Elbit Systems' profit jumps, sees anti-missile laser system ready in 2025

By Steven Scheer

TEL AVIV, May 20 (Reuters) - Israel's largest defence firm Elbit Systems ESLT.TA reported higher first-quarter profit on Tuesday, and said it expects a laser system to knock out incoming missiles to be operational by year end.

Elbit said it earned $2.57 per diluted share excluding one-time items in the first quarter of 2025, up from $1.81 a year earlier.

The results were boosted by a 20% increase in aerospace sales, largely of precision-guided munitions from which revenue rose 22% to $1.9 billion.

Shares in the company were up 2.4% in Tel Aviv.

More than 32% of Elbit's revenue came from Israel, where the country has been fighting Palestinian militant group Hamas in Gaza since October 7, 2023. The company has supplied munitions, drones, guided rocket systems, reconnaissance capabilities and other systems.

As numerous global conflicts boosted national defence budgets, Elbit's backlog of orders reached $23.1 billion. Some 66% of the backlog is from outside Israel, while 51% of the orders are scheduled to be fulfilled during 2025 and 2026.

"The company is growing rapidly," CEO Bezhalel Machlis told Reuters. "I see still a growing demand in the Israeli market, and hopefully this war will end soon. Israel's (military) needs are very big ... but strategically, growth should come from abroad."

Machlis noted that higher defence spending in the U.S. and Europe will bolster Elbit, which makes drones, avionics, munition-guided missiles, electro-optics and electronic warfare systems and has numerous subsidiaries around the world.

Elbit has also been co-developing Iron Beam that will complement Israel's Iron Dome anti-missile system which has been used to intercept thousands of rockets fired by Hamas militants in Gaza, Hezbollah from Lebanon and the Houthis in Yemen.

Machlis believes this ground-based system will be ready for deployment in 2025 and be "an operational breakthrough."

Another "game-changer", he added, will be a similar laser system that can be used airborne. "It's still under development and will take time," Machlis said. "Laser is just one example for different types of energy weapons that we are developing."

"I see growth coming for energy weapons this year and next year. There is huge interest in these solutions."

Elbit said it would pay a quarterly dividend of 60 cents a share, the same as in the fourth quarter.