Italian defense company Leonardo announced plans to create an AI-powered shield for cities and critical infrastructure (Leonardo SpA and subsidiaries)
© Leonardo SpA and subsidiaries
Italian defense company Leonardo on Thursday unveiled plans for an AI-powered shield for cities and critical infrastructure, bolstering Europe’s efforts to strengthen its sovereign defense capabilities amid growing geopolitical tensions.
The system, nicknamed “Michelangelo’s Dome,” in a nod to Israel’s Iron Dome and US President Donald Trump’s plans for a “Golden Dome,” will integrate multiple defense systems to detect and neutralize maritime and air threats, including missile attacks and drone swarms.
Leonard Stocks were slightly higher on Thursday and are up about 77% since January, amid a year of sharp rises in defense values across Europe as governments across the region have increased defense spending.
United Kingdom BAE Systems has increased by 42.7% since the start of 2025, Rheinmetall 148.9% and that of France Thales 63.8%.
Leonardo’s Dome will be built on what CEO Roberto Cingolani called an “open architecture” system, meaning it can work alongside any country’s defense systems.
“In a world where threats are rapidly evolving and becoming increasingly complex – and where defending is more expensive than attacking – defense must innovate, anticipate and embrace international cooperation,” Cingolani said at an event Thursday evening.
The company hopes the project will be fully operational by the end of the decade.
Airbus CEO Guillaume Faury told CNBC on Thursday that data exchange protocols between countries and battlefield teams were “still quite limited,” adding that it could take a decade to build Europe’s “digital battlefield.”
Europe’s defense effort
European governments have quickly pledged to increase their defense spending while the United States, a key ally of the bloc, has already threatened to cut its financial support for the region.
In May, the EU announced aid of 150 billion euros ($173.5 million) program to provide long-term loans to member states for defense acquisitions and industrial capacity. NATO members also pledged in June to increase their defense and security spending to 5% by 2035.
Leonardo’s unveiling of its new dome system is part of an industry-wide move by major defense players that sees them shifting “their investments from standalone hardware to integrated control architectures,” Loredana Muharremi, equity analyst at Morningstar, told CNBC.
“Modern warfare is won by a network that can integrate every platform into a single decision cycle,” she said. “The winners will be the entrepreneurs who own the network layer, not the metal, that captures recurring upgrades and scalability.”
Risks to Leonardo’s dome system include execution delays and “dependence on European supply cycles,” Meghan Welch, managing director of Brown Gibbons Lang & Company, told CNBC.
Large European companies are also increasingly competing with an emerging class of defense technology startups in the region.
German AI drone startup Helsing raised €600 million and doubled its valuation to €12 billion in June, the Financial Times reported. Quantum Systems, which also develops autonomous defense technologies, announced on Friday that it had tripled its valuation to more than 3 billion euros after an increase of 180 million euros.
