Israel’s defense exports reach record $19 billion in 2025

Israel’s defense exports reached a record $19.2 billion in 2025, marking the third consecutive annual increase, according to the Israeli Ministry of Defense. The surge follows approval of the country’s largest-ever defense budget and record backlogs from major defense firms like IAI and Elbit. Defense Minister Israel Katz attributed the growth to the Israel Defense Forces’ battlefield achievements and the capabilities of Israel’s defense industries, which have secured unprecedented global demand. Over half of the exports—53 percent—were classified as mega-deals exceeding $100 million each. Missile, rocket, and air defense systems led exports at 29 percent of total deal volume, though this marked a decline from 48 percent in 2024. Observation and optronics systems saw a significant rise, accounting for 22 percent of exports in 2025, up from just 6 percent the prior year. Drones, once a major export, dropped to 4 percent, while radar, electronic warfare, and manned aircraft systems each made up 11 percent of the total. Geographically, 36 percent of exports went to Europe, a decline from 54 percent in 2024, while Asia and the Pacific region accounted for 32 percent. The Middle East and North America received 15 percent and 13 percent, respectively. The ministry noted that Israel’s defense industries maintained round-the-clock production for domestic military needs while fulfilling international contracts amid ongoing conflicts, including the war with Hamas since October 2023 and participation in Operation Epic Fury alongside the U.S. The ministry credited the export boom to strategic reforms, including reduced regulation, expanded market access, and new partnerships. Director General Amir Baram highlighted these changes as key factors behind landmark deals, alongside the proven effectiveness of Israeli defense systems in active conflicts. Systems like the Arrow 3, Barak naval defense, and laser air defenses have been deployed operationally, further boosting global confidence in Israel’s military technology.