Best 3 ASX Defence Stocks To Buy Now

Some defence stocks, after a brief lull period, are coming back in the reckoning. These are again offering an opportunity to add to the portfolio.

DroneShield Limited (ASX: DRO) 

in the first half of 2025 the company made revenue of about A$72.3 million which is up 210% from last year for the same period and it also recorded its most profitable half year ever with PBT of A$5.2 million. Year to date secured revenues touched A$176.3 million and the sales pipeline has grown to A$2.34 billion which is more than double compared to last year. The company has a strong balance sheet with A$207.9 million cash and no debt. It keeps investing over A$50 million every year into research and development with focus on AI powered software and multi mission counter drone systems. Its products are already being used by defence forces and critical sites around the world. For the future DRO wants to grow its SaaS revenues along with building more manufacturing hubs in US and Europe and increase its pipeline to A$5 billion by 2027-2028. 

Titomic Limited (ASX: TTT) 

is trying to build itself as a big name in aerospace and defence by using its own cold spray technology. FY2025 was a year of big changes as the company opened its new 59,000 sq ft Huntsville facility in USA and also started preparing a European site. In July 2025 Titomic raised around A$50 million which uplifted its cash position to about A$59 million giving support for expansion along with adding more technical staff and certification programs. The company is already working with big defence names like Boeing, Northrop Grumman, Airbus and even NASA. It is now moving from research validation stage into pilot projects and pre production contracts. In the near future the company expects important milestones like defence demos and Airbus maintenance trials in late 2025. With a long term goal of reaching about U$750 million revenue by 2030, and its exposure to different industries along with government backing in US, Europe. Titomic seems in a strong position to benefit from rising defence spending.

Electro Optic Systems Holdings Limited (ASX: EOS) 

posted revenue of about A$44.1 million in the first half of 2025 compared to A$105.5 million last year. Even though sales dropped but gross margin increased to 76% which was an improvement of 32% from last year because of final payments from deals in the Middle East. The company booked a net loss of A$44.8 million. Balance sheet however looks stronger now with around A$130 million cash after it sold EM Solutions and repaid all its debt. Contract wins have picked up with backlog climbing to A$307 million in August 2025 more than double from December. New deals include a A$53 million order for the Slinger counter drone system and a A$125 million high energy laser export deal with a NATO country in Europe. Going forward EOS wants to grow across counter-drone along with laser weapons and space control. Projects worth billions being discussed in Europe Middle East and Asia for future. 

(Source: Company Announcements)