Leonardo DRS Reports 10.1% Revenue Growth to $829.8 Million in Q2 2025

Leonardo DRS, Inc. reported a significant increase in financial performance for the second quarter of 2025, with total revenues reaching $829.8 million, a 10.1% increase from $753 million in the same period last year. For the first half of 2025, revenues totaled $1.628 billion, up 13% from $1.441 billion in the prior year. The company’s net earnings also saw a notable rise, increasing by 42.1% to $54 million for the quarter and by 55.2% to $104 million for the six-month period. This growth was reflected in earnings per share, which rose to $0.20 for the second quarter and $0.39 for the first half, compared to $0.14 and $0.25, respectively, in the previous year.

The company’s operational efficiency contributed to this financial growth, with gross profit increasing by 16.6% to $197 million for the second quarter and by 17.4% to $378 million for the first half. The gross margin improved to 23.8% for the second quarter, up from 22.4% a year earlier, driven by effective execution on key programs, particularly in electric power and propulsion. General and administrative expenses also rose, reflecting increased investments in research and development and bid proposal efforts, which were necessary to support future growth.

In terms of strategic developments, Leonardo DRS reported a total backlog of $8.607 billion as of June 30, 2025, an increase of 8.6% from $7.925 billion a year prior. This backlog growth was attributed to new awards in both the Advanced Sensing and Computing (ASC) and Integrated Mission Systems (IMS) segments. The company’s bookings for the first half of 2025 totaled $1.844 billion, a 5% increase from $1.756 billion in the same period last year, indicating a strong demand for its defense technology solutions.

Operationally, the ASC segment generated $542 million in revenue for the second quarter, a 10.2% increase year-over-year, while the IMS segment reported $290 million, up 9%. The ASC segment's operating earnings remained stable, while the IMS segment saw a 57.1% increase in operating earnings, reflecting improved program performance. The company continues to focus on enhancing its capabilities in advanced sensing, network computing, and electric power systems, which are critical to meeting the evolving needs of the U.S. Department of Defense and allied customers.

Looking ahead, Leonardo DRS remains optimistic about its growth trajectory, bolstered by recent legislative measures that authorize increased defense spending. The company is closely monitoring the implications of U.S. government budgetary decisions and geopolitical developments, which could impact its operations and funding. With a strong backlog and ongoing investments in technology and innovation, Leonardo DRS is well-positioned to capitalize on future opportunities in the defense sector.