Key Highlights

• AVAV shares rose 5.54% pre-market to $182.00.

• The company won a $500 million U.S. Army counter-drone contract.

• Fiscal fourth-quarter revenue reached $641.6 million, up 133% year over year.

• Adjusted earnings per share beat consensus estimates by approximately 25%.

• Funded backlog stands at $1.2 billion, up 65% year over year.

Record Quarter Paired With Major Defense Contract Win

AeroVironment, Inc. (NASDAQ:AVAV) shares surged in pre-market trading, vastly outpacing the broader industrials sector exchange-traded fund, following a blockbuster fiscal fourth-quarter earnings report paired with a newly awarded $500 million U.S. Army counter-drone contract. The Arlington, Virginia-based defense technology company designs and produces robotic systems spanning air, land, sea, space, and cyber domains.

The company posted record quarterly revenue of $641.6 million, up 133% year over year and above the $557 million consensus estimate. Adjusted earnings per share of $1.84 beat expectations by approximately 25%, reflecting strong demand across the company's autonomous systems and directed energy product lines.

Executives Cite Unprecedented Demand Despite Soft Guidance

Funded backlog reached $1.2 billion, up 65% year over year, with company executives describing defense demand over the next 12 to 24 months as unprecedented. A securities research firm reiterated a Market Outperform rating with a $350 price target following the results.

The lone soft spot in the report was fiscal year 2027 earnings per share guidance of $3.02 to $3.34, below the $4.00 consensus estimate, though investors appeared to largely overlook the guidance shortfall in favor of the strong order pipeline. Company figures show a market capitalization of approximately $8.73 billion following the pre-market move.

Conclusion

AeroVironment's pre-market surge reflects investor enthusiasm for the company's record quarterly results and expanding defense backlog, reinforced by the new Army counter-drone contract award. While next fiscal year's earnings guidance came in below consensus, the strength of the funded backlog and management's characterization of demand as unprecedented appear to have outweighed near-term guidance concerns.

 

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