AeroVironment Stock Gains. It’s Building a “Solid Foundation” for the Future.

AeroVironment makes several unpiloted systems, including the Mantis i23 D imaging drone. (AeroVironment, Inc.)

Shares of the drone maker AeroVironment gained ground after the company reported messy, but largely better-than-expected, fiscal first-quarter results.

Tuesday evening, AeroVironment announced adjusted earnings per share of 32 cents from sales of $455 million. Wall Street was looking for 33 cents and $438 million, respectively.

EPS missed by a penny, but a lot has been going on. AeroVironment closed its acquisition of BlueHalo in May, sending sales up 140% year over year, making comparisons more complicated. Excluding BlueHalo, AeroVironment said, sales rose 16% year over year.

Quarterly earnings before interest, taxes, depreciation, and amortization, or Ebitda, were $56.6 million, better than the $50 million analysts projected.

The backlog of work looked solid as well, ending the quarter at $1.1 billion, up from $727 million at the end of the April quarter.

Management stuck with most of its financial forecasts for fiscal 2026. AeroVironment expects sales of $1.9 billion to $2 billion and earnings per share of $3.60 to $3.70. Prior guidance given in June called for sales of $1.9 billion to $2 billion and adjusted EPS of $2.80 to $3.00. The forecast for Ebitda was left unchanged at a range of $300 million to $320 million.

There was a lot to digest in the aftermath of the BlueHalo combination, but investors appear fine with the update. Shares added 7%, closing at $247.05, while the S&P 500 rose 0.3% and the Dow Jones Industrial Average lost 0.5%.

Gauging the stock reaction was made more difficult by Russian military drones, which flew into Polish airspace on Tuesday evening.

Wall Street appears fine with the results. The quarter was a “solid foundation for fiscal year 2026 and beyond,” wrote Jefferies analyst Greg Konrad in a Wednesday report. He projects sales growth of 15% for the next few years. Konrad rates shares Buy and has a $320 price target for the stock.

Heading into the earnings report, expectations were running high. Through Tuesday trading, AeroVironment stock was up about 50% year to date. Increased focus on unmanned systems at the Defense Department has boosted investor sentiment.

AeroVironment plans to capitalize on that trend. “We are excited by the continued strength across both our Autonomous Systems and Space, Cyber and Directed Energy segments with record revenue and backlog,” said CEO Wahid Nawabi in a news release. “AeroVironment is exceptionally well-positioned to capture growing demand due to our innovative solutions and manufacturing capacity that can quickly scale to meet our customers’ expedited delivery timelines.”

Write to Al Root at allen.root@dowjones.com