The figures from the Joe Biden administration’s final year underpin expectations of stronger sales for U.S. weapons makers like Lockheed Martin (LMT.N), General Dynamics (GD.N),  and Northrop Grumman (NOC.N), whose shares are forecast to climb amid rising global instability.

During his presidential campaign, Republican Donald Trump stated allies should spend more on their own defenses. Trump wants other members of NATO to spend 5% of their gross domestic product on defense – a huge increase from the current 2% goal and a level that no NATO country, including the United States, currently reaches.

Defense contractors are straining to meet the surge of demand that has mushroomed as a result of Russia’s invasion of Ukraine. Global ministries of defense have been lining up to submit orders to boost their inventories, while the U.S. is seeking to replenish stockpiles of weaponry and munitions sent to Kyiv.

Arms sales and transfers are viewed as “important U.S. foreign policy tools with potential long-term implications for regional and global security,” the State Department announced in a statement.

Sales approved in 2024 included $23 billion worth of F-16 jets and upgrades to Turkey, $18.8 billion worth of F-15 fighter jets to Israel, and $2.5 billion worth of M1A2 Abrams tanks to Romania.

Orders approved in 2024 often go into the order backlog for U.S. weapons makers, which are expecting that orders for hundreds of thousands of artillery rounds, hundreds of Patriot missile interceptors, and a surge in orders for armored vehicles will underpin their results in coming quarters.

There are two major ways foreign governments purchase arms from U.S. companies: direct commercial sales negotiated with a company, or foreign military sales in which a government typically contacts a Defense Department official at the U.S. embassy in its capital. Both require U.S. government approval.

Direct military sales by U.S. companies rose to $200.8 billion in fiscal 2024 from $157.5 billion in fiscal 2023, while sales arranged through the U.S. government rose to $117.9 billion in 2024 from $80.9 billion the prior year.

Rubio instructed diplomatic and consular posts to issue “stop-work orders” on nearly all “existing foreign assistance awards,” Politico said, citing an internal document.

According to Politico, the order “shocked” State Department officials and appears to apply to funding for military assistance to Ukraine.

The magazine cited three current and two former officials familiar with the matter as saying Rubio’s guidance means that “no further actions will be taken to disperse aid funding to programs already approved by the US government.”

The BBC, which also reviewed the State Department memo, reported that it appears to “affect everything from development assistance to military aid.”

Although the Pentagon previously told Voice of America that the aid freeze would not affect “security assistance to Ukraine,” Rubio’s memo reportedly only granted exceptions for military aid to Israel and Egypt, without mentioning any other country.

Journalist Ken Klippenstein posted what he said was a copy of Rubio’s guidance, which “pauses all new obligations of funding, pending a review, for foreign assistance programs” funded through the State Department and the US Agency for International Development (USAID).

Trump, who took office on Monday, has ordered a 90-day suspension of all “foreign development assistance for assessment of programmatic efficiencies and consistency with United States foreign policy.”

A USAID official told Reuters that among the programs that were frozen are assistance to schools and healthcare, including emergency maternal care and the vaccination of children.

Since February 2022, USAID has provided $2.6 billion in humanitarian aid, $5 billion in development assistance, and more than $30 billion in “direct budget support,” according to its website.

The US has provided nearly $66 billion in military aid to Ukraine since February 2022, according to the Pentagon.

Trump has repeatedly criticized his predecessor, Joe Biden, for approving unconditional aid to Ukraine and has vowed to implement cost-cutting measures. He also promised to quickly negotiate a peace deal between Moscow and Kiev.