Thales SA: 1H26 Results: Orders and EBIT Beat, FCF Exceptional

Research evidence excerpt

Thales SA: 1H26 Results: Orders and EBIT Beat, FCF Exceptional

Update

July 23, 2026 06:28 AM GMT

Morgan Stanley & Co. International plc+MThales SA | Europe Ross Law, CFA

Equity Analyst

1H26 Results: Orders and EBIT Ross.Law@morganstanley.comMarie-Ange Riggio +44 20 7677-0560

Marie-Ange.Riggio@morganstanley.com +44 20 7677-2003

Beat, FCF Exceptional Leonore Pele

Research Associate

Leonore.Pele@morganstanley.com +44 20 7425-2044

AlphaSignals Earnings Reaction

Thales SA (TCFP.PA, HO FP)

Unchanged Modest upside Largely unchanged

Aerospace & Defence | France

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS Stock Rating Equal-weight

Source: Company data, Morgan Stanley Research Industry View Attractive

Price target €253.00

Shr price, close (Jul 22, 2026) €226.80

Key Takeaways 52-WeekMkt cap, currRange(mn) €279.30-212.60€46,694

Net debt (12/26e) (mn)* €1,388

Orders +22% org yoy, a 19% beat, driven by Defence and Space. Europe and EV, curr (mn)* €49,648

Middle East orders grew materially.

* = GAAP or approximated based on GAAP

Sales in line, with Defence modestly ahead offset by Aerospace and Cyber &

Digital slightly shy.

Adj. EBIT 4% ahead – Aerospace (Space) and Defence, offset by Digital.

FCF very strong at €1.9bn, driven by working capital.

FY26 guidance confirmed, having recently upgraded order intake and cash

generation targets.

Our view: Headline H1 metrics are either ahead (orders, EBIT, FCF) or in line (sales)

with consensus expectations. Orders and FCF are the standouts. Orders grew 22%

organically and came in 19% ahead, despite a tough comp, driven by defence as well

as space. FCF grew ~4x yoy (+300% vs cons.), driven by a >€1bn positive swing in

working capital (downpayments and execution).