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The Rostec CEO reported, in particular, on the implementation of the state defence order, the modernisation of military equipment and the development of airspace control and electronic warfare systems. He also spoke about increasing the output of civilian products, including medical ones.

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President of Russia Vladimir Putin: Mr Chemezov, how are things?

CEO of Rostec State Corporation Sergei Chemezov: Mr President, we have completed the assessment of our enterprises’ performance in 2024 and generated a consolidated budget and statement. Today, I would like to brief you on some results of our financial operations and the performance of the state corporation and its enterprises as a whole.

We continue working to strengthen the security, defence capability and industrial independence of our country. It was, is and will remain our top priority. I would like to note that we continue to demonstrate sustainable growth even despite the sanctions and a complicated macroeconomic situation. Our revenues increased by 27 percent compared to the previous year and has reached 3.61 trillion rubles. Our net profit has grown by 119 percent to 131.5 billion rubles. Our output per worker has increased by 20 percent year on year and reached 5.2 million rubles. Investments have risen to 676 billion rubles, more than in many years, primarily due to the growth of the defence order and the task of increasing the capacities of our enterprises and modernising them to reliably implement the state defence order.

Regarding the state defence order, our enterprises produce 80 percent of the armaments supplied to the special military operation. In 2024, the production of lightly armoured vehicles and tanks increased by ten percent, munitions for conventional artillery rose by 30 percent, for lightly armoured vehicles and tanks by 110 percent, and for multiple-launch rocket systems by 70 percent. I would like to point out that this is a year-on-year increase. Compared to 2021, our output has grown many times over. Overall, the implementation of the state defence order is traditionally high at 99.5 percent.

Vladimir Putin: I assume it is 100 percent in the critical sectors, isn’t it?

Sergei Chemezov: Yes, the figure for the critical sectors is 100 percent.

We are constantly working to enhance the equipment we produce. We maintain direct contact with the military personnel who utilise and operate our equipment. Our maintenance teams are positioned near the frontlines, allowing for direct communication. Naturally, we take into account all feedback and suggestions, which is why our equipment undergoes continuous modernisation.

I can provide an example: the well-known Pantsir. Today, this is the Pantsir SMD-E model. It differs from the previous version in that it is equipped with mini-missiles, and its ammunition load has quadrupled. Instead of 12 missiles, it now carries 48. This is crucial for countering drone threats, as 12 missiles are sometimes insufficient during mass attacks. Forty-eight, of course, is far better, and our military is very pleased with this.

We have developed a robotic platform capable of transporting supplies to the battlefield, evacuating the wounded, delivering ammunition, and even operating as a kamikaze unit.

Vladimir Putin: Depesha?

Sergei Chemezov: Yes, it is called Depesha.

Regarding electronic warfare, we have introduced a new system, a complex called SERP-VS13D, which is capable of detecting and suppressing FPV drones, including previously invulnerable unmanned aerial vehicles with control functions across a broader frequency range. SERP is now deployed at many defence enterprises, including ammunition plants, and provides effective protection against drone strikes.

An airspace control system has also been developed by our High Precision Systems holding – these are mini-radars. They detect low-visibility targets such as drones. Naturally, if they operate in tandem with Pantsir, the effectiveness is very high. If they function purely as detection systems for low-visibility targets, the data is immediately relayed to the air defence command centre, where appropriate measures are taken to neutralise the threat.

As for civilian production, we are working to increase its share. Last year, it stood at 35 percent, whereas this year it is 30.7 percent, meaning a decrease of 4.3 percentage points. However, in absolute terms, we are still growing: the volume of civilian product sales has increased, revenue has risen by 11.6 percent and now amounts to 1.108 trillion rubles. In other words, a third of our total revenue originates from civilian production.

What brand-new civilian products can I name? Primarily, there is the 2000VH five-axis milling machining centre. Russia has never produced centres of this kind before; we are the first to do so. It is intended for aircraft engine manufacturing and the defence industry. It can machine large parts weighing up to five tonnes while demonstrating pinpoint accuracy to second decimal places of a millimetre.

In the waste-to-energy industry, we started building waste incineration plants in 2019. The plan was to build four plants in the Moscow Region and one in Tatarstan. But COVID-19 intervened, and later sanctions were imposed, with the result that this construction project came to a standstill. We commissioned the first plant only in December 2024. I should note that no federal budget funds were allocated for this. All the plants were to be built with private investment, our own funds, and, of course, we secured loans.

Vladimir Putin: You owe money, Mr Chemezov.

Sergei Chemezov: Yes, unfortunately. But we built it after all, and it works. As of today, 100 million kilowatt-hours of green energy have been produced, along with 200,000 tonnes of household waste disposed of. Previously, all of that was consigned to landfills. Currently, this plant processes over 2,000 tonnes of waste per day.

The second plant is 92 percent ready. We will complete its construction next year. We are short of money, but we are negotiating with banks to secure some preferential loans to a certain extent. We will also contribute a portion of our own funds. I can assure you that another plant will be put into operation next year.

We will have to freeze the remaining three plants – two in the Moscow Region and one in Kazan – until better days, when money is cheaper, or, possibly, when some state assistance is forthcoming.

Speaking of medicine, we have developed a cutting-edge histological scanner. While it is similar to Japanese, German or Chinese scanners, its characteristics are significantly better than those of the Chinese device, and comparable to the Japanese and German analogues. What is a histological scanner? It is a digital platform that uses artificial intelligence to analyse tissue samples obtained from human biopsies, generating a report in just a few minutes. Until now, patients had to wait two to three weeks for a diagnosis to determine whether they have cancer. Worse, unfortunately, errors occurred in 40 percent of biopsy reports. Why? Because a human operator can get tired; in other words the doctor examining the samples under the microscope can make mistakes. With artificial intelligence, the proportion of errors is dramatically reduced, from 40 percent to just five.

Vladimir Putin: Indeed, with artificial intelligence…

Sergei Chemezov: All it does is match the specimen to the existing dataset. The remaining five percent of errors stem from the embedded dataset. If an error creeps into the database, AI can generate distorted analyses.

Furthermore, our Metallist plant has partnered with Bauman Moscow State Technical University to develop a knee module with microprocessor control. You and I have visited the Centre for Innovative Technologies in Orthopaedics (CITO), another Rostec unit that helps special military operation veterans with serious injuries; this knee module is being used there. Your instruction was to open 25 centres like this throughout Russia. At this stage, these centres have opened in Kurgan, Kursk, Izhevsk, St Petersburg and the Moscow Region; the last one opened just a week ago.

It goes without saying that we are providing assistance to our veterans. Since 2022, CITO has rolled out 6,000 prosthetics, more than one third of which are bioelectric devices with built-in microprocessor.

KAMAZ has created a truck with hand controls, as well as a lift that raises a person into the cabin. They may have no legs, but they can still drive a truck. This opens up additional opportunities for the veterans to return to normal life and find employment even after suffering serious injuries.

As for our workforce, it goes without saying that it is our unique team that has made all these achievements possible. Today, we have about 700,000 specialists from various fields and domains working for our corporation. In fact, this makes us Russia’s biggest employer in manufacturing. Since 2022, we have added over 100,000 employees and expect to go even further, with plans to recruit about 130,000 staff members, including around 30,000 engineers by 2028.

We offer a very employee-friendly environment and have recently increased salaries to reach an average of about 107,000 rubles, which is a good pay level. In addition, we offer social benefits, including voluntary medical insurance plans, sponsored trips to health resorts, housing programmes, private retirement insurance plans, and more. In 2024, we spent 23.7 billion on these benefits, up 35 percent compared to 2023.

Of course, we are committed to attracting young people. This is why we have been working with schools, vocational colleges and higher education institutions. Building on the support they receive from our companies, schools have created 200 classes specialised in engineering with 5,500 school students study robotics, programming, biotechnology and other engineering disciplines. Over 4,000 school students get our specialised university scholarships.

Vladimir Putin: This is the way to build a talent pool.

Sergei Chemezov: Indeed, we are creating this talent pool. Otherwise, attracting young people would have been much harder. We are working with the Ministry of Education and the Ministry of Science and Higher Education, which have always been there to support us in every possible way.

It is thanks to these career guidance efforts that today, in 2025, 50 percent of school students graduating from these specialised classes have chosen mathematics as their main subject for the National Final School Exam (EGE), while 21 percent opted for IT and another 16 percent picked physics. What this indicates is that young people are now focusing on engineering schools and prefer them over economics and law.

Vladimir Putin: The tide has changed – they are now switching back from social sciences to STEM disciplines.

Mr Chemezov, what about titanium production? What is going on in this sector?

Sergei Chemezov: Of course, we can say that the enterprise is not operating at its full capacity these days. We mostly serve our aviation and helicopter manufacturers.

However, since the Americans have left, we have had to suspend operations at our joint venture with Boeing, which has unfortunately resulted in lower output figures.

Vladimir Putin: They suffered losses because of this move. Is that correct?

Sergei Chemezov: Of course. They brought many advanced machines here, and we built an entire plant. Moreover, we worked with them to develop five cutting-edge alloys and split our intellectual property rights in half.

Vladimir Putin: Were they designed for the aviation industry?

Sergei Chemezov: Yes, for aircraft manufacturing.

Vladimir Putin: I see. Good. Thank you.