AeroVironment Inc
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: −13.34%.
Did AVAV Beat Earnings? Q3 2025 Results
AeroVironment delivered a sharply disappointing fiscal Q3 2025, with both earnings and revenue falling well short of Wall Street expectations as a confluence of operational disruptions weighed heavily on results. The drone and munitions maker reported non-GAAP adjusted EPS of $0.30, missing the $0.66 consensus estimate by 54.77%, while revenue slid 10.2% year-over-year to $167.64 million — an $38.77 million shortfall against the $206.41 million analysts had anticipated. The primary culprits were a steep 44% collapse in UnCrewed Systems revenue and the January Southern California wildfires, which physically disrupted operations and prevented the company from fulfilling scheduled deliveries — sending shares down roughly 13% to their lowest level in a year. A 46% surge in Loitering Munitions Systems revenue to $83.94 million provided only partial cushion. On a more constructive note, AeroVironment's funded backlog hit a record $763.50 million, up 65% from fiscal year-end, and management now guides FY2025 revenue of $780 million to $795 million, with a record Q4 expected to close the year on stronger footing.
- Record Switchblade and Jump-20 orders drove funded backlog to record $763.5 million
- LMS revenue grew 46% year-over-year driven by increased Switchblade demand
- Gross margin percentage improved to 38% from 36% due to favorable LMS contract definitizations
- Southern California high winds, fires and resulting blackouts negatively impacted Q3 revenue
- UxS revenue declined 44% year-over-year, reflecting transition away from Ukraine demand
- SG&A increased $16.0 million year-over-year including $10.1 million in BlueHalo acquisition-related expenses
“We faced a number of short-term challenges in the third quarter, including the unprecedented high winds and fires in Southern California, which impacted our ability to meet our goals. Nevertheless, we made significant progress towards executing our long-term growth strategy and building resiliency for the future.”
AeroVironment CEO, on the earnings call
Forward Guidance & Outlook
For fiscal year 2025, AeroVironment now expects revenue of $780 million to $795 million, non-GAAP adjusted EBITDA of $135 million to $142 million, and non-GAAP earnings per diluted share of $2.92 to $3.13. This guidance does not include forecasted results from the anticipated BlueHalo acquisition or certain contingent acquisition-related expenses. The company expects Q4 FY25 adjusted EBITDA to be significantly higher than the first three quarters. R&D expenses are expected between 12%-13% of revenues, and adjusted gross margins between 40%-42% of revenues in FY25. Ukraine-related revenues are expected to represent 17% of FY25 revenues and about 6% of Q4 FY25 revenues. Management expects accelerating growth in FY26.
AVAV YoY Financials
AVAV Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.