BAE Systems raises 2025 outlook after strong H1 performance

BAE Systems has raised its full-year guidance after reporting strong results for the first half of 2025, with momentum driven by combat air and space programs. Sales rose 11% year-on-year to £14.6 billion (approx. $19 billion), while underlying EBIT grew 13% to £1.55 billion (approx. $2 billion). Order intake reached £13.2 billion (approx. $17.2 billion) and the backlog remained high at £75.4 billion (approx. $98 billion). 

Combat air and space drive performance 

The Air segment posted £4.3 billion (approx. $5.6 billion) in sales and £500 million (approx. $650 million) in EBIT. Growth was supported by Typhoon sustainment, strong MBDA missile activity, and GCAP development work. 

Electronic Systems recorded £3.6 billion (approx. $4.7 billion) in sales and £541 million (approx. $703 million) in EBIT. Key wins included a $1.2 billion US Space Force contract for missile-tracking satellites and strong performance in electronic warfare and flight control systems. 

The Maritime segment generated £3.2 billion (approx. $4.2 billion) in sales, with BAE supporting the Royal Navy’s Indo-Pacific deployment. Its Malloy T-150 uncrewed drones were used at sea for logistics support during carrier operations—a first for the service. Submarine work also advanced, including Dreadnought and Astute programs. 

Cyber & Intelligence remained stable, posting £1.2 billion (approx. $1.6 billion) in sales. 

GCAP accelerates, but Typhoon line stands still 

The Global Combat Air Programme (GCAP) remains a key growth driver. BAE secured £1 billion (approx. $1.3 billion) in new UK funding and launched Edgewing, a joint venture with Italy and Japan to design the future fighter. 

RELATED

UK reveals design of supersonic demonstrator for next-generation fighter

Yet on the industrial side, cracks are emerging. Production of the Eurofighter Typhoon at BAE’s Warton site came to a halt in July 2025 due to a lack of new orders. Workers were redeployed, prompting warnings from union Unite and the UK Parliament’s Defence Committee over the risk of losing critical skills before GCAP enters production. 

Unite called the government’s failure to place a fourth tranche Typhoon order “an act of national self-harm,” accusing the UK Ministry of Defence of undermining the very workforce needed for the UK’s future air power. 

A potential reprieve came later in July, when Turkey and the UK signed a memorandum of understanding on a possible Typhoon sale. Germany, which had previously blocked the deal, has now approved export clearance for 40 aircraft. BAE welcomed the MoU and said it will continue working with both governments to finalize an agreement. 

RELATED

Turkey, UK sign Eurofighter Typhoon MoU as Germany lifts export veto

While no contract has been signed, the deal could temporarily revive Warton’s final assembly line and help sustain the supply chain until GCAP ramps up. 

Guidance raised, but transition risk remains 

BAE now expects full-year sales to grow 8–10%, with EBIT rising 9–11%. EPS guidance remains unchanged at 8–10%. The group reaffirmed its free cash flow target above £1.1 billion. 

With rising defense budgets across NATO and Asia-Pacific, BAE’s long-term outlook remains strong. But the halt in Typhoon production highlights the fragility of the industrial bridge between fourth- and sixth-generation airpower in Europe. The post BAE Systems raises 2025 outlook after strong H1 performance appeared first on AeroTime.

Go to Source