AVAV - Earnings call transcript Q4 2024

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Operator

Good day, and thank you for standing by. Welcome to the AeroVironment Fourth Quarter and Full Fiscal Year 2024 Conference Call. [Operator Instructions] Please be advised, that today's conference is being recorded. I would now like to hand the conference over to your speaker for today, Jonah Teeter-Balin.

You may begin.

Jonah Teeter-Balin

Thanks and good afternoon, ladies and gentlemen. quarter fiscal fourth call. XXXX AeroVironment's to and year full earnings Welcome is of Director Teeter-Balin, Development This Senior Relations. Corporate Jonah and Investor

to Investor filed our call www.avinc.com release earnings Investors content is this Events posted afternoon, team. Relations presentation circumstances begin, Litigation of results of filings conference materially such company's with risks slide Reform these as or remarks no on and and any is with certain XX-K risks section website to the that in and of XXXX. This contains from differ under the only make to the forward-looking today, Risk to please that involve undertakes the update Statement on Act of XXXX. or this The the we any many a that obligation to statements meaning to our time-sensitive we Securities them other contained information or our call are within forward-looking at events SEC, expectations. and Further revision Presentations. The information AeroVironment could from the information Private in the contained June of uncertainties the from presentation today and and the on occurring uncertainties statements our after company XX, reflect particular website filings. in contains our These accurate Forward-Looking in this call. the available SEC, also statements Before Factors portions Copies presented note conference cause actual of

and Nawabi; Mr. and President Mr. Chief Kevin and McDonnell. are Officer, me Joining AeroVironment Officer, today Senior President Vice Financial from Wahid Chief Chairman, Executive

Wahid with begin remarks now Wahid? Nawabi. will We from

Wahid Nawabi

your our XXXX results to review will and in our financial for Jonah report performance will questions. I'm quarter our finally, a start Jonah. earnings detail. year fiscal recent for year and in for XXXX the I summarizing fourth by I you, year will greater quarter Thank and AeroVironment. strong then results provide after call. Kevin take achievements, Kevin, I and conference pleased fiscal which will our expectations fiscal record-breaking to Welcome, full everyone

messages, Slide of are #X included as presentation which key follows. Our our are on earnings

XX% full to fourth million last $XXX fiscal $XXX million, year. year, revenue million fiscal for record quarter consecutive top Fourth and revenue increase now This same our increased rose record. period the line $XXX to quarter last a the from a First, to compared year of new a X% growth. seventh year is

XX% with to full of XX% expect awards Third, program our revenues fiscal year growth $XXX pipeline fiscal compared Loitering accelerate record strong our a to of between reflecting opportunities, and revenues growing nearly and fiscal $XXX fourth, year XX% Munition XXXX. increase million, year. key million, Systems execution, million in continues segment last And given $XXX we to top-line

past our to expand needs for the AV systems and this meet capacity our responded demand enhance year, team, manufacturing accordingly. across our our and During fiscal autonomous of invested to strengthen solution global continued organization evolving to customers. the offerings We surge

lead counsel core to global our growth. with impressive Board in and past to our and to added growing innovation, investments and we this expertise, With directors strengths continued been the strong capacity we year, these policy defense X continue our instrumental whose in experience, market. In has

area to and and help leaders enhance key define requirements. customer headquarters engagement future shape added in also at We our D.C. the

pipeline, further efficiencies. plan our strong to we made were improve level-loading we this year retaining able strides manufacturing production operational With very in high and performance even increase levels capacity maintaining we grow hard work, efficiencies. more to capacity operational XXXX, addition, than quality, profitability. XX%, product fiscal In by orders revenue Due in our while of to while expanding production while to increasing

experience combat our X product in customers the of which implement to Ukraine relationship close leverage important of with upgrades. currently we are and our products, our serving Finally,

in autonomous, customers to Retrofit that SPOTR-Edge, suite can sense is or on now space. is and AVACORE, to more portfolio battle solutions, positioned than meet our solutions across Kinesis, best vehicles resilient our customers' Our firm more the of sense, utilize tech information contested make and We autonomous more and Kit ever environments, including act ARK the believe utilizing before. By Autonomy relevant effective AV more defense our needs. autonomy interconnected

VITAL have from helping of each the are with even their X proud today, for future. Our uncrewed munition our LMS. loitering of year years into I'd and systems segments, customers accomplishments or expectations our ahead. With solutions that, to like greater we and tomorrow missions and starting loitering We're munitions achieve our the results this discuss

our year As for this growth we the and earlier, driver segment grew LMS past was $XX quarter last to quarter mentioned fiscal year. full XX% the Fourth strongest same quarter million. revenue from

around had ability deliver program in yet globe volume. of Switchblade our reflected XXX this the and rate solutions expect unprecedented and which the by the in and awards at These in Demand validate grew few have to the million. and year revenue For beyond. In $XXX full to numerous past and not months year, XXX backlog. both we our XXXX XX%, wins key wins effectiveness increased are past we alone, this of for growth an continue totaling year fiscal our announcements, active and further many conflicts

initiative. example, Altitude Army participate selected DoD's in program subsequently Switchblade iteration was Ordnance For selected LASSO was X procurement Strike as by tranche or their the Stalking under first of and to U.S. and Low XXX Replicator the U.S. the first of the

the first In the Fires-Light, their their Precision United fact, Army. Similarly, by first tranche of delivered program U.S. OPF-L record. selected organic was batch States of Marine Switchblade to the XXX we for Corps or XXXs of Switchblade just

X In of the which addition Initiative. recently Assistance Switchblade to value announcements, not for contract Ukraine awards, was The under $XXX approximate exceeds these million. announced yet also authorized these Security are significant

growing, continue is also allies. our we DoD to see customers from interest our U.S. While demand increasing from international

that U.S. further contract international IDIQ our foreign to facilitate future getting countries. DoD will and multiyear closer Ukraine sales better other We are to

XXX. In Lithuanian our received XXX fact, Switchblade and for we just first order

stands for to ready continues AV customers' our increasing expectations. rise, Switchblade meet As demand to

current levels to we're million expanded than planning additional and actively growth. annual $XXX Our for more manufacturing support revenue product capacity have in

We tremendously in to are year countries that DoD and the our products The to U.S. need lead the LMS today XXXX. supply and allied ready factory we in our grown they and with missions. their succeed year business growth to fiscal has expect this similarly past technology

segment, to year, award primarily million, timing. down was to quarter as quarter slightly on our Uncrewed Now Revenue the the same was due last to for referred which fourth $XXX Systems segment. formerly Systems Unmanned our from

JUMP surveillance. for current XX% totaling systems. the much-needed to and the segment revenue grew of fiscal conflicts, XXXX our small prior year Uncrewed from Systems However, the lead year, UAS continues Puma workforce reconnaissance Much as providing and from $XXX came in the market ISR Puma XX growth dominant million.

As evidenced, expect continues Ukraine on the the we Puma quarters. heavily to battlefield utilize and in additional future orders

given Puma of We our for emerging the continue development geopolitical We in and small best-in-class advancing to to believe will remains continue are growing especially maritime while We make XX the contested ensure system environment. enhancements operations customers, of support recent to similarly threats. JUMP environments to platform, to next-generation UAS our the importance products. maritime the

are could As be not acquisition, performing. how we anniversary of they X-year more are our well pleased nearing the Tomahawk we with Robotics

We other common vehicles by to technology the are continue control integrate this with to autonomous our our capabilities software and provides Kinesis customers. pleased Tomahawk's amazing

and for in to evolve our tactics adversaries We're response. continue and and prepare programs JUMP missions to every we both Systems customers our domestic record. we not ourselves adjust XX XXXX. While of future standing around be define Uncrewed the our international we strong demand and day innovate customers' demand globe, in and remain fiscal Puma market, are in best-in-class Systems continue for Uncrewed to high idle for to as the year anticipate pushing

MacCready involved next provide our the their MacCready Works heavily team continued We're developing year, This of in the and and solutions past generation Replicator details AI to additional solutions Moving segment. autonomy DoD's program the new capabilities. and to incubating hope U.S. of expanding soon. our mission now for Works

In our make maritime year XXXX. We with systems, continue strides for and to HAPS uncrewed exciting secured in make million SoftBank robotics contract just and with progress addition, visibility logistics, to $XX space that continue and platforms similarly fiscal other in another reflected contested we on fact, is innovations.

development Just continued recently, was for ANCILLARY of design AV X-Plane for program. by the agency's its DARPA selected down

support capabilities customers UAS to future theater, Our the landing JUMP solution becoming region. named of maritime complementary to the for take-off Wildcat this Wildcat specifically more is on focus a and Group that as environments. is XX X missions ship-based continue and DoD in provides important proud also U.S. increases INDOPACOM operations are our we're Maritime missions. for our vertical and developed

fully or objectives computer ARK achievement, to solutions, announced key execution tracking and Autonomy mission comes of [ operationally environments. which objects including enables AVACORE. and SPOTR-Edge, this operators ] ARK we Kit Retrofit in to software for In while day or addition team contested a suite uncrewed AV's ARK multi-vehicle new classification, vision localization or operating with our single autonomy onboard also night. enables of pre-installed detection, also autonomous with suite, relevant task

quarter disruptive an deliver solutions, and and AeroVironment's MacCready suite, platforms over rapid fiscal as anticipate review we turn with set auto applications. Kevin? summary, new I modular Additionally, to sensors year call software McDonnell a for RF supports In and Uncrewed the its mission communication framework exciting the interfaces a providing is and fourth now in novel that, is It of year fulfilling devices to announcements Kevin like would open develop financials. features autonomy pilots, further for such Works AVACORE XXXX. With integration Systems. of full and and to

Kevin McDonnell

year Thank occasionally fiscal the website. quarter I'll available of and to I will you, our refer on our press fourth reviewing performance, our highlights 'XX Today, release and be Wahid. FY earnings during which presentation full

the mentioned, segment. to 'XX Uncrewed as we record a Wahid fourth now our UxS highest Unmanned refer quarter the will with FY and or finished As Systems revenue year, was strong the ever. quarter segment

into business this We continue momentum FY expect 'XX. to

to the $XXX.X for year as XXXX. the an revenue full year, of fiscal totaled $XXX.X terms million of million, XX% In increase compared the

and strong, is during XXX revenue Block in Switchblade year products. the small with million the largest from came XX% delays. the the our LMS, revenue negatively -- accounting munition million, Switchblade demand the was from of the the revenue systems, came a UxS, Tomahawk $XXX had $XXX.X XX increase which Works million medium but Our $XX combination $XXX.X products U.S. UxS million primarily UAS XX from ground Systems, at a of remainder product, includes last our was flat of XX% segment last is million. budget Uncrewed products revenue, for businesses. the million. government year's UGV UxS services, year, during to fiscal or recorded remained generated by compared LMS which XXX which year. XX% while up vehicles $XXX.X authorization of from JUMP of from fiscal and our Tomahawk the our also acquisition, segment $XX.X year. Loitering UAS, came XX% or impacted $XX.X and our MacCready Puma to Revenue in growth contributions last This from products compared MacCready from the segment was million Works year. along

due LMS the revenue, fourth the Systems, $XX.X million, revenue, XX% quarter. Loitering with during of In small of for of XX% during $XX.X product XXXX. Ukraine whereas the The of for impacted revenue service comparable product fourth fiscal $XXX.X contribution to quarter million, sales came Works total programs. In quarter X fourth $XXX fourth from half an several compared revenues, resolution, the both [ of compared of Uncrewed munition the Works decline JUMP for as primarily between million the revenue represented compared XX% revenue. increase revenue. showing year, UAS of from had quarter total earnings the delays year Puma of accounted we with revenue $XX.X last to our from the of at Switchblade to due and ] achieved small UxS down million, from businesses. million as MacCready revenues last terms million, QX, the again increase a an a the of $XX.X UxS fiscal UxS previous recorded revenue result UAS a to continuing X% is year's in breakdown XX in $XXX.X XXX and to revenue segment demand revenue of as $XXX record and funding the a increase delays or our XX% MacCready revenue X% from million, XX% of XX. there close biggest or systems, last the accounted in lower of Switchblade to decrease the million U.S. Slide both and Revenue which munition systems a result DoD XXX product and XX% medium SoftBank a UAS product Block primarily from loitering presentation, strong year, of

as to product expect remain future. of XX% a above We for foreseeable revenues percentage revenue the

of Slide to intangible reconciles Moving non-cash X of adjusted and service trend margins while excludes items. amortization margins. Slide adjusted expense the earnings to gross shows margins, which gross other product presentation margins, gross the GAAP gross XX purchase accounting and the

margins. For the previous finished a a a gross gross gross product margins consolidated margins higher GAAP at year. revenue from mix in and were XX% of year, result the The up GAAP improvement combination XX%, service of in higher of

increase XXXX last by The XX% from gross to Fiscal same the margins. gross as a driven was the the adjusted GAAP same period full gross factors reached margins adjusted significant improvement margins. in reported year. the year Moving XX%,

overall continue product gross revenue. be margins the year, down slightly but the last in year increasing were -- with the even to LMS margins product 'XX, adjusted year flat for in fiscal expect with fiscal gross the low run to FY We XXs. Adjusted XX%,

service adjusted gross year. year last full XX% ended at of terms the XX% versus In margins,

reminder, down increase ended margins quarter the last impacted the year. mix last operations. Fourth gross service gross XX%, systems an negatively from year's the of driven quarter XX% recorded margins year. overall the same and year. period the in last the marking COCO by reflecting wind XX% Adjusted versus as a revenue gross increase MUAS the was the factors margins munition this improvement full were in As by fiscal XX% same product were The the adjusted loitering at fourth for quarter the year, product fiscal of for of in

In of included COCO quarter versus operations. terms quarter margins, margins same the the year's of wind XX% during impact QX XX% gross was the year. fourth at down Again, last adjusted service service the the last of gross

of XX of shows adjusted reconciliation terms a EBITDA. EBITDA, adjusted In of income presentation GAAP net Slide our earnings to

was a year. million, is margin, of [ to decrease SG&A year to by Tomahawk For percentage ] of continued quarter from revenue version a were year. R&D and and of expenses. includes revenue Group or The to XX% expense of as increased expense performance-based fourth HAPS expense, which R&D year. our fourth AV in representing and investments $XX investments acquisition quarter to or or $XXX A $XX an funding expense higher for investments next. SG&A of expense, increases of $XX of solar some $XX UAV, will our of the fiscal prior investments percentage the intangible full million and million SG&A year. JUMP of million after products. in directed expansion the the QX in million XXXX, adjusted of in million XX, acquisition-related both from revenue compared expense to factors fourth main and revenue was result compared revenue million of fiscal the The delayed million been of $XX was flat and new expense our year is in the terms our a offset year. sales due last were stayed which our revenue prior XX% contributing in in programs increased or XX% this federal domestic aircraft I of of Tomahawk The gross XX% of in XX% in year for of was next-generation EBITDA in in international R&D another DoD U.S. adjusted to sales X million increase of of maritime team. government prior SG&A or the compared but to $XX budget record -- of increase the lower of EBITDA for or X% EBITDA $XX quarter dollars of finalization last the adjusted increases of XX% to the or quarter revenue our government fiscal dollar and cover the expansion $XXX representing from fiscal R&D XX% U.S. R&D year-over-year million year. incremental revenue compared or or for portion the SG&A our result XXXX, is other and attributed amortization In million, were the the the pending compensation increase R&D The or acquisition, a million excluding revenue revenue had year-over-year $XX year. $XX fiscal of was was XX% fourth the The year. fiscal the $XX and prior team significant the revenue for [indiscernible] XX% increase partially expense for

to continue across R&D We expect the portfolio. range the XXXX expense as in we to area fiscal to XX% make product in investments XX%

recognized Now $XXX of turning in acquisition-related million income. These be can income our in the $XX.X approximately accelerated the associated equity $XX.X decrease amortization, up of year other of to in attributed related In increase intangible full rate GAAP amortization million ended investment year unrealized balance and and versus $XX.X the R&D business in net million loss expenses, $XXX.X to other intangible closure $X portfolio. in a million increase the million. the that a were for income our expense, increase taxes net fiscal increase margin, company expenses, $X.X earnings. million million SG&A its investment an in a increase 'XX, a million offset in recorded excluding being of amortization be sites. following $XX.X COCO losses XXXX, impairment a in million partially $XX.X In XXXX, million fiscal should It interest and intangible medium in in $XXX.X fiscal $X.X of favorability year noted The generated goodwill company UAS by $XXX.X of its increase gross X%. a tax million to mostly increase million million a in decrease equity-related $XX.X losses, net adjusted spending,

diluted our in increase the X%. In FY versus XX period $X.XX earnings adjusted Adjusted $XXX.X $X $X.XX a adjusted million a share XXXX. million same diluted diluted generated of earnings range reported of adjusted -- in net the fourth share per the fiscal posted fourth loss of company we per of income shows fourth per in share diluted GAAP tax $X.XX last XXXX to to fiscal were and However, earnings share fiscal year. Slide 'XX share quarter per rate the fiscal EPS. the for X% of The of non-GAAP expect per company XXXX. for reconciliation XXXX quarter of versus quarter, of the for versus or in net $X.XX

the Turning balance third and quarter. fourth million amounted end the close At the to total compared investments of sheet. to cash to quarter, of our million $XXX the the $XX.X at

the as Our total and of the facility at the fiscal $XXX was down term during loan year. we debt million fiscal course end the million paid the of $XX XXXX of

fiscal to forward XXXX, levels to working remain with some capital at quarter-to-quarter current fluctuations. we Looking the expect

start is unbilled the see contract Our U.S. as with we some new into to expectation we reductions a enter in our receivables Army.

single expenditures around remain the in capital should of X% digits Our revenue. or low

support growth. facilities FY 'XX. tooling Overall, invest to in we continue manufacturing our We new increase free and our flow in in fixtures cash expect significant and systems, to

things turn to like to I'd Wahid. Now back

Wahid Nawabi

on non-GAAP year XXXX to as our and million R&D per or revenues. behind forecast to to pleased to fiscal net of follows: XX% and $XX between million $XXX EBITDA we expect XX% million year revenue a million, $XX provide Slide to million; With share; be $XXX income fiscal for we're $X.XX million $XXX adjusted anticipate between between strong XXXX $XXX #X diluted of Kevin. we $X.XX and us, Thanks, guidance we

of at the at backlog year funded fiscal XXXX healthy million. $XXX Our remained end

midpoint As our a XXXX range fiscal guidance revenue result, of visibility at to XX%. year the is

for including visibility announced by the our contracting important of more reflects are process. note million our While government not LMS $XXX years, business backlog, awards than recent orders in uncertainty in yet this that included visibility some it been level but Many alone. is have than in our to additional lower our customers is

in visibility update to pipeline achieving guidance, opportunities and quarters convert other orders in future revenue. confident full and in our are we'll and these We our year our accordingly as awards

represent year. solutions We business. first accelerating the almost autonomous, for to global the of revenues. QX growth to XX% across for fiscal Further, of revenue demand expect we half revenue uncrewed half AI-enabled our anticipate full first approximately drive We to account continued expect half

that Given be fiscal year our strong will AeroVironment. another year record-breaking performance and execution, for we fiscal confident XXXX remain

We the technology as DoD positioned battle-tested and in best-in-class We with unrivaled base, marketplace and experience, budget an this installed trusted are U.S. defense unparalleled benefit an of well tech leader solutions, manufacturing remain capacity. priorities industry decades to positioned from uniquely innovator. original

growth, top lends positioned shareholder a the value have to We multi-year company line for strong healthy creation. which itself

poised is growth well XXXX. company Our significant fiscal extends that beyond for year

summarize turning key call Before questions, the takeaways from today's over the me for let call.

First, of full year top revenue marking new set and our growth. line consecutive seventh records, year profitability

delivered strong our quarter Second, financial met exceeded we fourth and or performance expectations.

fiscal be notably, the work you the our have our of Munition helping and we AeroVironment as team customers anticipate family our expect Loitering the for we missions. setting Systems year segment and thank for increase serve our would achieve continues in to hard company. I you to fiscal to our you. to entrusting our year record key again our thank company us be been solutions to Switchblade for for XXXX. of another ever demand business their driver and strong XXXX fourth, customers like And for and fundamentals Thank their the most they year as for to are VITAL to in the company, growth supporting dedication Third, shareholders

critical at allies your Kevin, will take honored now the Jonah our into time are future. And this support that, and I We and with and to country questions.

Operator

line from of Greg Jefferies. Konrad question first comes Our Instructions] [Operator with the

Greg Konrad

year time LMS called LMS in that about the out which of give you reaching capacity. for annual $XXX out of 'XX annual kind maybe continued sales. greater Can that is production growth called capacity than you line, fiscal production million, a X.Xx X.X or given You than more

Wahid Nawabi

Greg. Sure,

capacity monthly expand So to rates production we on almost -- continue on basis. in a

you keeps quarter, fourth was QX with growing. a million the increase significant. and as as of from just see saw $XX-plus the to revenue, worth So you our quarter fourth the rate quarter QX And we finished

of that increase to continue. expect We same rate

customers' Our capacity. in is our always of always, terms of demand goal to stay ahead

the So at during especially were X-plus as as chips, demand years, semiconductors we customers' last shortages COVID era far, in of well meeting our successful the appropriately. and

to of not in it from worth signals billion our that to customers' that next receive So is we're about be with able couple the to expectation away demand we're reach seeing, far going going we that with is to $X.X in today of line that production capacity. And right the quarters. the expect and be orders especially

Greg Konrad

And or then about much up at Do the of stay -- range of XX% you mix? margin some expect drivers? called follow-up, are the How But guidance, a expansion? pieces to the the XX% talk EBITDA at within XX LMS you fiscal of the in look midpoint, LMS out bps I maybe is margin 'XX. that expect if R&D maybe just year as about you the margins 'XX can in just expansion in to moving

Wahid Nawabi

Sure.

demand generally we between and small UAS significant for to be have 'XX that year shift despite very business. fiscal Greg, margin this going the LMS our -- much speaking, our for faster-growing our healthy So fact is a mix

increase margin of mix well. the LMS as in growth to within the profile is aggressive able robust, that LMS we've and While business successfully our quite it's been

Army have business with grow. and level-loading we're those to a U.S. improve we our be international continue segment to we going the allies, to LMS that improve to the new see we're increase we the we to continue that our we market and that the to But margin throughout the of contracts negotiating able as going are of believe is year. profile our factory, the year, LMS believe the overall, fastest-growing business. for continues expect and margins be fact capacity to to So

full All the year. roughly margins into of for that to translate basically XXXX similar should

Kevin McDonnell

adjusted is -- slightly improving gross So our margin EBITDA. gross

Wahid Nawabi

That's right.

Operator

Our from of next comes Baird. Peter Arment question the with line

Peter Arment

kind $XXX OPF-L, was Hey, and all Lithuania, of you in them was Replicator, off mentioned. think Jonah, Ukraine, also the Wahid, nice Wahid, Kevin mentioned that results. that you some, million, LASSO, I listed

of kind quarter you about fourth So run just that rate. talked

through $XXX we and roll do Just orders think from contracts how kind see think then about of how going do we're it rolling to an through? about kind So we those domestic LMS? customers? million Is like XX-month that how of period, additional

Wahid Nawabi

Sure.

little fiscal year, with because and a of longer several terms case, that contract conditions and for of we key Peter, those working our contract our customers. primary that suppliers, the So line since budgets we're bit government now contract. on of U.S. yet critical on of has not negotiating they're multiyear contracting for half trying and reason in different especially the approved not takes to in all be time really The working terms secured especially almost those fronts. orders are their and government having capacity a we're challenged some been of is The their

more worth potential fiscal contracts much that, that into convert year. or So $XXX than materialize of having even orders pretty those we expect this all said -- million of to that and

XX then the our visibility that that that number we're now, contracts backlog higher fiscal in year upside on next into and just I X that months. believe of going we to was not we orders some but to all see are is though out point the to at year, trying convert as the in the of expect even significant was that last much strong full as works our year strong the was We not more. and end as the

Kevin McDonnell

or revenue year. to timing the of this dictate year And ability those next recognize contracts will kind the of our

Wahid Nawabi

That's right.

Peter Arment

of prepared on just kind unbilled mentioned follow-up, as And your a Kevin, the you remarks.

does guess, do how I the continue year, we think new So But that grow? where that as unbilled about from You to think changes, was contract the then maybe to and fiscal go terms. mentioned that we up here you're 'XX? it going $XX have about a will But about year-over-year. for and million that

Kevin McDonnell

or But recognize the when progress it in some nice of mean, a revenue. take we'll that I be contracts, near that will we milestone not expecting get to able the new term. we're for Yes. payments be

on of But new that the that see a start should get off up the be for new the year, hopefully overall then probably contract fluctuations and some go will you'll little down So reach we think bounce place board. in unbilled and kind ones to we'll are, contracts a a point about in as when we and the I near older same come bit. the down just we term come the

Operator

question with comes next line Our from the RBC. Ken of Herbert

Kenneth Herbert

the it year, up for follow about in segment. for top talking if the the UAS growth apply implies limited to LMS some outlook line the we on the of obviously you're -- former segment, wanted just I numbers next

we on So how point between to think put finer do maybe the fiscal 'XX? X a it segments respectively, in about growth,

Wahid Nawabi

expect Ken, next grow of we this only not the years. year in our segments but also to So all few

handsome trajectories All very one. of of is announcements going soon. forecast the Obviously, multiple years, into number fastest large is we've for one growth 'XX, growing very, recently, including awards to very that the contracts of which attractive and and be translate our because segments munition year fiscal ones have won loitering going to

business, Systems In contract on -- of really demand Unmanned Uncrewed timing. is terms based that the

pipeline notified been growth part in small package their especially UAS, Ukraine, A of our in international we've And know, Ukraine is several and which growing. you given will we grow the got see either. that's the assistance potential of our we've is our solutions Ukraine. were to continue one performance up as reflected And of announced our for opportunities. and as loading our because orders that international inventories allies So of are we opportunity, also lot increasing not

the into business. or our picture is to the LMS of but largest growth expect growth our that the different versus because is going optically going the we're primarily to going highest So overall, look grow, actual orders. And do Uncrewed we to Systems contracts convert that to come or UxS each from of strongest, timing quarter year, or quarter

Kenneth Herbert

competitive others volume like shifting lot obviously, for taking be discussion look competitive days if seem some some maybe think market grows, to the Maybe and these we Wahid, competitive other I how recent landscape. relative And sales think and companies to potential more at And can just the the about they where foreign ability to the could, as military companies? growth be for we about AVAV -- Or maybe your a to and your landscape continue of we view share should from just the to particular take in you strengths just share? address of [indiscernible] as seem aggressively. around fairly you how

Wahid Nawabi

Sure.

closely. a glad we that's I'm that and or addressing great And that us these question, close are things question So very it are follow we you very asking Ken. because

two, recent contract contract quite growing convert companies, AV's orders, the Taiwan a more those the this just saw to for of you and these actually rapidly. said and foremost, allow State yet. prefers to authorization and actually that to solutions, would they done Switchblade. and more we not an that for authorization. into a an Three, market number be that is It's the as including one. Number know before, acquire like I there's work is Department It will announcement FMS just First by lot is

because there's going a to very going it's by more our it's up natural the make more that X than and U.S. the attract sure allies more to show And to So competition. are in player market. lot military for definition, competitors

of between the in at that, actually ability in of lot prototypes volume difference deliver that and but win deliver people delivering talk volume. and us solutions the they to track battle-proven huge announcements now Given unmatched. A have for there's solutions we battle can or about record is than solution solutions, in tests can all rate they battle-tested have a terms our tested and

our like The is to of to success. we grow. So continue market going odds

history and in new we competing competition not again, for the whenever deliver space deliver our space, us. We've in past. their of competitors this the ready to seen and that's once more that's in see more And than probably to been on stand but this lots over happening will lots over been can't and We movie we've whenever promises, years. in actually

And we that no sensitivity given manner deliver is actually now. booming one Indo-Pacific do, timely so right there in that things volume the in as the of these bad time there in are a especially can conflicts

Operator

from Sandberg William next of the Instructions] [Operator Blair. with Our line question Bryce comes

Bryce Sandberg

endurance from that the aircraft for a bit it can I'm the aircraft? talk Like, JUMP wondering vision if XX? or PXXX I what Puma long little is the guess, differentiate announced. about you the you And how does

Wahid Nawabi

question, couldn't that your repeat hear sorry, I'm Could I you you well. please?

Bryce Sandberg

Yes.

little Just endurance it talk aircraft long XX? PXXX the JUMP differentiate does a Puma wondering about if you the and bit vision is for can What the the you from announced. that how or aircraft

Wahid Nawabi

it. Got

PXXX. The Okay.

is purpose long-range So, program requirements. X next-generation UAS X/Group for U.S. is Group designed Army's our that reconnaissance the PXXX

has amount customer, related performance the at that Puma's. this those, at that you in XX limited If the that the capability. years so LRR requirements the a than of they will Long-term, our directly PXXX PXXX, believe published, the fantastic far of is look I We stronger down missions requirements program expect needs the the to as as It we've Army you the multiple our a for look that written. the specifications the our seller really actually for have enhances it's the JUMP and U.S. road be that a well Puma. of

So, our our with of us to disruptive continuing innovations it's all competition. the way of lead innovation keep our is to going that ahead continuing and market essentially category of

there. proposals, opportunity The We're our their more in PXXX going all investors many and And City. Day are LRR tomorrow our to decision we're lot forward actually that share Conference what at so about out we've New is as delivered to competing in to our about. that's look we forward here the recently on with York well And LRR Investor a and opportunities that published other near the was future. as looking

Operator

the line comes question Andre with next of BTIG. Our Madrid from

Andre Madrid

about bit with announced start week. sale to want talking more I just that a the FMS was first Taiwanese last maybe

there think context your then be and that that relative the competitor, in mix thoughts just think So, are move and region to within And vis-a-vis as there any limited is range if you can you line? further focus you the the as product competitors program the Switchblade you how a given the Indo-Pacific, on the range of on about Indo-Pacific? such do marketable that in the vast range mean, Switchblade I of maybe up expanding

Wahid Nawabi

thoughts and couple Number question a Andre, not one, of me approvals, that's orders. on so basically that. let those announcements a great out point were again, yet

secured publicly two, to highly the we loitering is way in type two. Number as know orders announced is two public the Replicator terms different from both by same being brewing they that's of by part the So, conflicts us to initiative the three, missions. U.S. far, there. Switchblade of solutions what XXX, INDOPACOM there's quite go still long and highly, the focused you our only competitors. Number there saw, we targeted to Replicator address, that been from and that not the within of missions They're for And of a number as actual are munition theater, all know program. are information DoD the actually

need Army's that. So, of selected U.S. to obviously, And part what most that by was X,XXX our going the know the contribution customers announcement our recent public and the for Switchblade they over are procuring be they XXXs customer our as solution. they Replicator to

already we thousands systems. let for speak these So, We've our delivered record itself. of

delivered can in reliability for INDOPACOM of only thousands at critical the and that's systems. high who today conflict. them will thousands company As We've in a I space deliver battle-proven of really know and decade volume thousands level quality the see the in that space. more competitors been and high the in to And and we've we're I we over of said, competing

And the announcements that what in you've announcements a ended than we from different seems happen end lot outcome in seen and and in industry. Announcement proud that's so, up think very that being could of the the many somewhat as past unmatched that the be the to we're beginning.

progresses we'll look process. through and the keep to you competing we so, forward And this updated as

Andre Madrid

guess more of over and How active to that further for of that on on? prospect mean, that international to the with are can and what FMS the conversations as something look just quantitative sales for. I going you've approved And as received? you sales interest know before metrics much I I the you've we were so kind give you shifting, actual mix highlighted countries reference -- that's XX then,

demand and you're degree of some just how more from color are incremental how much maybe advancing U.S. getting on So, allies? those quantitative conversations

Wahid Nawabi

Andre. Sure,

market So, we of received on XX and engage know, up XXX allies -- as both Switchblade you and with XXX. to approval we have to our

Switchblade received today for that I order the call and both said As XXX first our XXX. on for Lithuania international we

for the -- have addition you that In from Taiwan. to saw as the Department that, we announcement also XXXs they Switchblade State approved

Switchblade And still actively half European for are that the these plus to close we in engaged are have of XXX a the Pacific. Asia very as of various in theater needs. and the pretty in XXX countries both well countries stages acquisition as those, their addition dozen In to a much

because FMS skyrocketed. so, the the U.S. FMS has very, And the and been really and really, military is arm of busy the State The export process long and extremely Department very U.S. office the is sales exports have busy. U.S.

going we to but timing us. The for see months difficult those we're cases that almost sort pinpoint that to XX all orders U.S. the has been independently through of Department the depends The of probably we're really And engaged. takes It most to is supportive XX State just likely each countries engaged very we so of are Pentagon is -- extremely as are are next in convert and us into well. on and case some go to and exactly. process receptive that and interested. every very but time. It through,

Operator

would showing call Ladies the in for you. I Jonah I'm the to remarks. and like further Thank gentlemen, closing back turn questions to no queue. now

Jonah Teeter-Balin

again, call Thank continued joining you, once interest in for for and today's conference your AeroVironment.

many archived at a look to news Day this and Investors you of the found SEC We tomorrow relevant filings Investor As and wish be can a forward call, our good evening. version XXXX under of our seeing section of reminder, you an website.

Operator

That concludes today's conference call.

You may disconnect. now

AeroVironment (AVAV) 26 Jun 242024 Q4 Earnings call transcript