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AeroVironment stock ripped 19% higher on Monday after the bell as the dronemaker reported fourth-quarter earnings that beat on the top and bottom lines.
The company smashed expectations, reporting earnings of $1.84 per share while analysts polled by LSEG were expecting $1.46 per share. Revenue also came in ahead, more than doubling to $642 million versus an analyst estimate of $559 million.
CEO Wahid Nawabi said in a release that AeroVironment is well positioned to benefit from the rising global demand in drones, counter-drones and space technology.
AeroVironment’s funded backlog of $1.2 billion was up 65% over last year, but only slightly above the $1.1 billion backlog reported in the prior period. Autonomous systems revenue of $492 million handily beat the $402 million StreetAccount expectation.
Nawabi told CNBC’s Morgan Brennan during a recent exclusive tour of the company’s Simi Valley, California, facility that the fundamentals of warfare have changed due to the recent conflicts in Ukraine and Iran.
“We knew that this inflection point was going to happen sooner or later,” he said, “and these last couple of conflicts that have become globally well known has essentially brought this thing to the forefront.”
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AeroVironment posted net income of $63.17 million during Q4 2026, or $1.25 per share. A year ago, the company posted net income of $16.66 million, or 59 cents per share.
The dronemaker expects fiscal year 2027 revenue in the range of $2.13 billion and $2.23 billion, with LSEG expecting $2.17 billion. The company’s guidance for adjusted 2027 EPS called for a range of between $3.02 and $3.34, while LSEG expectations were for $3.94 per share.
The company’s shares are down more than 40% this year, but with the U.S. Defense Department budget for drones alone set to possibly top $75 billion next year, there is a huge opportunity ahead.
“Not only the U.S. Department of War, but all of our allies are behind the eight ball in terms of adoption and deployment,” Nawabi told CNBC.
“Now we’re playing catch-up. Our military is playing catch-up in a very fast pace,” he added.
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