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Introduction & Market Context
Indra A (BME:IDR) reported strong financial results for the first nine months of 2025, highlighting substantial growth across key metrics and significant progress on its strategic initiatives. The presentation, delivered on October 30, 2025, showcased the company’s accelerated transformation into a defense and aerospace powerhouse amid increasing European defense spending.
The results come against a backdrop of robust European defense momentum, with the €800 billion ReArm Europe initiative driving cross-border procurement and industry collaboration. Spain’s reinforcement of national defense capabilities, with expenditure expected to stabilize above 2% of GDP, provides a favorable environment for Indra’s growth strategy.
Despite the strong performance, Indra’s stock dipped 1.2% in pre-market trading to €50, suggesting some market caution despite the company’s impressive 190% share price appreciation since March 2024.
Quarterly Performance Highlights
Indra reported substantial growth across all key financial metrics for the first nine months of 2025, with particularly strong performance in backlog and net income.
"We could say that we have completed the first phase of the plan one year ahead of schedule," stated CEO José Vicente de los Mozos during the earnings call, adding that "Indra Group has nothing to do with what was here before I got here."
The company’s financial results show robust growth in all major indicators:
Order intake increased by 20.2% to €4,449 million, with strong growth across all divisions, particularly in Air Traffic Management. The backlog grew by 34.9% to €9,512 million, including €1,476 million from TESS Defence.
Revenue rose by 6.2% year-over-year to €3,611 million, with growth across all divisions. This aligns with the €829 million Q3 revenue reported in the earnings call, maintaining the consistent growth trajectory.
Profitability metrics showed significant improvement, with EBITDA margin at 11.2% (€405 million, up 9.7% YoY), operating margin at 10.2% (€369 million, up 10.8% YoY), and EBIT margin at 8.8% (€319 million, up 9.6% YoY).
Net income surged by 57.9% to €291 million, driven by operational improvements and a one-off impact from TESS consolidation. Free cash flow generation was €57 million, down 38.9% from the previous year, while net debt stood at €114 million with a Net Debt/EBITDA ratio of 0.2x, indicating a strong balance sheet.
Strategic Initiatives
Indra’s presentation highlighted significant progress on its "Leading the Future" strategic plan, with advancements across seven key areas:
The company has secured over €7,800 million in pre-financing for Spain’s defense modernization programs (PEM), consolidating its position as a national leader. The pre-financing is distributed across multiple programs, with Indra leading or participating in 16 out of 30 total programs.
Indra has created new business units including Indra Land Vehicles, Indra Weapons & Ammunition, and IndraMind, strengthening its product portfolio. The company has also optimized its supplier base, with 90% of purchasing volume concentrated on fewer than 550 suppliers, while 64% of purchasing comes from Spanish suppliers (up 14% from last year).
The company is significantly expanding its industrial and technological footprint across Spain, with new facilities in Gijón, Vigo, Lugo, Barcelona, Sevilla, Málaga, and Córdoba, as well as a new plant in Kansas, USA.
In the space sector, Indra is creating a new company with end-to-end capabilities through acquisitions of Deimos, Hispasat, and Hisdesat (pending closing). The company has also made strategic acquisitions in defense (TESS, AERTEC DAS) and formed a joint venture called Pulse in the Middle East with EDGE.
The launch of IndraMind, focusing on AI, cyber, and cloud technologies, represents another significant strategic initiative. The platform aims to provide protection solutions across both civil and military domains.
Forward-Looking Statements
Indra’s presentation outlined ambitious growth targets, with the company expecting to meet its 2026 financial guidelines by the end of 2025, a full year ahead of schedule. The company plans to hold a Capital Markets Day in Q2 2026 to present the second phase of its strategic plan, "Leading the Future - Scale Up," which will outline the path to achieving €10 billion in revenue before 2030.
The company expects its defense backlog to surpass €10,000 million during 2026, following the expected contracts from Spain’s defense modernization programs. Indra also plans significant capital expenditure, with over €100 million allocated for new production and engineering capabilities in Asturias, Vigo, and Córdoba, plus €50 million for a new plant in Kansas, USA.
The workforce expansion is equally ambitious, with plans to hire more than 3,000 new employees over the next two years, supporting the threefold expansion of Indra’s industrial footprint compared to 2024.
Market Reaction
Despite the strong financial results and strategic progress, Indra’s stock experienced a slight decline of 1.2% in pre-market trading on October 30, closing at €50. This cautious market reaction contrasts with the company’s impressive year-to-date performance, where the share price has appreciated by 190% since March 2024.
The market’s response may reflect broader economic uncertainties or specific concerns about the sustainability of growth rates. During the earnings call, analysts inquired about Indra’s participation in defense programs, with the company confirming involvement in 29 out of 31 initiatives. Questions were also raised regarding potential divestments, to which management responded by indicating a focus on core strategic assets.
Indra’s transformation into a defense and aerospace leader, accelerated by strategic acquisitions and government support, positions the company for continued growth. However, investors appear to be taking a measured approach to the ambitious targets, perhaps waiting for further evidence of sustained execution on the company’s strategic initiatives.
Full presentation:
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