What’s Behind Rheinmetall’s Growth? A Segment-by-Segment Breakdown
For NATO planners tracking which suppliers can actually deliver at scale, Rheinmetall’s FY2025 results answer a specific question: which product lines are carrying the group’s growth. The German prime posted group sales of €9,935 million in 2025, up 29% year on year, with the increase concentrated in three defence segments — Vehicle Systems, Weapon and Ammunition, and Electronic Solutions. The company’s former civilian automotive arm, Power Systems, was classified as a discontinued operation from Q4 2025 and has since been divested, meaning the reported growth is now entirely defence-driven.
Vehicle Systems: The Largest Single Contributor
Vehicle Systems generated €4,992 million in sales in 2025, up 32% from €3,790 million, with an operating margin that rose from 11.2% to 11.7%. Management attributed part of the increase to the consolidation of the US-based acquisition Loc Performance, alongside continued deliveries under the Boxer, Puma and Lynx programmes. For US and allied procurement offices, the Loc Performance integration is the clearest sign that Rheinmetall’s American footprint is now a material part of group revenue, not a side venture. The segment’s order backlog stood at €7,797 million at year-end.
Weapon and Ammunition: First Billion-Euro Operating Result
Weapon and Ammunition sales rose 27% to €3,532 million, and the segment’s operating result crossed €1 billion for the first time, reaching €1,037 million (up 31%), with margin improving from 28% to 29%. Rheinmetall disclosed that an incident at its Murcia facility in Spain reduced 2025 sales by more than €200 million, yet the segment still posted the group’s strongest absolute profitability. Capacity was also expanded through the integration of Spanish ammunition maker Expal, a factor relevant to NATO’s broader push to scale 155mm shell production. The segment’s backlog reached €7,126 million.
Electronic Solutions: Fastest Growth, Largest Backlog Jump
Electronic Solutions was the fastest-growing segment in percentage terms, with sales up 45% to €2,504 million and operating result up 68% to €366 million; margin climbed from 12.6% to 14.6%. Its order backlog jumped 181% to €14,235 million — the largest increase of any segment — signalling that this line is set to take on a larger share of group revenue in coming years.
Segment Comparison (FY2025)
| Segment | Sales (€m) | YoY Growth | Operating Margin | Order Backlog (€m) |
|---|---|---|---|---|
| Vehicle Systems | 4,992 | +32% | 11.7% | 7,797 |
| Weapon and Ammunition | 3,532 | +27% | 29% | 7,126 |
| Electronic Solutions | 2,504 | +45% | 14.6% | 14,235 |
| Group Total | 9,935 | +29% | 18.5% | 63,800 |
Source: Rheinmetall AG, FY2025 Annual Report (March 2026). Group total reflects intersegment eliminations.
2026 Restructuring: Five Segments
As of January 1, 2026, Rheinmetall split its former Electronic Solutions segment into standalone Air Defence and Digital Systems units, and added a dedicated Naval Systems segment alongside Vehicle Systems and Weapon and Ammunition. In Q1 2026, the new Air Defence segment reported sales of €192 million, up 43% from €135 million a year earlier. For full-year 2026, the company guided to sales growth of 40-45%, reaching €14.0-14.5 billion, with H1 2026 revenue already up 39% year on year to €5,227 million. [FORECAST: full-year 2026 segment-level results were not yet available at the time of publication.]
Sources
- Rheinmetall AG, “Financial report: Figures FY 2025 – Rheinmetall on course for success,” March 11, 2026: rheinmetall.com
- Rheinmetall AG, “Deal finalised – Rheinmetall divests its civilian division,” June 3, 2026: rheinmetall.com
- Investing.com, “Earnings call transcript: Rheinmetall AG reports strong Q4 2025 growth”: investing.com
