Gaza war and higher European spending lift profit at Israel's Elbit Systems (updated)

Elbit Systems

18/11/2025 16:38

Adds details, officials' comments, shares in paragraphs 2-4, 7-10

By Steven Scheer

JERUSALEM, Nov 18 (Reuters) - Israel's largest defence firm Elbit Systems ESLT.TA reported sharply higher third-quarter profit on Tuesday, fuelled by sales to Israel's military during its war against Palestinian militant group Hamas in Gaza and by higher global defence spending.

Company officials expect a growing order backlog to continue translating into higher sales and profits. Elbit was getting better at converting its backlog into revenue and profit, CFO Kobi Kagan said.

On the heels of more European contracts, Elbit's backlog of orders reached $25.2 billion. Some 69% of the backlog is from outside Israel, while 38% of the orders are scheduled to be fulfilled during the rest of 2025 and in 2026.

Elbit ESLT.O said it earned $3.35 per diluted share, excluding one-time items in the July to September quarter, up from $2.21 a year earlier.

Revenue rose to $1.92 billion from $1.72 billion.

Its Nasdaq-listed shares were up 0.5% at $505.74.

CEO Bezhalel Machlis said that despite a ceasefire after two years of war in the Gaza Strip, companies that had halted purchases during the conflict were resuming orders while in Israel, "there is a huge need to build inventory".

Prime Minister Benjamin Netanyahu has also touted the need for Israel's defence industry to become more self-reliant.

Machlis told Reuters Elbit had brought to the market products that combined several of its technologies, including a successful long-range air-to-ground missile. A strong backlog "indicates stability for years to come," he said.

The quarterly results were boosted by a 14% increase in revenue from the company's command, control, communications, computer, intelligence and cyber systems.

More than 33% of Elbit's revenue came from Israel, where the country fought an intensive campaign against Hamas from October 7, 2023 until a ceasefire deal last month. The company supplied munitions, drones, guided rocket systems, reconnaissance capabilities and other systems to Israel's military.

Sales to Europe, which is in the process of boosting defence spending largely due to threats from Russia, rose to $536 million from $430 million a year earlier, comprising 28% of revenue.

Elbit said on Monday it had received a $2.3 billion, eight-year international contract, without disclosing further details.

The company said it would pay a quarterly dividend of 75 cents a share.

 (Reporting by Steven Scheer. Editing by Mark Potter, Aidan Lewis)

 ((steven.scheer@thomsonreuters.com; +972 2 632 2210; Reuters Messaging: X: @StevenMScheer))