Archer Aviation Q2 Earnings Call Highlights

Archer Aviation said it has entered agreements to acquire Boeing-owned Wisk Aero, Insitu and SkyGrid in an all-stock transaction that is expected to close by the end of the year, broadening its operations beyond electric air taxis into unmanned aircraft systems, aviation artificial intelligence and autonomous-flight technology.

Founder and CEO Adam Goldstein characterized the transaction as an “important inflection point” for Archer, saying the acquisitions would support its strategy to build a diversified aerospace and defense platform. Boeing will receive a strategic equity stake in Archer, subject to a lockup, while the companies plan to collaborate on aviation autonomy, flight controls and other technologies.

Goldstein said Archer will retain ownership of intellectual property acquired in the deal, while sharing IP with Boeing for products involving flight-control systems, autonomy and related areas. He described the arrangement as a partnership intended to help both companies develop future civil and defense products.

Wisk brings engineers and technology focused on autonomous flight, flight controls and sensors, according to Archer. Goldstein said Archer sees an opportunity to use Wisk’s technology initially on its Halo Thunder aircraft platform before incorporating it into future air-taxi iterations when the Federal Aviation Administration is prepared to certify autonomy.

Insitu, an intelligence, surveillance and reconnaissance drone manufacturer, is profitable and generates more than $200 million in annual revenue across 35 countries, Goldstein said. The company has built more than 4,000 Group 2 and Group 3 unmanned aircraft systems that have accumulated nearly 2 million autonomous flight hours. Archer expects Insitu to provide an immediate revenue base and positive free cash flow after the transaction closes. Goldstein said the company plans to focus first on growing Insitu’s existing product portfolio and increasing manufacturing of the Group 2, Group 3 and Group 4 drones it produces.

SkyGrid is expected to complement Archer’s ZEE aviation-specific foundation model, which uses data including ADS-B, air traffic control communications, maps, aircraft movements, terrain and weather. Archer said it believes the combined technologies could support a next-generation air-traffic-management product.

Goldstein said Archer’s Midnight air-taxi program remains central to the company’s strategy. During the quarter, Archer flew piloted aircraft almost daily, at times conducting multiple flights per day, incl...