Military Electro-Optics/Infrared (EO/IR) Systems Market Report 2026

The military electro-optics/infrared (eo/ir) systems market size has grown strongly in recent years. It will grow from $10.77 billion in 2025 to $11.42 billion in 2026 at a compound annual growth rate (CAGR) of 6%. The growth in the historic period can be attributed to increasing deployment of infrared sensors, early adoption of night vision systems, expansion of airborne surveillance platforms, reliance on conventional optics, growth in military reconnaissance systems.

The military electro-optics/infrared (eo/ir) systems market size is expected to see strong growth in the next few years. It will grow to $14.75 billion in 2030 at a compound annual growth rate (CAGR) of 6.6%. The growth in the forecast period can be attributed to rising demand for advanced thermal imaging, increasing investment in unmanned defense systems, expansion of hyperspectral imaging technologies, development of long-range surveillance solutions, growth in multispectral target acquisition. Major trends in the forecast period include adoption of AI-driven target recognition, integration of autonomous surveillance platforms, advancement of cloud-connected eo/ir processing, development of intelligent multi-spectral imaging systems, expansion of IoT-enabled defense monitoring.

Increasing geopolitical tensions are projected to drive the growth of the military electro-optics and infrared (EO/IR) systems market in the coming years. Geopolitical tensions refer to conflicts, disputes, or escalated competition among nations or geopolitical entities, often fueled by political, economic, territorial, or ideological differences. These tensions contribute to a heightened demand for military electro-optic and infrared (EO/IR) systems, which are vital for improving situational awareness, reconnaissance, and surveillance capabilities. As reported by Lebanon’s Ministry of Public Health, from 8 October 2023 to 27 January 2025, the Israel Defense Forces killed 217 healthcare personnel, damaged 177 ambulances, carried out 68 hospital attacks, and were accountable for 237 assaults on emergency medical services. Therefore, the rise in geopolitical tensions is influencing the military electro-optics and infrared (EO/IR) systems market.

Major companies in the military electro-optics and infrared (EO/IR) systems market are emphasizing product innovations, exemplified by offerings such as Point Blank. This tactical missile system, designed for use by small tactical units, aims to enhance lethality by providing an independent capability. Israel Aerospace Industries Corporation unveiled the Point Blank in January 2023, a hand-launched electro-optical guided missile carried in a soldier's backpack. Equipped with advanced electro-optical systems, Point Blank allows real-time surveillance information validation and collection, facilitating high-precision target targeting and real-time strikes.

In September 2023, General Atomics, a U.S.-based energy and defense corporation, acquired EO Vista for an undisclosed sum. This acquisition is intended to significantly boost its capabilities in electro-optical sensor systems, especially for military and aerospace uses. EO Vista is a U.S.-based aerospace firm that focuses on developing advanced electro-optical (EO) sensor systems.

Major companies operating in the military electro-optics/infrared (eo/ir) systems market are Raytheon Technologies Corporation, Lockheed Martin Corporation, Northrop Grumman Corporation, Thales Group, L3Harris Technologies Inc., BAE Systems PLC, Leonardo SpA, Elbit Systems Ltd., Rheinmetall AG, Ultra Electronics Holdings, Theon Sensors SA, Safran SA, Excelitas Technologies Corp., General Dynamics Corporation, PVP Advanced EO Inc., Textron Inc, Teledyne FLIR, Leidos Holdings Inc., Logos Technologies, Moog Inc., The Boeing Co., CONTROP Precision Technologies, Tonbo Imaging, UTC Aerospace Systems, Curtiss-Wright Corporation.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

Tariffs have affected the military electro-optics/infrared system market by increasing costs for imported optical components, infrared sensors, semiconductor materials, and stabilization electronics used in airborne, land, and naval defense platforms. Defense organizations in North America, Europe, and Asia-Pacific face procurement delays and elevated system costs due to global material dependencies. However, tariffs are also accelerating domestic manufacturing of EO/IR subsystems, promoting localized defense supply chains, and supporting innovation in cost-efficient imaging technologies to enhance strategic readiness.

The military electro-optics/infrared (EO/IR) systems market research report is one of a series of new reports that provides military electro-optics/infrared (EO/IR) systems market statistics, including military electro-optics/infrared (EO/IR) systems industry global market size, regional shares, competitors with a military electro-optics/infrared (EO/IR) systems market share, detailed military electro-optics/infrared (EO/IR) systems market segments, market trends and opportunities, and any further data you may need to thrive in the military electro-optics/infrared (EO/IR) systems industry. This military electro-optics/infrared (EO/IR) systems market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

A military electro-optics/infrared (EO/IR) system is a technological system that integrates both electro-optics and infrared capabilities to collect and process information from the electromagnetic spectrum. This system combines various devices and components to facilitate the detection, imaging, tracking, and analysis of targets or objects using both visible light and infrared radiation.

The primary products included in military electro-optics/infrared (EO/IR) systems are handheld systems and EO/IR payloads. Handheld systems are portable electronic devices designed to be operated while held in the hand or carried by an individual. These systems comprise components such as human-machine interfaces, stabilization units, control systems, optics, sensors, and processors. Various types of imaging technology are employed, including scanning, starring, hyperspectral, and multispectral. Military EO/IR systems are deployed on different platforms, including land, airborne, and naval, for applications such as military intelligence, surveillance, and reconnaissance.North America was the largest region in the military electro-optics/infrared (EO/IR) systems market in 2025. The regions covered in the military electro-optics/infrared (eo/ir) systems market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the military electro-optics/infrared (eo/ir) systems market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The military electro-optics/infrared (EO/IR) system market consists of sales of radar systems, lidar systems, and electro-optical targeting systems. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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