Aerovironment Stock Earnings Reports

Key points for investors: AeroVironment delivered a strong Q2 FY2026 with record contract awards and bookings amid a challenging government shutdown and an ERP transition. Highlights include $472.5M in revenue for the quarter (a record Q2), $3.5B total contract award ceiling in the quarter and nearly $1.4B of bookings (record Q2 bookings). Funded backlog was $1.1B with unfunded backlog growth (management noted ~$2.8B unfunded), and the company reports 93% visibility to the midpoint of its FY2026 revenue guidance. Management raised the lower end of full-year revenue guidance to $1.95B–$2.0B, and reiterated adjusted EBITDA guidance of $300M–$320M and non-GAAP EPS of $3.40–$3.55. Q2 adjusted EBITDA was $45M (9.5% of revenue). Adjusted gross margin was pressured in Q2 at ~27% (versus 41% prior year) due to an unfavorable mix, the Oracle Fusion go‑live, and shutdown-related delays; management expects margins to improve into the high‑30s by Q4 and to finish the year in the low‑30s on average. Strategic/operational items: BlueHalo acquisition integration is proceeding and generating synergies; multiple product launches (Switchblade family Block 2/400/300 Block 20, VAPOR CLE, AV_Halo Cortex and Mentor); P550 was downselected for the Army LRR program; JUMP 20/JUMP 20X added to a Navy BOA; an ~$240M long‑haul laser communications contract (with options bringing the total quoted ceiling higher) and a ~ $874M Army IDIQ for international small UAS and related products were secured. Management is expanding manufacturing capacity (new ~100,000 sq ft Salt Lake City facility planned, potential >$2B annual production capacity for Switchblade/other products) and expects significant international and allied demand. Cash and balance sheet: cash/investments ~$669M; new balance sheet composition after BlueHalo and financing transactions; management targets ~50% cash conversion of EBITDA for the year. Key risks/timing notes: many awards currently unfunded (due to budget timing/continuing resolution effects), so near-term performance depends on timing of task orders and funding; Q3/Q4 are expected to be back‑loaded (approx. 45% of second half revenue in Q3 and 55% in Q4; 70% of second half EBITDA expected in Q4).