Italian defense and aerospace group Leonardo has signaled strong momentum heading into 2026, forecasting higher orders, revenues, and operating profits as global defense spending continues to rise. The company also proposed a dividend of €0.63 per share, highlighting confidence in its financial position and cash generation capabilities. As geopolitical tensions reshape defense budgets across Europe and beyond, Leonardo appears well positioned to benefit from increased government investment in military technology, aerospace systems, and security infrastructure.

Orders and Revenue Expected to Climb in 2026

Leonardo expects new orders to reach approximately €25 billion in 2026, compared with €23.8 billion recorded in 2025. Revenue is also projected to grow to about €21 billion, up from €19.5 billion the previous year. The company’s outlook reflects sustained demand for defense equipment and advanced aerospace technologies as governments increase military spending in response to evolving security threats. The growth trajectory also highlights Leonardo’s strong position within Europe’s defense supply chain, where long-term government contracts and international partnerships continue to support stable revenue expansion.

Profitability and Cash Generation Continue to Strengthen

The defense contractor expects earnings before interest, taxes, and amortization (EBITA) to reach around €2.03 billion by the end of the year. Improving profitability is supported by operational efficiencies, strong order backlogs, and ongoing investment in high-value defense technologies. The company emphasized that stronger cash generation is reinforcing its financial stability, allowing it to maintain investment in research and development while also returning value to shareholders through dividends. Such financial resilience is particularly important in the defense industry, where large contracts often require sustained capital investment over long development cycles.

Dividend Proposal Signals Confidence in Financial Outlook

Leonardo’s proposal to distribute a dividend of €0.63 per share underscores management’s confidence in the company’s growth trajectory and balance sheet strength. Dividends remain a key attraction for investors in large industrial and defense companies, which often generate predictable cash flows through long-term government contracts. By increasing shareholder returns while maintaining investment in technology development, Leonardo aims to balance growth with financial discipline as it expands its global defense and aerospace operations.

Industry Outlook

Looking ahead, the outlook for defense contractors such as Leonardo appears closely tied to rising geopolitical tensions and increased government defense budgets. Many European countries are accelerating military modernization programs, creating long-term opportunities for companies involved in aerospace systems, defense electronics, and security technologies. At the same time, the industry faces challenges including supply chain constraints, technological competition, and evolving regulatory oversight. Investors will therefore be watching whether Leonardo can sustain its growth trajectory while navigating the complex global defense market.