Axios Future of Defense

December 17, 2025
Hello, again. This is the last Future of Defense of 2025. Time flies.
- See y'all in the new year β and thanks, as always, for not marking me as spam (or slop).
π§ Situational awareness: EraDrive, a startup that wants to "make every satellite intelligent, agile and self-sufficient," raised $5.3 million. The seed round was led by Haystack Ventures.
On the way: A Ukrainian warning for Europe, engine tests in Indianapolis and a chat with Scale AI's Chris Kirchhoff.
Today's newsletter is 2,214 words, an 8.5-minute read.
1 big thing: Exclusive ... Inside Apex
Apex wants to be the Toyota or Ford of space, according to chief executive Ian Cinnamon. President Trump's hemispheric missile shield could be its golden ticket.
The big picture: Ask around and you'll hear it repeated: The next war will be fought in space.
- That's one reason for the surge of speeches, spending and startups focusing on the domain.
- "When I was at Palantir, I was noticing: OK, the government is asking for people to launch not one satellite, but dozens or hundreds," Cinnamon told me. "Nobody's able to deliver on time and on schedule. Why is that?"
State of play: Apex builds satellite buses, or the platforms that star-bound payloads sit atop. Seven were on the production line when I toured the company's facilities just north of LAX airport. The company makes its own avionics, batteries and solar panels, as well.
- "We try to keep it really simple," Cinnamon said as we walked the factory floor. "The key is a straight line all the way through. That's something that is, again, very much from the automotive mentality."
- The buses are popular: "The reality is we've been selling them faster than we can make them." The next "available one," he added, "is in March."
Zoom in: The buses come in three sizes. While the smallest works for electro-optical and hyperspectral sensors and the largest is good for communications and radar configurations, Cinnamon thinks the medium variant is ripe for Golden Dome.
- That's "really for missile tracking, missile warning, space-based interceptors, that kind of stuff," Cinnamon said.
- "When we saw the executive order, saw the line about space-based interceptors, the immediate reaction was this is the first time in history that we could actually have the pieces to pull this off."
Flashback: A similar feat was attempted during the Reagan era. It foundered.
The intrigue: Apex in October announced Project Shadow.
- Formally, it's an effort to validate what the company is calling "orbital magazines," or spacecraft that host and support interceptors. The upcoming demonstration includes two test fires; Cinnamon promised not to create additional space debris.
- Informally, it's a make-or-break moment powered by private capital.
- "The whole point of Shadow is ... to basically say, 'Hey, we actually know how to integrate all your pieces together,'" he said, without disclosing potential collaborators. "Think of us like a Tier 1 supplier."
By the numbers: Apex was founded in 2022. It now employs more than 230 people. Cinnamon wants to double that.
- The company raised $200 million in September, pushing its valuation above $1 billion. That Series D was led by Interlagos.
- Its $95 million Series B included support from Toyota Ventures.
Zoom out: Trump has set a 2028 target for Golden Dome. Defense Secretary Pete Hegseth has said the endeavor will create "tangible protection for this country" before he leaves the White House.
- That's a tight timeline β or an impossible one, according to critics, unless it's just a rehash of existing countermeasures. And cost estimates are scattershot. Billions? Yes. Trillions? Maybe.
- "This is not something that is going to be an overnight success by any means. And I think we have to be realistic about that," Cinnamon said.
- "There is a lot of work that needs to come together," he added. "Having one space-based interceptor does nothing for us."
What we're watching: How the Missile Defense Agency's Scalable Homeland Innovative Enterprise Layered Defense contract β worth as much as $151 billion β plays out, and who buddies up with Apex.
Go deeper: Ursa eyes space defense with $35 million Draper engine deal
2. Europe's "new reality"
Europe must quickly acknowledge a "new reality" in which it must "take responsibility for its own security," Ukrainian Defense Minister Denys Shmyhal said at the Washington edition of the Aspen Security Forum.
- "After decades of sleep," he added, "hesitation is a luxury Europe cannot afford."
Why it matters: The appeal comes directly from the front lines of war with Russia βΒ a country already sabotaging projects across the European continent βΒ and amid uneasy transatlantic attitudes.
- Both Kyiv and Brussels have felt the whiplash of America's security-aid rollercoaster.
Context: Chatter of European rearmament gained significant steam this year. Four factors worth considering:
- Defense-tech investments and advancements, like Helsing's factory in southern Germany and the rollout of its CA-1 Europa drone wingman.
- Renewed nuclear weapons debates in France and Poland, among other locales.
- New NATO spending agreements, including a spinoff for critical infrastructure.
- The Trump administration's latest national security strategy, which was applauded by Moscow.
The bottom line: "We are living in an era that historians will later call an order transition: a shift from one world order to another. Such transitions are rare; they happen once every 30-50 years, and they are never smooth," Shmyhal said.
- "Russia has fully mobilized its war machine. And make no mistake, the Kremlin is not just testing Ukraine. The Kremlin is testing Europe and the West."
Go deeper: Trump's new cold war with Europe
3. Exclusive: MV-75 engine tests underway
Rolls-Royce has commenced AE 1107 engine testing for prototypes of the U.S. Army's MV-75 Future Long-Range Assault Aircraft.
Why it matters: It's a significant milestone for the multibillion-dollar tiltrotor project, which service leadership has demanded be accelerated. It's expected to replace many Black Hawk helicopters.
- Testing is underway at Rolls-Royce's facilities in Indianapolis, its largest stateside footprint.
Zoom in: Each MV-75 will be fitted with two AE 1107F engines.
- Candice Bineyard, director of U.S. business development and future programs, described them in a statement to me as "ultra-modern" and "low risk."
- They're the latest in the AE line, which has 80% commonality across variants, according to the company. That can smooth supply chain wrinkles.
Catch up quick: Army Vice Chief of Staff Gen. James Mingus earlier this year revealed the 101st Airborne Division at Fort Campbell, Kentucky, would be the first to receive the Bell Textron-made aircraft.
- "This aircraft changes how we move forces. More importantly, it changes the geometry of ground combat," he said at the time. "And we're not waiting for a distant out-year to make this thing real."
- Bell Textron in 2022 beat a Sikorsky-Boeing team for the contract. The Government Accountability Office denied a protest the following year.
Fun fact: The MV-75 designation refers to its multi-mission design, its vertical-takeoff-and-landing capabilities and the Army's founding in 1775.
Zoom out: Rolls-Royce is the world's 25th-largest defense contractor by revenue, according to Defense News analysis.
Go deeper: Army seeks "65-year change" in weapons trying and buying
4. A new frigate β and soon
The U.S. Navy wants a new frigate "in the water" in 2028, according to Jason Potter, a senior service official.
Why it matters: It's a hyper-ambitious schedule, considering the previously commissioned frigate, the Constellation-class, was axed just weeks ago.
- That one was dunked on for cost, schedule and design bloat.
The latest: Potter, the Navy's acting assistant secretary for research, development and acquisition, on Dec. 10 told the Defense Forum Washington that the service is "building the Golden Fleet," which includes the new frigate. "To do that, we are changing how we build ships."
- "We are focused on high-confidence U.S. designs, built in the U.S., delivered to the U.S. government in operational use and numbers," he said, "with known performance, manning, maintenance, spares and training needs."
The intrigue: Breaking Defense reported the new frigate could be a modified National Security Cutter. The outlet cited two unnamed sources.
- The previous frigate, made by Fincantieri, was based on a design adopted by the French and Italian navies.
Friction point: There have been few good-news shipbuilding stories recently.
- U.S. shipyard output is dwarfed by Chinese competitors. And some of the Navy's most important assets, including the Columbia-class nuclear submarine, are delayed.
- "It is the fleet of the future that will decide whether we retain maritime superiority. The challenges we face are well known and they are not created overnight," Potter said.
- "Too often our programs have arrived late and over-cost, and, meanwhile, the demand for our high-performing fleet has only grown."
What we're watching: How the frigate work is divvied up β aka where the millions and millions of dollars go.
Go deeper: Navy unveils "ShipOS" with Palantir to speed up shipbuilding
5. Quick hits
π The Defense Innovation Unit named MatrixSpace the overall winner of the Counter-small Unmanned Aircraft System Low-Cost Sensing challenge. Three other top performers were named: Guardian RF, Hidden Level and Teledyne FLIR Defense.
- Why it matters: "Small UAS threats are evolving faster than traditional acquisition cycles, and meeting that challenge requires capabilities that can be deployed at speed and scale," David Payne, the acting director of DIU's autonomy portfolio, said in a statement.
- π My thought bubble: Hidden Level's one to watch. Promise.
π Northrop Grumman conducted an F-16 separation test of its Stand-in Attack Weapon.
- Why it matters: The trial validates the air-to-ground missile's aerodynamics. Northrop won a $705 million Air Force contract for SiAW in late 2023.
- π My thought bubble: The Aviationist has more details and analysis, here.
π§ Avio USA selected Virginia to be the home of its new 860,000-square-foot solid-rocket motor production facility. Additional details will be disclosed early next year, according to the company.
- Why it matters: Avio is collaborating with RTX, a prominent missile maker.
- π My thought bubble: You already know the local chambers of commerce are going wild.
π BAE Systems secured a five-year U.S. Navy contract for APKWS laser-guidance kits. The deal is worth as much as $1.7 billion; an initial order was pegged at $322 million.
- Why it matters: APKWS kits turn unguided rockets into precision weapons. Their popularity is exploding as drones proliferate on the battlefield.
- π My thought bubble: Want to see them in action? BAE has footage, here.
6. Axios interview: Chris Kirchhoff
This week's conversation is with Chris Kirchhoff, the head of applied AI strategy and global security at Scale AI.
- We met up in Rosslyn. Fun fact: Kirchhoff was featured in one of the earliest editions of Future of Defense. (Look how far we've come.)
Why he matters: Kirchhoff worked for the Pentagon and White House and helped establish the Defense Innovation Unit. He later wrote a book about that adventure, plus the evolving defense-tech landscape.
Q: When you hear "future of defense," what comes to mind?
A: I think the future of defense isn't about any one thing, but rather about a race to adopt commercial technology.
- Scale AI, for instance, has an incredible new program called Thunderforge. We're doing it with the Defense Innovation Unit.
- It's all about creating decisional advantage for Indo-Pacific and European commands by taking best-in-class commercial models, and engineering them into a very bespoke command-and-control and planning system.
Q: When will wars be waged solely by robots?
A: I don't worry about killer robots quite yet, in the sense that architecting AI systems that work reliably is very difficult.
- I think the real question is: When will autonomous systems provide a layer of deterrence that we don't have today?
Q: What's a national security trend we are not paying enough attention to?
A: How much of the Pentagon's budget goes to venture-backed defense-tech companies. The faster the Pentagon increases its spend, the quicker we get to a revolution in the technology that's deployed at scale.
Q: What's your secret to a successful overnight flight?
A: First, you reverse the aging process. Then you get a prescription for fourth-generation sleeping drugs that aren't invented yet.
- And, as long as you do those two things, you'll have a great flight.
Q: What time do you wake up? What does the morning routine look like?
A: 5am. Twice a week I go trail running in the Marin Headlands.
Q: What advice would you give your younger self?
A: There is no such thing as a planned career. Work hard, and watch for the door to open stage left.
7. Check this out
The final Axios Live event of the year was a banger.
- I interviewed USA Rare Earth CEO Barbara Humpton and Rep. Raja Krishnamoorthi, an Illinois Democrat.
The big picture: Two bits β one from each person, both concerning international competition β jumped out at me.
β°οΈ On critical minerals: "China chose to dominate this sector 30 years ago, and now we are completely dependent. Now is the time to take this back. ... If we took just 20% of the market that China has been satisfying, all of us will grow," Humpton told me.
- "Our Air Force turns into paperweights without the magnets that support the rotating equipment inside those vehicles."
π¨π³ On H200 chip sales: "They're making the Chinese stack. They want to kill Nvidia. That is their operating approach, OK? So why hand them the murder weapon. We should be very clear-eyed about the CCP's economic playbook," Krishnamoorthi told me.
- "Absolutely, they want their hands on those chips."
The bottom line: We make news on stage. Thanks for tuning in.
Shoutout to Dave Lawler for editing and Matt Piper for copy editing.
ππΌ Thanks, as always, for reading and sharing. Tell your friends to subscribe here.
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