5.1.9Segment

Missiles, Munitions & Ordnance

Manufacturers of guided missiles, munitions, ordnance, and rocket propulsion systems for defense applications.

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Verticals

Overview

Missiles, Munitions & Ordnance covers manufacturers of guided missiles, munitions, ordnance, rocket propulsion, and ammunition for defense applications. It has been one of the fastest-growing defense segments, driven by the surge in munitions demand to support Ukraine and to replenish depleted U.S. and allied stockpiles.

Demand is structural and budget-backed, with multi-year procurement to rebuild and expand munitions production capacity. It is consolidated around primes (RTX, Lockheed, Northrop) and ammunition specialists, with capacity expansion the defining theme.

Market snapshot

Market size
~$60B
Growth
~7.6%CAGR (2017–22, nominal)
Companies
~844 firms
Firms by employee count

64.8% of firms have fewer than 20 employees: 543 micro-businesses, below most mandates.

The investable universe295 firms with 20+ employees
20–99
14549%
100–499
7224%
500+
7826%

The fastest-growing part of the sector, and the growth is real demand — munitions restocking and missile-defence programs — rather than price. One caution on the total: the classification that carries guided missiles also carries space vehicles, so this figure spans launch and satellite manufacturing as well as weapons.

NAICS 325920, 332992, 332993, 332994, 336414, 336415, 336419. U.S. Census Bureau — 2022 Statistics of U.S. Businesses; U.S. Census Bureau — 2022 Economic Census.

Business model & economics

Revenue model

Defense procurement contracts for missiles and munitions

Key economics

Revenue per firm
$71,622,932
Revenue per employee
$462,660
Employees per firm
167.2
Recurring revenue
High

multi-year procurement programs

EBITDA margin
Program-margin-driven
Capex intensity
High

Characteristics

  • Scale-driven — payroll is only 22% of revenue; the cost base is assets, not headcount
  • Moderate strategic-buyer pool — 78 firms exceed 500 employees; a scaled asset has buyers, but not many
  • Among the fastest-growing defense segments.
  • Ukraine support and stockpile replenishment drive demand.
  • Multi-year capacity expansion the defining theme.

NAICS 325920, 332992, 332993, 332994, 336414, 336415, 336419. U.S. Census Bureau — 2022 Statistics of U.S. Businesses; U.S. Census Bureau — 2022 Economic Census.

Geographic concentration

AlabamaAlaskaArizonaFloridaGeorgiaIndianaKansasMaineMassachusettsMinnesotaNew JerseyNorth CarolinaNorth DakotaOklahomaPennsylvaniaSouth DakotaTexasWyomingConnecticutMissouriWest VirginiaIllinoisNew MexicoArkansasCaliforniaDelawareDistrict of ColumbiaHawaiiIowaKentuckyMarylandMichiganMississippiMontanaNew YorkOhioOregonUtahVirginiaWashingtonWisconsinNebraskaSouth CarolinaNevadaVermontLouisianaRhode IslandColoradoNew HampshireTennesseeIdaho

Munitions and missile work clusters away from the aerospace centres — propulsion and energetics in New Hampshire and Tennessee, space and missile programs in Colorado, and ordnance loading in Idaho.

New HampshireColoradoTennesseeIdaho

U.S. Census Bureau — 2022 County Business Patterns (employment by state), NAICS 325920/332992/332993/332994/336414/336415/336419. Concentration shown by location quotient.

M&A deal context

Deal activityHigh

Who’s acquiring

  • Defense primes
  • Munitions & ammunition specialists
  • PE-backed defense suppliers

What’s driving deals

  • Munitions-replenishment budget surge.
  • Capacity-expansion investment.
  • Consolidation around primes and specialists.

Verticals in this segment

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