Elbit Systems Q3 2025 presentation: Revenue up 12%, backlog reaches $25.2bn

Introduction & Market Context

Elbit Systems Ltd (NASDAQ:ESLT) presented its Q3 2025 financial results on November 18, 2025, revealing strong performance across key metrics. The Israeli defense technology company, which ranks 22nd in the Defense News Global 100 Defense Companies, saw its stock rise 4.02% in pre-market trading to $523.46 following the announcement, reflecting investor confidence in the company's growth trajectory.

With a market capitalization of approximately $24 billion and a workforce of around 20,000 employees, Elbit Systems continues to strengthen its position as a global defense technology provider through its diversified portfolio spanning aerospace, land, naval, cyber, and unmanned systems.

Quarterly Performance Highlights

Elbit Systems reported impressive financial results for Q3 2025, with revenues reaching $1.9 billion, representing a 12% increase compared to Q3 2024. The company's non-GAAP operating income surged 33% to $187 million, while non-GAAP diluted earnings per share jumped 52% to $3.35 compared to $2.21 in the same period last year.

Free cash flow saw a dramatic improvement, reaching $101 million compared to just $5 million in Q3 2024, demonstrating the company's enhanced operational efficiency and cash generation capabilities.

As shown in the following chart of Q3 2025 financial highlights:

The company's order backlog, a key indicator of future revenue potential, grew 14% year-over-year to reach $25.2 billion as of September 30, 2025. This substantial backlog, representing approximately 3.27 times annual revenue, provides Elbit with strong visibility into future performance.

Detailed Financial Analysis

Looking at the full-year 2024 performance, Elbit Systems demonstrated robust growth across all key financial metrics. Revenues increased by 14% to $6.8 billion, while non-GAAP operating income rose 23% to $550 million. Non-GAAP diluted EPS grew 31% to $8.76, and the order backlog expanded by 27% to $22.6 billion.

The company's financial highlights for 2024 are illustrated in the following chart:

For the last twelve months ending September 30, 2025, Elbit's revenue reached $7.7 billion, up from $6.5 billion in the comparable period ending September 30, 2024, representing an 18% increase. This growth trajectory is supported by a consistent increase in both backlog and revenue since 2020, with a backlog CAGR of 18% and a revenue CAGR of 11%.

The company's long-term revenue and backlog growth is shown in the following chart:

Business Segment Analysis

Elbit Systems operates across five main business segments, each contributing significantly to the company's overall performance. For the last twelve months ending September 30, 2025, the revenue breakdown by segment shows a balanced portfolio: Land (26%), Aerospace (26%), ESA (20%), ISTAR & EW (17%), and C4I & Cyber (11%).

From a geographical perspective, Israel accounts for the largest share of revenue at 33%, followed by Europe (27%), North America (21%), Asia-Pacific (15%), Latin America (1%), and other regions (3%). This diversified geographical footprint helps mitigate regional risks and provides multiple growth avenues.

The following chart illustrates Elbit's revenue breakdown by segment and geography:

All business segments have shown growth in both revenue and operating income from 2022 through LTM 2025. The Land segment has experienced particularly strong growth, with revenue nearly doubling from $1,169 million in 2022 to $2,213 million in LTM 2025. The Aerospace segment also showed significant expansion, growing from $1,733 million to $2,160 million over the same period.

The performance of each business segment is detailed in the following chart:

Strategic Initiatives

Elbit Systems has consistently pursued a value-creating M&A strategy, acquiring technologies and market positions to enhance its comprehensive portfolio. Major acquisitions since 2000 include ELOP (expansion into EO Systems), ELISRA (expansion into EW Systems), SOLTAM (Advanced Artillery Solutions), IMI (transformed into a Full Service Land Systems Provider), and HNV (Enhanced Night Vision, Warfighter Systems).

The company's capital allocation framework focuses on investing in organic growth while returning cash to shareholders. In 2024, Elbit invested $466 million in R&D and $215 million in CAPEX, while distributing $89 million in dividends to shareholders. In May 2025, the company raised $589 million in a share offering on Nasdaq, and in August 2025, it increased its quarterly dividend to 75 cents from 60 cents in Q1 2025.

The company's capital allocation priorities are illustrated in the following chart:

Forward-Looking Statements

Elbit Systems' consistent earnings growth and expanding backlog suggest a positive outlook for the company. The non-GAAP diluted EPS has shown a steady upward trend, reaching $11.81 for LTM Q3 2025, a 54% increase from $7.66 in LTM Q3 2024.

The company's quarterly EPS performance is illustrated in the following chart:

Free cash flow generation has also improved significantly, with $333 million generated in the first nine months of 2025, alongside continued CAPEX investments to support growth. This enhanced cash generation capability provides Elbit with greater financial flexibility for future investments and shareholder returns.

The company's free cash flow trend is shown in the following chart:

Analyst Perspectives

According to the earnings call transcript, analysts focused on the potential impact of geopolitical developments on domestic demand, opportunities in the US market, and drivers behind margin expansion. CEO Butzi Machlis highlighted that Q3 2025 marked "Elbit's seventh consecutive quarter of double-digit growth," demonstrating the company's "global leadership on the modern battlefield."

CFO Kobe Kagan emphasized the strategic importance of the growing backlog, stating, "We are looking at that as some kind of the nature of the growth of the backlog for the future."

While the presentation shows non-GAAP EPS of $3.35 for Q3 2025, the earnings report mentioned an EPS of $2.80, which still exceeded analyst expectations of $2.48. This discrepancy may be due to different calculation methodologies between the presentation and the earnings report.

Despite a slight revenue miss compared to analyst forecasts ($1.92 billion actual vs. $1.99 billion expected), investors responded positively to Elbit's overall performance, with the stock trading near its 52-week high of $529.99, indicating strong market confidence in the company's growth strategy and execution.

Full presentation:

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