AeroVironment Earnings Q3 Misses Cuts Guidance
AeroVironment earnings Q3 missed estimates and it trimmed FY guidance to $1.85-$1.95B after a $151.3M goodwill impairment, raising near-term earnings risk.
KEY TAKEAWAYS
- Cut FY2026 guidance to $1.85-$1.95 billion and $2.75-$3.10 non-GAAP EPS after integration and impairment.
- Q3 revenue was $408 million, up 143% year over year, but missed consensus estimates.
- GAAP net loss was $(156.6) million driven by a $151.3 million Space goodwill impairment.
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AeroVironment, Inc. (AVAV) reported fiscal third-quarter results for the period ended January 31, 2026, on March 10, 2026, and lowered its full-year outlook after recording a goodwill impairment related to its Space business and citing integration-timing effects.
Third-Quarter Results
The company announced third-quarter revenue of $408 million, up 143% from $167.6 million a year earlier, with nine-month revenue totaling $1.3 billion. These results fell short of consensus estimates, which ranged from $476 million to $485 million in revenue and $0.68 to $0.72 in earnings per share (EPS).
Non-GAAP adjusted EBITDA rose to $44.5 million from $21.8 million a year earlier, while non-GAAP earnings per diluted share increased to $0.64 from $0.30. These adjusted figures exclude certain accounting items and were cited by management as measures of underlying operating performance.
On a GAAP basis, AeroVironment reported an operating loss of $179 million and a net loss of $156.6 million, or $3.15 per diluted share. The net loss primarily reflected a $151.3 million goodwill impairment related to the Space segment. Product sales accounted for $277.8 million of revenue, with services contributing $130.2 million. Gross margin was $98.8 million, or 24% of revenue, rising 56% year over year and including $12.7 million of intangible-asset amortization.
Segment revenue also missed estimates, with the Aeronautics and Space Systems (AxS) segment generating $278.7 million versus an expected $298.3 million, and the Space and Cyber Defense Electronics (SCDE) segment reporting $129.3 million against a $169.4 million estimate.
Record Backlog and Lowered Outlook
Funded backlog reached a record $1.1 billion as of January 31, 2026, while nine-month bookings totaled $2.1 billion, yielding a book-to-bill ratio of 1.6. Management highlighted these figures as supporting revenue visibility despite the trimmed near-term earnings outlook.
The company reduced its fiscal 2026 guidance, now expecting revenue between $1.85 billion and $1.95 billion and non-GAAP EPS of $2.75 to $3.10. It projected adjusted EBITDA of $265 million to $285 million and a GAAP net loss between $201 million and $218 million, with GAAP loss per diluted share ranging from $4.10 to $4.44. This outlook assumes integration of the BlueHalo acquisition and execution of defense programs.
BlueHalo, acquired on May 1, 2025, contributed $176.5 million to the quarter’s revenue, providing a significant lift to top-line growth. At quarter-end, AeroVironment held $289.9 million in cash and cash equivalents, total assets of $5.45 billion, and stockholders’ equity of $4.27 billion. Management cited these figures as providing financial flexibility during integration and program delivery.
The results reflect a mixed picture: record backlog and acquisition-driven revenue gains support revenue visibility, while the goodwill impairment and lowered guidance signal near-term earnings risks tied to integration and defense program performance.
