Elsight Surges on US$4.28M European Defence Order for Autonomous Connectivity Platform

Key Highlights:

• European drone OEM places US$4.28M order with Elsight for Halo systems
• Deal more than doubles Elsight’s 2024 full-year revenue
• Defence sector continues to fuel growth, now over 50% of company revenue
• Shares climb 10% as investors welcome revenue forecast upgrade
   

Elsight Ltd (ASX: ELS) surged 10% to $0.385 in morning trade on Tuesday after announcing a landmark US$4.28 million (~A$7.1 million) supply deal with a European defence drone manufacturer. The follow-on order, due for delivery between April and July 2025, represents a significant scale-up from a US$300,000 initial order placed just last month and brings the total value of the engagement to US$4.58 million (~A$7.56 million).

This latest agreement not only validates Elsight’s Halo technology, a high-reliability AI-powered connectivity platform for drones and autonomous systems, but also materially shifts the company’s near-term revenue trajectory. Management has now upgraded its 2025 revenue expectations, noting that this one order alone exceeds twice its entire 2024 revenue base.

Elsight’s CEO Yoav Amitai described the deal as “a major validation of the value, reliability and strategic position” of the company’s solution, following successful field integration trials. The customer, a key European government supplier, completed extensive testing before rapidly accelerating to a full-scale production rollout.

“The speed and scale of this expansion show just how critical dependable, cybersecure communications are in modern defence operations,” Amitai said. “We are proud to support this program and are excited about the long-term growth potential.”

Elsight, which is not currently covered by a major broker, posted a trading volume of over 462,000 shares Tuesday—more than 9x its four-week average—indicating investor enthusiasm for its transition from tech hopeful to validated defence supplier. The stock has gained over 11% in the past month and is now up more than 4% year-to-date.

The announcement reinforces the company’s strategic pivot toward defence. In 2024, the sector accounted for 51% of total revenue, a figure that is expected to increase significantly in 2025 given the ongoing geopolitical instability and rapid adoption of unmanned autonomous systems across NATO members. The deal is also separate from a previous September 2024 defence contract, suggesting diversified momentum across multiple military programs.

Notably, the agreement comes at a time when European nations are revising their defence budgets in response to shrinking U.S. support and rising regional security threats. The EU’s increased defence spending is accelerating the adoption of swarm drones and other autonomous platforms—a sector in which Elsight’s Halo product is emerging as a foundational technology. With its low latency, multi-network connectivity and cyber-secured design, Halo is designed to function reliably even in highly contested or remote environments.

Elsight recently participated in the UK Military Robotics & Autonomous Systems event, where the UK Army’s Chief of General Staff confirmed that future budgets would prioritise autonomous defence technologies. That strategic alignment gives Elsight a strong competitive position as NATO and EU nations expand procurement in 2025 and beyond.

With a current market cap of just under A$70 million, Elsight’s valuation still appears modest relative to its pipeline and positioning. As deliveries ramp up and recurring revenue opportunities crystallise, the company may increasingly attract institutional interest.

The defence order also provides a solid cushion for Elsight to weather broader market volatility. As the ASX technology index shed 2.32% on Tuesday amid macroeconomic pressures and global trade tensions, Elsight’s double-digit share price gain made it a clear outlier in the sector.

While no customer identity was disclosed for security reasons, Elsight confirmed that the order includes a material upfront payment and that all deliveries will be completed by July. Further updates are expected as long-term volume requirements and rollout plans are finalised.

For now, the takeaway is clear: in an era where reliable communication defines battlefield success, Elsight is finding its signal.