April 21 : Europe’s largest defence technology group Thales on Tuesday reported first-quarter sales well above analyst forecasts, with revenues rising nearly 10 per cent organically driven by surging defence deliveries.
The group posted quarterly sales of 5.32 billion euros ($6.27 billion), up 9.7 per cent organically from a year ago, as its defence division, which alone accounted for more than half of total sales, benefited from expanded capacity that lifted delivery rates across its portfolio.
Thales, however, missed analyst expectations for first-quarter order intake, which came in at 4.65 billion euros, despite its core defence division surging 75 per cent organically to 2.24 billion euros.
Analysts had on average expected quarterly sales of 5.19 billion euros and an order intake of 4.85 billion euros, based on a consensus compiled by the company.
Shares in the company, which are up 10.5 per cent this year, were down 3.6 per cent at 0923GMT.
The company kept its annual guidance range of between 6-7 per cent organic sales growth unchanged.
Chief Financial Officer Pascal Bouchiat told journalists in a press conference that the Middle East crisis was generating urgent operational requirements from clients in the region, with demand for air surveillance, air defence and mine-hunting capabilities particularly strong.
However, he cautioned that any material revenue impact was more likely in the second half of 2026 or into 2027.
The crisis was resulting in a structural, long-term shift in how countries in the region were thinking about their defence needs, Bouchiat said.
“It’s not just for the short term that those countries are willing to get better equipped,” he told reporters.
Bouchiat added that U.S. providers may be struggling to replenish inventories and Thales, through its stake in the Eurosam joint venture with MBDA, could benefit from increased demand for air defence equipment in the region.
“So all of that will be also probably a driver for effectors,” he said.
($1 = 0.8486 euros)