Defense spending is ramping up worldwide amid multiple massive and ongoing conflicts. Global military expenditure climbed by nearly 10% between 2023 and 2024, reaching $2.7 trillion last year as spending accelerated faster since the Cold War. Ongoing conflicts throughout Eastern Europe and the Middle East threaten to continue driving a worldwide race toward defense growth into the foreseeable future. While the implications of this increased spending on defense may be catastrophic on a geopolitical level, the increased military budgets of countries around the globe could benefit companies in the defense industry. The firms below are among the top defense names likely to see a boost from continued increases in military spending.

L3Harris Technologies Inc. (NYSE: LHX) is a defense industry giant with a market cap above $50 billion. It has engaged in rapid expansion of its technological efforts this year, including a partnership with electric vertical takeoff and landing firm Joby Aviation Inc. (NYSE: JOBY). In mid‑August, L3Harris’ experimental Navigation Technology Satellite‑3, the first defense‑focused experimental satellite to launch in almost half a century, was successfully launched. L3Harris posted an all‑around earnings win in late July for its second quarter of 2025, topping analyst predictions for earnings and revenue. The firm’s integration with Aerojet Rocketdyne has doubled production and deliveries, leading to record quarterly revenue. Investors have priced in optimism; LHX shares are up more than 30% so far in 2025. Analysts remain bullish, with 13 of 18 rating LHX a Buy, and earnings expected to rise by more than 12% in the coming year.

Kratos Defense & Security Solutions Inc. (NASDAQ: KTOS) is a maker of equipment and technology for use in manned and unmanned military systems. It recently reported a mid‑year earnings report with revenue growing 17% year‑over‑year, beating top‑line expectations by more than $45 million and earnings above analyst expectations. The success of its Valkyrie tactical drone in both the United States and international applications has prompted increased production. Kratos has a large pipeline of about $13 billion, including the sole‑source program Poseidon, which awarded an estimated $750 million contract. The company raised its full‑year guidance. Analysts support the stock, with 14 of 16 rating it a Buy, though its P/E ratio of nearly 688 makes it riskier. Investors may look for a modest dip to buy in.

TransDigm Group Inc. (NYSE: TDG) builds aircraft components for general aerospace and defense applications and has a market cap of around $80 billion. Its latest earnings miss for the fiscal third quarter was due to issues with Airbus and Boeing and lower commercial build rates. However, defense revenue improved 13% year‑over‑year, generating $630 million in cash flow. TDG shares fell after the earnings report in early August and have not recovered. Analysts support the stock, and with upside potential it may be a unique opportunity to buy the dip.

The article also notes that L3Harris Technologies is not on the list of five stocks that top analysts are quietly recommending, which currently include other picks not named here.

Next Gen Defense: 3 Stocks Riding the New Global Arms Race

The article highlights how rising global military spending amid ongoing conflicts is boosting three U.S. defense companies—L3Harris Technologies, Kratos Defense & Security Solutions, and TransDigm Group—by detailing their recent earnings, contracts, and strategic moves. It notes L3Harris’ partnership with Joby Aviation and satellite launch, Kratos’ drone success and large pipeline, and TransDigm’s defense revenue rebound despite a miss in overall earnings.