Elbit Systems profits surge due to increased demand from Israel military in Gaza and Hezbollah conflict

Israel’s Elbit Systems, a company which sells weapons to the Israeli military used in attacks on Palestinians, reported a sharp rise in quarterly profits, driven by increased demand from the Israeli military during its ongoing war against Gaza and Lebanese Resistance movement, Hezbollah.

The Israeli arms company posted a net profit of $98.8 million for July-September, marking a nearly 30 per cent increase from $76.5 million in the same period last year. Revenue grew by 14.4 per cent, reaching $1.72 billion, boosted by rising drone sales and a 7 per cent uptick in aerospace-related revenue.

According to the Times of Israel, as Israel faces multiple security threats and the Russia-Ukraine war continues, Israeli defence technology has drawn heightened interest from both Israel’s military and European buyers concerned about regional security.

Moreover, Elbit Systems’ order backlog reached $22.1 billion by the end of September, a $1 billion increase from the previous quarter. Almost 66 per cent of this backlog comes from international clients. Elbit expects 37 per cent of the backlog to be completed by the end of 2024 and into 2025.

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Bezhalel Machlis, president and CEO of Elbit, stated that the company’s strong order backlog, combined with ongoing investments in research and development, ensures long-term stability and growth. In the third quarter, sales to Israel’s military accounted for $499 million, or roughly a third of Elbit’s revenue, while Europe became its second-largest market with $430 million in sales.

He said, “The Company’s order backlog provides stability and resilience for the company for years to come, as our investments in R&D create strong foundations for long-term growth and development.”

“Our highly regarded solutions and products are experiencing high demand,” he added.

Elbit also announced $335 million in new contracts to supply defence systems, including its PULS long-range rocket artillery system and Hermes 900 UAVs, to a European country.

Despite growing protests against Israel, particularly from pro-Palestinian groups, Elbit has secured contracts globally. However, it has resulted in challenges, including supply chain disruptions, export restrictions, rising transportation costs. Recently, the French government has pushed to exclude Israeli defence companies like Elbit from major international defence exhibitions.

In October, Elbit Systems’ office in Gothenburg, Sweden, was targeted in a shooting while, in London, protesters threw red paint at the offices of Allianz, a German financial firm, in protest of its ties to Elbit. Allianz is the latest global financial company to have suffered such vandalism.

In August, seven people were charged with burglary and violent disorder at a warehouse linked to Elbit near Bristol, south-west England.

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