AeroVironment (AVAV) was a big mover last session on higher-than-average trading volume. The latest trend in earnings estimate revisions might not help the stock continue moving higher in the near term.
AeroVironment, Inc. remains a high-conviction, volatile defense play, driven by record contract awards and persistent global tensions. Despite 151% revenue growth (9% ex-BlueHalo), AVAV's adjusted gross margin fell sharply to 27%, raising profitability concerns. Guidance was raised to $1.95–$2.0B revenue, but non-GAAP EPS was lowered; execution risk is high with 70% of EBITDA expected in Q4.
For decades, the defense sector was viewed as a safe harbor for conservative investors. Companies like Lockheed Martin NYSE: LMT or General Dynamics NYSE: GD were treated as bond proxies, stocks that offered slow growth, reliable dividends, and low volatility.
AVAV, KTOS and DPRO are some stocks in the drone technology space that are worthy of investment consideration.
AeroVironment's NASDAQ: AVAV fiscal Q2 (FQ2) earnings release was mixed, but the positives outweigh the negatives. The negatives include margin pressures from integration costs related to the Blue Halo acquisition.
Yesterday we were watching whether AeroVironment could sustain its explosive revenue trajectory while returning to profitability.
AeroVironment, Inc. (AVAV) Q2 2026 Earnings Call Transcript
While the top- and bottom-line numbers for AeroVironment (AVAV) give a sense of how the business performed in the quarter ended October 2025, it could be worth looking at how some of its key metrics compare to Wall Street estimates and year-ago values.
AeroVironment (AVAV) came out with quarterly earnings of $0.44 per share, missing the Zacks Consensus Estimate of $0.85 per share. This compares to earnings of $0.47 per share a year ago.
Shares of AeroVironment Inc. (NASDAQ:AVAV) are up 1.8% to trade at $287.61 at last check, after the defense company secured a $874.26 million contract with the U.S. army for its unmanned aerial systems (UAS) and counter-UAS systems.
AeroVironment is uniquely positioned in the rapidly evolving defense-tech sector, benefiting from surging global demand for drones and remote warfare solutions. I maintain a strong buy rating on AVAV, citing robust contract momentum, a growing $1.1 billion backlog, and favorable structural tailwinds from U.S. and NATO initiatives. AVAV's margin volatility is transitional, with management guiding for steady improvement toward 35% by Q4 and long-term rerating potential as integration stabilizes.
Looking beyond Wall Street's top-and-bottom-line estimate forecasts for AeroVironment (AVAV), delve into some of its key metrics to gain a deeper insight into the company's potential performance for the quarter ended October 2025.