Europe’s defense boom faces a new test: Can it actually deliver weapons?

After years of surging military budgets, emergency Ukraine spending and soaring defense stocks, Europe's rearmament push must now prove it can turn hundreds of billions of euros into weapons, factories and usable military capability. The question for investors no longer seems to be one of defense demand or political ambition, but whether valuations have run ahead of the industry's ability to execute. That test is becoming more critical ahead of next week's NATO Summit in Ankara, Turkey , where leaders are due to review progress since last year's summit and set out a roadmap for delivering on new spending goals to "turn allied commitments into concrete results." But the path from higher budgets to delivered weapons is proving uneven. Procurement delays, fragmented national programs, labor shortages, and strained supply chains are raising doubts over how quickly Europe can rebuild an industrial base that has been hollowed out from decades of lower defense spending. The pressure is rising from both sides of the Atlantic. NATO allies agreed on a dramatic rise in defense spending at last year's summit, reflecting growing concern that Europe can no longer live under the protection of the U.S. Pressure intensified when U.S. War Secretary Pete Hegseth earlier this month announced a review of American forces in Europe and warned that allies failing to meet spending commitments could face consequences . …