AeroVironment (AVAV) shares skyrocketed over 20% in pre-market trading on Tuesday after the drone and defense systems manufacturer reported blockbuster fiscal fourth-quarter results. Revenue for the quarter ended April 2026 came in at $641.6 million, more than doubling the $275 million from a year ago and smashing the consensus estimate of $557 million. Non-GAAP earnings per share hit $1.84, topping analyst expectations by roughly 25%.
The company's Autonomous Systems segment was the standout, generating $492 million in revenue — approximately 76% of total quarterly sales — and far exceeding the $402 million analysts had penciled in. Recent acquisitions BlueHalo and Empirical Systems Aerospace (ESAero) contributed over $282 million to the quarter's top line. Funded backlog climbed to $1.2 billion, up from under $727 million a year earlier, with an additional $1.5 billion in unfunded backlog. CEO Wahid Nawabi highlighted strong customer indications for future contract wins and growing demand for the LOCUST laser weapon system after successful Navy drone interception tests.
The only blemish was forward guidance: fiscal 2027 EPS of $3.02–$3.34 fell well short of the $4.00 consensus, though management's revenue guide of $2.13–$2.23 billion topped expectations. Investors shrugged off the bottom-line miss, focusing on the massive order pipeline and demand tailwinds.
The earnings blowout sent ripples through the broader defense sector. Kratos Defense & Security Solutions rose 8%, Vishay Precision Group added 5%, and Unusual Machines also traded higher. Red Cat Holdings and Ondas gained in extended trading Monday, while the ARK Space and Defense Innovation ETF and Defiance Drone and Modern Warfare ETF both reflected positive year-to-date moves. The rally underscored Wall Street’s growing conviction in modern drone warfare and autonomous systems as a durable growth theme.
