AVAV Stock Plummets As Q3 Revenue Comes Way Below Wall Street Expectations, Triggering Selloff

It reported third quarter revenue of $408.0 million which fell well short of analyst expectations of $475.65 million, as per data from Fiscal.ai.

• AVAV’s net loss for Q3 of fiscal 2026 was $156.6 million, or $3.15 loss per diluted share, as compared to net loss of $1.8 million, or $0.06 loss per diluted share from the year-ago period.
• The company's third quarter results were impacted by revenue timing and adjustments in its Space business, the CEO said. 

Aerovironment stock plummeted 8% during after-hours trading on Tuesday after its weak third quarter revenue for fiscal 2026 and widening quarterly loss spurred a selloff in the stock.

It reported third quarter revenue of $408.0 million which fell well short of analyst expectations of $475.65 million, as per data from Fiscal.ai.

However, revenue increased 143% as compared to $167.6 million for the third quarter of fiscal 2025, due to higher product sales of $138.1 million and higher service revenue of $102.3 million.

“While our third quarter results were impacted by revenue timing and adjustments in our Space business, demand for our unique solutions remains robust,” said Wahid Nawabi, AeroVironment chairman, president and chief executive officer.

“Strong order flow and growth in funded backlog during the quarter are setting the stage for record fourth quarter revenue and a solid start to fiscal year 2027. We are executing with discipline, scaling manufacturing ahead of demand and accelerating the commercialization of our platforms to improve profitability and time to market,” Nawabi said. 

More Details

Net loss for the third quarter of fiscal 2026 was $156.6 million, or $3.15 loss per diluted share, as compared to net loss of $1.8 million, or $0.06 loss per diluted share, in the prior-year period, respectively. The current quarter was negatively impacted by goodwill impairment charges of $151.3 million. 

In January, the company received a stop-work order on its deal for the delivery of BADGER phased array antenna systems to support Space Force’s Satellite Communication Augmentation Resource (“SCAR”) program. 

The U.S. Space Force earlier in the month announced that it is putting the Satellite Communications Augmentation Resource program back up for competition, which significantly affected AVAV’s backlog. 

Gross margin for the third quarter of fiscal 2026 was $98.8 million, an increase of 56% as compared to $63.2 million for the third quarter of fiscal 2025, reflecting higher product margin of $19.1 million and higher service margin of $16.5 million.

Retail Reaction

Retail sentiment around AVAV stock trended in ‘bullish’ territory amid ‘high’ message volume. 

Shares in the company have fallen 20.3% year-to-date.