As global defence priorities evolve, the battlefield is becoming increasingly digital. Unmanned systems, drones, autonomous vehicles, and AI-driven surveillance platforms are now standard issue across many defence programs. But behind these innovations lies one critical requirement: reliable, real-time communication.
Enter Elsight Ltd (ASX: ELS) an emerging player in defence-grade connectivity.
Its flagship product, Halo, offers AI-powered, carrier-agnostic communications that can aggregate multiple networks into a single, ultra-resilient connection. This is a game-changer for military platforms operating in areas with weak or compromised networks.
The traction is showing. In June 2025, Elsight announced a US$5.08 million contract with a European defence OEM, bringing total orders from that client to US$14.7 million a staggering 600% year-on-year increase. In Q3 2024 alone, Elsight’s revenue surged 70%, with defence contracts now making up over half of total income.
To meet rising demand, the company is scaling its production capabilities, and the same OEM partner is evaluating additional product applications beyond Halo. With names like Lockheed Martin and Droneup in its broader pipeline, Elsight is clearly playing in serious circles.
The broader backdrop? Defence departments around the world are modernising rapidly not just buying drones and sensors, but also investing in the comms tech that keeps them running. As battlefield autonomy rises, secure, uninterrupted connectivity is becoming a strategic necessity not a luxury.
Elsight’s growing footprint underscores how important that shift has become.
VEEM Ltd (ASX: VEE): Quiet Engineering Power in the Defence Supply Chain
When you think about defence, submarines and drones usually come to mind. But behind the scenes, specialised manufacturers like VEEM Ltd (ASX: VEE) are quietly playing a pivotal role in the machinery that powers, stabilises, and propels maritime and defence assets.
Headquartered in Perth, VEEM designs and manufactures advanced marine propulsion systems and gyro stabilisers technology essential to reducing vessel roll in rough seas. Their client base includes superyacht builders, naval defence contractors, and commercial fleets. And while recent months have presented challenges, the long game appears to be anchored in defence expansion.
In its H1 FY25 trading update, VEEM flagged revenue of $33–35 million and EBITDA between $3.4 to 4 million, citing shipment delays and softer-than-expected defence revenues. But management has already responded with cost optimisation efforts and resolved key quality assurance issues that had impacted performance.
Importantly, VEEM was recently awarded a $1 million Defence Industry Development Grant by the Australian government. This funding is expected to boost their manufacturing capacity and accelerate their readiness for incoming defence-related production.
Looking ahead, VEEM anticipates a rebound in H2 FY25, led by delivery of delayed gyro units and a likely lift in defence work. With new capital equipment on the way supported by the grant and a renewed focus on stabilising operations, VEEM seems positioned to re-enter growth mode.
As Australia sharpens its naval capabilities, suppliers like VEEM may find themselves closer to the strategic core than most realise.
(Source: Company Announcements)
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