Elbit Systems’ order backlog reached a record $32 billion at the end of the second quarter of 2026 as the defense technology company increases investment in production infrastructure to expand capacity and convert its growing backlog into revenue.
Approximately 73% of the backlog relates to customers outside Israel, while about 42% is scheduled to be performed during the remainder of 2026 and throughout 2027. The increase in backlog during Q2 came primarily from Europe.
Elbit said its increased capital investments are focused on scaling production infrastructure, expanding capacity, improving execution and supporting the company’s ability to deliver at greater scale. The company is also continuing to increase R&D investment to support future growth.
Q2 revenue increased to $2.29 billion from $1.97 billion a year earlier. C4I and Cyber revenue increased 11%, ISTAR and Electronic Warfare revenue grew 22%, Land revenue increased 32%, and Elbit Systems of America revenue rose 17%. Aerospace revenue declined 8% because of project mix and lower training and simulation sales in Europe, partly offset by increased UAV sales in Israel.
GAAP gross profit increased to $579 million from $472.9 million, while gross margin expanded to 25.3% from 24%. Non-GAAP gross margin reached 25.6% compared with 24.4% a year earlier.
Non-GAAP net income attributable to shareholders increased to $199.1 million from $151 million, while non-GAAP diluted EPS increased to $4.14 from $3.23. GAAP diluted EPS reached $3.61 compared with $2.69.
Cash generation strengthened significantly. Operating cash flow for the first six months of 2026 increased to $517.8 million from $304 million a year earlier, driven primarily by higher net income and an increase in contract liabilities.
Elbit is simultaneously developing new directed-energy capabilities. The company recently unveiled an airborne high-power laser system under development for helicopters and fighter aircraft, while sales of airborne and land High Power Laser systems contributed to the growth in ISTAR and Electronic Warfare revenue.
Recent awards include an approximately $350 million contract to upgrade main battle tanks for an international customer and more than $370 million of U.S. Customs and Border Protection awards through Elbit Systems of America.
KEY QUOTES:
“The strong momentum in the second quarter was sustained, delivering double-digit growth in sales, backlog and earnings per share, improved profitability, and strong cash flow generation.”
Bezhalel (Butzi) Machlis, President And CEO Of Elbit Systems
