Thales nine-month sales and orders top forecasts on arms and space contracts

By Florence Loeve

PARIS, Oct 22 (Reuters) - French defence and security company Thales reported better-than-expected nine-month sales and orders on Thursday, helped by rising European defence spending and a pickup in space contracts, while reaffirming its 2026 outlook.

The company, whose products range from military radars to civil air traffic control, said sales rose 8.1% on an organic basis to €16.42 billion ($18.46 billion), exceeding analysts' expectations for 7.4% growth in a company-compiled consensus.

Defence, its largest division and the source of more than half of 2025 sales, posted organic growth of 13% to €9.36 billion.

Thales reaffirmed its 2026 targets and said it expected organic sales growth near the upper end of its 6%-7% target range.

Its shares were down 0.8% to 228.2 euros at 0840 GMT.

ORDER BOOST FROM SPACE CONTRACTS

Orders for the first nine months of this year rose 14% from a year earlier to €19.12 billion, beating expectations for an 11% increase.

Berenberg analysts said the stronger-than-expected order intake was driven by a pickup in space contracts, including an order worth about €500 million linked to the European Union's IRIS² communications constellation.

Thales has signed an agreement with satellite operator Eutelsat to supply government payloads for the project. Chief Financial Officer Jeremie Papin told analysts the company expected to book around €2 billion of additional IRIS² orders over the next few quarters.

Papin also said talks were ongoing on exports of the SAMP/T NG air defence system produced by the Franco-Italian Eurosam consortium, which includes MBDA France, MBDA Italy and Thales.

The SAMP/T NG is Europe's most advanced medium-to-long-range ground-based air defence system and is seen as an alternative to the US-made Patriot system.

"We are having a lot of discussions with many interested customers," Papin said.

France said on Wednesday it had ordered four additional SAMP/T NG systems.

Thales also launched Hexaforce, an AI-enabled military command software platform, in September as an alternative to Palantir's Maven.

($1 = 0.8894 euros)

(Reporting by Florence Loeve. Edited by David Gaffen and Mark Potter)