Laser nation How One of Europe's Smallest Countries Became NATO's Precision Photonics Capital

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Lithuania is NATO's eastern flank, and its physicists have turned six decades of laser research into a defence industry. What began in university labs is now a cluster of 60+ agile companies growing 16% a year on average with the United States as the top buyer of Lithuanian lasers. 

Lithuania is becoming NATO's precision photonics capital because it has what almost no one else does: 60 years of laser science, and companies fast enough to move at the speed the technology demands. Lithuania is NATO’s most exposed border, where precision photonics is a defence need for the country, not a market opportunity. That combination has built a cluster of 60+ companies and thousands of specialists in Vilnius, with the sector growing by 16% annually.

The United States is Lithuania's top laser export market, proof that the world's most demanding laser buyers already trust what this small country builds.

"Our laser industry didn't happen by accident—it's the result of 60 years of physicists who kept doing the work, even when there was no market for it. That kind of foundation isn't something you can buy, and it's not something you can rush. Any country can fund a lab, but very few have a whole generation of scientists behind them. For us, defence was a natural direction, due to geography and the pressure that comes with being on russia’s border," said Laurynas Šatas, CEO of Aktyvus Photonics.

Technology too hard to rush

Building a laser system precise enough for military targeting means controlling power density, beam quality, and thermal stability to margins that most other technologies never have to consider. Pushing too much energy into a small component causes it to overheat and fail, which can make the laser useless in the field.

That difficulty is exactly why the field has so few real competitors. Large defence companies can take months just to re-test a single design change, because every change has to move through layers of approval and procurement processes built for managing dozens of contracts at once.

Lithuania's laser companies run the same rigorous testing without that layered bureaucracy, because small teams and close ties with local suppliers cut out the approval layers that slow larger companies down. That's why Lithuania's companies are shipping precision laser systems to NATO while others are still writing specifications.

"Lasers are one of the hardest technologies in physics to get right, and that difficulty has quietly built Lithuania an advantage most countries don't even know exists. We're small and fast where it matters, and focused companies are usually the ones who move first on hard problems," commented Laurynas Šatas.

When defence isn't optional

Lithuania’s laser companies are already responding to their own country’s security needs. Aktyvus Photonics, for example, built its early business on industrial and scientific lasers. They shifted toward defence applications after Russia's annexation of Crimea in 2014 and invasion of Ukraine in 2022, turning their laser expertise toward targeting systems for tactical drones.

"Our shift from industrial lasers to defence systems came as a direct response to rising regional threats. That meant re-engineering what we already knew for one goal: reliability in the field, for the people who'll depend on it," said Laurynas Šatas.

The company’s growth reflects that shift. Aktyvus Photonics grew revenue from €402 thousand (approx. 460 thousand USD) in 2023 to €3.8 million (approx. 4.4 million USD) in 2025, closing last year with a 40% EBITDA margin. Headcount grew from 4 employees in 2022 to 50 today.

60 years of continuity

Lithuania's laser industry traces back to 1966, when physicists at Vilnius University built the country's first laser during the Soviet occupation. This was one of the few fields where serious research was possible at the time. That work continued even after independence, when Soviet research funding was cut.

In the 1990s, two companies, Ekspla and Light Conversion, both founded by Vilnius University scientists, turned that research into Lithuania's first commercial laser products. This built a local supply chain of component makers and precision manufacturers that later generations of companies could build on.

Today, Vilnius has more than 60 laser and photonics companies and thousands of specialists, with the sector growing by 16% a year.