BAE Systems Lifts Guidance After Defense Spending Booms

By Mauro Orru

BAE Systems raised its sales, earnings and cash flow targets for the year after a strong first half as governments keep spending on military hardware in the face of escalating geopolitical tensions.

The U.K. arms maker said it expected sales growth of 8% to 10% this year, above a prior forecast of 7% to 9%.

Underlying earnings before interest and taxes--the group's preferred measure of profitability--should grow 10% to 12% compared to a previous range of 9% to 11%. Underlying earnings per share, another closely watched profitability metric, are expected to grow 11% to 13%, above a prior range of 9% to 11%.

Meanwhile, the company said free cash flow should exceed 2 billion pounds ($2.67 billion) compared to previous guidance of more than 1.3 billion pounds.

The boost comes after the group said sales climbed 9% on year in the first half to 15.77 billion pounds. Analysts had forecast 15.61 billion pounds in sales, according to a market consensus provided by the company.

The group reported a net profit of 1.02 billion pounds compared with 969 million pounds a year earlier, while pretax profit increased to 1.28 billion pounds from 1.19 billion pounds.

Write to Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

July 30, 2026 02:41 ET (06:41 GMT)