Thales, Europe’s largest defense technology company, has unveiled ambitious growth targets, projecting annual sales increases of five percent to seven percent between 2024 and 2028 and aiming for an operating profit margin of 13 percent to 14 percent by 2028. This growth is underpinned by a decade of investments in cybersecurity and a strategic pivot toward digital security.
CEO Patrice Caine highlighted the company’s strong positioning amid rising global defense spending and increasing demand for cybersecurity solutions, with market research indicating the cybersecurity market is expected to reach $304.91 billion in the coming years. “It is evident that the world has entered a cycle of higher investments in defense,” said Caine during Thales’ investor day in Paris.
Cybersecurity has been a key focus for Thales, with revenues in this domain quadrupling over recent years through strategic acquisitions. The company’s 2019 acquisition of Gemalto marked a significant milestone, leading to the establishment of its Digital Identity and Security (DIS) business unit. This was further strengthened by the acquisition of U.S. cybersecurity firm Imperva in 2023. These strategic moves have positioned Thales among the global top five in cybersecurity, leveraging its expertise to address growing threats of cyberattacks and heightened privacy demands. “Cybersecurity is not just a priority—it’s a necessity in today’s interconnected world,” Caine remarked, pointing to the increasing importance of this segment within the company’s broader portfolio.
Thales is also a leader in biometric technology, supplying identity systems for sectors ranging from banking to national security. Thales’ biometric solutions have been integral in digital identity programs, supporting secure and seamless identification processes for millions worldwide. The company’s expertise in this area complements its cybersecurity capabilities, as biometric authentication becomes a cornerstone in safeguarding sensitive data and systems.
Despite these positive developments, Thales’ latest forecasts were met with some skepticism, with shares dipping 1.5 percent as analysts viewed the targets as cautious. Still, Caine remains optimistic about the future, citing Europe’s potential to play a larger role in defense. “If Europe wants to take a bigger role in defense, it is more of an advantage than a risk for Thales,” he said, adding that security risks are unlikely to diminish in the near term. The company’s ambitious recruitment plans, including a plan last year to hire 12,000 new employees, further underscore its commitment to growth and innovation in the security sector.
Source: Reuters
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November 18, 2024 – by Ali Nassar-Smith
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