AeroVironment's Q4 Revenue Surges 40% on Defense Demand

AeroVironment, a leading defense technology company headquartered in Virginia, has announced its strongest financial performance to date for the fourth quarter and full year. The company's revenue, order volume, and profits all reached unprecedented levels, driven by the increasing demand for its unmanned systems and loitering munitions.

The company's fourth-quarter revenue amounted to $275.1 million, marking a 40% year-over-year increase and setting a new record for the strongest quarterly performance in its history. For the full year, revenue grew by 14% to $820.6 million, with net income reaching $43.6 million.

Chief Executive Officer Wahid Nawabi credited this success to the growing global demand for the company's unmanned aerial vehicles and loitering munition systems, as well as the strategic acquisition of defense company BlueHalo, completed in May. "Our investments across various business segments have effectively driven product demand, securing key orders both domestically and internationally," Nawabi stated during a conference call with analysts. He highlighted that AeroVironment's annual order volume hit a record $1.2 billion, doubling from the previous year, providing a solid foundation for continued growth.

As of April 30, AeroVironment's backlog of signed orders surged to $726.6 million, nearly doubling from the previous year. The company's adjusted EBITDA for the quarter also reached a new high of $61.6 million, nearly doubling from the same period last year.

Despite a slight decrease in gross margin to 36% due to one-time amortization expenses related to its ground vehicle business, overall profitability significantly improved. The quarter's net income was $16.7 million ($0.59 per share), far exceeding the $6 million reported in the same period last year.

Looking ahead, AeroVironment anticipates nearly doubling its revenue to between $19 billion and $20 billion by the fiscal year 2026, driven by the BlueHalo acquisition and the overall positive outlook for the defense industry. The company projects adjusted EBITDA to range from $3 billion to $3.2 billion, with adjusted earnings per share between $2.80 and $3.00. However, due to uncertainties surrounding integration costs and the valuation of intangible assets related to the BlueHalo transaction, the company did not provide guidance on GAAP earnings per share.