Hensoldt Navigates Dual Growth Paths: Defense Contracts and Civilian Aviation

Hensoldt reports a record €8.83B defense backlog while entering the urban air mobility market with ePlane Company, aiming for €2.75B revenue in 2026.

The defense electronics specialist Hensoldt is charting a course for expansion on two distinct fronts. While its core military business is overflowing with a historic order backlog, the company is simultaneously making a strategic entry into the promising future market of urban air mobility.

Unprecedented Backlog in Core Defense Operations

The immediate driver for Hensoldt is its traditional defense sector performance. The company concluded its 2025 fiscal year with extraordinary momentum, securing new orders worth €4.71 billion. This figure represents a substantial 62 percent increase compared to the previous year. Consequently, the total order backlog has swelled to a record €8.83 billion. Revenue climbed in parallel, rising by nearly ten percent to reach €2.455 billion.

This operational strength, however, presents a significant logistical challenge. The central task for management is converting this massive pile of orders into realized revenue, a process hampered by current production capacity constraints. This practical hurdle is likely a factor behind the recent pause in the stock's rally. Although shares, closing yesterday at €77.95, remain up approximately 19 percent over a twelve-month horizon, they have retreated somewhat from the €80 mark in recent weeks.

Strategic Move into Civilian Urban Air Mobility

Alongside managing its defense boom, Hensoldt is planting a flag in a new growth area. A recently announced collaboration with India's "The ePlane Company" signals a deliberate expansion beyond pure defense technology. Hensoldt will supply the avionics—the "digital nervous system"—for the compact e200X electric air taxi.

This move leverages the company's deep-rooted expertise in military radar systems and mission computers, adapting this technology for connectivity and situational awareness in civilian airspace. The Indian market, with its densely populated urban regions and chronically congested road networks, offers substantial potential for this emerging form of transportation.

Acquisitions and Expansion to Ease Bottlenecks

To address the capacity bottleneck head-on and fulfill its soaring defense commitments, Hensoldt's management has moved swiftly. On March 5, the firm acquired Dutch optronics specialist Nedinsco, a move that bolsters its technological portfolio and stabilizes European supply chains. Merely one day later, the company announced plans for a major expansion of its own development and production facilities at its Aalen site.

These decisive steps are aimed at creating the concrete foundation needed to profitably work through the enormous order book in the coming quarters. For the ongoing 2026 fiscal year, the company is targeting revenue of approximately €2.75 billion, with an adjusted EBITDA margin projected between 18.5 and 19 percent.

Shareholders are set to participate in this solid performance through a proposed dividend of €0.55 per share for the 2025 financial year. The rapid and smooth integration of these new production capacities will be critical as Hensoldt executes its balancing act between capitalizing on a record defense pipeline and pioneering in the civilian aviation future.