Thales Boosts Defense Output Amid Spending Surge

Global defense spending is surging, with arms sales reaching an unprecedented $2.7 trillion in 2024, fueled by geopolitical tensions and increased demand for military equipment, according to industry leaders and a leading conflict think tank.

Global Arms Spending Surges to $2.7 Trillion

Arms spending in 2024 reached $2.7 trillion, according to the Stockholm International Peace Research Institute (SIPRI). The world’s top 100 defense companies collectively generated $679 billion in revenue, the highest amount reported since SIPRI began tracking the data in 2002.

“There is a very strong increase in defense spending in Europe, Asia, the Middle East, and in the Americas—it’s growing everywhere,” said Pascale Sourisse, CEO of Thales International, during the Singapore Airshow. The increased demand has prompted Thales, a French defense and technology company, to significantly ramp up production.

Thales has quadrupled its radar production to meet rising demand for air surveillance, Sourisse noted. The company is also focusing on technologies to counter drone attacks, known as Counter-Unmanned Aerial Systems (C-UAS), and manage swarms of drones.

Shares of Thales have increased by more than 50% over the past year, mirroring a global boom in defense stocks as investors anticipate continued demand for weapons and defense systems. Other defense firms, including Germany’s Rheinmetall, South Korea’s Hanwha Aerospace, Japan’s Mitsubishi Heavy Engineering, and Singapore’s ST Engineering, have also seen share prices rise by more than 100%.

Expanding Beyond Defense

Beyond defense, Thales is a major player in avionics and civil aviation, investing in AI-enabled flight systems to optimize flight paths and enhance safety. Airlines can now utilize weather forecast data with Thales’s AI systems to optimize flight paths immediately after takeoff.

The company’s AI-powered air traffic control systems are also designed to minimize delays and reduce fuel consumption, potentially by around 10%, at busy airports like Singapore’s Changi Airport. Passenger traffic has already surpassed pre-COVID levels in key hubs, increasing the need for efficient air traffic management.

Thales’s cybersecurity division has grown since its 2019 acquisition of Gemalto. The company’s Singapore facility currently produces over 200 million banking cards, 12 million identity cards, and nearly 10 million passport data pages annually.

Thales is investing in new automated technologies at its Singapore plant, aligning with the country’s ambition to become a global hub for advanced manufacturing. The company is also deepening its presence in Asia, with a focus on Southeast Asian countries like Indonesia, Malaysia, and Vietnam, as well as East Asian markets like China, Japan, and South Korea.

Thales is expanding its operations in India, where it currently employs 2,300 people, with plans for significant growth. The company generated 15.3 billion euros ($18.1 billion) in revenue for the first nine months of 2025, an 8.4% year-on-year increase. Approximately 80% of this revenue came from Europe, North America, Australia, and New Zealand.

The defense business accounted for 8.2 billion euros ($9.8 billion) in revenue, more than half of Thales’s total, and was the fastest-growing segment, increasing by 14% year-on-year.