Prime obligations are rising. Incumbents are capturing the growth.
Published July 21, 2026 / FY2021-FY2025 prime contract activity
Defense prime obligations rose by about 25% between FY2021 and FY2025.
But the number of distinct suppliers* receiving this money fell by nearly 10%.
prime obligations, FY2021-FY2025
distinct supplier CAGEs with positive obligations
increase from CAGEs present in FY2021 and FY2025
prime obligations captured by CAGEs active all five years
Net obligations to identified CAGEs.
Decline in distinct CAGEs with positive obligations.
Supplier change by annual obligations received
All net decline is below $1M; the $10M+ tier grew.
This entire decline occurred on the lower end of the supplier base, in suppliers receiving less than $1M in obligations per year. Meanwhile, the number of suppliers receiving more than $10M annually grew.
increase in positive obligations.
Persistent suppliers captured nearly all five-year obligations
Supplier CAGE persistence, FY2021-FY2025
The additional money flowed overwhelmingly to established suppliers. Supplier entities active throughout all five years captured more than 90% of prime obligations.
Largest parent increases
Top three: $58B increase
At the parent level, the growth had clear destinations: Lockheed Martin, RTX and General Dynamics.
Largest product increases
Top three: $51B increase
By product category, the largest increases were concentrated in ships, aircraft and missiles.
What the signal says
More spending did not necessarily mean a broader supplier base.
Defense prime obligations rose by about 25%, while the number of distinct CAGEs receiving this money fell by nearly 10%.
The decline occurred at the lower end.
The net decline came from CAGEs receiving less than $1M in obligations per year, while the number receiving more than $10M annually grew.
The growth reinforced incumbents.
Supplier entities active throughout all five years captured more than 90% of prime obligations.
*Distinct supplier entity = CAGE code receiving positive prime contract obligations in the fiscal year. CAGE refers to the Commercial and Government Entity code used to identify supplier entities and sites.
Sources: USAspending, FPDS, DLA, Mimir Data Platform and Modeling. Figures rounded; percentage changes calculated from unrounded values.