AeroVironment Q1 Earnings Call Highlights

AeroVironment reported $480 million in fiscal Q1 2027 revenue, a record $1.5 billion funded backlog and $683 million in bookings, while adjusted EPS rose 84% year over year to $0.59.

The company secured a nearly $465 million Army contract for its LOCUST laser system and a $500 million Titan counter-UAS IDIQ award, supporting its expansion in directed energy and drone-defense technologies.

AeroVironment maintained fiscal 2027 revenue guidance of $2.125 billion to $2.225 billion, but expects negative free cash flow as it invests heavily in new production facilities and capacity.

AeroVironment NASDAQ: AVAV reported record first-quarter fiscal 2027 revenue and funded backlog, while reaffirming its full-year outlook as it expands production capacity for uncrewed systems, loitering munitions and counter-drone technologies.

Revenue for the quarter totaled $480 million, according to Chairman, President and Chief Executive Officer Wahid Nawabi.

Funded backlog reached a record $1.5 billion, up 37% from the same quarter a year earlier and 23% from the prior quarter.

The company recorded $683 million in bookings, producing a quarterly book-to-bill ratio of 1.4 times.

Executive Vice President and Chief Financial Officer Sean Woodward said total funded and unfunded backlog was approximately $2.8 billion at quarter-end.

AeroVironment also said its reported unfunded backlog excludes remaining capacity on certain sole-source IDIQ contracts, including U.S. Army Switchblade, foreign military sales UAS and counter-UAS, and JIATF-401 counter-UAS RF contracts.

The Autonomous Systems segment generated $346 million of first-quarter revenue, accounting for 72% of total company sales and rising 21% year over year.

Within the segment, Precision Strike and Defensive Systems revenue increased 8% to $197 million, supported by loitering munitions, one-way attack systems and Titan counter-UAS RF products.

Uncrewed Aircraft Systems revenue rose 71% year over year to $120 million, led by domestic and international sales of the P550, JUMP 20-X and Puma platforms.

Space, Cyber and Directed Energy revenue was $134 million, down 21% from a year earlier and in line with company expectations.

Woodward attributed the decline to the termination of the SCAR contract in March and other discontinued government programs.

SCAR-related revenue had totaled $32 million in the prior-year first quarter.

Adjusted gross margin improved to 30% from 29% a year earlier.

Adjusted product gross margin rose to 40% from 36%, while adjusted service gross margin declined to 8% from 13%.

Woodward said service margins were affected by about $5 million in revenue lost from discontinued programs, other program losses and award delays in the Cyber and Mission Solutions business.

Adjusted EBITDA was $53 million, or 11% of revenue, while non-GAAP adjusted diluted earnings per share rose 84% year over year to $0.59.

AeroVironment generated $13 million in operating cash flow, though free cash flow was negative $36 million because of higher capital spending for facility expansions.

AeroVironment highlighted several recent contract awards across its product portfolio, particularly in counter-UAS systems.

The company said it received a nearly $465 million U.S. Army Enduring High Energy Laser, or EHEL, contract for its LOCUST direct...