Leonardo DRS builds the electronic brains and senses for military gear—infrared eyes, electronic warfare jammers, and rugged computers for tanks, ships, and submarines.
Revenue comes from selling defense electronics to the U.S. military and prime contractors like Lockheed Martin and Northrop Grumman. Gross margin is ~25%, net margin ~8.5%, with recurring maintenance and upgrade contracts.
High barriers from security clearances, decades of integration know-how, and entrenched relationships with the Pentagon. However, budget shifts and competition from L3Harris and RTX could erode its niche. Moat level: eroding.
Sell (sector percentile 28) — value C+, growth B, profitability C, momentum C. Updated daily, sector-relative, identical for every user.
Key events, in time order
Company signs agreement for new Brookfield, CT facility to support growth of Naval Power Systems business
All-cash deal valued at $450M to bolster multi-domain AI, data fusion and mission software capabilities
Company announces contract to supply over 50,000 Tenum Orbit thermal cameras, a major product order.
Q1 2026 revenue was $846 million, up 6% year-over-year, with adjusted EBITDA of $105 million, up 28% year-over-year
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The narrative suggests that politician investments in $DRS have not led to stock price appreciation, implying a lack of positive impact from such endorsements.
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