Defense Electronics Market Analysis

Defense Electronics Market Analysis

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Based on component, the defense electronics market is segmented into hardware and software. The hardware segment will record 5.5% CAGR through 2032. The hardware segment includes various equipment & systems that are important to the development & operation of electrical defense. In addition, the Electronic Warfare (EW) used for defense, electronic surveillance, and electronic evaluation includes hardware such as electronic warfare receivers, jammers, Radar Warning Receivers (RWR), and Electromagnetic Radiation Monitoring (ESM). These hardware components facilitate the development of advanced defense systems and enable capabilities, such as communications, surveillance, detection, routing, and control, that are respected in national defense operations.
 

Furthermore, with the increasing reliance on communications and communication security systems, cybersecurity has become a major concern. The hardware system is propelled by the need for hardware security and strong encryption systems that protect systems from cyber threats and ensure data integrity.
 

Based on industry vertical, the navigation, communication & display segment of the defense electronics market expanded at a 6.5% CAGR in 2022. These focuses on systems & technologies for accurate location, navigation, and guidance in defense operations. This section includes various equipment & systems that are designed to provide accurate & reliable navigation in harsh environments. Additionally, unmanned systems including UAVs (Military Drone) and UGVs rely heavily on navigation systems to operate autonomously or remotely. The demand for accurate and robust navigation hardware & software solutions for unmanned platforms will enhance the navigation segment share.
 

Based on platform, the airborne segment held approximately 35% of the defense electronics market share in 2022.  The airborne segment focuses on systems & technologies that are specially designed for use in aircraft and aircraft platforms. It features a variety of electronics and systems essential for on-board operations and mission success. Moreover, avionics systems are essential components of the airborne segment, which includes flight control systems for aircraft control, communications, navigation, and tracking. This includes flight control, cockpit instructions, communications, navigation systems, and surveillance. The demand for advanced avionics is a key driver responsible for airborne segment growth.

The defense electronics market for North America accounted around 40% of the revenue share and was valued over USD 95 billion in 2022. United States has the largest military budget in the world, with the country spending around USD 715 billion according to the Department of Defense in 2022. The country invests heavily on improving their defense capabilities to maintain their military dominance and protect their national security interests. Similarly, the country is home to leading defense electronics companies such as Northrop Gruman, Raytheon, Lockheed Corporation, etc. These companies are continuously investing on the development of new technologies in this market. Increasing defense expenditures have created opportunities for the regional market expansion.