Artificial intelligence is now a core enabler of aerospace and defence (A&D) capabilities, but while most public narratives focus on AI applications, the real power lies in the AI infrastructure that enables those applications to work at scale, securely, and under mission-critical conditions. This infrastructure is not consumer-grade technology repurposed for defence, it is a highly specialised, sovereign-controlled ecosystem that spans compute hardware, secure communications, energy resilience, and data governance.
At DWM, we believe that the next decade of defence modernisation will be defined by which nations and operators can deploy, maintain, and evolve such infrastructure faster and more securely than their adversaries. This creates a high-barrier, capital-intensive, and long-duration investment opportunity for patient private capital.
The Market Context
According to Allied Market Research, the global AI in defence market is projected to grow from $9.2 billion in 2023 to over $38 billion by 2032, a CAGR of nearly 17%. But within that, AI infrastructure, including edge computing, specialised chips, sovereign cloud, and encrypted networks, represents one of the fastest-growing subsegments.
This growth is being driven by:
- Defence modernisation programs in NATO, the Indo-Pacific, and the Middle East.
- Sovereignty imperatives as nations seek independence from foreign tech supply chains.
- The rise of contested domains such as space and cyber, where AI infrastructure plays a decisive role.
Why AI Infrastructure is Strategic
Modern aerospace and defence systems generate terabytes of data per mission from sources such as:
- Synthetic Aperture Radar (SAR) imaging.
- Signals intelligence (SIGINT) sensors.
- Hyperspectral cameras on satellites and UAVs.
- Acoustic and electromagnetic monitoring systems.
Transmitting this raw data to central command for analysis is often too slow, insecure, or bandwidth-intensive. AI infrastructure enables real-time, on-platform data fusion and decision-making, allowing operators to act in seconds, not minutes or hours.
Core Pillars of Defence AI Infrastructure
- Ruggedised Edge Computing
- Designed to survive high G-forces, radiation, and extreme temperatures.
- Enables AI processing on ships, aircraft, and satellites without reliance on ground-based servers. - Specialised AI Chips
- ASICs (Application-Specific Integrated Circuits) and FPGAs (Field-Programmable Gate Arrays) optimised for high-speed, low-power inference.
- Reduced thermal signature for stealth operations. - Sovereign Cloud & Data Sovereignty Frameworks
- Controlled entirely within national borders.
- Certified to handle classified data and defence workloads. - Encrypted, Low-Latency Communications
- Military-grade quantum-resistant encryption.
- Mesh networks for resilience if nodes are destroyed or jammed.
The Investment Case
AI infrastructure for A&D meets all the conditions of a high-barrier, long-duration, strategically protected market:
- High Switching Costs: Once deployed, systems are embedded in operational doctrines for decades.
- Regulatory Moats: Export controls, ITAR restrictions, and defence procurement rules keep competition limited.
- Dual-Use Potential: Many technologies (e.g., satellite AI processing, secure IoT) can be adapted for commercial aerospace and critical infrastructure.
This creates a market where private capital is not just welcome but essential, sovereign clients often require bespoke solutions, rapid scaling, and risk-sharing on early-stage deployments that public markets cannot accommodate.
DWM’s Positioning
We target operators who:
- Have proprietary hardware or software IP in AI infrastructure.
- Have proven deployments in operational defence environments.
- Can scale production under sovereign security protocols.
Our role is to bring capital with conviction, sectoral insight, and a network of engineering and operational expertise to accelerate the deployment of these mission-critical capabilities.
In aerospace and defence, AI algorithms are only as effective as the infrastructure that supports them. The future of sovereign security will be built on this backbone, and the nations and investors who control it will define the balance of power in the decades to come.
