Trump Proposes $892.6 Billion Defense Budget With 3.8% Troop Pay Raise, Fewer F-35s, More Missiles and Drones

US President Donald Trump has proposed a $892.6 billion defense budget for the 2026 fiscal year that prioritizes increased spending on high-tech missiles and drones while reducing expenditures on Navy jobs, ships, and fighter jets. The budget request includes a 3.8% pay raise for troops and a reduction in the number of F-35 fighter jets to be purchased, from 68 to 47 units. Additionally, 162 A-10 aircraft are slated for retirement. The focus on drones and missiles reflects lessons learned from the Ukraine conflict, emphasizing the battlefield value of small drones. This budget aims to maintain overall defense spending at levels similar to the current year while reallocating resources toward advanced missile and drone capabilities. Key defense contractors potentially impacted include BAE Systems, Boeing, General Electric, General Dynamics, Huntington Ingalls Industries, L3Harris Technologies, Lockheed Martin, Northrop Grumman, and Raytheon Technologies.