Israel Aerospace Industries reports record earnings in 2024

Net income surged 55% to $493 million, while its order backlog hit a record $25 billion, securing four years of operations.

By Pesach Benson, TPS

Israel Aerospace Industries (IAI) reported record earnings in 2024 according to its financial report released on Thursday. The state-owned defense contractor said the year’s revenue reached $6.11 billion, a 15% increase from 2023.

“The financial statements underpin the faith that our customers and partners have in the Company’s operations and the state-of-the-art systems which it develops from the perspective of the future battlefield. I wish to thank our customers and partners for their cooperation and vote of confidence in Israel’s technological leadership,” said IAI President and CEO Boaz Levy.

IAI’s success stems from Israel’s increased defense spending during the past year’s war with Hamas, Hezbollah and Iran and its proxies while Russia’s war in Ukraine sparked a surge in European contracts.

IAI is perhaps best-known for its Arrow missile defense system. Since Hamas’s October 7 attack, the Houthis have launched more than 200 missiles and 170 drones at Israel. The majority have been intercepted before reaching Israeli airspace.

Net income surged 55% to $493 million, while its order backlog hit a record $25 billion, securing four years of operations. Military sales drove growth, with exports comprising 66% of total revenue.

The financial performance was driven by sales in its Military Groups division, which grew by 15.5% to $5.19 billion. The Aviation Group also saw an increase in sales, rising by 6.4% to $1.48 billion.

Export sales accounted for 66% of total revenue, totaling $4.03 billion, while domestic sales rose to $2.08 billion, reflecting a greater share of the company’s revenue compared to 2023.

According to the financial statements, IAI’s order backlog reached an all-time high of approximately $25 billion, ensuring around four years of operational activity.

This represents a significant increase from the $18 billion backlog recorded at the end of 2023. The company’s sales rose to $6.11 billion in 2024, up from $5.33 billion in the previous year, an increase of about 15%.

IAI also reported a sharp rise in profitability, with net income surging by 55% to $493 million compared to $318 million in 2023. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed 19% to $792 million, while operating income grew 32% to $498 million.

Gross profit for the year stood at $1.14 billion, reflecting a $174 million increase from 2023.

The company’s positive cash flow from operating activities surged to $2.72 billion in 2024, compared with $889 million in 2023. IAI also reported investing $387 million in in-house R&D, with $333 million carried as expenses, up from $342 million and $275 million, respectively, in 2023.

The fourth quarter of 2024 also saw strong performance, with sales totaling $1.72 billion, an 18% increase from the same period in 2023. However, net income for Q4 dipped slightly to $77 million from $79 million the previous year.

Said Levy, “2024 was entirely managed alongside unprecedented fighting in Israel, and IAI faced numerous global challenges that affected its performance. I am deeply grateful to IAI’s employees for their relentless efforts to meet enhanced supply quotas to guarantee the satisfaction of our customers and meet our obligations for the success of the entire company.”