Looking ahead, the U.S. Department of Defense is under pressure to reduce costs, potentially slashing spending by up to $1 trillion by 2021. However, Ronald Epstein, sector analyst at Bank of America Merrill Lynch, argues that other western countries could pick up the slack.

“In our view, if the U.S. pulls back its involvement in the Middle East even though the battlefront continues to move to the West, Western Europe will likely have to spend more on defense spending in order to secure its borders and be able to help prevent future attacks,” Epstein told CNBC.

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Max Chen contributed to this article.