Thales

Revenue came in at €5.32bn vs €5.19bn consensus (+2.4%), with strong organic growth of +9.7%, primarily driven by Defence.

Order intake reached €4.65bn vs €4.85bn consensus (-4%), despite a robust +27% organic increase, reflecting timing effects on large contracts.

By division: 1/Defence: revenue of €3.05bn vs €2.90bn (+5%), highlighting strong execution, but order intake at €2.24bn vs €2.70bn (-17%); 2/ - Aerospace: broadly in line with expectations; 3/ - Cyber & Digital: revenue of €0.86bn vs €0.90bn (-4%), with orders also below expectations, confirming a softer start to the year.

Guidance:

- FY26 guidance confirmed, without upgrade. The midpoint is at ~€23.45bn vs ~€23.7bn consensus (~1% below).

Conclusion: The release shows solid operational delivery, particularly in Defence. However, the miss on order intake, weaker Cyber performance, and lack of guidance upgrade are likely to weigh on sentiment. Overall, we expect a muted to slightly negative market reaction, with the focus on softer visibility despite strong top-line execution.

Expert Opinion:
We still like the equity story on a medium-term basis. We think the demand for defence will be sustained and Thales is also a call option (alongside Dassault Aviation) if the USA were to exit NATO. A drop in the share price would be an opportunity to buy more in the name.