Defense Cybersecurity Market

Defense Cybersecurity Market Size

The global defense cybersecurity market was valued at USD 38.8 billion in 2024 and is estimated to grow at a CAGR of 9.8% from 2025 to 2034. The need to protect critical and classified data from cyber threats continues to drive the market.

 As defense organizations rely more on digital technologies and connected networks, they require robust solutions to secure both stored and transmitted data. This emphasis on protecting sensitive information from espionage and cyber-attacks has led to increased investment in security technologies, driving market expansion. For instance, in October 2023, Mercury Systems Inc., located in Andover, Massachusetts, launched the JDAR Type-1 encryptor module for cybersecurity applications serving United States military organizations and defense contractors. After receiving NSA Type-1 encryption certification in 2022, the JDAR data-at-rest encryptor was integrated into Mercury's data storage systems.

The defense cybersecurity market is implementing advanced security measures like zero-trust architecture, artificial intelligence (AI), machine learning (ML), and quantum-resistant encryption. These technologies help protect defense systems, critical infrastructure, and sensitive data from increasingly complex cyber threats. The industry focuses on protecting space assets, such as satellites and communication networks, while making military systems more secure. Defense contractors, governments, and cybersecurity firms are working together to build better security solutions that adapt to new digital challenges.

Defense Cybersecurity Market Trends

The defense cybersecurity industry is using AI and machine learning to better detect threats and respond to attacks automatically. Companies are moving toward zero-trust security systems to better protect their connected defense networks. The need for cybersecurity now includes protecting space equipment like satellites and ground control stations. Companies are investing in new encryption methods to defend against future quantum computing threats. To develop better security solutions, governments are working closely with defense companies and cybersecurity firms.

Defense Cybersecurity Market Analysis

The market struggles to integrate older systems with new cybersecurity technologies. As cyber threats become more sophisticated, current defense systems find it difficult to keep pace. However, new opportunities arise from developments in edge computing and secure cloud solutions, which help monitor and respond to threats in real-time, especially in critical operations. Government regulations like the Cybersecurity Maturity Model Certification (CMMC) and the European Cybersecurity Act set clear standards and encourage organizations to adopt new security technologies. These changes push the industry toward more proactive security approaches that focus on building stronger and more flexible defense systems.

Based on offering, the defense cybersecurity market is segmented into software and services and hardware. The software and services segment held a market share of over 62.5% in 2024 and is expected to grow at a lucrative pace.

• Defense organizations are moving toward cloud-based infrastructure, which has increased the need for cloud-native security software and services. These solutions work directly with cloud environments to protect defense and aerospace operations from cyber threats while offering scalability and immediate response capabilities.
  
• As cyber threats become more complex and skilled cybersecurity professionals remain scarce, organizations are turning to outsourced security solutions. Managed Security Service Providers (MSSPs) help defense organizations by providing expert security teams, continuous monitoring, threat analysis, and rapid response capabilities to strengthen their security measures.
  

Based on security type, the market is segmented into network security, endpoint security, application security, and cloud security. The network security segment is expected to grow at a CAGR of over 10.5% through 2034.

• Organizations are using zero-trust security models to protect their networks as cyber threats continue to evolve. Under this security approach, every user and device must verify their identity continuously, whether they are inside or outside the network. By enforcing strict access controls, the model helps protect defense networks against threats from both inside and outside the organization.
  
• AI and machine learning in network security are changing how defense organizations find and stop threats. These technologies look at massive amounts of network activity as it happens, quickly spotting unusual patterns, weak points, and possible attacks. This better detection helps keep defense networks more secure.
  

North America dominated the defense cybersecurity market and is expected to reach a value of over USD 34 billion by 2034. The United States market continues to grow as organizations invest more in protecting critical defense infrastructure and meeting regulatory requirements like the Cybersecurity Maturity Model Certification. To protect sensitive data and vital systems from state-sponsored cyber-attacks, organizations have begun using zero-trust architectures and security solutions powered by artificial intelligence.

Germany's defense cybersecurity industry prioritizes the protection of critical infrastructure while driving secure digital transformation initiatives. The government continues to increase its cybersecurity investments in defense and public sector applications to meet European regulatory requirements, specifically the General Data Protection Regulation (GDPR) and the EU Cybersecurity Act.

China's defense cybersecurity market continues to grow as the country modernizes its military systems and pursues technological independence. The government is making significant investments in artificial intelligence-based cybersecurity tools and quantum communication systems to strengthen its defense networks and protect vital information.

Japan's market continues to grow as the country faces more complex hybrid threats to its military systems and infrastructure. As Japan strengthens its defense capabilities, it has made cybersecurity a key part of its defense strategy, covering everything from missile systems to space operations.

South Korea's defense cybersecurity industry continues to grow as the country strengthens its defense systems against regional threats and cyberattacks. The country focuses on protecting its military technologies, from autonomous systems to missile defense networks, while building robust cybersecurity measures for its space operations.

Defense Cybersecurity Market Share

Major companies like General Dynamics, Raytheon, SAIC, Lockheed Martin, and CACI International compete in the defense cybersecurity industry. These organizations develop and deliver specialized cybersecurity solutions for defense systems and critical infrastructure. Their competitive strategies include developing new technologies, forming strategic partnerships, and maintaining regulatory compliance. The companies focus on creating AI-based threat detection systems, quantum-resistant encryption, and secure cloud platforms. To maintain their market positions, they invest heavily in research and development while pursuing long-term government contracts to help strengthen national security against sophisticated cyber threats.

Defense Cybersecurity Market Companies

Major players operating in the defense cybersecurity industry are:

• Airbus
• BAE Systems
• Boeing
• CACI International
• Carlyle Group
• Cisco
• CrowdStrike
• General Dynamics
• Hanwha Systems
• IBM
• Israel Aerospace Industries
• L3Harris Technologies
• Leonardo
• Lockheed Martin
• ManTech International
• Northrop Grumman
• Palo Alto
• Rafael Advanced Defense Systems
• Raytheon Technologies
• Rheinmetall
• Saab
• SAIC
• Salient CRGT
• Thales
  

Defense Cybersecurity Industry News

• In July 2023, Honeywell agreed to acquire SCADAfence, a provider of cybersecurity solutions for operational technology (OT) and Internet of Things (IoT) networks. SCADAfence helps organizations protect their industrial and building management systems through asset discovery, threat detection, and security governance capabilities.
  
• In September 2024, Airbus Defence and Space bought Infodas, a German company that provides cybersecurity and IT solutions for government organizations, defense, and critical infrastructure. After getting all necessary approvals from regulators, Infodas joined Airbus as a subsidiary, strengthening the company's ability to deliver cybersecurity and IT services.
  

This Defense Cybersecurity market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD million) from 2021 to 2034, for the following segments:

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Market, By Security Type

• network security
  • firewall and security appliance
  • Intrusion Detection System (IDS)
  • Intrusion Prevention System (IPS)
  • Secure network infrastructure
• Endpoint security
  • Antivirus/antimalware solution
  • Encryption tool
  • Biometric device
• Application security
  • Encryption device
  • Secure development tool
  • Application security testing
• Cloud security
  • Secure cloud server and storage device
  • Cloud encryption software
  • Cloud Access Security Broker (CASB)

Market, By Offering

• Hardware
• Software and services

Market, By Application

• Critical infrastructure protection
• Data protection and encryption
• Incident response and forensics
• Identity and access management
• Secure communications system

Market, By End Use

• Army
• Navy
• Air force

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Australia 
• Latin America
  • Brazil
  • Mexico
• MEA
  • UAE
  • Saudi Arabia
  • South Africa