IN Brief:
- Leonardo's nine-month order intake increased 27.8% to €23.3bn, while revenue rose 14.2% to €15.35bn.
- The €60.4bn backlog includes approximately €6bn brought into the group through Iveco Defence Vehicles.
- Leonardo increased its annual order guidance to €29.5bn while maintaining its existing revenue, profitability, and cash flow forecasts.
Leonardo has increased its 2026 order guidance after securing €23.3 billion in new business during the first nine months, with the Italian aerospace and defence group’s backlog exceeding €60 billion following continued programme growth and the acquisition of Iveco Defence Vehicles.
Order intake increased 27.8% compared with the corresponding period of 2025, while revenue rose 14.2% to €15.35 billion. Earnings before interest, tax, and amortisation increased 37.7% to €1.30 billion, reflecting higher activity and improved operating performance across the business.
Leonardo has raised its full-year order forecast from €28.2 billion to approximately €29.5 billion. The revised target includes the contribution from Iveco Defence Vehicles, which became part of the group following the completion of its acquisition in March.
The reported backlog reached €60.4 billion at 30 September, an increase of 27.7% from approximately €47.3 billion a year earlier. The company describes the total as providing more than 2.7 years of production coverage.
The Iveco Defence acquisition accounts for an important part of that increase. Leonardo acquired the business for approximately €1.6 billion, extending its land defence activities into military vehicles and associated engineering capabilities.
Approximately €6 billion of backlog entered the consolidated group through the acquisition. The reported increase therefore reflects both new business secured during the period and contracts already held by Iveco Defence Vehicles before it became part of Leonardo.
On a comparable basis excluding the acquired business, the backlog stood at approximately €54.4 billion, an increase of around 15% against September 2025. This provides a separate measure of growth within Leonardo’s previous operating perimeter.
Comparable order intake reached approximately €22.3 billion, up 22.4%. The difference between that figure and the consolidated €23.3 billion total reflects the contribution from Iveco Defence Vehicles.
The distinction is relevant to the company’s manufacturing outlook. Acquisitions enlarge the existing order book and industrial operations immediately upon consolidation, while newly awarded contracts generate additional work that must subsequently progress through engineering, production, and customer delivery.
Leonardo’s acquisition adds land platform manufacturing capabilities to a portfolio already spanning defence electronics, helicopters, aircraft, space systems, and naval equipment. The enlarged business combines complete military vehicle engineering with established mission electronics and systems integration activities.
Armoured and military support vehicles require several interconnected engineering systems. Structural assemblies, propulsion equipment, electrical power distribution, communications, sensors, and crew interfaces must operate within the configuration specified for each platform.
Leonardo’s established electronics portfolio includes equipment that can be integrated into different military platforms. The addition of Iveco Defence Vehicles creates opportunities to coordinate more of the mechanical and electronic integration activities within the group, although specific product combinations remain subject to programme requirements.
Vehicle electrical and electronic equipment must meet the requirements of the installation environment. Available space, power supply, thermal management, electromagnetic compatibility, and the mechanical interfaces of onboard systems can all affect integration and qualification.
Production programmes also require configuration management as customer requirements change. A vehicle supplied to one military customer may incorporate different communications, protection, or mission equipment from an otherwise similar platform delivered to another country.
Beyond land systems, Leonardo’s order book covers activities across aerospace and defence electronics. The group manufactures and integrates equipment used in military aircraft, helicopters, naval platforms, and surveillance systems, with individual programmes extending across several stages of development and production.
Defence electronics manufacturing can involve sensors, processors, communications equipment, and supporting software, with qualification required at both component and integrated system level. Customer acceptance depends on the equipment meeting the requirements established for its intended installation.
Aircraft production introduces additional coordination between structural manufacturing, propulsion, avionics, and final assembly. Deliveries may involve work by multiple suppliers and industrial partners, making the timing of completed aircraft and recognised revenue dependent on the wider programme schedule.
Leonardo participates in multinational programmes that divide engineering responsibilities across several countries. Its activities include the Global Combat Air Programme with British and Japanese partners, alongside other aerospace and defence cooperation arrangements.
The group also has an established land systems partnership with Rheinmetall. That venture and the acquisition of Iveco Defence Vehicles are separate industrial developments, although both contribute to Leonardo’s expanding involvement in military vehicle programmes.
The company’s nine-month financial performance reflects growth across its principal business sectors. The increase in revenue was accompanied by a larger improvement in profitability, with EBITA rising faster than sales.
The EBITA margin increased from approximately 7% to 8.5%, indicating an improvement in the relationship between operating earnings and recognised revenue. Leonardo attributed its results to higher activity and stronger operational performance.
Adjusted net profit increased 74.2% to €812 million. The group also reported improved cash generation, with free operating cash flow reaching negative €68 million, compared with negative €426 million in the corresponding period of 2025.
The negative cash flow figure indicates that net cash generation had not yet turned positive over the nine-month reporting period. Nevertheless, the reduction in the deficit represents a substantial improvement compared with the previous year.
Net debt stood at approximately €3.3 billion at the end of September. The acquisition of Iveco Defence Vehicles contributed to the increase, with the approximately €1.6 billion purchase price forming part of the financial movements affecting the group.
Leonardo has retained its full-year guidance for financial performance despite increasing the new order target. The company continues to expect annual revenue of approximately €22.1 billion and EBITA of €2.21 billion.
Free operating cash flow guidance remains approximately €1.37 billion, while year-end net debt is forecast at around €2.2 billion. Achieving those targets will depend on deliveries, customer payments, and other cash movements during the final quarter.
The new order forecast of €29.5 billion represents the second upward revision during 2026, following an increase in July. The company has not raised its other principal financial targets as part of the November results.
Leonardo’s chief executive, Lorenzo Mariani, has identified the scale and duration of the order book as support for the company’s longer-term industrial planning. The group is preparing an updated strategy that is expected to be presented in March 2027.
That programme will follow the integration of Iveco Defence Vehicles and continued development of the group’s multinational industrial partnerships. The combination of a larger consolidated business and higher demand creates requirements for manufacturing capacity, specialist engineering resources, and programme delivery management.
Individual backlog items will generate revenue according to their contractual schedules rather than immediately upon order recognition. The reported total includes programmes extending across several years, with equipment development, production, integration, and customer acceptance taking place at different stages.
Leonardo’s next industrial plan is expected to set out how the enlarged business intends to manage that programme pipeline. The company’s immediate financial targets remain unchanged apart from the higher full-year order forecast, with the remaining 2026 delivery schedule determining progress towards its revenue and cash flow guidance.
