Leonardo unveils ‘Michelangelo Dome’ AI-powered shield system

Italian defense company Leonardo on Thursday unveiled plans for an AI-powered shield for cities and critical infrastructure, adding to Europe’s push to ramp up sovereign defense capabilities amid rising geopolitical tensions.

The system, dubbed the “Michelangelo Dome” in a nod to Israel’s Iron Dome and U.S. President Donald Trump’s plans for a “Golden Dome,” will integrate multiple defense systems to detect and neutralize threats from sea to air including missile attacks and drone swarms.

Leonardo’s shares were marginally higher Thursday and is up around 77% since January, amid a year of steep rises for defense stocks across Europe as the region’s governments have hiked defense spending. 

The UK’s BAE Systems rose 42.7% since the start of 2025, Germany’s Rheinmetall 148.9% and France’s Thales 63.8%.

Leonardo’s dome will be built on what CEO Roberto Cingolani called an “open architecture” system meaning it can operate alongside any country’s defense systems.

“In a world where threats evolve rapidly and become ever more complex — and where defending is costlier than attacking — defense must innovate, anticipate and embrace international cooperation,” said Cingolani, during an event on Thursday evening.

The company is targeting the project being fully operational by the end of the decade.

Airbus CEO Guillaume Faury told CNBC earlier on Thursday that the protocols to exchange data between countries and teams on the battlefield were still “still quite limited,” adding it could take a decade to build out Europe’s “digital battlefield.”

European governments have rapidly committed to increased defense spending as the U.S., a key ally for the bloc, has previously threatened to reduce financial support in the region. 

In May the EU announced a 150 billion euro ($173.5 million) programme to provide long-term loans to member states for defense procurement and industrial capacity. NATO members also committed to increasing defense and security spending to 5% by 2035 in June.

Leonardo’s unveiling of its new dome system is part of a sector wide move from leading defense primes that’s seeing them shift “investment from standalone hardware to integrated command architectures,” Loredana Muharremi, equity analyst at Morningstar told CNBC. 

“Modern warfare is won by the network that can integrate every platform into one decision cycle,” she said. “The winners will be the contractors that own the network layer, not the metal, which capture recurring upgrades and scale.”

Risks to Leonardo’s dome system include execution delays and “dependency on European procurement cycles,” Meghan Welch, managing director at Brown Gibbons Lang & Company told CNBC.

European primes are also increasingly competing with an emerging class of defense tech startups in the region.

German AI drone startup Helsing raised 600 million euros and doubled its valuation to 12 billion euros in June, the Financial Times reported. Quantum Systems, which also develops autonomous defense tech, announced Friday it has tripled its valuation to above 3 billion euros after a 180 million euro raise.