Thales' Surging Shares Boosted by Record Defense Growth

Shares of France's Thales soared over 11% amid optimism in European defense stocks, as the firm reported robust 2024 earnings. Adjusted operating income rose despite losses in the space division, driven by strong demand for defense systems. New orders surpassed expectations, showcasing resilience amid geopolitical tensions.

France's Thales experienced a spike of over 11% in its share price on Tuesday, fueled by strong performances in Europe's defense sector. The company reported better-than-expected 2024 earnings, despite setbacks in its space business.

Thales, a leading European defense electronics firm, saw its adjusted operating income climb 5.7% on a like-for-like basis to 2.42 billion euros. Revenues rose by 8.3% to 20.58 billion euros, with defense sales outpacing aerospace and cyber segments. Meanwhile, new orders increased by an underlying 6% to 25.29 billion euros.

CEO Patrice Caine noted that geopolitical instability is bolstering defense investments. While aerospace earnings faced headwinds, the demand for defense technology and solid margins in avionics provided an upward thrust to Thales' financial performance.

(With inputs from agencies.)