Aselsan's Order Book Reaches $23.2 Billion as Turkey's Defense Electronics Powerhouse Achieves 25% Real Growth
Summary
Aselsan, Türkiye's premier defense electronics company, reported first-half 2026 revenues of 88.5 billion Turkish lira (approximately US$1.8 billion), representing a robust 25% increase in real inflation-adjusted terms and 37% in US dollar terms, with EBITDA reaching US$488 million at a healthy 26.3% margin. The company's order book tells an even more compelling growth story, with new contracts worth US$4.9 billion signed in the first half alone — a 72% year-on-year surge — pushing the total backlog to US$23.2 billion, up 45% annually, with CEO Ahmet Akyol projecting this figure will reach US$30 billion in 2026. Domestic demand continues to dominate Aselsan's revenue mix at 83%, driven heavily by Turkish Armed Forces procurement, particularly for the layered "Steel Dome" (Çelik Kubbe) air defense architecture first demonstrated at the EFES 2026 exercise, where Aselsan supplies sensors, effectors, and command systems. The company made substantial investments in future capabilities, with R&D spending rising 41% to US$804 million and capital expenditure surging 195% to US$323 million, accompanied by new production facilities, 19 robotic automation lines, and over 1,000 new hires. Despite this aggressive investment posture, Aselsan maintained a strong balance sheet with a 56% equity ratio and a low net debt-to-EBITDA ratio of 0.55, while maintaining full-year guidance targeting at least 10% real revenue growth and EBITDA margins above 24%.
Key Takeaways
- 1. **Exceptional Order Book Momentum:** With a backlog of US$23.2 billion growing faster than revenue recognition and new contract intake up 72%, Aselsan has multi-year revenue visibility that positions it among the world's most financially secure mid-tier defense companies.
- 2. **Steel Dome Integration Drives Domestic Demand:** Aselsan's deep integration into Türkiye's layered air defense architecture (Çelik Kubbe) ensures sustained high-volume domestic procurement, reinforcing Türkiye's strategic goal of achieving indigenous end-to-end air defense capability.
- 3. **Export Growth Remains a Strategic Priority but Challenges Persist:** Despite exports nearly doubling in 2025 to US$958 million, international sales still represent only 17% of revenue, indicating Aselsan must significantly accelerate foreign market penetration to reduce dependence on domestic Turkish defense budgets.
- 4. **Massive R&D and Automation Investment Signals Long-Term Competitive Ambitions:** R&D spending of US$804 million (up 41%) and a 195% surge in capital expenditure, including 19 new robotic production lines, suggest Aselsan is deliberately building the industrial and technological foundation to compete with established Western defense electronics firms globally.
- 5. **Financial Discipline Underpins Aggressive Growth:** The combination of a 26.3% EBITDA margin, a low 0.55 net debt-to-EBITDA ratio, and a 56% equity ratio demonstrates that Aselsan is scaling aggressively without compromising financial stability, making it a resilient strategic asset for Türkiye's broader defense industrial ambitions.