Elbit Systems Ltd. reported fourth‑quarter 2025 revenue of $2.148 billion, up 11.3% from the same period in 2024, and full‑year revenue of $7.939 billion, a 16.3% increase year‑over‑year. The quarterly growth was driven by a 22% rise in Land segment sales, a 19% increase in C4I & Cyber, and a 39% jump in ISTAR & EW, while Aerospace revenue fell 14% as legacy product demand cooled.
The company’s non‑GAAP diluted earnings per share reached $3.56, beating the consensus estimate of $3.09 by $0.47, a 15.2% beat. The upside was largely a result of disciplined cost management and a favorable product mix that shifted toward higher‑margin defense systems, offsetting the impact of a modest decline in lower‑margin Aerospace revenue. GAAP diluted EPS of $11.39 also surpassed expectations, reflecting the company’s ability to translate higher revenue into stronger earnings.
Elbit’s order backlog climbed to $28.1 billion, an increase of $5.5 billion from the prior year, with 54% of the backlog scheduled for 2026‑27. The backlog expansion signals robust future revenue visibility and underscores sustained demand from European customers, a key driver of the quarter’s performance. The backlog growth is supported by new contracts in the high‑power laser program and continued investment in AI‑enhanced platforms.
Gross margin expanded to 24.7% from 24.1% in Q4 2024, while non‑GAAP gross margin rose to 25.0% from 24.5%. Operating margin improved to 9.0% from 7.3% year‑over‑year, reflecting the company’s ability to maintain pricing power amid rising input costs. The margin expansion was driven by higher mix of high‑margin ISTAR & EW contracts and efficient scaling of production, which helped offset the cost pressure from raw material inflation.
President and CEO Bezhalel Machlis highlighted that the company is “investing heavily in disruptive R&D programs, including AI enhancements across multiple platforms for a total sum of over $500 million.” He also noted that Elbit “continued to invest heavily in high‑power laser technology,” positioning the firm to capture emerging opportunities in advanced weapons systems. These strategic investments are expected to sustain the company’s competitive edge and support future growth.
Market reaction was strongly positive, with analysts citing the EPS beat, record backlog, and margin expansion as key catalysts. The earnings beat, particularly against the lower consensus estimate, reinforced confidence in Elbit’s execution, while the backlog growth and strategic investments signaled continued demand and a solid trajectory for the defense sector.
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