Defense

The Suppliers

Sell the parts every prime depends on

HWM — Howmet Aerospace

Engineered metal components — turbine blades, fasteners, structures — inside nearly every western military and commercial aircraft.

market cap $109B · revenue $9B (research snapshot; source date not recorded here)

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TDG — TransDigm

Portfolio of sole-source aircraft parts with legendary pricing power — if a jet flies, TransDigm probably owns something on it.

market cap $68B · revenue $10B (research snapshot; source date not recorded here)

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The Primes

The five-decade incumbents with the big contracts

LMT — Lockheed Martin

The biggest defense contractor on earth: F-35, missiles and fire control, Skunk Works, and space systems.

Why it matters: The bellwether for the whole sector — its backlog is a readout on western rearmament.

Outlook: Backlog sits near record levels on missile replenishment and European rearmament, but growth is flat (+0.3% YoY) — the bull case rests on production capacity, F-35 upgrades, and Golden Dome awards.

market cap $117B · revenue $75B (research snapshot; source date not recorded here)

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RTX — RTX (Raytheon)

Missiles, air defense (Patriot), and jet engines (Pratt & Whitney) — the munitions maker the Ukraine and Middle East wars ran down stockpiles of.

market cap $261B · revenue $90B (research snapshot; source date not recorded here)

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NOC — Northrop Grumman

The B-21 stealth bomber, nuclear missiles (Sentinel), and military space — the quietest prime with the longest-duration programs.

market cap $74B · revenue $42B (research snapshot; source date not recorded here)

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GD — General Dynamics

Submarines (Electric Boat), Abrams tanks, Gulfstream jets, and defense IT.

market cap $100B · revenue $54B (research snapshot; source date not recorded here)

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BA — Boeing (Defense, Space & Security)

The second-largest US defense contractor hiding inside a commercial jet maker: F-15EX, KC-46 tankers, MQ-25 Stingray drones, the T-7 trainer, satellites — and now the F-47, the Air Force’s sixth-generation fighter.

Why it matters: Won the F-47 over Lockheed in March 2025 — the biggest fighter award in a generation, and proof the prime tier is not a closed club.

Outlook: Defense revenue grew 14% to $27.2B in 2025 and the segment nearly broke even after a $5.4B loss in 2024; the fixed-price development programs (KC-46, T-7, Starliner) remain the swing factor.

revenue $27B (research snapshot; source date not recorded here)

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The Disruptors

Software and autonomy natives moving fast

PLTR — Palantir

The software layer of modern warfare: data fusion and AI targeting for the Pentagon and allies, now embedded with the primes themselves.

market cap $317B · revenue $5B (research snapshot; source date not recorded here)

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ANDURIL — Anduril (private)

Palmer Luckey’s defense startup: autonomous drones, counter-drone systems, and the Lattice AI platform — built product-first, sold off the shelf.

Why it matters: The existence proof that a venture-backed startup can win real programs of record against the primes.

Outlook: Doubled its valuation to $61B in a $5B round (May 2026); revenue doubled to $2.2B in 2025, with ~$1.2B of planned 2026 operating losses as Arsenal-1 production scales.

valuation $61B · revenue $2B (research snapshot; source date not recorded here)

KTOS — Kratos

Low-cost jet drones (Valkyrie) and hypersonics testing — cheap, attritable airpower.

market cap $9B · revenue $1B (research snapshot; source date not recorded here)

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AVAV — AeroVironment

Switchblade loitering munitions and small drones — the battlefield-proven kit of the drone-war era.

market cap $7B · revenue $2B (research snapshot; source date not recorded here)

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The Customer

Effectively the only buyer in the market

Governments

The Pentagon and allied defense ministries — a single, budget-driven customer buying on multi-decade programs.

Relationships on the map

• Howmet Aerospace supplies RTX (Raytheon) — Engine components (~$2B/yr)
  Howmet blades and structures go into Pratt & Whitney engines.
• Howmet Aerospace supplies Lockheed Martin — Airframe parts (~$1B/yr)
  F-35 airframes are full of Howmet-engineered metal.
• TransDigm supplies Lockheed Martin — Sole-source parts (~$1B/yr)
  TransDigm’s sole-source components sit across the primes’ aircraft programs.
• TransDigm supplies General Dynamics — Aircraft components
  Gulfstream and defense aircraft carry TransDigm parts.
• Palantir partners with Lockheed Martin — AI software layer
  Palantir partners with the primes to modernize the software inside their platforms.
• Anduril competes with Lockheed Martin — Autonomy vs legacy
  Anduril bids product-first autonomous systems against the primes’ cost-plus model.
• Kratos competes with Northrop Grumman — Drone wingmen
  Kratos’ cheap Valkyrie drones compete for the collaborative combat aircraft mission.
• AeroVironment competes with Anduril — Small drones
  Loitering munitions and small autonomous drones — the fastest-growing niche in defense.
• Lockheed Martin competes with RTX (Raytheon) — Missiles & air defense
  The two missile giants split the replenishment supercycle.
• Lockheed Martin competes with Northrop Grumman — Aircraft & space programs
  Stealth aircraft and military space contracts flow to one or the other.
• Boeing (Defense, Space & Security) competes with Lockheed Martin — Fighters: F-47 vs F-35
  Boeing took the F-47 sixth-generation fighter from Lockheed in March 2025 — the two now split the Air Force’s fighter future.
• Lockheed Martin supplies Governments — Aircraft, missiles & space (~$70B/yr)
  Virtually all of Lockheed’s ~$75B revenue is government — the US and allied ministries.
• Boeing (Defense, Space & Security) supplies Governments — Tankers, fighters & space (~$27B/yr)
  Defense is roughly a third of Boeing — the rest is commercial jets and services.
• RTX (Raytheon) supplies Governments — Missiles & air defense (~$45B/yr)
  About half of RTX revenue is defense; the rest is commercial aerospace engines and parts.
• Palantir supplies Governments — Government AI software (~$3B/yr)
  Government work is over half of Palantir’s revenue, with commercial the faster-growing half.
• Anduril supplies Governments — Autonomous systems (~$2B/yr)
  Programs of record and border/counter-drone contracts — essentially all government revenue.