Draganfly Shares Plunge 9.15% as Skepticism Mounts Over Defense Contracts and Profitability

Draganfly Inc. (DPRO) shares plunged 9.15% on Thursday, reaching a session low of $9.36, marking the lowest level since October 2025. The stock experienced an intraday drop of 12.93%, signaling renewed investor caution amid ongoing financial challenges. This sharp decline underscores persistent concerns over the company’s profitability and operational efficiency despite recent defense-related partnerships.

The stock’s underperformance follows a mixed quarter for the company. While revenue grew 22.06% year-over-year as of June 30, 2025, the $1.55 million figure still fell short of the $2.24 million forecast. A negative net margin of 181.76% and a return on equity of -197.71% highlight structural weaknesses, as high costs and limited revenue expansion continue to weigh on investor sentiment.

Recent strategic moves in the defense sector initially boosted optimism. A partnership with Defense Prime Global Ordnance and a contract with the U.S. Army to supply drone systems drove a 59% stock surge in late September. However, the subsequent 9.15% decline suggests skepticism about the sustainability of these contracts. Investors remain wary of whether these deals can translate into consistent revenue or long-term profitability.

Institutional investors have shown cautious interest, with several firms increasing stakes in Q2 2025. Kieckhefer Group LLC, for instance, boosted its position by 69.1%, while others added smaller holdings. Despite this, institutional ownership remains at 10.39%, reflecting limited confidence in the company’s ability to scale operations effectively.

Market dynamics further complicate the outlook. Draganfly’s beta of 2.58 indicates extreme volatility, and the recent 329% spike in trading volume on October 1 did little to support the price. The stock’s 50-day moving average at $5.46 and 200-day average at $3.76 suggest an oversold condition, yet structural issues persist. Reliance on defense contracts also exposes the company to geopolitical risks and cyclical budget shifts.

Looking ahead, execution of military contracts, cost management, and diversification beyond defense will be critical. While analyst upgrades hint at long-term potential, the disconnect between ratings and market behavior underscores lingering doubts. For now, Draganfly’s path to profitability remains uncertain, with its low market cap and thin liquidity amplifying susceptibility to short-term speculative swings.