Ukraine's defense tech market reaches $6.8B in 2025

According to Ukrinform, these findings were published by the Kyiv School of Economics based on research conducted in cooperation with Brave1 and Defense Builder.

"In 2025, the volume of the defense technology market in Ukraine reached approximately $6.8 billion. At the same time, overall defense production grew more slowly due to limited domestic funding. In contrast, technological segments expanded much faster: UAV production increased by 137%, ground robotic systems (GRS) by 488%, and electronic warfare systems by 215%," the study states.

The report notes that the actual market size is likely higher, as a significant share of procurement occurs through decentralized channels – charitable foundations, direct unit contracts, and in-house brigade production – which are not reflected in official statistics.

The UAV segment has the greatest investment potential. It recorded the fastest and largest growth, reaching $6.3 billion last year. At least 150 companies operate in this segment, which is largely driven by private enterprises, although the state remains a key player due to its scale. The fastest-growing areas include long-range drones and interceptors, while FPV drones remain the most widespread category. Promising areas include interceptor drones, which are just beginning to scale, middle-strike drones, and domestic alternatives to Chinese DJI reconnaissance multicopters.

The GRS segment is still emerging and growing rapidly (valued at $43 million in 2024), although it remains relatively small at $252 million. Key growth drivers include logistics and evacuation platforms, while strike systems and demining solutions are opening new niches with strong long-term demand.

In 2025, the electronic warfare (EW) market was estimated at $220 million. The sector is currently transitioning from fragmented solutions to serial production of proven platforms, with a focus on software-defined systems capable of analyzing signals and selectively jamming them.

Ukrainian defense companies and startups attracted around $129 million in investments and grants in 2025. This is a minimum estimate, as some deals remain undisclosed for security reasons. The largest share of investments went to AI and software segments. Key funding mechanisms include Brave1 grants (over $60 million in 2025, supporting more than 600 companies), venture capital investments, concessional loans under the "5-7-9%" program ($160 million for 108 enterprises), and partner-country financing through direct procurement. Companies that secured funding are rapidly scaling up production.

Photo for illustrative purposes

More Ukrinform photos can be purchased here