AeroVironment stock soars after revenue more than doubles and earnings beat expectations

Adjusted earnings came in at $1.84 per share, topping the $1.46 per share consensus estimate, according to The Wall Street Journal. Quarterly revenue more than doubled to $641.6 million, well ahead of the $556 million analysts had anticipated, compared with $275.1 million in the same period a year ago, according to The Wall Street Journal.

According to GAAP, the company reported net income of $63.2 million, or $1.25 per diluted share, up from $16.7 million, or 59 cents per diluted share, a year ago. By the end of the quarter, the funded backlog reached $1.2 billion, about 65% higher than the $726.6 million reported as of April 30, 2025, the company said.

AeroVironment stock climbed more than 20% in premarket trading Tuesday, according to CNBC. Entering Tuesday, shares had shed more than 40% of their value since the start of the year, pressured by the government's cancellation of a contract and the company's disclosure of an accounting error, according to Barron's.

For fiscal year 2026 overall, the company posted revenue of $1.98 billion, up 141% year over year, and booked $2.7 billion in new orders, for a book-to-bill ratio of 1.4, the company said.

"Fiscal 2026 marked a transformational year for AeroVironment, which included the completion of our largest acquisition, meaningful investments toward diversifying our portfolio in critical areas aligned to our customers' highest priorities, and the strongest financial performance in our history," CEO Wahid Nawabi said in a statement.

Looking to fiscal 2027, management guided for revenue of $2.13 billion to $2.23 billion and adjusted earnings per share of $3.02 to $3.34 — both figures below what Wall Street had been modeling, with analysts projecting $3.84 in adjusted earnings per share on $2.16 billion in revenue.

On the earnings call, Nawabi described the counter-UAS segment — which brought in around $200 million during fiscal 2026 — as still early in its adoption curve, with the potential to one day match or outgrow the company's core drone business, according to Benzinga. "It will not surprise me in the next 3-5 years that our directed energy and our counter-UAS business would be equally as large, if not 2-3 times bigger," he said.

The results reflect a broad shift in how militaries are deploying drones, with the Pentagon's proposed fiscal 2027 budget including $53.6 billion for drone and autonomous warfare technologies. Nawabi said that the military is playing catch-up after recent conflicts demonstrated the primacy of unmanned systems. "We knew that this inflection point was going to happen sooner or later," he said.