Armenia’s technology sector has expanded 18.5-fold since 2017, with active tech companies surpassing 12,000 in 2025, as the country accelerates defense innovation, advances its national space program, expands digital connectivity through Starlink, and moves forward with a potential $4 billion AI data center project that could reshape its role in the global high-tech landscape.
Tech Sector Growth Accelerates
The number of active technology companies in Armenia reached 12,026 in 2025, up from 8,396 in 2024. In 2017, the figure stood at just 650, marking an 18.5-fold increase over eight years.
Employment has also expanded sharply. The sector employed 15,350 people in 2017, 21,541 in 2024, and 41,431 in 2025, a 2.6-fold increase compared to 2017.
Turnover exceeded 1 trillion AMD in 2025, up from 915.8 billion AMD in 2024 and 306.04 billion AMD in 2017, reflecting more than threefold growth over the period.
Technology exports totaled 135.44 billion AMD in 2017, surged to 702.1 billion AMD in 2024, and reached 711.5 billion AMD in 2025, a 5.2-fold increase compared to 2017.
Defense Industry Reforms and Export Licenses
Parallel to civilian tech growth, Armenia has expanded state support for defense-related innovation.
State funding for research and development (R&D) in the defense industry exceeded 2.1 billion AMD in 2025, representing a 50% increase compared to 2024.
Hayrapetyan said comprehensive reforms made the program more accessible and introduced the concept of technology readiness levels (TRL), allowing companies to develop complex defense projects step by step. Under the new framework, startups can begin with smaller funding and gradually mature into full-scale defense technology firms.
The minister also revealed that the government granted export licenses to several Armenian defense companies last year. While the specific military products remain classified, he said legislative changes have expanded the range of state support tools.
A new financing mechanism now supports the creation of prototypes required for state testing, systematizing what he described as a complex and costly process. “This is a new set of tools to financially assist our companies in navigating the complex and costly process of state testing,” he said.
Next Phase of Armenia’s Space Program
Armenia is also preparing the next stage of its national space program.
The state-owned ArmSat-1 satellite, launched in 2022, completed its mission at the end of 2025. The government is now considering the acquisition of new remote-sensing and Earth-imaging satellites, which officials describe as strategically important.
Alongside state procurement, locally developed satellite initiatives are gaining prominence. The Hayasat series, designed and built by Armenian research teams, is viewed as crucial for strengthening domestic scientific and technological expertise.
“Hayasat-type satellites are of exceptional importance for us,” the minister said, emphasizing their value for science, research, and innovation. Research teams working on Hayasat-2 may benefit from new R&D tax incentives introduced by the government.
Starlink Donates Terminals to Boost Internet in Armenian Schools
During Vice President Vance’s visit to Armenia, Starlink announced the donation of more than 100 satellite internet terminals to the Armenian government, Minister Hayrapetyan said.
“It is no secret that the services of Starlink have been available in Armenia since 2025. We began work here back in 2024 by liberalizing certain radio frequency domains, after which the company was able to expand its activities,” Hayrapetyan said.
The donation is intended to address internet connectivity issues in public educational institutions, particularly those located in high-mountain areas. Starlink will also cover the full cost of services for the coming year.
In addition to the donation, 340 Starlink terminals were imported to Armenia in the second half of 2025, further strengthening nationwide digital connectivity.
$4 Billion AI Data Center Project
Perhaps the most ambitious initiative is the Firebird AI data center project, which could position Armenia among global leaders in artificial intelligence computing capacity.
During a visit to Armenia by U.S. Vice President J. D. Vance, it was announced that the company had applied to implement the second phase of the project. If fully realized, total investment could reach $4 billion.
According to Hayrapetyan, Firebird AI has already acquired land, while construction permits, environmental impact assessments, and community approvals are underway. The first batch of graphics processors and server equipment is expected to arrive within two months.
The company has active contracts with NVIDIA for graphics processors and works with Dell Technologies for server production and integration. All necessary export licenses have been issued.
The minister clarified that the facility will not manufacture semiconductors or microchips. Instead, it will operate as an AI cloud and supercomputing center, importing fully assembled servers and GPUs to generate ultra-powerful computational resources for global users.
Employment is not the primary metric of the project’s success. The facility is expected to employ several dozen to 200 people, as the computational systems themselves will perform most of the work.
Domestic Access and Digital Transformation
Part of the center’s computing capacity will be allocated for Armenia’s domestic needs. Digital transformation, including automation of public services and AI integration in governance, has been identified as a strategic priority.
For the first time, Armenia will rely not only on rented foreign data center resources but also on computational capacity located within its own territory.
The project will also support science and innovation. Computational resources will be made available to research teams, companies, and students under state programs, fully subsidized due to their high cost. The first phase of applications has already been completed.
Strategic Positioning
Hayrapetyan described the overall fiscal impact of the AI project as “impressive,” noting that tax revenues from potential investments of up to $4 billion could significantly support education, science, infrastructure, social programs, and security.
Taken together, rapid private-sector growth, defense R&D reforms, satellite development, and large-scale AI infrastructure, the initiatives signal Armenia’s broader ambition to position itself as a regional technology hub and an emerging player in the global high-tech and artificial intelligence landscape.
