We study the financing of R&D and innovation expenditures of French defense firms at the end of a period characterized by a decline in the defense budget is analyzed. The results provide some support for the hypothesis that these firms rely on public aid. However, large groups receive most of this aid and small independent firms are more dependent on bank loans. Improving their financing may induce their R&D and innovation efforts. JEL: L60, L64, G32, O3