European Defence: Defence quarterly: Europe leading the way

研报英文原文证据摘录

European Defence: Defence quarterly: Europe leading the way

Equity Research

10 June 2026

European Defence

Defence quarterly: Europe leading

the way

We update our top-down forecasts for European defence European Aerospace & Defence

budgets thru 2035, compare current Europe cycle with US NEUTRAL

cycle 2000-2010, and detail key Middle East spending trends. European Aerospace & Defence

Afonso Osorio, CFA

Global Defence spend reached $2.8tn in 2025, +3% y/y, led by +44 (0)20 3134 7016

Europe +16% (US -8%). We expect European outperformance afonso.osorio@barclays.com

Barclays, UK

to continue. Milene Kerner

+33 (0)1 4458 4002

EPS momentum has been relatively weak this year, the worst since the start of the conflict milene.kerner@barclays.com

in Ukraine in 2022. Defence shares have also underperformed YTD (flat vs SXXP: +4%) and BBI, Paris

are now -16% from the peaks in mid-January (SXXP: +1%) on positioning, on the view that Luke Seelig

higher energy costs / fiscal issues could delay procurement in Europe, and on concerns +44 (0)20 3134 5355

around the relevancy of the companies' portfolios given the changing nature of warfare. It luke.seelig@barclays.com

is fair to be wary of some of these risks, but so far we have seen limited evidence that Barclays, UK

these could severely impact the structural investment case in the sector. Global defence Sambhav Kochar

spending grew +3% in 2025, led by Europe at +16%. We maintain a cautious stance on the +91 (0)22 6175 2559

pace of the European budget uplift but see the region achieving 3.1% of GDP by 2035 (vs sambhav.kochar@barclays.com

2025: 2.3%). The greater share of equipment puts TAM CAGR at +9.1% over the next five Barclays, UK

years. We cross-check our bottom-up corporate earnings forecasts against the top-down