Revenues from sales of arms and military services by the 100 largest companies in the industry totaled $597 billion in 2022, 3.5 percent less than in 2021 in real terms, even as demand rose sharply, according to new data released today by Stockholm International Peace Research Institute (SIPRI), Paralel.Az reports citing SIPRI.

The decrease was chiefly the result of falling arms revenues among major companies in the United States. Revenues increased substantially in Asia and Oceania and the Middle East. Outstanding orders and a surge in new contracts suggest that global arms revenues could rise significantly in the next few years.

War in Ukraine and geopolitical tensions around the world fuelled a strong increase in demand for weapons and military equipment in 2022. However, despite receiving new orders, many US and European arms companies could not significantly ramp up production capacity because of labor shortages, soaring costs and supply chain disruptions that were exacerbated by the war in Ukraine. In addition, countries placed new orders late in the year and the time lag between orders and production meant that the surge in demand was not reflected in these companies’ 2022 revenues.

The arms revenues of the 42 US companies in the Top 100 fell by 7.9 percent to $302 billion in 2022. They accounted for 51 percent of the total arms revenue of the Top 100. Of the 42 US companies, 32 recorded a fall in year-on-year arms revenue, most commonly citing ongoing supply chain issues and labor shortages stemming from the COVID-19 pandemic.

Türkiye’s Baykar, the producer of the Bayraktar TB-2 drone, entered the Top 100 for the first time after its arms revenue rose by 94 percent, the fastest growth rate of any company in the ranking.’

Due to a lack of data, only two Russian companies were included in the Top 100 for 2022. Their combined arms revenues fell by 12 percent to $20.8 billion. Transparency among Russian companies continues to decline.