Mentions of digitalization within the filings of companies in the aerospace and defence sector rose 21% between the final quarter of 2021and the first quarter of 2022.

In total, the frequency of sentences related to digitalization between April 2021 and March 2022 was 293% higher than in 2016 when GlobalData, from whom our data for this article is taken, first began to track the key issues referred to in company filings.

When companies in the aerospace and defence sector publish annual and quarterly reports, ESG reports and other filings, GlobalData analyses the text and identifies individual sentences that relate to disruptive forces facing companies in the coming years. Digitalization is one of these topics - companies that excel and invest in these areas are thought to be better prepared for the future business landscape and better equipped to survive unforeseen challenges.

To assess whether digitalization is featuring more in the summaries and strategies of companies in the aerospace and defence sector, two measures were calculated. Firstly, we looked at the percentage of companies which have mentioned digitalization at least once in filings during the past twelve months - this was 76% compared to 49% in 2016. Secondly, we calculated the percentage of total analysed sentences that referred to digitalization.

Of the 20 biggest employers in the aerospace and defence sector, Thales was the company which referred to digitalization the most between April 2021 and March 2022. GlobalData identified 373 digitalization-related sentences in the France-based company's filings - 2.5% of all sentences. Leonardo mentioned digitalization the second most - the issue was referred to in 1.7% of sentences in the company's filings. Other top employers with high digitalization mentions included BAE, Rheinmetall and Leidos.

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Across all companies in the aerospace and defence sector the filing published in the first quarter of 2022 which exhibited the greatest focus on digitalization came from Kongsberg. Of the document's 3,340 sentences, 68 (2%) referred to digitalization.

This analysis provides an approximate indication of which companies are focusing on digitalization and how important the issue is considered within the aerospace and defence sector, but it also has limitations and should be interpreted carefully. For example, a company mentioning digitalization more regularly is not necessarily proof that they are utilising new techniques or prioritising the issue, nor does it indicate whether the company's ventures into digitalization have been successes or failures.

In the last quarter, companies in the aerospace and defence sector based in Western Europe were most likely to mention digitalization with 0.89% of sentences in company filings referring to the issue. In contrast, companies with their headquarters in the United States mentioned digitalization in just 0.13% of sentences.