AIRO Shifts Full-Year Growth Outlook to Lower End

The Tip Desk · November 12, 2026 · 3 min read

Third-quarter revenue was $17.5 million, down from $43.2 million in the second quarter, as the drone maker booked a $13.1 million operating loss.

AIRO Group Holdings (AIRO), a global aerospace and defense company, reported third-quarter 2026 revenue of $17.5 million, a 179% increase from $6.3 million a year earlier, after a $43.2 million second quarter that had grown 76% year over year.

The sequential drop marked a reversal from the second quarter’s pace. The company said third-quarter 2025 results were adversely impacted by lower drone shipment volumes, creating a favorable comparison against the prior-year period. Revenue growth in the third quarter was driven by stronger-than-expected growth in the Drones segment, partially offset by continued softness in the Avionics and Training businesses.

Gross profit was $9.9 million, or 57% of revenue, up from 44% a year earlier. Gross margin compressed from 64% in the second quarter, after expanding from 27% in the first quarter. The company said the year-over-year expansion reflected a favorable mix shift toward higher-volume drone sales and improved operating efficiencies.

Profitability reversed from the second quarter. AIRO swung from operating income of $1.7 million to an operating loss of $13.1 million, versus an operating loss of $12.0 million a year earlier. Net loss was $12.0 million, or $0.38 a share, compared with a net loss of $8.0 million, or $0.28 a share, a year earlier. Adjusted EBITDA was a $7.5 million loss, compared with a $6.8 million profit in the second quarter and an $8.0 million loss a year earlier. The company attributed the operating and Adjusted EBITDA results to higher operating expenses associated with investments to scale the business, partially offset by improved revenue performance.

Research and development expense was $7.9 million, sales and marketing $3.7 million, and general and administrative $11.4 million.

Cash was $37.8 million as of September 30, 2026, with only $1.2 million of debt. Accounts receivable decreased by $29.6 million during the quarter, primarily from customer payments on Drone deliveries completed in prior periods.

Drone backlog, including U.S. opportunities, totaled approximately $200 million as of November 5, 2026, compared with $163 million at the end of the second quarter. Beginning with the third quarter of 2026, AIRO began including U.S. backlog in its reported Drones segment backlog, after prior-quarter figures excluded U.S. backlog. The company said it expects the majority of that backlog to convert to revenue over the next 12 months, and that revenue recognition may vary meaningfully across quarters depending on contract timing, production schedules and delivery milestones. Total opportunity pipeline was approximately $1.5 billion as of November 5, 2026.

Chief Executive Officer Joe Burns said the company secured its first U.S. order during the quarter and advanced the RQ-70 toward production.

The company reiterated its expectation for full-year 2026 revenue growth of 15% to 25% year over year and now expects growth to be at the lower end of the stated range. It also reiterated full-year 2026 Adjusted EBITDA guidance in the negative mid- to high-teens million-dollar range.