NATO allies are under sustained pressure from the Trump administration to dramatically increase defense spending, with the upcoming Turkey summit expected to formalize higher GDP targets. Multiple reports confirm that European members are accelerating procurement plans, with the US pressing for commitments well above the old 2% benchmark. The President's budget simultaneously calls for the highest US defense spending in history.
Who cashes in: Lockheed Martin (LMT) is the primary beneficiary of any NATO spending surge — F-35 orders from European allies, HIMARS systems, and Patriot batteries all run through Lockheed's order book. RTX (RTX) captures the missile and engine side: AMRAAM interceptors, Patriot upgrades, and Pratt & Whitney engines for allied air forces. Northrop Grumman (NOC) benefits through radar systems and electronic warfare. These are large-caps, so the moves are measured — but the backlog additions are real and multi-year. For higher beta, L3Harris (LHX) and Kratos Defense (KTOS) are smaller names with meaningful allied-sales exposure.