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Charted: U.S. Department of Defense Technology Spending: 2020 vs 2026

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November 10, 2025

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The following content is sponsored by Global X ETFs

U.S. Department of Defense Technology Spending: 2020 vs 2026

Key Takeaways

  • In 2026, the U.S. Department of Defense (DoD) has requested $384 billion for defense system procurement and R&D.
  • DoD spending is expected to be 71% higher in 2026 than in 2020.
  • Missile Defense Programs will see the largest spending increase in 2026 (+247%), while Ground Systems will see the only decrease (-21%), compared with 2020 numbers.

The U.S. Department of Defense (DoD) is expected to allocate a substantial $384 billion as part of the U.S. National Security Strategy to modernize all branches of the U.S. military and invest in additional research and development.

For part three of the Investing in Defense series, Visual Capitalist has partnered with Global X ETFs to provide a detailed exploration of U.S. defense technology spending and its evolution since 2020.

The Need for Advanced Technology

The DoD spends billions of dollars every year on acquisition, research, and development. Below is a table showing a breakdown of expected spending by program for 2026 compared to 2020 by the U.S. Department of Defense:

System FY2020 FY2026 (Requested)
Aviation and Related Systems 57.7 68.3
Command, Control, Communications, Computers, and Intelligence (C4I) Systems 10.2 23.2
Ground Systems 14.6 11.6
Missile Defense Programs 11.6 40.2
Missiles and Munitions 21.6 35.7
Shipbuilding and Maritime Systems 34.7 65.0
Space Based Systems 11.9 34.0
Total 162.3 278.0

DoD spending is expected to be 71% higher in 2026 than in 2020. This growth was driven mainly by the U.S. military’s need for advanced technology. However, the DoD spent more on some areas than others.   

Missile Defense Programs could receive the largest increase in funding with a 247% increase between 2020 and 2026, going from $11.6 billion to $40.2 billion.

Ground Systems is the only program that is expected to see a decrease in funding. The FY2026 budget request in 2026 is $11.6 billion, a 21% reduction versus $14.6 billion in 2020.

Shielding Investments

Governments worldwide, not just the U.S. DoD, want to use modern technology and update their militaries. The advancement of defense technology and the many conflicts worldwide have led to defense spending rising to $2.5 trillion in 2024.

As the needs of modern militaries are often disconnected from standard economic cycles, investing in defense technology presents investors with a strong diversification opportunity.

The Global X Defense Technology ETF (SHLD) offers investors exposure to companies that benefit from the adoption of defense technologies or manufacture these technologies.

The ETF invests in companies across various sectors, including robotics, aircraft, AI, and big data systems.

The 3-part Investing in Defense series explores the landscape of defense spending and the importance of defense technology.

Part one covers global defense spending, while part two examines the potential defense technology expenditures of NATO nations.

Learn more about the Global X Defense Technology ETF (SHLD).

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