Aerospace and Defense Digital Services 2025–2026 Market Insights™

December, 2025

This report identifies key demand-side trends in the Aerospace and Defense industry to help enterprises fine-tune their digital strategies. It also provides an overview of enterprise challenges in the industry based on Avasant’s assessment.

Why read this Market Insights?

Aerospace and Defense enterprises are seeking digital solutions that can scale reliably, meet strict compliance requirements, and support long-term program execution. They are shifting from pilot-led digital initiatives to production-scale adoption. They are prioritizing model-based and digitally validated workflows, expanding factory capacity and MRO operations in response to rising defense demand, and strengthening supply chain visibility to support regionalization and sovereign sourcing.

The Aerospace and Defense Digital Services 2025–2026 Market Insights™ aids enterprises in this sector in identifying important market trends and challenges for any digital project they participate in.

Methodology

The industry insights presented in this report are based on our ongoing interactions with enterprise CXOs and other key executives, targeted discussions with service providers, subject matter experts, and Avasant Fellows, analyst insights from primary and secondary research, and lessons learned from consulting engagements.

Table of contents

About the report (Page 3)

Executive summary (Pages 6–10)

    • Definition and scope
    • Key drivers and enterprise response
    • Avasant recognizes 21 top-tier providers supporting the Aerospace and Defense industry in digital transformation

Demand-side trends (Pages 11–16)

    • Geopolitics is driving a surge in defense spending and a rapid expansion of defense production across Europe and the US.
    • Digital twins, AI, and model-based engineering are moving from pilots to production in engineering, MRO, and sustainment.
    • Resilience and sovereign sourcing are now procurement priorities for critical materials and munitions.
    • Defense delivery is shifting to modular, productized, and flexible commercial operating models.
    • Buyers increasingly prefer platform-led, AI-first service models over labor-intensive deliveries.

Key contacts (Page 17)


Read the Research Byte based on this report. Please refer to Avasant’s Aerospace and Defense Digital Services 2025–2026 RadarView™ for detailed insights on the service providers and supply-side trends.

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DISCLAIMER:

Avasant’s research and other publications are based on information from the best available sources and Avasant’s independent assessment and analysis at the time of publication. Avasant takes no responsibility and assumes no liability for any error/omission or the accuracy of information contained in its research publications. Avasant does not endorse any provider, product or service described in its RadarView™ publications or any other research publications that it makes available to its users, and does not advise users to select only those providers recognized in these publications. Avasant disclaims all warranties, expressed or implied, including any warranties of merchantability or fitness for a particular purpose. None of the graphics, descriptions, research, excerpts, samples or any other content provided in the report(s) or any of its research publications may be reprinted, reproduced, redistributed or used for any external commercial purpose without prior permission from Avasant, LLC. All rights are reserved by Avasant, LLC.

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