Defense & Aerospace Report DEFAERO Daily Pod [Jul 28, 25] Week in Review & Byron Callan’s Week Ahead
Jul 28, 2025
Byron Callan, a seasoned expert from Capital Alpha Partners, discusses significant trade agreements between the U.S., Japan, and the EU, highlighting rising tariffs and their implications on defense exports. He shares insights into how these deals affect the aerospace industry and small businesses. The conversation also delves into the evolving landscape of drone warfare, the impact of AI legislation on defense technology, and upcoming industry events, offering a comprehensive view of the challenges and future trends in defense and aerospace.
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EU Tariff Deal's Defense Impact Limited
- The 15% baseline tariff agreement with the EU won't create a huge boost for U.S. defense exports.
- European countries will still build their own defense capabilities despite commitments to buy U.S. defense goods.
Defense Sales Growth Outlook
- Defense sales growth may last 1 to 3 years before flattening or declining.
- Smaller companies could grow faster than large diversified defense firms during this period.
Mixed Defense Earnings Performance
- Northrop Grumman and General Dynamics stocks rose sharply due to strong program performance.
- Lockheed Martin's quarter showed write-downs and lower expected free cash flow next year.