The global arms industry has reached a record high, with the world’s top 100 arms makers generating $679 billion in revenue last year. This represents a 5.9% increase from the previous year, according to a report by the Stockholm International Peace Research Institute (SIPRI). The surge in demand is largely driven by the ongoing conflicts in Ukraine and Gaza, as well as the threat perception of Russia by European states.

The report notes that the United States is home to 39 of the world’s top 100 arms makers, including the top three: Lockheed Martin, RTX, and Northrop Grumman. These companies saw their combined revenues rise 3.8% to $334 billion in 2024, nearly half of the world’s total. However, the authors of the report also highlight that budget overruns and delays plague several key US-led programs, such as the F-35 fighter jet and the Columbia-class submarine.

European arms makers also saw significant growth, with 26 of the top 100 companies based in the region experiencing a 13% increase in revenues to $151 billion. The Czech company Czechoslovak Group saw the sharpest increase, with revenue spiking 193% to $3.6 billion, largely due to the Czech Ammunition Initiative, which provides artillery shells for Ukraine.

However, the report also notes that European arms makers are facing difficulties in responding to the increased demand, with sourcing materials becoming more challenging. Chinese export restrictions on critical minerals have led companies such as France’s Thales and Germany’s Rheinmetall to warn of higher costs as they restructure their supply chains.

The Russian arms industry, which has two companies among the top 100, saw combined revenue rise by 23% to $31.2 billion, despite a shortfall of components due to international sanctions. However, the report also highlights that the Russian arms industry is struggling to find enough skilled labor to support the projected rates of production needed to sustain Russia’s war aims.

In contrast, the Asia and Oceania region was the only region to see a decline in overall revenues, with the 23 companies based there experiencing a 1.2% drop to $130 billion. However, the authors stress that the picture across Asia is varied, and the overall drop was largely due to a decline among Chinese arms makers.

The report also notes that Israeli arms companies remain popular, with the three companies in the ranking accounting for more than half of the $31 billion in combined revenues generated by the nine Middle Eastern companies in the top 100. The growing backlash over Israel’s actions in Gaza appears to have had little impact on interest in Israeli weapons, according to SIPRI researcher Zubaida Karim.

The record high in global arms sales highlights the ongoing tensions and conflicts around the world, and the significant role that the arms industry plays in fueling these conflicts. As the demand for arms continues to rise, it remains to be seen how the industry will adapt to the challenges and uncertainties of the current geopolitical landscape.