The $35 billion backlog represents about 4.7 years of operations and compares with $29 billion at the end of 2025. IAI said the first half and second quarter were the highest-grossing corresponding periods in the company’s history.
Second-quarter sales increased to $2.189 billion from $1.618 billion a year earlier, while quarterly net income rose 47% to $229 million. Operating income for the quarter increased to $244 million, or 11% of sales, from $150 million and 9% a year earlier.
First-half operating income climbed 53% to $483 million, equivalent to 11% of sales, compared with $315 million and 10% of sales in 2025. EBITDA rose 39% to $650 million, representing 15% of sales, while gross profit increased to $806 million.
IAI Chairman Boaz Levy linked the performance to the company’s position in strategic markets and continued investment in technology and production capabilities. He also pointed to demand for the company’s air defence systems and a recent successful test of the Arrow system.
“The proven capabilities of IAI’s systems, together with our close relationships with allies around the globe, enable us to penetrate new markets, drive increased demand for our advanced air defense systems and support our continued market growth,” Levy said. He said IAI would continue investing in technologies aimed at meeting changing customer requirements.
Levy also said preparations for a flotation of the state-owned aerospace and defence group were moving forward. “The company’s IPO is closer than ever and will enable investment in infrastructure and production lines, while contributing to both national security and the local economy.”
Acting President and CEO Guy Bar Lev said the results reflected growing confidence in Israeli technology and IAI’s cooperation with Israel’s defence establishment and international partners. “The financial results demonstrate that IAI is doing everything necessary to ensure the qualitative advantage of the State of Israel and its allies across all domains, in both defense and offense.”
“Following the evolving defense environment, we have increased our investment in research and development of advanced technologies that address current operational needs while also providing solutions to future threats,” Bar Lev said. He added that IAI was working across several areas to maintain supply-chain continuity and ensure customers have access to its systems and technologies.
IAI reported $137 million in positive cash flow from operating activities and said it had $4 billion in free cash flow. The combination of higher earnings, a larger backlog and rising demand for air defence systems is supporting the company’s plans to invest further in infrastructure, production lines and technology.
