Wars, ongoing conflicts and rising tensions have driven sales of arms and military services by the world’s 100 largest companies to $632bn in 2023, according to the Stockholm International Peace Research Institute (SIPRI) report.
This represents a 4.2% real-terms increase compared to 2022. Arms revenues rose across all regions, with significant growth observed among companies in Russia and the Middle East. Smaller producers were notably quicker to meet the increased demand driven by the conflicts in Gaza and Ukraine, escalating tensions in East Asia, and rearmament efforts in various regions.
SIPRI military expenditure and arms production programme researcher Lorenzo Scarazzato said: “There was a marked rise in arms revenues in 2023, and this is likely to continue in 2024. The arms revenues of the Top 100 arms producers still did not fully reflect the scale of demand, and many companies have launched recruitment drives, suggesting they are optimistic about future sales.”
In the US, 41 companies recorded arms revenues of $317bn, accounting for half of the total arms revenues. Although arms revenues for US companies have increased, they continue to face production challenges.
This was a 2.5% increase from 2022, despite companies such as Lockheed Martin and RTX experiencing a decline.
SIPRI military expenditure and arms production programme director Dr Nan Tian said: “Larger companies like Lockheed Martin and RTX manufacturing a wide range of arms products often depend on complex, multi-tiered supply chains, which made them vulnerable to lingering supply chain challenges in 2023. This was particularly the case in the aeronautics and missile sectors.”
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The UK’s Atomic Weapons Establishment stood out among British companies, with a notable 16% increase in arms revenues year-on-year, reaching $2.2bn.
Early in December 2024, the UK Ministry of Defence announced plans for a multi-year procurement framework to secure high explosives for Ukrainian warheads and artillery amid a global munitions shortage.
Revenue from arms sales for the 27 European companies listed in the Top 100, excluding those in Russia, totalled $133bn, a marginal 0.2% increase from 2022, representing the most modest regional growth globally.
The overall stagnation in revenue growth among European arms manufacturers masks a more intricate situation. Many of these firms were engaged in fulfilling pre-existing contracts for advanced weaponry throughout 2023, meaning the recent surge in orders has yet to be reflected in their financial outcomes.
In contrast, several European arms producers experienced significant revenue increases due to heightened demand stemming from the conflict in Ukraine. This demand particularly affected sectors such as ammunition, artillery, air defence, and land systems.
Notable among these were companies from Czechia, Germany, Norway, Poland, Sweden and Ukraine. For example, Germany’s Rheinmetall ramped up its production of 155mm ammunition and saw a revenue boost from delivering Leopard tanks and securing new contracts through exchange programs that support Ukraine with military supplies.
Russian defence companies noted a substantial increase in revenue due to wartime production demands. The two Russian entities within the Top 100 witnessed a combined revenue jump of 40% to an estimated $25.5bn. This spike was largely attributed to Rostec—a state-owned conglomerate encompassing numerous arms manufacturers—which alone reported a 49% rise in arms sales.
Meanwhile in Asia and Oceania, South Korean and Japanese defence companies led the way in revenue growth at 5.7%, reaching $136bn.
South Korean companies experienced a 39% increase in arms revenues, totalling $11.0bn.
Japanese companies saw a 35% rise to $10.0bn, propelled by domestic military build-up policies since 2022.
The value of new orders for some Japanese companies increased by more than 300%.
Chinese companies within the Top 100 reported their lowest annual increase since 2019 at just 0.7% amidst an economic downturn, bringing their total arms sales for 2023 to $103bn.
In India, the three companies in the Top 100 recorded a 5.8% increase in arms revenues, reaching $6.7bn.
Israeli companies, amid the Gaza conflict, achieved $13.6bn in arms revenues, which marks the highest ever recorded by Israeli companies in the SIPRI Top 100.
Türkiye’s three companies saw a 24% increase in arms revenues to $6.0bn, driven by exports and a push for self-reliance in arms production.
Baykar, a Turkish producer of armed uncrewed aerial vehicles, reported a 25% revenue increase to $1.9bn, with exports comprising 90% of its arms revenues.
Lastly, arms producers based in the Middle East—comprising six companies within the Top 100—experienced an aggregate revenue growth of 18% due to conflicts including those in Gaza and Ukraine, reaching $19.6bn.
