Defense company Elbit Systems (TASE ESLT; Nasdaq: ESLT) released strong 2024 results today, showing record demand for its products. The company has a market cap of $16.5 billion, after a 43% rise in its share price so far this year, to an all-time high.
Elbit Systems’ revenue grew by 14.3% last year to $6.8 billion, of which $1.9 billion was recorded in the fourth quarter. GAAP-based net profit attributable to shareholders rose 49.3%, to $322 million. On a non-GAAP basis, the company posted net profit of $392 million, 31% higher than in 2023. It generated cash flow from operations of $535 million in 2024, up from $114 million in 2023.
Elbit’s orders backlog rose by some $500 million in the fourth quarter to $22.6 billion at the end of the year, which compares with $17.8 billion at the end of 2023. Since 2020, the company’s order book has doubled.
Israel’s share in the company’s revenue rose from 19.5% in 2023 to 29.1% in 2024, and was worth $1.99 billion, representing growth of 70.3%, largely because of the Swords of Iron war. Revenue rose in most geographical areas.
At an investor conference held by Elbit Systems at the Tel Aviv Stock Exchange today, CEO Bezhalel Machlis said, “The global defense environment is being driven by three conflicts that are leading to higher defense budgets. The first is the Chinese threat, which affects all the countries in the region – Japan, India, Thailand, the Philippines, Australia, Korea – and in all of them there has been a very large rise defense budgets to cope with the Chinese challenge.
“The second conflict is in Europe. The Russian threat is causing massive rearmament in all European countries, and there is a will in Europe to build a local defense industry. The third threat relates to Iran and its satellites, and it affects us and all the Sunni countries, among them the Gulf states. We are very active in the region. The only place where defense budgets have declined is Latin America. In general, there is a huge opportunity for Elbit Systems. We see some of it in the 2024 reports, and you will see the continuation of this in the future as well.”
Amplifying his remarks on what is happening in Europe, Machlis said, “US President Donald Trump, in his previous term, demanded that the countries of Europe should spend 2% of GDP on defense. At that time they were well below 2%, and today they are getting close to 2%. Every 1% rise in their defense budgets is $280 billion in a year. Now, Trump is demanding that the European countries should spend 5%, but even if they don’t reach 5%, but only 3%, that is still a huge jump in defense spending. Our potential in Europe is huge.”
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Elbit’s revenue from Europe grew 2.5% in 2024, to $1.8 billion, 26.7% of total sales.
Investment in AI
As for the company’s activity in Israel, Machlis mentioned its new factory at Ramat Beka in the Negev, which he said would be considerably expanded. To meet demand, the government has allowed Elbit to continue operating its Ramat Hasharon factory for a further two years.
The company has sites in Kiryat Shemona and Tel Hai in the north of Israel, and Machlis said that it had resumed their operation and would continue to expand production there.
Machlis presented a video clip in which Chief of Staff Eyal Zamir (in his previous role as director general of the Ministry of Defense) says that Israel’s defense industry saved the country by ensuring routine supply. Incidentally, Machlis said that Elbit Systems had set a goal for itself for hiring injured IDF soldiers, and had already taken on dozens of them. The company has some 22,000 employees, about 14,000 of them in Israel.
Machlis also commented on the impact of AI on the company. He said that this was threefold: faster and more efficient development; more efficient operational management; and in the company’s systems, in which, he said, “AI is embedded in all of them, so that the system will not just deliver the data, but will also analyze it.”
Published by Globes, Israel business news – en.globes.co.il – on March 18, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.
