinmetall shares fell 8% after the guidance, which a Jefferies analyst described as “realistic but soft,” adding that investors had high expectations for a share price that is up 1,700% since the start of 2022.
The war in Iran, which has entered its thirteenth day, has renewed attention on defense companies, which are seeing increased demand regardless of their specific focus within the sector.
Leonardo is positioning itself as a digital defense player, investing in defense electronics and interconnected platforms such as “Michelangelo’s Dome,” which can detect and neutralize aerial threats similar to Israel’s Iron Dome. Rheinmetall is a leading supplier of ground systems such as tanks and ammunition.
The Swedish Saab specializes in fighter aircraft, while the British Bae SystemsThe largest of the European defense companies by sales and market capitalization, it has a broad portfolio of military equipment, from nuclear submarines to the Eurofighter Typhoon aircraft.
Annual income of Rheinmetall, Leonardo, Bae Systems and the French company SuchThe German Hensoldt and Saab rose an average of 57% between 2021 and 2025.
These companies also experienced large increases in order intake, an indicator of future sales, during the same period.
Rheinmetall and Saab have seen the most explosive growth of 323% and 284%, respectively, according to unaudited 2025 figures.
On average, order intake grew by 135%. Thales’ order intake grew by 27% between 2021 and 2025.
Analysts at Barclays earlier this week upgraded their recommendation on Leonardo to Overweight from Neutral, saying the US-Iran conflict helps the narrative of a booming defense sector in the near term, but Leonardo has greater earnings momentum relative to its peers.
Its diversified portfolio and low exposure to Ukraine also offer resilience to the potential impact of a ceasefire, they added.
