Kongsberg Gruppen: Pure-Play Defense Giant Faces First Earnings Test After Restructuring

Kongsberg Gruppen spins off maritime division, sharpens defense focus, and posts strong 2025 results with 32% revenue growth and a record order backlog.

The Norwegian defense contractor has emerged from a corporate transformation that would make most management teams blanch — and now comes the hard part: proving the new structure works.

Kongsberg Gruppen completed its most significant strategic overhaul in a decade on April 23, spinning off its maritime division into a separately listed entity on the Oslo Børs. Shareholders received one share in the new Kongsberg Maritime for each share they held in the parent company. The move transforms the group into one of Europe's purest large-cap defense plays, with its focus narrowed exclusively to defence, aerospace, space and geospatial operations.

The timing of the restructuring has been anything but quiet. Just days after the split, on May 1, Kongsberg signed a Memorandum of Understanding with OSI Maritime Systems to jointly develop technology solutions for warships and submarines. The Canadian firm currently supplies integrated bridge and navigation systems to 27 navies worldwide, with its equipment installed on more than 800 military vessels. For Kongsberg, the partnership opens fresh avenues both domestically and among allied forces.

Eirik Lie has taken the helm as chief executive, succeeding Geir Håøy who led the company for a decade.

A formidable starting position

The numbers heading into the new era are striking. Kongsberg Defence & Aerospace generated revenues of 25 billion Norwegian kroner in 2025, representing 32% year-on-year growth. The division's EBIT margin stood at 16.1%, while its order backlog reached approximately 125 billion NOK. At the group level — prior to the maritime separation — total revenues hit 58.6 billion NOK, with the order book swelling 23% to 157.4 billion NOK.

Physical expansion is gathering pace across three continents. In Virginia, construction began in January on a $100 million missile production facility. A factory in Newcastle, Australia, for Naval Strike Missiles and Joint Strike Missiles is slated to begin production in 2027. Recent contract wins include 2 billion NOK for F-35 components from Lockheed Martin, $240 million for JSM Lot 2 from the US Air Force, and a $1.5 billion framework agreement for the CROWS program with the US Army. The company has also been selected for seven projects under the European Defence Fund.

Analyst recalibration

The corporate split has forced analysts to rework their valuation models. Several houses have lowered their price targets to around 372 NOK to reflect the removal of the maritime business from the group's earnings profile. On the last trading day before the Norwegian holiday, shares closed at 310 NOK, up roughly 2% from the prior session.

The consensus view remains broadly constructive: 54% of analysts rate the stock a buy, with 38% recommending a hold. The average target implies moderate upside from current levels, though the post-split valuation picture is still settling.

The moment of truth

All eyes are now on May 6, when Kongsberg will publish its first-quarter 2026 results — the maiden earnings report under the new corporate structure. The bar is set high: in the same period last year, the group surprised markets with 28% revenue growth. Investors will be watching closely to see whether the streamlined defense pure-play can sustain that momentum without the maritime division's contribution.

The broader sector backdrop remains supportive. European defense spending is at record levels, and Kongsberg's order book — recently bolstered by a 136 million NOK contract for F-35 components and the massive CROWS framework — suggests the pipeline is robust. The question is whether the market will reward the newfound clarity of the group's focus or penalize the loss of diversification.

For a company that has just reinvented itself, the next few weeks will be decisive.