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Israel Aerospace Industries reports most profitable year in its history

The growth was driven by IAI’s Missile and Space Systems Division, with $1.87 billion in sales for the first nine months of 2024, up from $1.63 billion in 2023.

By Pesach Benson, TPS

Israel Aerospace Industries reported a record-breaking order backlog of approximately $25 billion and a 74% increase in net income in its third-quarter earnings report released on Thursday.

“During this time, we have achieved unprecedented milestones, not just in technological and business terms but as a testament to our commitment to excellence,” said IAI chairman Amir Peretz.

Net income for the nine months ending September 30 rose sharply to $416 million, up from $239 million in the same period last year, making it the most profitable period in the state-owned company’s history.

For the third quarter alone, net income increased to $122 million, a significant rise from $74 million in Q3 2023.

The growth was driven by IAI’s Missile and Space Systems Division, with $1.87 billion in sales for the first nine months of 2024, up from $1.63 billion in 2023.

The Arrow missile system earned global acclaim, supported by increased R&D investment of $81 million in Q3, up from $65 million.

IAI also reported a record-breaking $25 billion order backlog as of September 30, 2024. This represents a $7.22 billion increase from the previous year and secures 3.5 years of operations at current sales volumes.

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International demand for Israel’s military technology has surged as European countries increased their defense budgets in response to Russia’s war in Ukraine. Israel is developing a multilayered aerial defense system that has drawn global attention.

The Arrow-3 system, which is designed to intercept ballistic missiles, had its first operational success when it shot down a ballistic missile fired by Iran-backed Houthi rebels in Yemen in November.

It is widely believed to be the first time a missile was intercepted in outer space, but Israeli officials have not confirmed this.

Operating income during the nine months grew to $431 million, up from $292 million in 2023.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the nine-month period reached $646 million, a 33% increase year-over-year, while gross profit for the third quarter climbed 25% to $282 million, reflecting an 18% profit margin.

The company’s sales also rose, reaching $4.39 billion for the nine-month period, a 13% increase from $3.87 billion in the previous year. Third-quarter sales alone totaled $1.54 billion, up 16% from Q3 2023.

This growth was driven by increased demand across all business divisions, with particularly strong performance in the Military and Aviation groups.

“Despite a national crisis, IAI maintained supply chain continuity and expanded its global relationships. Our systems play a critical role in Israel’s defense while strengthening our international standing,” said IAI President and CEO Boaz Levy.