AIRO · AIRO Group Holdings, Inc. Common Stock

AIRO Group Holdings reported first quarter 2026 results reflecting expected variability as a newly public company, with revenue declining 25% year-over-year to $8.9 million due to normal seasonality, shipment timing, and a higher mix of lower-margin upgrade programs versus full system deliveries. Gross margin compressed to 26.6% from 58.8%, driven by this product mix shift, though management anticipates improvement as drone deliveries accelerate. Operating and net losses widened significantly to $(17.2) million and $(15.5) million, respectively, reflecting lower revenue, elevated cost of sales, and ongoing investments in engineering, production scaling at the Støvring facility, and public company infrastructure post-IPO. Adjusted EBITDA deteriorated to $(12.8) million from near-breakeven, underscoring investment timing. Balance sheet remains solid with $54.2 million cash and minimal $1.2 million debt as of March 31. Operationally, drone backlog held steady above $150 million into April, offering revenue visibility as most converts within 12 months. Strategic shifts include launching AI-enabled RQ-35 variant, prioritizing cargo/ISR drones like JX250/JC250 with first flight targeted 2026, scaling manufacturing 30% above backlog, and evaluating alternatives for the Training segment to focus on high-return drone opportunities. Management reiterated full-year revenue growth of 15-25%, supported by drone deliveries, international NATO demand, and partnerships, while introducing negative mid- to high-teens Adjusted EBITDA guidance to fund growth. Executives view Q1 as the yearly low point, positioning for acceleration amid robust pipeline.