AVEX · Aevex Corp.

AEVEX Corp. positions itself as a battle-tested prime contractor in the rapidly expanding unmanned systems market, delivering AI-enabled UAS/USV platforms critical for U.S. dominance in contested environments. With $433M revenue in 2025 (up 10% YoY) driven by marquee programs like Phoenix Ghost (4,400 units) and EUCOM Deep Strike ($646M, 4,800 UAS), the company showcases execution at scale—funded backlog surged 181% to $503M, 97% convertible in 2026. Tactical Systems (74% revenue) anchors growth via modular attritable UxS, while Global Solutions adds ISR/C-UAS services. Gross margins compressed to 21.8% from 28.1% due to EUCOM startup costs and supply chain pressures, flipping to a $17M net loss vs. $79M profit prior year, but Q1 2026 prelims signal rebound ($204M revenue, +283% YoY). The $293M IPO (16M shares at $19.50 midpoint) funds debt repayment ($258M term loan at 9.92%), deleveraging from 1.3x net debt/EBITDA while preserving $100M new term loan capacity. Post-IPO Up-C structure gives AEVEX 43% economics in Holdings LLC but full control; MDP retains 79% voting via Class B, qualifying as controlled company with dual-class risks. $8.1B pipeline and 28% competitive win rate position for TAM capture ($11B U.S. UxS by 2030), bolstered by NAC autonomy tech and ForgeX edge manufacturing (1,080 UAS/year per unit). Insider ownership aligns incentives, but risks loom: 78% U.S. Gov revenue vulnerable to budgets/DOGE cuts; unremediated material weaknesses; China/Russia sanctions on execs/supply chain; competition from AeroVironment/Anduril. TRA liability (~$368M over 15 years) pressures liquidity. At ~1.9x 2026E revenue (implied), valuation reflects growth but execution on margins/debt paydown critical for re-rating.