Authors:
Suraj Gujar, Tanisha Malwa
Download free PDF
Air-to-Ground Missile (AGM) Market Size & Share 2026-2035
Report ID: GMI16111
|
Published Date: September 2026
|
Report Format: PDF/Excel/Dashboard/Platform
Explore Our Licensing Options:
Air-to-Ground Missile (AGM) Market
Get a free sample of this report
What are you hoping to find?
Your PDF is on its way. Tell us little about your research goal, and we'll help you find the most relevant market insights.
Air-to-Ground Missile (AGM) Market Size
The global air-to-ground missile (AGM) market is valued at USD 8.2 billion in 2025 and is projected to reach USD 8.9 billion in 2026 and USD 16.5 billion by 2035, at a CAGR of approximately 7.1% from 2026 to 2035.
Air-to-Ground Missile (AGM) Market Key Takeaways
Market Leader: Lockheed Martin led with over 15.9% market share in 2025.
Leading Players: Top 5 players in this market include Lockheed Martin, MBDA, Rafael, IAI, Northrop Grumman, which collectively held a market share of 48.2% in 2025.
Market value rose from USD 5,810.69 million in 2022 to USD 6,499.01 million in 2023 and USD 7,301.11 million in 2024. This progression coincided with a sharp expansion in defense outlays: global military expenditure reached USD 2.887 trillion in 2025, while European spending rose 14% and Asia–Oceania spending rose 8.1% in real terms [1]Stockholm International Peace Research Institute - Global military spending rise continues as European and Asian expenditures surge. sipri.org. For AGM suppliers, the important change is not simply larger defense budgets; it is the shift from modernization-only purchases toward replenishment, platform integration, and inventory depth after high-tempo consumption.
AGM demand is also becoming more differentiated by mission. Short-range weapons remain necessary for anti-armor and close-support missions, but sophisticated air defenses raise the value of weapons that can be launched outside threat envelopes. At the same time, armed UAVs are broadening the buyer and platform base for lighter precision weapons. These requirements pull demand through a value chain that combines missile primes with seeker, propulsion, warhead, and aircraft-integration specialists, where qualification cycles and export approvals can determine the timing of revenue recognition as much as end-user demand.
GMI Analyst View
The forecast implies a re-pricing of air-delivered lethality, rather than a uniform increase in missile volumes. Replenishment supports high-volume programs, while stand-off, anti-radiation, and maritime weapons lift the value per deployed capability because they require more demanding seekers, navigation, software, and integration. The leading indicators are already visible in multiyear production arrangements, allied FMS cases, and aircraft-specific integration activity [2]U.S. Department of Defense Office of the Under Secretary of Defense (Comptroller) - FY2026 Defense Budget Weapons Systems. comptroller.defense.gov. Suppliers able to convert those signals into qualified capacity should benefit; firms dependent on a single platform or export channel remain more exposed to certification and release timing.
Key Drivers
Rising demand for precision strike capabilities in modern warfare
Rising budgets create purchasing capacity, but precision weapons receive priority because they allow aircraft to attack assigned targets with fewer exposures than repeated unguided sorties. The U.S. FY2026 weapons budget continues procurement support for JASSM, while Poland's USD 745 million order for 200 AARGM-ER missiles for F-35A aircraft illustrates allied investment in suppression of hostile radars [3]Breaking Defense - Poland adds long-range strike to its F-35 fleet with AARGM-ER missiles. breakingdefense.com. The result is demand spanning replenishment and high-end force design, rather than a single-theater order cycle.
Expansion of next-generation combat aircraft and multi-role platforms
A new fighter fleet does not create AGM demand automatically; weapons must be cleared for the aircraft's stores-management system, software, carriage configuration, and mission set. Japan's FY2025 budget directed ¥939 billion to stand-off weapons, including JASSM-ER and Joint Strike Missile programs, and a subsequent U.S. approval covered 16 additional JASSM-ER missiles [4]Defense News - Japan passes record defense budget, while still playing catch-up. defensenews.com. U.S. integration work on JASSM for Marine Corps F/A-18 aircraft and planned LRASM integration on F-15E/EX demonstrate how platform qualification extends the addressable life of established missile families.
Increasing defense modernization and fleet upgrade programs
Modernization programs translate budget commitments into longer procurement visibility when they include stocks, platforms, and industrial throughput. EU member states raised defense investment to €134 billion in 2025, up 23%. India's August 2025 procurement package included more than 110 air-launched BrahMos missiles and 87 armed MALE UAVs. The U.S. also issued a presolicitation for sustained JAGM and Hellfire production across FY2027–FY2034. These programs favor suppliers that can support both new integration and serial output.
Rising use of unmanned aerial vehicles (UAVs) for combat missions
UAVs change missile demand because persistent ISR can be paired with a lighter, lower-cost strike payload. Belgium's acquisition of 240 Hellfire II missiles for MQ-9B aircraft and Poland's USD 310 million MQ-9B acquisition show that armed-UAV portfolios are moving through formal procurement channels. BAE Systems' contract for up to 55,000 APKWS II rounds further indicates sustained demand for precision weapons below the cost and weight of conventional stand-off missiles. The commercial opportunity lies in adapting seekers, launch interfaces, and warheads to UAV endurance and payload constraints.
Technological advancements in guidance, propulsion, and seeker systems
Technology investment supports demand when it addresses a concrete targeting constraint. RTX's StormBreaker combines millimeter-wave radar, imaging infrared, and semi-active laser guidance; its Lot 10 contract covered more than 1,500 weapons. At the long-range end, HACM remains in development, with the GAO reporting schedule pressure and a reduction in planned flight tests, while ARRW received FY2026 procurement funding. The contrast matters: mature multi-mode weapons can support near-term production, whereas hypersonic programs remain dependent on development execution.
Key Restraints
High development and procurement costs of advanced missile systems
Cost constrains both inventory depth and access to the most capable systems. Poland's AARGM-ER purchase equates to roughly USD 3.7 million per missile before considering broader program costs. High-end development adds further risk: HACM's baseline development contract was approximately USD 985 million, and schedule delays have reduced its test margin. Capacity bottlenecks in seekers, motors, and electronics can therefore turn strategic urgency into delayed deliveries or more expensive production ramps.
Stringent regulatory frameworks and export control restrictions
Export controls restrict the reachable market even where operational demand exists. U.S. FMS transactions require executive approval, congressional notification, and end-use arrangements; the congressional budget framework documents the central role of these processes in weapons transfers. Poland's AARGM-ER path from 2024 approval to a 2025 contract, with deliveries beginning in 2029, illustrates the elapsed time between requirement and fielding. MTCR and ITAR constraints are structural, particularly for long-range systems, and can limit exportability or force redesign around controlled components.
GMI Analyst View
Demand-side momentum is durable, but the market will not distribute growth evenly. Budget expansion and platform modernization support the aggregate forecast, whereas cost and controls concentrate the highest-value programs among countries with established industrial, FMS, and integration relationships. Production constraints are potentially cyclical if capacity investments mature; export restrictions are enduring market-access constraints. That distinction favors primes with qualified supply chains and broad allied customer bases, while making nominal demand in less-accessible markets a poor proxy for realizable sales.
Air-to-Ground Missile (AGM) Market Segment Analysis
By Missile Range
Short-Range AGMs (< 25 km) - The segment increases from USD 2,401.48 million in 2025 to USD 3,882.41 million in 2035, a 4.71% CAGR. Hellfire and JAGM-family demand sustains high-volume anti-armor and close-support missions, supported by the U.S. multiyear production framework [5]Congressional Research Service - Defense Primer: U.S. Precision-Guided Munitions. congress.gov. Its slower growth reflects incremental budget allocation toward standoff weapons, although UAV-compatible guided rockets preserve an economical precision option.
Medium-Range AGMs (25–100 km) - Valued at USD 3,553.30 million in 2025, the largest range segment reaches USD 6,773.56 million by 2035 at a 6.47% CAGR. StormBreaker's all-weather, multi-mode targeting illustrates why this range band serves moving-target interdiction as well as conventional support missions. Its breadth across fighters and unmanned platforms provides a hedge against reliance on any single platform class.
Long-Range / Stand-Off AGMs (> 100 km) - This segment rises from USD 2,250.00 million to USD 5,864.92 million, a 9.82% CAGR. JASSM procurement, AARGM-ER adoption, and planned LRASM integration show that air forces are buying distance, survivability, and mission flexibility together [6]FlightGlobal - Pentagon to outfit F-15s with long-range missile seen as critical for Indo-Pacific conflict. flightglobal.com. Stand-off weapons are therefore the principal beneficiary of air-defense-driven changes in force employment.
By Guidance Technology
Laser-Guided AGMs - From USD 1,571.53 million in 2025 to USD 2,147.72 million in 2035, the 2.92% CAGR reflects continued value in economical, designator-supported engagements. APKWS II production sustains this installed-base segment, but weather, obscurants, and the need for terminal designation limit its role in more contested missions.
Infrared (IR) / Electro-Optical (EO) Guided AGMs - The segment grows from USD 1,517.88 million to USD 2,230.32 million at 3.69%. Imaging seekers permit post-launch maneuver and improve autonomous terminal engagement, but their growing importance increasingly resides in multi-mode architectures rather than purely single-mode weapons.
Radar-Guided AGMs (Anti-Radiation / Active Radar Homing) - From USD 1,249.65 million to USD 2,643.34 million, at 7.59%, radar-guided weapons align closely with SEAD/DEAD growth. AARGM-ER's allied adoption gives this category a direct route into F-35-enabled suppression missions.
GPS / INS Guided AGMs - The segment expands from USD 1,723.00 million to USD 3,469.39 million at 7.06%. It remains central to fixed-target strike, but GNSS disruption increases the premium on anti-jam navigation and complementary terminal seekers.
By Launch Platform
Fighter / Multi-Role Aircraft - The largest platform segment grows from USD 4,216.00 million in 2025 to USD 7,599.61 million in 2035, a 5.87% CAGR. Its scale rests on global F-35, F-15, Typhoon, Rafale, and Su-30 fleets, while recurring qualification work protects supplier engagement across aircraft upgrades.
Attack Helicopters - The segment rises from USD 1,609.40 million to USD 2,478.13 million, at 4.19%. Helicopters retain value in permissive close-support environments, but their exposure to modern defenses and substitution by UAVs restrain growth.
Unmanned Aerial Vehicles (UAVs) - UAV-launched AGMs climb from USD 725.81 million to USD 2,478.13 million, at 12.68%. Formal MQ-9B procurement and Hellfire arming decisions confirm that persistent ISR-strike operations are becoming a procurement category rather than an experimental adjunct.
Bombers - The segment advances from USD 627.98 million to USD 1,073.86 million, at 5.31%. Payload and range make bombers important for deep strike and maritime missions, but their growth depends on the pace at which new stand-off systems are integrated.
Special Operations / Gunship Aircraft - From USD 441.80 million to USD 743.44 million, at 5.14%, this segment is anchored in precision support in permissive environments, where small guided weapons match mission endurance and collateral-risk requirements.
Maritime Patrol Aircraft - The fastest-growing platform segment rises from USD 583.80 million to USD 2,147.72 million, at 13.47%. LRASM integration across patrol and land-based aircraft broadens maritime-strike options beyond carrier aviation, making platform diversification a central procurement theme.
By Application
Close Air Support (CAS) - CAS grows from USD 2,038.53 million to USD 3,469.01 million, at 5.26%. It remains the largest application because it consumes high volumes of short- and medium-range guided weapons, though its growth trails missions requiring greater stand-off.
Air Interdiction - From USD 1,757.72 million to USD 3,221.59 million, at 6.05%, interdiction benefits from seekers that retain moving-target performance in adverse conditions, including StormBreaker's multi-mode configuration.
Precision Strike Against Fixed Infrastructure - The segment increases from USD 1,805.05 million to USD 3,634.60 million, at 7.06%. GPS/INS-enabled stand-off weapons retain a central role, with resilience to electronic warfare becoming the key technology differentiator.
Suppression & Destruction of Enemy Air Defenses (SEAD/DEAD) - This application grows from USD 1,360.10 million to USD 3,056.36 million, at 8.23%. Allied AARGM-ER procurement indicates that suppression capability is being treated as a prerequisite for conventional air operations, not a specialist niche.
Maritime Strike - From USD 1,243.38 million to USD 3,139.33 million, at 9.48%, maritime strike benefits from distributed launch-platform integration and Indo-Pacific investment in stand-off capability.
GMI Analyst View
The strongest structural combinations pair stand-off range with radar, resilient navigation, or multi-mode guidance, and place them on fighters or maritime platforms serving SEAD/DEAD and maritime missions. These pairings address a common problem: operating against defended targets without placing scarce aircraft inside the threat envelope. UAV growth is more complementary than wholly cannibalistic in the near term; it expands persistent light-strike capacity, while fighters retain missions that require payload, speed, survivability, and deep penetration. The competitive implication is a two-track portfolio requirement: economical, adaptable weapons for distributed unmanned operations and premium systems for high-end deterrence.
Air-to-Ground Missile (AGM) Market Regional Analysis
North America
North America grows from USD 2,790.88 million in 2025 to USD 5,640.55 million in 2035, a 7.10% CAGR. The U.S. accounts for USD 2,644.89 million in 2025 and USD 5,302.12 million by 2035, supported by JASSM, StormBreaker, AARGM-ER, JAGM, and hypersonic program activity. Canada grows from USD 145.98 million to USD 338.43 million, at 8.57%, as F-35 acquisition and NATO interoperability increase the relevance of compatible munitions.
Europe
Europe expands from USD 2,293.05 million to USD 4,583.07 million, at 6.98%. Spending increases and investment in European defense industry capacity create demand for both replenishment and sovereign strike options [7]Council of the European Union - EU defence in numbers. consilium.europa.eu. Germany rises from USD 312.39 million to USD 870.95 million, at 10.53%, supported by its increased defense expenditure and F-35-related precision-weapon integration. The UK grows from USD 596.14 million to USD 1,191.46 million, France from USD 476.23 million to USD 916.51 million, Russia from USD 462.23 million to USD 641.55 million, Italy from USD 150.15 million to USD 229.40 million, and Spain from USD 63.25 million to USD 91.65 million. Russia's 3.09% CAGR reflects a commercially constrained market despite high wartime demand, whereas Western European demand is more accessible to allied industrial supply chains.
Asia Pacific
Asia Pacific rises from USD 2,140.06 million in 2025 to USD 4,349.95 million by 2035, at 7.16%. China remains the largest country market, moving from USD 957.49 million to USD 1,761.68 million, but domestic procurement limits participation by foreign suppliers. Japan's USD 333.94 million market reaches USD 913.38 million, a 10.34% CAGR, as its stand-off weapon budget becomes concrete procurement [8]The Aviationist - U.S. Approves Japan's Purchase of More AGM-158 JASSMs in $39 Million Deal. theaviationist.com. South Korea grows from USD 256.67 million to USD 521.78 million, India from USD 214.01 million to USD 434.99 million, and Australia from USD 188.59 million to USD 500.08 million. India's procurement approval for BrahMos and armed UAVs, alongside its approval of indigenous systems including LRASSCM, signals a market in which local capability and external supply can coexist.
Latin America
Latin America grows from USD 240.44 million to USD 445.31 million, a 6.16% CAGR. Brazil rises from USD 97.29 million to USD 187.03 million, Mexico from USD 40.82 million to USD 75.70 million, and Argentina from USD 23.49 million to USD 40.08 million. Budget constraints and export-access limitations keep demand focused on compatible upgrades rather than large stand-off inventories.
Middle East and Africa
The region expands from USD 740.36 million to USD 1,502.00 million, at 7.14%. Saudi Arabia grows from USD 215.97 million to USD 450.40 million and the UAE from USD 127.93 million to USD 271.05 million, supported by mixed U.S. and European combat-aircraft inventories. South Africa rises from USD 389.37 million to USD 766.29 million; Denel Dynamics' Mokopa capability adds an indigenous supply dimension that is uncommon in African markets.
GMI Analyst View
North America and Europe remain the revenue center because they combine large budgets, qualified fleets, and established missile-industrial ecosystems. The more consequential diversification lies in Asia Pacific: Japan and Australia are accelerating stand-off and maritime investment through alliance-backed programs, while India is building domestic precision-strike capacity alongside procurement. These markets offer significant opportunity, but entry paths differ sharply. Allied FMS and integration channels shape Japan and Australia; localization, sovereign production, and technology control are more important in India and South Korea. Regional growth rates alone therefore understate the advantage of suppliers that can match each market's industrial and export architecture.
Air-to-Ground Missile (AGM) Market Share & Competitive Landscape
Competition is concentrated among firms that can integrate guidance, propulsion, warhead, software, and platform qualification under sovereign procurement rules. Lockheed Martin is positioned across the highest-value growth missions through JASSM/JASSM-ER, LRASM, and JAGM; LRASM's planned F-15E/EX and P-8 integration extends that franchise into distributed maritime strike. Northrop Grumman occupies the anti-radiation niche through AARGM-ER and also participates in the HACM supply chain, making its position closely tied to SEAD and hypersonic execution.
RTX/Raytheon combines a mature multi-mode strike weapon in StormBreaker with the higher-risk HACM development program. Its position illustrates the value of balancing serial production with technology options: StormBreaker has established production and export relevance, while HACM's timing remains subject to development milestones. Boeing sustains a broad installed-base presence through JDAM, Harpoon, and Small Diameter Bomb programs, where integration breadth can matter as much as individual missile range.
MBDA's portfolio spans Brimstone, SPEAR, and Storm Shadow/SCALP-EG, giving it a European route across tactical, network-enabled, and stand-off missions. BAE Systems contributes APKWS II scale and precision-weapon systems engineering; Saab and KONGSBERG are important to European and maritime-strike portfolios through Taurus and NSM/JSM-related capabilities. These firms compete not only on weapon performance but on European sovereignty, integration with regional fleets, and the ability to offer alternatives to U.S.-controlled supply.
Rafael, IAI, and Elbit Systems provide Israeli precision-strike and unmanned-system expertise, while Roketsan and Denel Dynamics anchor Turkish and South African domestic capability. In Asia Pacific, Hanwha Aerospace and LIG Nex1 support South Korean guided-weapon development; BrahMos is central to India's air-launched supersonic strike plans; and Mitsubishi Heavy Industries participates in Japan's expanding standoff and anti-ship portfolio. The strategic contest is consequently not a single global tender market: it is a set of alliance, sovereignty, and platform-specific competitions.
Recent Industry Developments
In August 2025, the U.S. Army awarded Lockheed Martin a USD 720 million contract for the production of Joint Air-to-Ground Missiles (JAGM) and HELLFIRE missiles, representing the fourth and final follow-on award of the company's current multi-year production contract, covering deliveries to the U.S. Army, U.S. Navy, and international customers including the United Kingdom, Poland, Spain, Czech Republic, Italy.
In October 2025, MBDA and Korean Aerospace Industries (KAI) signed a Memorandum of Understanding for the integration of the SPEAR Air-to-Ground missile onto the KF-21 Boramae fighter jet, announced at Seoul ADEX 2025, targeting enhancement of the KF-21's precision strike capability through a turbojet-powered, multi-sensor guided stand-off weapon capable of engaging both land and maritime targets beyond the horizon.
In May 2025, Rafael Advanced Defense Systems unveiled the SPICE 250 ER a GPS-independent, long-range glide munition with electro-optical scene-matching guidance capable of precision strike beyond 150 km at DEFEA 2025 in Athens, extending the SPICE family's engagement envelope and expanding its applicability for NATO-compatible air forces operating in GPS-contested environments.
Need a specific section of this report?
Purchase regional analysis, country-level analysis, company profiles, or any other segment-level insights separately
based on your research needs.
Frequently Asked Questions (FAQs):
Research methodology, data sources & validation process
This report draws on a structured research process built around direct industry conversations, proprietary modelling, and rigorous cross-validation and not just desk research.
Our 6-step research process
1. Research design & analyst oversight
At GMI, our research methodology is built on a foundation of human expertise, rigorous validation, and complete transparency. Every insight, trend analysis, and forecast in our reports is developed by experienced analysts who understand the nuances of your market.
Our approach integrates extensive primary research through direct engagement with industry participants and experts, complemented by comprehensive secondary research from verified global sources. We apply quantified impact analysis to deliver dependable forecasts, while maintaining complete traceability from original data sources to final insights.
2. Primary research
Primary research forms the backbone of our methodology, contributing nearly 80% to overall insights. It involves direct engagement with industry participants to ensure accuracy and depth in analysis. Our structured interview program covers regional and global markets, with inputs from C-suite executives, directors, and subject matter experts. These interactions provide strategic, operational, and technical perspectives, enabling well-rounded insights and reliable market forecasts.
3. Data mining & market analysis
Data mining is a key part of our research process, contributing nearly 20% to the overall methodology. It involves analysing market structure, identifying industry trends, and assessing macroeconomic factors through revenue share analysis of major players. Relevant data is collected from both paid and unpaid sources to build a reliable database. This information is then integrated to support primary research and market sizing, with validation from key stakeholders such as distributors, manufacturers, and associations.
4. Market sizing
Our market sizing is built on a bottom-up approach, starting with company revenue data gathered directly through primary interviews, alongside production volume figures from manufacturers and installation or deployment statistics. These inputs are then pieced together across regional markets to arrive at a global estimate that stays grounded in actual industry activity.
5. Forecast model & key assumptions
Every forecast includes explicit documentation of:
✓ Key growth drivers and their assumed impact
✓ Restraining factors and mitigation scenarios
✓ Regulatory assumptions and policy change risk
✓ Technology adoption curve parameter
✓ Macroeconomic assumptions (GDP growth, inflation, currency)
✓ Competitive dynamics and market entry/exit expectations
6. Validation & quality assurance
The final stages involve human validation, where domain experts manually review filtered data to identify nuances and contextual errors that automated systems might miss. This expert review adds a critical layer of quality assurance, ensuring data aligns with research objectives and domain-specific standards.
Our triple-layer validation process ensures maximum data reliability:
✓ Statistical Validation
✓ Expert Validation
✓ Market Reality Check
Trust & credibility
Verified data sources
Trade publications
Industry journals, trade publications, and specialized media.
Industry databases
Proprietary and third-party market databases
Regulatory filings
Government procurement records and policy documents
Academic research
University studies and specialist institution reports
Company reports
Annual reports, investor presentations, and filings
Expert interviews
C-suite, procurement leads, and technical specialists
GMI archive
13,000+ published studies across 20+ industry verticals
Trade data
Import/export volumes, HS codes, and customs records
Parameters studied & evaluated
Every data point in this report is validated through primary interviews, true bottom-up modelling, and rigorous cross-checks. Read about our research process →