Hensoldt reports revenue miss but defense boom supports backlog

Core Viewpoint - Hensoldt reported full-year revenue slightly below market expectations, but a significant increase in high-value orders and a strong backlog indicate positive momentum from Europe's defense rearmament efforts [1] Financial Performance - Hensoldt's revenue for 2025 was 2.46 billion euros ($2.90 billion), falling short of the 2.50 billion euro consensus [1] - Adjusted EBITDA rose to 452 million euros, reflecting a margin of 18.4%, aligning with expectations and surpassing the company's forecast [1] Order Intake and Backlog - Order intake surged by 62% to 4.71 billion euros, increasing the order backlog to 8.83 billion euros [1] - The company anticipates revenue of approximately 2.75 billion euros for 2026, with an adjusted margin target of 18.5%-19.0% [1] Market Dynamics - The geopolitical situation is driving Europe to enhance its defense capabilities, with Germany playing a crucial role in Hensoldt's order intake momentum [1] - Hensoldt's sensors are utilized in various platforms, including the Eurofighter Typhoon and the Puma infantry fighting vehicle [1] Challenges - Supply chain constraints in electronic components and hiring bottlenecks are impacting the pace at which Hensoldt can convert its backlog into revenue [1] - The company maintains expectations for a book-to-bill ratio in the range of 1.5-2.0, indicating sustained demand for its products [1]