Article published by La Tribune Dimanche on 10 June 2025. Translated with the kind permission of La Tribune. Read the article in French on La Tribune website: Patrice Caine, PDG de Thales : « L’Europe peut rester en Ligue des Champions dans le domaine spatial »

“Europe can remain a Champions League player in the field of space”

The Chairman of the French high-tech firm has far-reaching ambitions in the field of quantum technology and in the consolidation of the European space industry.

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After ten years at the head of Thales, what strategic vision have you defined for the next ten years?

Thales has successfully completed a strategic transformation over the past decade that makes our company a global leader in high-tech for defence, aerospace, cybersecurity and digital. This has allowed us to double our size and our operational performance. In cybersecurity and digital, we have made significant investments, especially with the acquisitions of Gemalto and Imperva, which have turned us into a world leader in those fields. These are areas with a future, with prospects for growth and profitability, for example the digitalisation of SIM cards. We also sold our railway signalling business after having righted the ship. This is a sector that has been consolidated around very large vertically-integrated players that have a “turnkey” offer incorporating both rolling stock and signalling.

What growth-rate are you anticipating for Thales in the medium term? 

Looking ahead to the coming years, my vision is to consolidate and develop Thales' position as a global high-tech leader. We are responding to the needs created by three major trends: growing geopolitical tensions, which we all deplore, but which generate a strong global demand for more security and defence; continued growth in air traffic until 2050; and the digitalisation of our lives and societies. The more the objects we use are connected, the more software they use... and the more potentially vulnerable they are to cyberthreats. This is even truer in the era of artificial intelligence (AI). Cybersecurity is becoming the oxygen of our societies, so to speak, and it is true for both individuals and businesses. This favourable environment, combined with the excellence of our technologies and our R&D, is what will drive our growth over the coming years. We have made it clear to our investors that our aim is to increase our turnover by 5% to 7% per year between now and 2028. 

Many observers believe that Thales is becoming more and more a defence company, as evidenced by the strong increase in the share-price in recent months.

There is perception and then there are facts. Taking into account the strong growth of ourdefence activities and the sale of the railway signalling business in May 2024, Thales now generates over 50% of its turnover in defence (around 55% last year). However, when we completed the acquisition of Gemalto in April 2019, the pendulum swung towards our civil businesses. You have to remember that a well-balanced duality between civil and defence businesses remains at the heart of the company’s strategy and provides us with resilience. It’s part of Thales' DNA. And it’s one of its great strengths.

What is your R&D strategy?

Our three major markets - defence, aerospace, and cyber and digital - all draw on a common technology base. We invest more than €4 billion a year in R&D, to which 33,000 Thales engineers and researchers are dedicated. Beyond our R&D investments, our civil and defence cyber businesses (€2 billion in sales) also help to set us apart from the competition by bringing ever more value to our customers. 

How do you choose the technologies that bring a decisive advantage to your future products?

Thales invests in technologies that anticipate future trends, which is absolutely key for a company like ours. Our turnover, which today exceeds €20 billion, allows us to support a powerful R&D strategy. We are interested in many technologies, such as algorithms, electronic components, optics, photonics, signal propagation and acoustic waves... We cover a huge scope that encompasses the technologies of the digital world as well as those of the physical sciences. On the outside, there is a lot of talk about AI and quantum, but the reality is much broader.

For example?

We are working on the technologies of future components, called SIP (System In Package) – components of components. This is an area that may seem a little dreary, but it is fundamental for our industry, for the electronics of tomorrow and for the sovereignty of states. We are working on a project with FoxConn and Radiall around an SIP production line in France. With a planned production capacity of more than 100 million SIP-type components per year by 2031, this project aims to meet the needs of the European market for advanced semiconductor packaging in the aerospace, automotive, telecommunications and defence sectors. These SIPs will allow France and Europe to increase competitiveness and strategic autonomy in the face of the major component suppliers. 

What lessons has Thales learnt from the conflict in Ukraine, in terms of artificial intelligence and drones?

In the field of AI, Thales has created its cortAIx accelerator, which brings together more than 800 experts and engineers around the world. We already have more than 100 products that incorporate trusted AI for critical systems. AI is a differentiating technology and is already part of our daily lives. And we are starting to see it on the battlefield. Although it is not so clear from what we see on television, we have to face facts: what the war in Ukraine has confirmed is just how decisive high technology is. At the front, Russian and Ukrainian drones are facing an electromagnetic interference wall. This is why, for short range, the two armies now use wire-guided drones equipped with optical fibres 20 to 30 kilometers long, to avoid jamming. Electronic warfare has become pivotal, and it requires a very high level of technological mastery. What makes the difference on the battlefield today is not only the number of systems, but also how highly they perform. As for the quantum revolution, Thales is one of the most advanced companies in the field.

But quantum technology is much further down the line...

Quantum technology is starting to be seen outside of laboratories. And soon, we will offer sensors that use quantum technologies, such as cold atom inertial units, radio antennas based on quantum interference filters, and magnetic anomaly detectors using nitrogen-vacancy synthetic diamonds (NV centres). They are going to be on the market in a few years, and will be a game-changer. We will be able to detect and measure noises, signals, and “anomalies” that we did not detect before, with sensors a thousand times more compact and a thousand times more precise. This leap in performance is such that it is likely to confound a number of certainties in several areas.

In the field of space, Thales is currently discussing a consolidation with Airbus and Leonardo, code-named Bromo. Do you have any red lines for this major operation?

It is important to remember that at this stage, these are preliminary – and not binding – talks. We must first get the green light from the industry principals, i.e. the governments we work for. The turnover of this industry is largely driven by institutional bodies such as ESA (the European Space Agency) and national space agencies. For example, two-thirds of Thales Alenia Space‘s turnover comes from our institutional customers. Without the agreement of these large constituents, we can do nothing. Today, there is a good understanding – including among our major customers – of the issues surrounding this project, and of why these discussions are taking place. Of course, any consolidation of these businesses must ultimately make economic sense and be useful to all stakeholders. 
 
Is the geopolitical context changing the European Commission’s vision on competition? 

I’m not going to comment on the ongoing discussions, outside of the fact that they’re good. Everyone understands that the geopolitical situation has changed. This project, if it is implemented, will obviously have to obtain the approval of the authorities in charge of questions of competition.

Broadly speaking, is there not a risk of space in Europe stalling?

The ESA ministerial conference at the end of the year will be an important and, in fact, strategic event. European countries, including France, are lucky enough to be able to pursue their ambitions in the space sector in order to remain in the Champions League.
 
Should we be worried?

The country’s fiscal position is what it is, but Europe and France have enormous assets. In particular, we must strongly support the sectors where we are in a leadership position, so as to remain there. We must therefore make the right public investment choices in order to develop our strengths, and to maintain or even increase our positions as leaders: the space industry, the aeronautics industry, where we are at work within CORAC (the council for civil aeronautics research) and of course the defence industry in the service of our armed forces.