Undersea Warfare Systems Market Report 2026

The undersea warfare systems market size has grown strongly in recent years. It will grow from $21.14 billion in 2025 to $22.6 billion in 2026 at a compound annual growth rate (CAGR) of 6.9%. The growth in the historic period can be attributed to increasing naval investment in antisubmarine and mine-warfare capabilities, expansion of submarine fleets to strengthen maritime defense, advancements in underwater communication systems to support coordinated operations, rising deployment of acoustic sensors and sonar technologies for threat detection, early modernization programs upgrading legacy undersea warfare platforms.

The undersea warfare systems market size is expected to see strong growth in the next few years. It will grow to $28.51 billion in 2030 at a compound annual growth rate (CAGR) of 6%. The growth in the forecast period can be attributed to growing demand for autonomous and remotely operated undersea warfare systems, increasing integration of advanced sonar and sensing technologies for enhanced situational awareness, development of next-generation submarines with improved stealth and endurance, rising emphasis on securing strategic maritime zones amid geopolitical tensions, expansion of digital undersea communication networks enabling real-time coordinated defense operations. Major trends in the forecast period include integration of advanced sonar and acoustic detection systems, development of autonomous unmanned underwater vehicles (uuvs), enhancement of electronic countermeasure (ecm) capabilities, deployment of precision mine warfare systems, improvement of undersea communication and data link technologies.

Rising military expenditure is expected to drive the growth of the undersea warfare systems market going forward. Military expenditure refers to the financial resources allocated by a government or nation to support its armed forces, defense infrastructure, and related operations. Larger defense budgets enable governments to acquire and upgrade underwater warfare systems such as submarines, torpedoes, sonar technologies, and anti-submarine warfare equipment. For instance, in April 2024, the Stockholm International Peace Research Institute (SIPRI), a Sweden-based international research organization, reported that global military spending reached $2.443 trillion in 2023, representing a 6.8% increase in real terms compared to 2022. Therefore, rising military expenditure is fueling the growth of the underwater warfare systems market.

Major companies operating in the undersea warfare systems market are focusing on developing advanced systems, such as fast-attack submarines, to integrate low-observable acoustic coatings and support networked undersea operations. Fast-attack submarines are vessels designed for high-speed, stealth missions to detect and engage enemy ships and submarines while also supporting intelligence gathering and special operations to protect key maritime assets. For example, in August 2024, the US Navy, a US-based maritime service branch, launched the USS IDAHO (SSN 799), a Virginia-class fast-attack submarine. The USS Idaho incorporates advanced stealth features, cutting-edge surveillance systems, and special warfare upgrades, enabling it to fulfill the Navy’s multi-mission operational needs. Its design prioritizes reduced acoustic signatures and enhanced sensor systems, improving performance across various mission scenarios. Additionally, the USS Idaho includes expanded payload capabilities, offering greater versatility in mission execution.

In January 2025, Fincantieri, an Italy-based shipbuilding group, acquired Leonardo’s underwater business, Whitehead Alenia Sistemi Subacquei (WASS), for an undisclosed amount. This acquisition aims to strengthen Fincantieri's position in naval defense and the underwater sector by integrating advanced expertise in underwater weaponry and acoustic technologies, improving capabilities for military and critical infrastructure security, and supporting growth in the underwater systems market. Whitehead Alenia Sistemi Subacquei (WASS) is an Italy-based company specializing in the design and production of undersea warfare systems.

Major companies operating in the undersea warfare systems market are BAE Systems plc, General Dynamics Corporation, Kongsberg Gruppen AS, L3Harris Technologies Inc., Leonardo S.p.A., Lockheed Martin Corporation, Northrop Grumman Corporation, RTX Corporation, Saab AB, Thales Group, ATLAS ELEKTRONIK GmbH, S.A. de Electronica Submarina, ECA Group, Ultra Electronics Holdings plc, Abeking & Rasmussen GmbH & Co. KG, Babcock International Group PLC, Bharat Electronics Limited, DRS Technologies Inc., Elbit Systems Ltd., Fincantieri S.p.A., Hydroid Inc., Israel Aerospace Industries Ltd., Kraken Robotics Inc., L3 OceanServer, Navantia S.A., Ocean Aero Inc., QinetiQ Group plc, Rafael Advanced Defense Systems Ltd., Safran Electronics & Defense, Sonardyne International Ltd.

North America was the largest region in the undersea warfare systems market in 2025. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the undersea warfare systems market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.

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 on undersea warfare components and unmanned underwater vehicles have increased manufacturing costs and disrupted global supply chains, particularly affecting naval weapon systems and surveillance sensors in North America, Europe, and Asia-Pacific. Navy operations are most impacted due to reliance on imported subsystems, while autonomous systems experience moderate disruption. Positive impacts include the promotion of domestic production, strengthening local R&D, and encouraging innovation in cost-efficient and advanced undersea warfare solutions.

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

Undersea warfare systems serve the purpose of defending against undersea threats posed by adversaries, contributing to the enhancement of a nation's security. These systems are typically employed in naval operations of a specific country to ensure security against potential adversaries. The undersea warfare arsenal encompasses antisubmarine, offensive and defensive submarine, and mine warfare systems, which collectively manage and safeguard the maritime borders by employing diverse and effective underwater weapons and systems.

The primary categories of undersea warfare systems include communication and surveillance systems, sensors and computation systems, countermeasure systems and payloads, unmanned underwater vehicles, and weapon systems. Communication and Surveillance systems within this framework oversee various communication channels, such as emails, phone calls, servers, and others, facilitating data exchange monitoring and threat assessment. The modes of operation encompass manned, autonomous, and remote operations. The diverse end-users of these systems span the navy, air force, and army.

The countries covered in the undersea warfare systems market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The undersea warfare systems market consists of sales of submarines, communication systems and mine warfare 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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