ACHR 10-K & 10-Q changes, risk factors and insider trading
Archer Aviation Inc. · NYSE · Aircraft · CIK 1824502 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We are developing our eVTOL aircraft and related UAM operations, which remain in the early stages, and our business and future prospects are subject to significant risks.”
New heading “Our initial air taxi operations will be concentrated in a limited number of metropolitan areas.”
New heading “We may fail to realize the anticipated benefits from our planned operations at Hawthorne Airport.”
New heading “Our operations at Hawthorne Airport subject us to additional federal and state regulations that may result in additional costs.”
New heading “Our master ground lease with the City of Hawthorne for the property on which Hawthorne Airport is located may not be renewed or may be amended on unfavorable terms, potentially limiting our operations and increasing costs.”
New heading “A major health or safety incident could adversely affect our reputation, business and results of operations.”
New heading “Our business and reputation are impacted by information technology system failures and network disruptions.”
New heading “Our investment in AI initiatives and use of AI exposes us to risk, which could adversely affect our reputation, business, operating results, and financial condition.”
New heading “Our aircraft operations and infrastructure may be affected by adverse weather and other factors.”
New heading “We may face legal proceedings, which can be costly and time-consuming.”
New heading “Our Class A common stock price and trading volume may be affected by industry and financial analysts’ reports.”
Removed heading “We are still developing our eVTOL aircraft, have not yet obtained governmental certification of our eVTOL aircraft under development and have yet to manufacture or deliver any aircraft to customers, which makes evaluating our business and future prospects difficult and increases the risk of investment in our securities.”
Removed heading “We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy.”
Removed heading “Our aerial ride sharing operations will initially be concentrated in a small number of metropolitan areas, which makes our business particularly susceptible to infrastructure, economic, social, weather, regulatory conditions or other circumstances affecting these areas.”
Removed heading “Our ability to effectively compete and generate revenue from our products and services depends upon our ability to distinguish our products and services from our competitors and their products and services.”
Removed heading “Ineffective disclosure controls and procedures and internal control over financial reporting could also cause investors to lose confidence in our reported financial and other information, which would likely have a negative effect on the market price of our Class A common stock.”
Removed heading “We are subject to cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our aircraft, as well as our customer and other confidential data or proprietary information processed by us or third-party vendors.”
Removed heading “We are subject to risks associated with climate change, including the potential increased impacts of severe weather events on our operations and infrastructure.”
Removed heading “We are, and may in the future become, subject to legal proceedings, which may be time-consuming and expensive and, if adversely determined, could delay, limit or prevent our ability to commercialize our aircraft or otherwise execute on our business plans.”
Removed heading “Our management team has limited experience managing a public company.”
Removed heading “If securities analysts do not publish research or reports about our business or if they downgrade our Class A common stock or our sector, our Class A common stock price and trading volume could decline.”
Largest changes
“We are also planning on completing certain capital projects at Hawthorne Airport, including preparing the site for planned air tax operations in the Los Angeles area and for use during the LA28 Olympic Games. The estimated costs of, and the projected schedule for, our planned capital projects are subject to a number of uncertainties. …”see in full comparison
“We are subject to numerous U.S. and foreign laws, regulations, contractual obligations and industry standards relating to privacy, data protection, and consumer protection, including the California Consumer Privacy Act and the European Union and U.K. General Data Protection Regulations. These laws govern the collection, storage, retention, protection, use, processing, transmission, sharing and disclosure of personal information and impose obligations such as security safeguards, breach notifications, and rights for individuals to access or control their data. …”see in full comparison
“We are substantially reliant on our relationships with our suppliers and service providers for the parts and components in our aircraft. If any of these suppliers or service partners were unable to meet our demand for any reason, including as a result of supply chain constraints; quality control problems; natural or man-made disasters (including events related to climate change); import/export restrictions, such as new, expanded or retaliatory tariffs, sanctions, quotas or trade barriers (including recent U.S. …”see in full comparison
“The price of our Class A common stock and warrants may fluctuate due to various factors, including changes in macroeconomic, geopolitical, market, and industry conditions; volatility in interest rates, inflation, and currency exchange rates; supply chain disruptions; political events, regulatory developments, and acts of war or terrorism; our financial performance and guidance relative to expectations; actions by us or our competitors; strategic transactions and capital commitments; changes in management; declines in equity markets generally; future issuances or sales of our securities; …”see in full comparison
“•changes in macroeconomic or market conditions or trends in our industry or markets, such as inflation, recessions, volatility in interest rates, ongoing supply chain shortages, local and national elections, international currency fluctuations, uncertainty with respect to the federal budget and federal debt ceiling and potential government shutdowns related thereto, actual or perceived instability in the global banking sector, political instability and acts of war, such as the war in Ukraine and conflicts in the Middle East, or terrorism;”see in full comparison
see in full comparisonCurrent global politicalPolitical and macroeconomic conditions andtherelatedeffectseffects,thereof,suchincludingas inflation,volatileinterestrates,ratechanges involatility, tradeagreementsandorregulatoryregulations,changes, tariffs,uncertainty with respect to thefederal budget andfederaldebt ceilingand potential government shutdowns related thereto, actual or perceived instability in the globaluncertainty, bankingsector,sectortheinstability,wargeopoliticalin Ukraine and conflicts in the Middle East,conflicts, supply chainissues,disruptions, andanyregional or global economicdownturndownturns,orhaverecession in certain regions or worldwide have,affected and may continueto, adverselyto affect our business, strategy, financialconditioncondition, and results of operations. The existence of inflation in certain economies has resulted in, and may continue to result in, volatile interest rates and capital costs, supply shortages, increased costs of labor, components, manufacturing and shipping, as well as weakening exchange rates and other similar effects.AsOuramitigationresult,effortswemayhavebeexperiencedineffective or delayed, andmayadversecontinueconditionstocouldexperiencemateriallycost increases. Although we take measures to mitigate the effects of macroeconomic challenges, if these measures are not effective,harm our business,financialliquidity,condition,and results ofoperations and liquidity could be materially adversely affected.operation. Even if such measures are effective, there could be a delay between the adverse effect of macroeconomic conditions and the timing of when those beneficial actions impact our results of operations.
Full comparison: every changed paragraph (318)
As of December 31, 2024,2025, we incurred a net loss of $536.8$618.2 million, and we have incurred a net loss of approximately $1.7$2.3 billion since inception. We believeexpect that we willto continue to incurincurring operating and net losses each quarter until at least the time we begin generating significant revenues from our planned lines of business. Even if we are able to successfully launch our planned lines of business, there can be no assurance that such lines of businessthey will be financially viable.
We expect losses could increase as we develop and expand operations, including to:
We expect the rate at which we will incur losses could be significantly higher in future periods as we:
•continue to design, develop, manufacture,and certify and market our aircraft in the United States and other countries;
•continue to design and develop UAM networks and operations;
•expand our business lines and operations, including our defense program, operations at Hawthorne Airport, and aviation services and technologies;
•initiate and develop our new defense program;
•continue to utilizeengage third parties to assist us withon the design, development, manufacturing, certification and marketing of our aircraftproducts and UAM networkservices;
•continue to attract, retain and motivate talented employees;
•expand our aircraft manufacturing capabilities, including costs associated with the manufacturing of our aircraft;
•build up inventories of parts and components for our aircraft;
•manufacture an inventory of our aircraft;
•expand our design, development and servicing capabilities;
•increase our sales and marketing activities and develop our distribution infrastructure;
•work with third-party partners to develop pilot training programs; and
•increase our general and administrative functions to support our growing operations and operations as a public company.
Because we expect to incur the costs and expenses from these efforts before we receive any significant revenues with respect thereto, our losses in future periods are expected to be significant. In addition, we may find that these efforts are more expensive than we currently anticipate or that these efforts may not result in the revenues we expect, which could further increase our losses.
We are still developing our eVTOL aircraft, have not yet obtained governmental certification of our eVTOL aircraft under development and have yet to manufacture or deliver any aircraft to customers, which makes evaluating our business and future prospects difficult and increases the risk of investment in our securities.
We were incorporated in October 2018 and have a limited operating history in designing, developing, and working to certify an eVTOL aircraft. Our eVTOL aircraft is in the development stage and we are still working with the FAA in the U.S. and equivalent government authorities in certain other countries in an attempt to obtain type certification of our eVTOL aircraft. While we have received our Part 135 Air Carrier Certificate in the U.S. from the FAA and anticipate being able to obtain the remaining required authorizations and certifications, we may be unable to do so on our projected timeline or at all. As an organization, we have no experience in volume manufacturing of aircraft. Some of our current and potential competitors are larger and have substantially greater resources than we have and expect to have in the future. As a result, those competitors may be able to devote greater resources to the development of their current and future technologies, the promotion and sale of their offerings, and/or offer their technologies at lower prices. In particular, our competitors may be able to receive type, production or airworthiness certification from the FAA covering their eVTOL aircraft prior to us receiving such certifications. Our current and potential competitors may also establish cooperative or strategic relationships amongst themselves or with third parties that may further enhance their resources and offerings. Further, it is possible that domestic or foreign companies or governments, some with greater experience in the aerospace industry or greater financial resources than we possess, will seek to provide products or services that compete directly or indirectly with ours in the future. Any such foreign competitor, for example, could benefit from subsidies from, or other protective measures by, its home country from which we may not be able to benefit.
We cannot assure you that we or our partners will be able to develop manufacturing and supply chain capabilities that will enable us to meet the quality, price, engineering, design and production standards, as well as the production volumes, required to successfully commercialize our aircraft. You should consider our business and prospects in light of the risks and significant challenges we face as a new entrant into a new industry, including, among other things, with respect to our ability to:
•design and manufacture safe, reliable and quality aircraft on an ongoing basis;
•obtain the necessary regulatory approvals in a timely manner, including receipt of FAA certifications covering our aircraft and, in turn, any other government approvals necessary for manufacturing, marketing, selling and operating UAM networks or selling our aircraft, or for operating our defense program;
•build a well-recognized and respected brand;
•establish and expand our customer base;
•successfully market not just our aircraft but also the other services we intend to provide, such as aerial ride sharing services;
•successfully service our aircraft after sales and maintain a good flow of spare parts and customer goodwill;
•improve and maintain our operational efficiency;
•successfully execute our manufacturing and production model and maintain a reliable, secure, and scalable technology infrastructure;
•predict our future revenues and appropriately budget for our expenses;
•expand our aircraft manufacturing capabilities and manufacture an inventory;
•build inventories of parts and components for our aircraft;
•expand design, development and servicing capabilities;
•increase sales and marketing activities and develop distribution infrastructure; and
•develop pilot training programs.
We may also be unable to manage growth effectively, which could strain resources and create operational challenges such as hiring, training, and managing personnel, distracting management, and harming our brand and financial results. Expansion may require additional office space, infrastructure, personnel, and increased insurance coverage. We expect insurance needs and costs to rise as we build production facilities, manufacture aircraft, establish commercial operations, add routes, increase flight and passenger volumes, and expand into new markets. It is too early to predict the impact of commercial eVTOL operations on insurance costs, which may adversely affect our business, financial condition, and results of operations.
Because these costs are expected before significant revenues, our losses in future periods are expected to be significant. In addition, we may find that these efforts are more expensive than we currently anticipate or that these efforts may not result in the revenues we expect, which could further increase our losses.
We are developing our eVTOL aircraft and related UAM operations, which remain in the early stages, and our business and future prospects are subject to significant risks.
We were incorporated in October 2018 and have a limited operating history in designing, developing, and certifying eVTOL aircraft.Our eVTOL aircraft is in the development stage, and we depend on continued engagement with the FAA, DOT, and other regulators in the U.S. and certain other countries to obtain required certifications and authorizations for aircraft design, production, and operations. Delays, interruptions, or unwillingness by regulatory agencies to engage with us could postpone or prevent certification. For example, the U.S. government shutdown in 2025 disrupted operations at certain agencies, including the FAA. Although we plan to develop Hawthorne Airport into our flagship Los Angeles hub, including for the LA28 Olympic Games, there can be no assurance we will receive all required approvals on time, if at all. In addition, our competitors may obtain regulatory approvals in the U.S. or non-U.S. markets before we do.
Our operations also depend on the performance and availability of a Midnight aircraft platform, and any delays, defects, or grounding of this aircraft could significantly disrupt our business. In addition, we may face airspace integration and operational constraints, including airspace capacity limits, air traffic control restrictions, vertiport availability, and local operating limitations, which could reduce aircraft utilization, limit the number of flights we can operate, and adversely affect our business and the scaling of our planned operations.
We and our partners may not be able to obtain necessary production certificates, ramp up manufacturing, or develop supply chains capable of meeting quality, price, engineering, design, target aircraft specifications, and production standards, as well as required production volumes. We face significant challenges in the following areas, any of which could harm our business:
•designing, certifying, manufacturing, and operating safe, reliable, and quality aircraft that meet intended use cases and target aircraft specifications;
•obtaining and maintaining timely regulatory approvals for manufacturing, marketing, selling, operating UAM networks, or conducting defense-related programs;
•building and protecting a respected brand and expanding our customer base;
•marketing, selling, and servicing our aircraft and other technologies;
•maintaining spare parts availability and customer support;
•scaling manufacturing and operations efficiently;
•managing growth effectively;
•obtaining and maintaining adequate facilities and infrastructure;
•attracting, retaining, and motivating skilled employees; and
•adapting to technological change, competitive pressures, market trends, and evolving global regulations.
As an organization, we have no experience in volume aircraft manufacturing and we may be unable to scale our production to meet future demand or achieve targeted, cost, quality and delivery metrics. Some of our current and potential competitors are larger, have more experience in the aerospace industry or have substantially greater resources, enabling them to develop technologies faster, promote and sell offerings more effectively. In particular, our competitors may receive FAA or foreign government certifications for their eVTOL aircraft before we are able to do so. Competitors may also form strategic partnerships that enhance their capabilities, and some foreign competitors could benefit from subsidies or protective measures, placing us at a competitive disadvantage.
We are developing aircraft and related services intended to support multiple use cases and market entry strategies, which may not achieve our anticipated benefits. For example, through our Launch Edition program, we are offering aircraft, services and technologies to governments and customers to support the commercialization of our Midnight aircraft in markets outside the U.S., including early trial operations, pilot training, maintenance and certification support. Agreements with program partners remain conditional, and there is no assurance we will execute definitive agreements timely, or at all. In the U.S., we have applied for participation in the eIPP, but selection is not guaranteed. If selected, we plan to conduct trial operations in participating cities. Investments and expenses in early adopter markets and UAM networks, such as Southern California, including vertiport and charging infrastructure and customer-focused products and services, may not achieve anticipated competitive advantages or benefits.
•anticipate trends that may emerge and affect our business;
•anticipate and adapt to changing market conditions, including technological developments and changes in competitive landscape; and
•navigate an evolving and complex global regulatory environment.
If we fail to adequately address any or all of these risks and challenges, our business may be harmed.
We expect our capital expenditures and operating expenses to continue to be significant in the foreseeable future as we develop our aircraft and business, and thatto ourbe leveldriven ofprimarily capitalby expendituresaircraft development, certification, and operating expenses will be significantly affected by the aircraft development and certification process as well as subsequent customer demand for our aircraft.demand. We believe our current cash and cash equivalents and other sources of liquidity, including borrowingsexisting under our Credit Agreement,borrowings, will be sufficient to fund our current operating plan for at least the next 12 months. However, we expect that over the coming years we will continue to make significant investments in our business, including development of our aircraft and related technologies,technologies rampingand upservices manufacturing, building outfor our commercial and defense businesses, manufacturing ramp up, UAM networks,network build out, development of ourHawthorne defense program,Airport, and investments in our brand.
Our investments and expenses may be greater than currently anticipated or there may be investmentsunforeseen or expenses that are unforeseen,costs, and we may not succeed in acquiring sufficient capital to offset these expenses and achieve significant revenue generation. We have a limited operating history and no historical data on the demand for our planned commercialproducts and defense areas of our business.services. As a result, our future capital requirements are difficult to predict and our actual capital requirements may be different from those we currently anticipate. We may need to seek equity or debt financing to finance a portion of ourfund future capital requirements. Such financing might not be available to us when needed or on terms that are acceptable, or at all. Additionally, we also issue equity securities as consideration for products and services provided to us by certain vendors, which results in dilution to our stockholders.
Our ability to obtain the necessary capital to carry out our current business plan is subject to a number of factors, including general economic and market conditions, as well as investor sentiment regarding our planned business. These factors may make the timing, amount, terms and conditions of any such financing unattractive or unavailable to us. The current macroeconomic environment may increase our cost of financing or make it more difficult to raise additional capital on favorable terms, if at all. If we are unable to raise sufficient capital, we may have to significantly reduce our spending and/or delay or cancelcurtail ouroperations or planned activities. We might not be able to obtain any financing, and we might not have sufficient capital to conduct our business as projected, both of which could mean that we would be forced to curtail or discontinue our operations.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems. If any of our counterparties to our financial instruments, including funds held in uninsured deposit accounts, credit agreements, letters of credit and certain other financial instruments, are impacted by liquidity issues and placed into receivership, we may be unable to access such funds. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition.
Management's Discussion & Analysis (MD&A)
New heading “Cost of Revenue”
New heading “Cost of Revenue”
New heading “At-The-Market (“ATM”)”
New heading “Forward Purchase Agreement”
New heading “Registered Direct Offerings”
New heading “Vendor Share Issuances”
New heading “Business Combinations”
Removed heading “Other Warrant Expense”
Removed heading “Other Warrant Expense”
Largest changes
“In connection with the Hawthorne Airport acquisition, we assumed a $16.1 million loan with Banc of California. The loan bears a fixed interest rate of 6.3% and matures in April 2030, with an option to extend to April 2035 at a rate of the five-year U.S. Treasury plus 2.7%. The loan is secured by a leasehold deed of trust on the properties and contains representations, warranties, covenants, and indemnities customary for secured commercial real estate debt.”see in full comparison
“Our aircraft under development for Archer Defense is planned to be a hybrid-propulsion, Midnight-like VTOL aircraft with both a low thermal and acoustic signature purpose built for next generation defense use cases. We are jointly developing this aircraft with Anduril. …”see in full comparison
“We allocate the acquisition purchase price to the tangible and intangible assets acquired and liabilities assumed, based on their estimated fair values. The excess of the purchase price over the fair value of these assets acquired and liabilities assumed is recorded as goodwill. Allocation of the purchase price requires significant estimates in determining the fair value of acquired assets and assumed liabilities, especially with respect to intangible assets. Critical estimates include, but are not limited to, future expected cash flows, discount rates and expenses associated with an asset. …”see in full comparison
“Financial instruments, which subject us to concentrations of credit risk, consist primarily of cash and cash equivalents. Our cash and cash equivalents are held at several long-standing financial institutions located in the United States. At times, cash account balances with any one financial institution may exceed Federal Deposit Insurance Corporation insurance limits ($250 thousand per depositor per institution). We have not experienced any losses due to these excess deposits and believe this risk is not significant. …”see in full comparison
Full comparison: every changed paragraph (85)
Archer is developing the technologies and aircraft to power the future of advanced aviation. We are building a platform to deliver advanced aircraft, technologies and services to customers worldwide across commercial and defense sectors.
Midnight is our eVTOL aircraft purpose-built for air taxi operations globally. To prepare for commercial operations, we are working with aviation authorities, governments, and strategic partners in key U.S. and international markets to certify Midnight and build out air taxi networks. These planned networks will connect major population and business centers with key transportation hubs in select metropolitan areas through partnerships with airline operators to integrate eVTOL flights into passenger journeys and collaborations with infrastructure partners to develop vertiports.
•In the U.S., we have applied to participate in the eIPP, a White House initiative to accelerate air taxi deployments in American cities. We have partnered with cities across California, Florida, Texas, Georgia, and New York on multiple applications to launch initial air taxi operations under the eIPP later this year. As part of broader commercialization strategy in the U.S., we recently acquired control of the Hawthorne Airport located near Los Angeles International Airport and Downtown Los Angeles. We plan for the airport to serve as the operational hub for our Los Angeles network and an innovation hub for developing and commercializing next-generation AI-powered aviation technologies.
•Outside the U.S., through our Launch Edition program, we are offering aircraft, technologies, and services to governments and customers to support the commercialization of Midnight in select international markets with the UAE leading the way. In the UAE, we have been working closely with the country’s federal aviation regulator, the GCAA, over the past year to establish the optimal regulatory pathway for commercial operations. Following hot weather flight testing last year, we are on track to deliver additional Midnight aircraft this year in preparation for initial passenger operations and are working with strategic partners to build out a vertiport network across Abu Dhabi and the country.
Our commercial readiness progress is driving growing global demand across Europe, Middle East, Africa and Asia-Pacific for this new category of transportation.
We are also advancing a dual-use hybrid-electric, autonomous vertical take-off and landing (“VTOL”) aircraft platform for both defense and commercial customers. Through our strategic partnership with Anduril Industries Inc. (“Anduril”), this aircraft platform is intended to meet the vertical lift needs of the U.S. and its Allies for decades to come. For commercial customers, that aircraft can be tailored for cargo and medical evacuation.
We are currently scaling production of our aircraft and electric powertrain at our "golden manufacturing lines" in Silicon Valley and our high-volume facility in Georgia to support certification and early commercial deployments.
We are also developing artificial intelligence (AI) and autonomy technologies to support the advancement of our air traffic control system from concept to a scalable reality.
Headquartered in Silicon Valley, California, Archer is developing the technologies and aircraft to power the future of advanced aviation. We plan to provide customers with advanced aircraft and related technologies and services in the United States and internationally in both the commercial and defense sectors. We unveiled our first planned production aircraft, an eVTOL aircraft, Midnight, in November 2022. In December 2024, we launched Archer Defense, entering into a strategic partnership with Anduril to jointly develop a next-generation aircraft for defense applications. In December 2024, we completed construction of our high-volume aircraft manufacturing facility, ARC, located in Covington, Georgia. We plan to start our initial production of aircraft at this facility in the first half of 2025 and ramp our production there to support our commercialization efforts. We are first and foremost working to commercialize our Midnight aircraft which is intended to be used in air taxi operations in and around major cities around the world. To do so, we are working with aviation authorities, countries, cities, and strategic partners in select locations globally to obtain certification of our Midnight aircraft and build out UAM networks that will utilize our Midnight aircraft in their operations. Our goal is to begin early commercial operations with our Midnight aircraft in Abu Dhabi in the UAE and ramp our operations from there. In parallel, we plan to continue to advance the development of our aircraft for Archer Defense, as well as other technologies to support the future of advanced aviation.
By maintaining an innovative and disciplined approach to new product and service development, manufacturing, and commercialization we believe that we can deliver advanced aviation technologies and solutions that can service a broad range of industries and applications.use cases. We intend to operate in the following areas:
•Commercial: This is planned to consist of the sale of our commercial aircraft and related technologies and services, as well as providing direct-to-consumer air taxi services in select metropolitan areas worldwide.
•Commercial: This is planned to consist of the sale of our commercial aircraft (“Archer Direct”), such as Midnight, to aircraft operators as well as technologies and services related thereto, including, commercial launch (i.e., certification, testing, training, demonstration, market survey and early trial operations), and maintenance and repair. In addition, we plan to provide direct-to-consumer aerial ride share services utilizing our aircraft and potentially others in select metropolitan areas around the world with consumers being able to book rides via an app-based platform (“Archer UAM”).
•Defense: This is planned to consist of the sale of next-generation aircraft and related technologies for defense applications. Our initial product is intended to be athe hybrid-propulsionhybrid-electric VTOL aircraft discussed earlier that we are jointly developing with Anduril. Our team is advancing opportunities around at how we can bring the proprietary technologies we’ve built for our commercial aircraft to defense applications, such as our electric battery pack and electric engines. In November 2025, we announced our first deal for third-party adoption of these technologies in the defense sector, with Anduril and EDGE Group choosing to use our electric powertrain to power their Omen autonomous air vehicle. We have also been partneringcontinuing to advance our partnership with the DoDDoD, sincewhich 2021started in 2021, on a series of projects through the USAFUSAF’s AFWERX program with the goal of helping the AFWERX Agility Prime program assess the transformational potential of the vertical flight market and eVTOLrelated technologies for DoD purposes. We continue to advance this partnership and deliver under the related contracts we have entered into with the USAF, which include the delivery of our Midnight aircraft to the USAF, the sharing of additional flight test data and certification related test reports, pilot training, and the development of maintenance and repair operations.
To date, we have not generated significant revenue from these planned areas. We will use our cash and cash equivalents for the foreseeable future as we continue to develop our aircraft, related technologies, manufacturing operations and UAM operations, and work to commercialize both the commercial and defense sectors of our business.
To date, we have not generated significant revenue from either of these planned areas. We will use our cash and cash equivalents for the foreseeable future as we continue to develop our aircraft and technologies and services related thereto, manufacturing operations and work to commercialize our aircraft. The amount and timing of any future capital requirements will depend on many factors, including the pace and results of the design and development of our aircraft and manufacturing operations, as well as our progress in obtaining necessary aircraft certifications and other government approvals to begin commercial operations. For example, any significant delays in obtaining such certifications and other government approvals may require us to raise additional capital above our existing cash on hand and delay our generation of significant revenues.
Our Aircraft
Our Midnight aircraft is designed around our proprietary 12-tilt-6 distributed electric propulsion platform. Midnight is the evolution of our demonstrator aircraft, Maker, which we developed and used to validate its aircraft configuration and key enabling technologies. Midnight is designed to carry four passengers plus a pilot, bring an enhanced level of safety and deliver on a reduced level of noise as compared to traditional helicopters. Our Midnight aircraft is built around key advanced aviation technologies we have developed, including what we believe to be cutting-edge electric propulsion and flight control systems. We have paired those with systems and components sourced from leading aerospace suppliers many of which are already being used on certified aircraft today, with the goal of reducing Midnight’s certification risk, as well as its development timelines and costs. The aircraft is purpose-built for its intended use case of air taxi operations in major cities across the globe, with its range and payload being optimized around back-to-back short distance trips of around 20-miles, with minimal charging time between trips. Our approach to designing Midnight focuses on combining high function and high emotion, with the goal of inspiring passengers to want to experience it, similar to the feeling that was evoked during the Golden Age of aviation in the 1950s.
We continue to work to optimize our Midnight aircraft design for both manufacturing and certification. The development of an eVTOL aircraft that meets our business requirements demands significant design and development efforts on all facets of the aircraft. We believe that by bringing together a mix of talent with eVTOL, traditional commercial aerospace, as well as electric propulsion backgrounds, we have built a team that enables us to move through the design, development, and certification of our eVTOL aircraft, thus helping us to achieve our end goal of bringing to market our eVTOL aircraft as efficiently as possible. We continue to work to certify Midnight with certain aviation authorities around the globe so that it can be used in our planned commercial operations as soon as possible.
Our aircraft under development for Archer Defense is planned to be a hybrid-propulsion, Midnight-like VTOL aircraft with both a low thermal and acoustic signature purpose built for next generation defense use cases. We are jointly developing this aircraft with Anduril. Our goal is to bring together our ability to rapidly develop advanced VTOL aircraft using existing commercial parts and supply chains and Anduril's deep expertise in artificial intelligence, missionization, and systems integration, to accelerate the speed to market for critical hybrid VTOL aircraft capabilities at a fraction of the cost of more traditional alternatives. To support this effort, we intend to invest in the development of our hybrid-propulsion platform, as well as in critical capabilities like the manufacturing of composites and battery cells needed for this aircraft and also potentially on our commercial aircraft.
Revenue
We are still workingcontinue to design, develop, certify, and bring up manufacturing of our aircraft and thus have not generated revenue from any of our planned lines of business. We do not expect to begin generating significant revenues until we are able to complete the design, development, certification, and manufacturing bring upramp-up of our aircraftaircraft, andas well as the development of related technologies and services.
We began generating lease revenue from the leasing of hangar space at Hawthorne Airport in the fourth quarter of 2025. The lease income is recognized as earned over each monthly lease period beginning on the lease commencement date. We expect revenue to increase as we develop and bring additional hangar spaces into service and expand offerings.
Cost of Revenue
Cost of revenue primarily consists of master ground lease payments to the City of Hawthorne, utilities, property taxes, and insurance associated with the leased hangar space. Master ground lease payments are accounted for in accordance with ASC 842, Leases, while utilities, property taxes, and insurance are recognized as incurred. We expect cost of revenue to increase over time as operations expand.
Research and development activities represent a significant part of our business. Our research and development efforts focus on the design and development of our eVTOL aircraft, including certain of the systems that are used in it. As part of those activities, we continue to work closely with theU.S. Federaland Aviationinternational Administration (“FAA”)regulators towards our goal of achieving certification of our eVTOL aircraft on an efficient timeline.commercialization. Research and development expenses consist primarily of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for employees focused on research and development activities, costs associated with developing and building prototype aircraft, associated facilities and IT infrastructure costs, and depreciation. We expect research and development expenses to increase significantly as we progress towards the certificationcommercialization and manufacturing of our eVTOL aircraft.manufacturing.
We cannot determine with certainty the timing, duration or the costs necessary to complete the design, development, certification, and manufacturing bring up of our eVTOL aircraft due to the inherently unpredictable nature of our research and development activities. Development timelines, the probability of success, and development costs may differ materially from expectations.
General and administrative expenses consist primarily of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for employees associated with administrative services such as finance, legal, human resources, information technology, associated facilities and IT infrastructure costs, depreciation, and technologyTechnology and disputeDispute resolutionResolution agreementsAgreements (as defined in Note 7 - Commitments and Contingencies in the accompanying notes to our consolidated financial statements) expense. We expect our general and administrative expenses to increase as we hire additional personnel and consultants to support our operations and comply with applicable regulations.
Other Warrant Expense
Other warrant expense consists entirely of non-cash expense related to the vesting of warrants issued in conjunction with the execution of the United Purchase Agreement and the Warrant to Purchase Shares Agreement with United Airlines Inc. (“United”).
Interest income, net primarily consists of interest income from our cash and cash equivalents and short-term investments in marketable securities, net of interest on notes payable.debt.
Revenue increased by $0.3 million for the year ended December 31, 2025, compared to the year ended December 31, 2024 as we began generating revenue from the sublease of hangar space following the acquisition of Hawthorne Airport.
Cost of Revenue
Cost of revenue increased by $0.3 million or the year ended December 31, 2025, compared to the year ended December 31, 2024. This primarily consists of master ground lease payments, utilities, property taxes, and insurance associated with the leased hangar space.
Research and development expenses increased by $81.3$136.2 million, or 29.4%,38.1%, for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023,2024, asprimarily wedue investedto increased investment in people and materials to advance our technology development. The increase was primarily due to an increase of $42.4$48.4 million in personnel-related expenses due to a significant increase in our workforce from the prior year,expansion, an increase of $20.1$46.3 million in stock-based compensation expenses, andexpense, an increase of $17.4$23.6 million in costs related to professional services and tools and materials to support our increased research and development activities.activities, Theand remainderan increase of the$22.7 increasemillion wasin madefacilities, uptravel, and other operating costs. These increases were partially offset by a decrease of other$4.8 incidentalmillion items.in research and development warrant expenses related to the warrants issued to Stellantis (Note 11 - Warrants in the accompanying notes to our consolidated financial statements for further details).
General and administrative expenses decreased by $16.4 million, or 9.7%, for the year ended December 31, 2024, compared to the year ended December 31, 2023. The decrease was primarily due to a decrease of $58.3 million in the charge for the warrant issued to Wisk Aero LLC, to purchase up to 13,176,895 shares of our Class A common stock with an exercise price of $0.01 per share (the “Wisk Warrant”), and a decrease of $14.7 million in professional service expenses mainly due to legal fees and expenses. The decrease was partially offset by a reversal of previously recognized stock-based compensation expense of $59.1 million associated with the forfeiture of the unvested portion of the restricted stock units (“RSUs”) granted to our founders pursuant to the terms and conditions of the Business Combination Agreement immediately prior to closing (the “Founder Grant”) issued to the Company’s former co-CEO. See Note 7 - Commitments and Contingencies and Note 9 - Stock-Based Compensation to our consolidated financial statements for further details on our commitments and contingencies and stock-based compensation, respectively. The remainder of the decrease was made up of other incidental items.
Other Warrant Expense
OtherGeneral warrantand expenseadministrative decreasedexpenses increased by $2.1$83.4 million, or 100.0%,54.9%, for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The decreaseincrease was primarily due to thean vestingincrease of United$68.3 warrantsmillion associatedin withstock-based specificcompensation milestonesexpense, duringan increase of $8.1 million in personnel-related expenses due to an increase in our workforce from the prior year endedperiod, Decemberand 31,an 2023.increase of $13.8 million in professional services and IT infrastructure expenses. The warrantsincrease associatedwas withpartially theoffset specificby milestonesa fullydecrease vestedof $8.8 million in the firstcharge quarterfor ofthe 2023.warrant issued in connection with Technology and Dispute Resolution Agreements expense, which was fully exercised and settled in 2024. See Note 9 - Stock-Based Compensation in the accompanying notes to our consolidated financial statements for further details on our warrants.stock-based compensation. The remainder of the increase was made up of other incidental items.
Other income (expense), net decreasedincreased by $21.9$107.4 million, or 81.4%,220.1%, for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The decreaseincrease was primarily due to changes in fair value of our warrant liabilities. See Note 311 - SummaryWarrants ofin Significantthe Accountingaccompanying Policiesnotes to our consolidated financial statements for further details.
Interest income, net increased by $5.5$30.9 million, or 33.5%,141.1%, for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increase was primarily due to higher interest income from ourhigher average cash, cash equivalents and cashshort-term equivalents.investments.
As of December 31, 2024,2025, our principal sources of liquidity were cash, cash equivalents, and cashshort-term equivalentsinvestments of $834.5$1,964.7 million. We have incurred net losses since our inception and to date have not generated any revenues.significant revenues to date. We expect to incur additional losses and higher operating expenses for the foreseeable future. We believe that our existing cash, cash equivalents, and cashshort-term equivalentsinvestments will be sufficient to fund our operations for at least the next 12 months to meet our requirements and plans for cash,months, including meeting our working capital requirements and capital expenditure requirements.
Debt
On October 5, 2023, we entered into a $65.0 million credit agreement with Synovus Bank to fund the construction of our Covington, Georgia facility (the “Synovus Loan”). The loan bears interest at secured overnight financing rate (“SOFR”), plus 2.0% subject to a SOFR floor of 0.0% and requires interest-only payments for 36 months or through October 2026, followed by monthly principal and interest payments until maturity on October 5, 2033. The obligations are secured by specified cash and financial assets and are guaranteed by certain of our domestic subsidiaries. As of December 31, 2025, the facility was fully drawn at $65.0 million.
In connection with the Hawthorne Airport acquisition, we assumed a $16.1 million loan with Banc of California. The loan bears a fixed interest rate of 6.3% and matures in April 2030, with an option to extend to April 2035 at a rate of the five-year U.S. Treasury plus 2.7%. The loan is secured by a leasehold deed of trust on the properties and contains representations, warranties, covenants, and indemnities customary for secured commercial real estate debt.
At-The-Market (“ATM”)
On October 5, 2023, we entered into a credit agreement (the “Credit Agreement”) with Synovus Bank, as administrative agent and lender, and the additional lenders (the “Lenders”) from time to time. We may request the Lenders to provide multiple delayed term loan advances (together, the “Loan”) in an aggregate principal amount of up to $65.0 million for the construction and development of our manufacturing facility in Covington, Georgia. The Loan under the Credit Agreement shall accrue interest from and including the date the applicable advance is made but excluding the repayment date at a rate of the secured overnight financing rate (“SOFR”), plus 2.0% subject to a SOFR floor of 0.0%. We are required to make interest-only payments for 36 months on the Loan starting on November 14, 2023, followed by monthly interest and principal payments for the remaining maturity, with any outstanding principal, interest and other then outstanding indebtedness due at maturity. The Credit Agreement matures on the earlier of October 5, 2033 or the date on which the outstanding Loan has been declared or automatically becomes due and payable pursuant to the terms of the Credit Agreement. Our obligations under the Credit Agreement are jointly and severally guaranteed by our current and future wholly-owned domestic subsidiaries, and are secured by cash, general intangibles, instruments, securities, financial assets, security entitlements and other property maintained in a money market account at Synovus Bank. As of December 31, 2024, we had drawn down $65.0 million of the Loan.
In November 2023, we filed a shelf registration statement on Form S-3 with the SEC and a related prospectus supplement pursuant to which we may, from time to time, sell shares of our Class A common stock, having an aggregate value of up to $70.0 million, pursuant to a Controlled Equity OfferingSM Sales Agreement (the “Sales Agreement”) with the placement agent (the “First ATM Program”). The First ATM Program was fully utilized in May 2024. During the years ended December 31, 2024 and 2023, we sold 10,275,033 and 3,109,097 shares of Class A common stock, respectively, under the First ATM Program, for net proceeds of $48.1 million and $19.5 million, respectively. The First ATM Program was fully utilized in May 2024.
In May 2024, we filed aan additional shelf registration statement on Form S-3 with the SEC that permits the offering of an aggregate of up to $95.0 million of shares of our Class A common stock or preferred stock, debt securities, warrants, and units (the “2024 Shelf Registration Statement”), including a prospectus for the sale under the Sales Agreement of shares of our Class A common stock, having an aggregate value of up to $70.0 million (the “Second ATM Program”). The Second ATM Program was fully utilized in November 2024. During the year ended December 31, 2024, we sold 20,644,100 shares of Class A common stock under the Second ATM Program for net proceeds of $68.0 million. The Second ATM Program was fully utilized in November 2024.
In November 2024, we filed a shelf registration statement on Form S-3ASR with the SEC and a related prospectus for the sale under the Sales Agreement of shares of our Class A common stock, having an aggregate value of up to $70.0 million (the “Third ATM Program”, and together with the First ATM Program and the Second ATM Program, the “ATM Program”). During the year ended December 31, 2024, we sold 2,052,484 shares of Class A common stock under the Third ATM Program for net proceeds of $21.7 million. AsDuring ofthe year ended December 31, 2024, we had $47.5 million remaining eligible for sales under2025, the Third ATM Program.program was fully utilized in July 2025, resulting in the sale of 3,921,875 shares for net proceeds of $46.3 million.
Forward Purchase Agreement
We pay the placement agent a commission rate of up to 3.0% of the gross proceeds from any shares of Class A common stock sold through the Sales Agreement.
PIPE Financing
On December 11, 2024, we entered into subscription agreements with certain investors providing for the private placement of our Class A common stock at a purchase price of $6.65 per share (the “Second 2024 PIPE Financing”, and together with the First 2024 PIPE Financing, the “2024 PIPE Financings”), pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. A portion of the Second 2024 PIPE Financing closed on December 13, 2024 for 63,909,776 shares of our Class A common stock for net proceeds of approximately $407.7 million, after deducting offering costs. The remaining portion of the Second 2024 PIPE Financing covering an aggregate of 751,879 shares of our Class A common stock to be issued and sold to Stellantis for anticipated gross proceeds of approximately $5.0 millionmillion, iswhich remains subject to the satisfaction of certain closing conditions, including approval by our stockholders.conditions.
Registered Direct Offerings
On February 12, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated February 11, 2025, by and between us and certain institutional investors, we issued and sold 35,500,000 shares of our Class A common stock for gross proceeds of $301.8 million, after deducting offering costs.
On June 16, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated June 12, 2025, by and between us and certain institutional investors, we issued and sold 85,000,000 shares of our Class A common stock for gross proceeds of $850.0 million, after deducting offering costs.
On November 10, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated November 6, 2025, by and between the Company and certain institutional investors, the Company issued and sold 81,250,000 shares of our Class A common stock for gross proceeds of $650.0 million, after deducting offering costs.
Vendor Share Issuances
During the years ended December 31, 2025, and 2024, we issued 15,045,913, and 1,685,994 shares of Class A common stock to certain vendors to satisfy $126.8 million and $5.8 million of our current and/or future obligations to those vendors, respectively.
•the level of research and development expenses we incur as we continue to develop our eVTOLaircraft, aircraft and other productstechnologies and services to be provided in our planned business lines;
•capital expenditures for vertiport infrastructure, UAM networks, and related facilities, including the transformation of Hawthorne Airport into our flagship Los Angeles hub, airport and hangar redevelopment, and the development and deployment of advanced aviation technologies;
What changed in the latest 10-Q
Risk Factors
New heading “Risks Related to the Proposed Acquisition of the Target Companies”
New heading “The Acquisition may not be completed on the anticipated timeline, or at all, and the Purchase Agreement may be terminated in accordance with its terms.”
New heading “Consummation of the Acquisition will cause immediate dilution to our existing stockholders. We will also face further dilution if we exercise our right to require Boeing to participate in a future equity offering.”
New heading “Upon consummation of the Acquisition, Boeing will continue to have influence over the Company causing potential conflicts of interest.”
New heading “We have and will incur significant costs in connection with the Acquisition and integration of the Target Companies, which may be in excess of those anticipated by us.”
New heading “We may not successfully integrate the Target Companies or realize the anticipated benefits of the Acquisition on the anticipated timeline or at all.”
Largest changes
“Consummation of the Acquisition will cause immediate dilution to our existing stockholders. We will also face further dilution if we exercise our right to require Boeing to participate in a future equity offering.”see in full comparison
“We have and will incur significant costs in connection with the Acquisition and integration of the Target Companies, which may be in excess of those anticipated by us.”see in full comparison
“The Acquisition may not be completed on the anticipated timeline, or at all, and the Purchase Agreement may be terminated in accordance with its terms.”see in full comparison
“We may not successfully integrate the Target Companies or realize the anticipated benefits of the Acquisition on the anticipated timeline or at all.”see in full comparison
“Upon consummation of the Acquisition, Boeing will continue to have influence over the Company causing potential conflicts of interest.”see in full comparison
“On the Acquisition Closing Date, we will issue Boeing a number of shares of Class A Common Stock equal to 19.75% of our shares outstanding immediately prior to Closing, subject to a downward adjustment tied to the Target Companies' estimated cash, indebtedness, and unpaid transaction expenses on the Acquisition Closing Date. …”see in full comparison
Full comparison: every changed paragraph (15)
Risks Related to the Proposed Acquisition of the Target Companies
The Acquisition may not be completed on the anticipated timeline, or at all, and the Purchase Agreement may be terminated in accordance with its terms.
Completion of the Acquisition is subject to the satisfaction or waiver of certain agreed-upon closing conditions, a number of which are not within our control, including receipt of required regulatory approvals and the satisfaction of other conditions specified in the Purchase Agreement. There can be no assurance that all required conditions will be satisfied (or waived) on a timely basis or at all, or that the Acquisition will be completed on the currently anticipated timeline. Delays in obtaining regulatory approvals, including foreign regulatory and export approvals, litigation relating to the transaction, the imposition of conditions, limitations, divestiture requirements or other remedies by governmental authorities, or the failure to satisfy other closing conditions could delay or prevent completion of the Acquisition. In addition, the Purchase Agreement may be terminated in accordance with its terms.
The Purchase Agreement also places certain restrictions around equity capital financings prior to the completion of the Acquisition, including by limiting our ability to issue Class A Common Stock below a specified price prior to a specified date, subject to customary exceptions, and by conditioning whether shares issued in an equity financing will be excluded from the calculation of Consideration Shares. These restrictions could limit our financing flexibility prior to the completion of the Acquisition.
If the Acquisition is delayed or not completed, we may not realize the anticipated strategic, operational and financial benefits of the transaction, and our business, financial condition, results of operations and stock price could be adversely affected.
Consummation of the Acquisition will cause immediate dilution to our existing stockholders. We will also face further dilution if we exercise our right to require Boeing to participate in a future equity offering.
On the Acquisition Closing Date, we will issue Boeing a number of shares of Class A Common Stock equal to 19.75% of our shares outstanding immediately prior to Closing, subject to a downward adjustment tied to the Target Companies' estimated cash, indebtedness, and unpaid transaction expenses on the Acquisition Closing Date. If such estimated cash, net of indebtedness and unpaid transaction expenses, is below an agreed target amount, the number of shares issued will be reduced by a number of shares equal in value to such shortfall, based on the volume-weighted average price ("VWAP") of our Class A Common Stock for the five trading days ending on the trading day immediately prior to the Acquisition Closing Date. If such amount instead exceeds the target cash amount, the excess will be provided to Boeing. We will also issue two warrants, each covering $100.0 million of our Class A Common Stock. The number of shares covered by the warrants is determined based on the 5-day VWAP on the trading day immediately prior to the Acquisition Closing Date, with exercise prices of $13.00 and $17.88 per share, respectively. The issuance of the warrants may depress our stock price in anticipation of exercise and will cause further dilution if and when exercised. If we do not obtain stockholder approval of the issuance of the shares underlying the warrants before the warrants are exercisable, we may be required to settle the warrants, in cash rather than shares of our Class A Common Stock, based on the value of our Class A Common Stock at the time of settlement, which could require a significant cash outlay and adversely affect our liquidity and financial condition.
In addition, the Company and Boeing have entered into a Forward Equity Purchase Agreement, pursuant to which the Company may require Boeing to participate in an equity offering for up to $55.0 million, at the lowest price per share as other purchasers in such offering. Any issuances under the Forward Equity Purchase Agreement would result in further dilution to our stockholders.
Upon consummation of the Acquisition, Boeing will continue to have influence over the Company causing potential conflicts of interest.
Following the Acquisition Closing Date, Boeing is expected to hold approximately 16.5% of our outstanding Class A Common Stock (without giving effect to the exercise of any warrants held by Boeing), and will have the right to designate one individual for nomination to our board of directors for so long as it holds at least the number of shares equal to 10% of our outstanding shares immediately prior to the Acquisition Closing Date. Boeing’s interests, including in matters that come before our board, may differ from those of our other stockholders, which could result in stockholder litigation, heightened regulatory or proxy advisor scrutiny, or the need for additional governance safeguards.
We have and will incur significant costs in connection with the Acquisition and integration of the Target Companies, which may be in excess of those anticipated by us.
We have incurred and expect to continue to incur costs associated with negotiating and completing the Acquisition and integrating the operations of the Target Companies. These costs have been, and will continue to be, substantial. The majority of costs will consist of transaction costs related to the Acquisition and include, among others, fees paid to financial, legal and accounting advisors, filing fees, employee retention costs and other employment-related costs. Many of these costs will be borne by us even if the Acquisition is not completed.
If the Acquisition is completed, we will also incur transaction costs, some of which may be unanticipated, related to integrating the Target Companies, including facilities, systems and service contract consolidation costs and employment‑related costs. Additionally, securities or derivative litigation is common following the announcement of transactions like this one and, even if without merit, could result in substantial defense costs or other unanticipated liabilities. The costs described above, as well as other unanticipated costs and expenses, could adversely affect our results of operations and financial condition.
We may not successfully integrate the Target Companies or realize the anticipated benefits of the Acquisition on the anticipated timeline or at all.
Even if the Acquisition is completed, we may not successfully integrate the Target Companies or realize the expected benefits of the Acquisition on the anticipated timeline or at all. For example, the Target Companies’ technologies and businesses and our existing business operate under different regulatory and customer regimes, and integrating them successfully, including retaining key and security-cleared personnel, may take longer or cost more than expected, or may not succeed at all. In particular, our management team has limited experience operating a business of the type conducted by Insitu, particularly its defense contracting and unmanned systems operations, and may encounter unanticipated operational, regulatory, or customer-relationship challenges in managing that business following Closing. Additionally, we will be newly subject to U.S. and foreign government-contracting and export-control regimes applicable to the combined business, which will require additional compliance investment. The integration may be complex and time-consuming. For these and other reasons, it is possible that the integration process could result in the diversion of management’s attention, the disruption of our ongoing business or inconsistencies in operations, controls, policies and procedures, any of which could adversely affect our business, financial condition and results of operations.
Management's Discussion & Analysis (MD&A)
New heading “Proposed Acquisition of Wisk, Insitu and SkyGrid”
Largest changes
“General and administrative expenses increased by $83.1 million, or 88.4%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase was primarily due to an increase of $34.8 million in stock-based compensation expense, an increase of $11.7 million in personnel-related expenses, driven by an increase in our workforce, an increase of $22.1 million in professional services and IT infrastructure expenses, an increase of $8.4 million in facilities, travel, and other operating costs and an increase of $6.0 million for litigation settlement-related expense.”see in full comparison
General and administrative expenses increased bysee in full comparison$42.9$40.2 million, or106.5%,74.9%, for the three months endedMarchJune31,30, 2026, compared to the three months endedMarchJune31,30, 2025. The increase was primarily due to an increase of$19.4$15.5 million in stock-based compensation expense, an increase of$6.4$9.3 million in professional services and IT infrastructure expenses, an increase of $6.0 million for litigation settlement-related expense, an increase of $5.3 million in personnel-related expenses, driven by an increase in our workforce,an increase of $12.8 million in professional services and IT infrastructure expenses,and an increase of$4.3$4.1 million in facilities, travel, and other operating costs.
“We are also developing physical AI and autonomy technologies to support the advancement of our aircraft and the modernization of U.S. and international airspace and air traffic control systems . …”see in full comparison
Headquartered in Silicon Valley, California, Archer issee in full comparisondevelopingbuildingtheantechnologiesend-to-end advanced air mobility platform that delivers air taxis, unmanned aircraft systems (“UAS”), aviation-related physical artificial intelligence (“AI”) solutions, andaircraft to power the future of aerospace and defense. We are building a platform to deliver advanced aircraft,other technologiesand servicesto customers worldwide across the commercial aerospace and defense sectors.
“On August 9, 2026, we entered into a definitive Equity Purchase Agreement (the “Purchase Agreement") with The Boeing Company (”Boeing”) to acquire all of the equity interests of Wisk Aero LLC, an autonomous aviation company, SkyGrid, a digital airspace integration and air traffic management platform, and Insitu, Inc., a manufacturer of unmanned aircraft systems and AI-enabled technologies, together with certain of their respective related entities (collectively, the “Target Companies” and such acquisition, the “Acquisition”) for total consideration consisting of (i) shares of our Class A …”see in full comparison
Full comparison: every changed paragraph (46)
Headquartered in Silicon Valley, California, Archer is developingbuilding thean technologiesend-to-end advanced air mobility platform that delivers air taxis, unmanned aircraft systems (“UAS”), aviation-related physical artificial intelligence (“AI”) solutions, and aircraft to power the future of aerospace and defense. We are building a platform to deliver advanced aircraft,other technologies and services to customers worldwide across the commercial aerospace and defense sectors.
Air Taxis
Midnight is our electric vertical takeoff and landing (eVTOL) aircraft purpose-built for air taxi operations in major cities.operations. To prepare for commercial operations, we are working with aviation authorities, governments, and strategic partners in key U.S. and international markets to certify Midnight and build out air taxi networks. These planned networks will connect major population and business centers with key transportation hubs in select metropolitan areasareas, through partnerships with airline operators to integrate eVTOL flights into passenger journeys and collaborations with infrastructure partners to develop vertiports.
•In the U.S., we were recently selected as a partner in multiple winning applications under the White House-backed electric vertical takeoff and landing (eVTOL) Integration Pilot Program (eIPP). Through the program, we have the opportunity to begin early operations this year in several key states, such as Florida, Texas and New York. The eIPP paves the way for us to bring our technology directly to U.S. communities in parallel with our continued work to receive FAA type certification of Midnight. As part of our broader commercialization strategy in the U.S., we recently acquired control of the Hawthorne Airport located near Los Angeles International AirportAirport, SoFi Stadium and Downtown Los Angeles. We plan for the airportHawthorne to serve as the operational hub for our Los Angeles network and an innovation hub for developing and commercializing next-generation AI-powered aviation technologies.
•Outside the U.S., through our Launch Edition program, we are offering aircraft, technologies, and services to governments and customers to support the commercialization of Midnight in select international markets, with the UAE leading the way. In the UAE, we have been working closely with the country’s federal aviation regulator, the GCAA, to establish the optimal regulatory pathway for commercial operations. Following hot weather flight testing last year, we are on track to deliver additional Midnight aircraft this yearyear, in preparation for initial passenger operations and are working with strategic partners to build out a vertiport network across Abu Dhabi and the country.UAE.
UAS
We are also advancing the development of our hybrid-electric, autonomous vertical take-off and landing (“VTOL”) aircraft platformplatform, called Halo, intended for dual use by both civilcommercial and defense customers. As part of the defense opportunities with this development effort,aircraft, we are working closely with our strategic partner, Anduril Industries Inc. (“Anduril”), to ensure this platform meets thetheir next generation vertical lift aircraftneeds, needswhich are based on what they believe is necessary to win programs of therecord U.S.with andallied its Allies.nations. For commercial customers, that aircraftHalo is expected to be used primarily for cargo and rescue operations.
AI
We are also developing physical AI and autonomy technologies to support the advancement of our aircraft and the modernization of U.S. and international airspace and air traffic control systems . We recently announced our aviation-specific AI foundation model, ZEE, that is purpose-built to turn disparate data from ADS-B, ATC communication, maps and charts, aircraft state, terrain and weather into a unified intelligence layer that can help operators, airlines and pilots make better, more informed decisions with the goal of increasing safety and efficiency across the entire aviation system, from air taxis and UAS to commercial airlines and air traffic management.
We are currently developing and scaling production of these aircraft and the components we build in-house across our test and manufacturing facilities in California and Georgia.
We are also developing artificial intelligence and autonomy technologies to support the advancement of our air traffic control system from concept to a scalable reality.
•Commercial: This is planned to primarily consist of the sale of our piloted, commercial aircraftaircraft, physical AI solutions and related technologies and services, as well as providing direct-to-consumer air taxi services in select major cities.services.
•Defense: This is planned to primarily consist of the sale of next-generation aircraftUAS, physical AI solutions and related technologies throughand our Anduril partnershipservices for defense applications.
To date, we have not generated significant revenue from these planned areas. We will use our cash and cash equivalents for the foreseeable future as we continue to develop our aircraft, related technologies, manufacturing operations and urban air mobility (“UAM”) operations, and work to commercialize both the commercial and defense sectors of our business.
Proposed Acquisition of Wisk, Insitu and SkyGrid
On August 9, 2026, we entered into a definitive Equity Purchase Agreement (the “Purchase Agreement") with The Boeing Company (”Boeing”) to acquire all of the equity interests of Wisk Aero LLC, an autonomous aviation company, SkyGrid, a digital airspace integration and air traffic management platform, and Insitu, Inc., a manufacturer of unmanned aircraft systems and AI-enabled technologies, together with certain of their respective related entities (collectively, the “Target Companies” and such acquisition, the “Acquisition”) for total consideration consisting of (i) shares of our Class A common stock representing approximately 19.75% (subject to closing adjustments) of our shares outstanding immediately prior to the closing date of the Acquisition (the “Acquisition Closing Date”) and (ii) two warrants, each covering $100.0 million of Class A common stock, with the first warrant, with an exercise price of $13.00 per share, exercisable during the period beginning on the first anniversary through the third anniversary of the Acquisition Closing Date, and the second warrant, with an exercise price of $17.88 per share, exercisable during the period beginning on the first anniversary through the fourth anniversary of the Acquisition Closing Date. Under the terms of the Purchase Agreement, completion of the Acquisition is subject to agreed upon closing conditions, including regulatory clearances and required consents.
For additional detail on the Acquisition, see the Current Report on Form 8-K filed on August 10, 2026, and Item 1A, “Risk Factors” of this Quarterly Report on Form 10-Q.
We began generating lease revenue from the leasing of hangar space at Hawthorne Airport in the fourth quarter of 2025. TheLease lease incomerevenue is recognized ason earneda straight-line basis over each monthlythe lease periodterm, beginning on the lease commencement date. In the second quarter of 2026, we also began generating FBO revenue from aviation fueling, ground handling, and related services at Hawthorne Airport. We expect revenue from both our hangar and FBO operations to increase as we develop and bring additional hangar spaces into service and expand offerings.FBO service offerings at Hawthorne Airport.
Cost of revenue primarily consists of master ground lease payments to the City of Hawthorne, utilities, depreciation, property taxes,fuel and insurancesupplies costs associated with theFBO leasedoperations, hangaramortization space.of operating rights, depreciation and other operating costs. Master ground lease payments are accounted for in accordance with ASC 842, Leases,Leases. while utilities, property taxes,Fuel and insurancesupplies costs are recognized as incurred upon delivery of services. Amortization of operating rights associated with the Hawthorne FBO acquisition is recognized on a straight-line basis over their respective estimated useful lives. All other costs are recognized as incurred. We expect the cost of revenue to increase overas time asFBO operations expand.scale and we bring additional spaces into service.
Comparison of the Three and Six Months Ended MarchJune 31,30, 2026 and 2025
Revenue increased by $1.6$5.0 million for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025 as we primarilygenerated generated$3.0 million revenue from FBO operations, $1.0 million revenue from the lease of hangar space at Hawthorne Airport.Airport and $1.0 million revenue from other sources.
Revenue increased by $6.6 million for the six months ended June 30, 2026, compared to the six months ended June 30, 2025 as we generated $3.0 million revenue from FBO operations, $2.0 million revenue from the lease of space at Hawthorne Airport and $1.6 million from other sources.
Cost of revenue increased by $1.3$4.3 million for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025. This increase primarily consisted of fuel and supplies costs associated with FBO operations, amortization of operating rights and master ground lease expense, which is accounted for in accordance with ASC 842, Leases, depreciation, utilities, property taxes, and insurance associated with the leased hangar space.spaces.
Cost of revenue increased by $5.6 million for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. This increase primarily consisted of fuel and supplies costs associated with FBO operations, amortization of operating rights and master ground lease expense, depreciation, utilities, property taxes, and insurance associated with the leased spaces.
Research and development expenses increased by $68.0$63.6 million, or 65.6%,52.0%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, primarily due to increased investment in people and materials to advance technology development. The increase consisted of $22.7$27.8 million in personnel-related expenses driven by workforce expansion, $21.0$18.3 million in stock-based compensation expense, $17.2$12.7 million in engineering services and tools and materials to support our increased research and development activities, and $7.1$4.7 million in facilities, travel, and other operating costs.
Research and development expenses increased by $131.6 million, or 58.2%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to increased investment in people and materials to advance technology development. The increase consisted of $50.5 million in personnel-related expenses driven by workforce expansion, $39.3 million in stock-based compensation expense, $29.9 million in engineering services and tools and materials to support our increased research and development activities, and $11.8 million in facilities, travel, and other operating costs.
General and administrative expenses increased by $42.9$40.2 million, or 106.5%,74.9%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to an increase of $19.4$15.5 million in stock-based compensation expense, an increase of $6.4$9.3 million in professional services and IT infrastructure expenses, an increase of $6.0 million for litigation settlement-related expense, an increase of $5.3 million in personnel-related expenses, driven by an increase in our workforce, an increase of $12.8 million in professional services and IT infrastructure expenses, and an increase of $4.3$4.1 million in facilities, travel, and other operating costs.
General and administrative expenses increased by $83.1 million, or 88.4%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase was primarily due to an increase of $34.8 million in stock-based compensation expense, an increase of $11.7 million in personnel-related expenses, driven by an increase in our workforce, an increase of $22.1 million in professional services and IT infrastructure expenses, an increase of $8.4 million in facilities, travel, and other operating costs and an increase of $6.0 million for litigation settlement-related expense.
Other income (expense), net decreasedincreased by $21.4$41.8 million, or 51.0%,104.5%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025. The decreaseincrease was primarily due to non-cash changes in fair value of our warrant liabilities. Refer to Note 12 - Warrants in the accompanying notes to our condensed consolidated financial statements for further details.
Other income (expense), net increased by $20.4 million, or 1020.0%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase was primarily due to non-cash changes in fair value of our warrant liabilities.
Interest income, net increased by $7.7$4.0 million, or 88.5%,39.2%, for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to higher interest income from higher average cash, cash equivalents and short-term investments.
Interest income, net increased by $11.7 million, or 61.9%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily due to higher interest income from higher average cash, cash equivalents and short-term investments.
As of MarchJune 31,30, 2026, our principal sources of liquidity were cash, cash equivalents, and short-term investments of $1,775.9$1,560.6 million. We have incurred net losses since inception and have not generated any significant revenues to date. We expect to incur additional losses and higher operating expenses for the foreseeable future. We believe that our existing cash, cash equivalents, and short-term investments will be sufficient to fund our operations for at least the next 12 months, including meeting our working capital and capital expenditure requirements.
On October 5, 2023, we entered into a $65.0 million credit agreement with Synovus Bank to fund the construction of our Covington, Georgia facility (the “Synovus Loan”). The loan bears interest at secured overnight financing rate (“SOFR”), plus 2.0% subject to a SOFR floor of 0.0% and requires interest-only payments for 36 months or through October 2026, followed by monthly principal and interest payments until maturity on October 5, 2033. The obligations are collateralized by specified cash and financial assets and are guaranteed by certain of our domestic subsidiaries. As of MarchJune 31,30, 2026, the facility was fully drawn at $65.0 million.
On February 12, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated February 11, 2025, by and between us and certain institutional investors, we issued and sold 35,500,000 shares of our Class A common stock for gross proceeds of $301.8 million, after deducting offering costs.million.
On June 16, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated June 12, 2025, by and between us and certain institutional investors, we issued and sold 85,000,000 shares of our Class A common stock for gross proceeds of $850.0 million, after deducting offering costs.million.
On November 10, 2025, we closed a registered direct offering in which pursuant to the securities purchase agreement dated November 6, 2025, by and between us and certain institutional investors, we issued and sold 81,250,000 shares of our Class A common stock for gross proceeds of $650.0 million, after deducting offering costs.million.
During the threesix months ended MarchJune 31,30, 2026 and 2025, we issued 6,547,560,11,093,897 and 1,906,1614,331,384 shares of Class A common stock, respectively, to certain vendors to satisfy $42.1$70.6 million and $13.6$40.2 million of our current and future vendor obligations.
The following includes our short-term and long-term material cash requirements from known contractual obligations as of MarchJune 31,30, 2026:
We continue to experience negative cash flows from operations as we are still working to design, develop, certify, and bring up manufacturing of our aircraft and thus have not generated any significant revenues from either of our planned lines of business. Our cash flows from operating activities primarily reflect our continued investments to support the growth of our research and development activities and related general and administrative functionsfunctions. Our operating cash flows are also impacted by the working capital requirements to support growth and fluctuations in personnel-related expenditures, accounts payable, accrued interest and other current liabilities, and other current assets.
Net cash used in operating activities during the threesix months ended MarchJune 31,30, 2026 was $149.1$305.5 million, resulting from a net loss of $217.7$480.9 million, reflecting our continued investment in our research and development activities. The net loss adjustment for non-cash items consists primarily of $70.4$156.0 million in stock-based compensation expense, a gain of $22.8$26.9 million due to a change in fair value of our warrant liabilities, and $7.8$17.9 million in depreciation and amortization. The net cash used infrom changes in our net operating assets and liabilities was $8.5$19.4 million.
Net cash used in operating activities during the threesix months ended MarchJune 31,30, 2025 was $94.6$198.0 million, resulting from a net loss of $93.4$299.4 million, adjusted for non-cash items consisting primarily of a gain of $41.7 million due to a change in fair value of our warrant liabilities, and $30.1$81.9 million in stock-based compensation.compensation, and $8.9 million in depreciation and amortization. The net cash provided by changes in our net operating assets and liabilities was $4.7$8.9 million.
Net cash provided by investing activities during the threesix months ended MarchJune 31,30, 2026 was $78.7$131.6 million, driven by proceeds from maturities of short-term investments of $115.0$230.0 million, partially offset by purchases of property and equipment of $32.6$69.7 million and business acquisition of $3.7$28.7 million.
Net cash used in investing activities during the threesix months ended MarchJune 31,30, 2025 was $10.0$34.1 million, driven by purchases of property and equipment of $28.9 million and acquisition of intangible assets of $5.2 million within the period.
Net cash provided by financing activities during the threesix months ended MarchJune 31,30, 2026 was immaterial,$5.1 reflectingmillion, $0.1driven by $5.3 million of net proceeds from employee stock option exercises and purchases under our employee stock purchase plan, partially offset by $0.2 million of principal repayments on debt, offset by $0.1 million of proceeds from employee stock option exercises.debt.
Net cash provided by financing activities during the threesix months ended MarchJune 31,30, 2025 was $300.2$1,121.3 million, driven by gross proceeds from the registered direct offering of $301.8$1,151.8 million, gross proceeds from the First 2024 PIPE Financing of $10.0 million, partially offset by payments of offering costs in connection with financing activities for $11.6$44.3 million.
ACHR insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 11 filings (5 insiders, 6 trade dates, 522,947 shares, about $3.2M; 2 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: -522,947 (purchases minus sales); net value about -$3.2M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-09-21 | Lyon Benjamin |
Open-market sale |
45,359 | $5.43 | $246.3K |
| 2026-08-20 | Lentell Eric |
Open-market sale |
100,000 | $6.31 | $631.0K |
| 2026-08-17 | Lyon Benjamin |
Open-market sale | 50,188 | $6.41 | $321.7K |
| 2026-08-17 | Rungta Harsh |
Open-market sale | 13,880 | $6.41 | $89.0K |
| 2026-08-17 | Gupta Priya |
Open-market sale | 10,015 | $6.41 | $64.2K |
| 2026-08-17 | Lentell Eric |
Open-market sale | 52,762 | $6.41 | $338.2K |
| 2026-08-15 | Lyon Benjamin |
Option exercise | 54,383 | — | — |
| 2026-08-15 | Lyon Benjamin |
Option exercise | 41,164 | — | — |
| 2026-08-15 | Rungta Harsh |
Option exercise | 12,412 | — | — |
| 2026-08-15 | Rungta Harsh |
Option exercise | 21,754 | — | — |
| 2026-08-15 | Gupta Priya |
Option exercise | 10,291 | — | — |
| 2026-08-15 | Gupta Priya |
Option exercise | 3,583 | — | — |
| 2026-08-15 | Gupta Priya |
Option exercise | 6,524 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 26,096 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 22,866 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 19,797 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 8,946 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 15,437 | — | — |
| 2026-08-15 | Lentell Eric |
Option exercise | 7,301 | — | — |
| 2026-06-26 | Spellacy Michael |
Option exercise | 19,102 | — | — |
| 2026-06-26 | Pinelli Maria |
Option exercise | 19,102 | — | — |
| 2026-06-26 | Munoz Oscar |
Option exercise | 19,102 | — | — |
| 2026-06-26 | Diaz Fred M |
Option exercise | 19,102 | — | — |
| 2026-06-26 | Diaz Deborah |
Option exercise | 19,102 | — | — |
| 2026-06-11 | Lentell Eric |
Open-market sale | 3,754 | $5.00 | $18.8K |
| 2026-05-18 | Rungta Harsh |
Open-market sale | 12,414 | $5.95 | $73.9K |
| 2026-05-18 | Muniz Thomas Paul |
Open-market sale | 91,839 | $5.95 | $546.4K |
| 2026-05-18 | Lentell Eric |
Open-market sale | 48,169 | $5.95 | $286.6K |
| 2026-05-18 | Gupta Priya |
Open-market sale | 9,860 | $5.95 | $58.7K |
| 2026-05-15 | Rungta Harsh |
Option exercise | 21,754 | — | — |
| 2026-05-15 | Rungta Harsh |
Option exercise | 12,412 | — | — |
| 2026-05-15 | Muniz Thomas Paul |
Open-market sale | 44,740 | $6.06 | $271.1K |
| 2026-05-15 | Muniz Thomas Paul |
Option exercise | 8,946 | — | — |
| 2026-05-15 | Muniz Thomas Paul |
Option exercise | 7,611 | — | — |
| 2026-05-15 | Muniz Thomas Paul |
Option exercise | 7,719 | — | — |
| 2026-05-15 | Muniz Thomas Paul |
Option exercise | 143,750 | — | — |
| 2026-05-15 | Lentell Eric |
Option exercise | 8,946 | — | — |
| 2026-05-15 | Lentell Eric |
Option exercise | 7,301 | — | — |
| 2026-05-15 | Lentell Eric |
Open-market sale | 39,967 | $6.06 | $242.2K |
| 2026-05-15 | Lentell Eric |
Option exercise | 26,096 | — | — |
| 2026-05-15 | Lentell Eric |
Option exercise | 15,437 | — | — |
| 2026-05-15 | Lentell Eric |
Option exercise | 19,796 | — | — |
| 2026-05-15 | Lentell Eric |
Option exercise | 22,866 | — | — |
| 2026-05-15 | Gupta Priya |
Option exercise | 3,583 | — | — |
| 2026-05-15 | Gupta Priya |
Option exercise | 10,291 | — | — |
| 2026-05-15 | Gupta Priya |
Option exercise | 6,524 | — | — |
| 2026-04-20 | Muniz Thomas Paul |
Grant/award | 78,659 | — | — |
| 2026-04-20 | Lentell Eric |
Grant/award | 78,659 | — | — |
Well-known investors holding ACHR (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| ARK Investment Management (Cathie Wood) | 2026-06-30 | 31,963,922 | $151.2M | 0.98% | Reduced 15% |
| Renaissance Technologies | 2026-06-30 | 4,160,486 | $19.7M | 0.03% | Added 65% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 1,088,496 | $5.1M | 0.0% | Reduced 63% |
| Millennium Management (Israel Englander) | 2026-06-30 | 955,777 | $4.5M | 0.0% | Added 2609% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 116,779 | $552.4K | 0.0% | Added 198% |
| D. E. Shaw & Co. | 2026-06-30 | 1,507,382 | $180.9K | 0.0% | No change |
| D. E. Shaw & Co. | 2026-06-30 | 29,114 | $137.7K | 0.0% | Reduced 95% |