Leonardo DRS views Raft's software as the 'thinking part'

Leonardo DRS is eyeing its $450 million cash agreement to acquire Raft as a way of adding more software into an overall edge compute offering, which includes a significant cognitive element.

During Leonardo DRS’ second quarter earnings call with investors Thursday, chief executive John Baylony laid out the rationale for the transaction and direction the company sees this move as taking it.

Baylony cited the Air Force, Space Force, Special Operations Command and intelligence community as agencies where Leonardo DRS has a larger footprint with Raft in tow.

Raft is also providing its data platform for the Army’s Next Generation Command and Control effort to establish a common data baseline.

Then there is the technology equation Leonardo DRS is looking at, which Baylouny laid out for analysts on the call.

“We've been really focused on sensing and computing and communications and force protection, and those sensors that we created and have in the marketplace really need to have that intelligence,” Baylouny said. “As Raft likes to say, sensors need a brain.

"In the future, autonomous platforms are going to increasingly need to sense the battlespace, make sense out of the battlespace and do something about it and act," Baylouny added.

Leonardo DRS has historically worked on the front end of that technology ecosystem, in particular the sensors and computing infrastructure. Raft enters into the “thinking part” of events happening out in the field and that involves software, Baylony said.

For the Army NGC2 effort specifically, Raft’s platform works to convert data acquired from sensors in a way that helps AI algorithms read it across the enterprise. Baylouny said Leonardo DRS is looking to “immediately have synergies” from having both its hardware and Raft’s software working on that problem set.

This transaction is also taking place against the backdrop of the Pentagon’s acquisition reform agenda to transform how it buys goods and services from industry, especially software.

Baylouny described that push as one where the customer is moving toward more purchases of solutions, versus individual components and subsystems on more of a piecemeal basis.

“This was one of the missing pieces that we needed to fill to get to that level,” Baylouny said of Raft. “We're heading off at the pass where the customers are moving, so that's a big structural change in both the way that the customers are buying and what we're selling and how we're selling.”