Archer Aviation Inc.
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Item 1. Business
Overview
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 electric vertical take-off and landing (“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 eVTOL Integration Pilot Program (“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 Hawthorne Municipal Airport (“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 United Arab Emirates (“UAE”) leading the way. In the UAE, we have been working closely with the country’s federal aviation regulator, the General Civil Aviation Authority (“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.
To support certification and early commercial deployments, 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. 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.
Our Planned Lines of Business
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 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.
•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 the hybrid-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 continuing to advance our partnership with the Department of Defense (“DoD”), which started in 2021, on a series of projects through the United States Air Force’s (“USAF”) AFWERX program with the goal of helping the AFWERX Agility Prime program assess the transformational potential of the vertical flight market and related technologies for DoD purposes.
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Our Aircraft
Air Taxi Aircraft
Midnight is built on a proprietary 12-tilt-6 distributed electric propulsion platform and is designed to carry four passengers plus a pilot. It prioritizes safety and delivers significantly reduced noise compared to traditional helicopters. Midnight integrates key in-house developed advanced aviation technologies, including what we believe to be cutting-edge electric propulsion and flight control systems, with systems and components from leading aerospace suppliers, many of which are already used on certified aircraft, with the goal of reducing certification risk, development time and cost.
The aircraft is purpose-built for urban air taxi operations, with range and payload optimized for high-frequency, short distance trips of around 20-miles, supported by minimal charging time between trips. Its design focuses on combining high function and high emotion, with the goal of inspiring a passenger experience reminiscent of the Golden Age of aviation in the 1950s.
Midnight’s design, with redundant electric motors and simpler propulsion systems than traditional helicopters, aims to reduce failure points and achieve high-assurance safety and reliability standards. Our aircraft has engaged in extensive flight test campaigns that expand the flight envelope and collect safety‑critical data to support certification with the Federal Aviation Administration (“FAA”) and safe performance evaluation.
Dual-Use Cargo Aircraft
Our dual-use autonomous cargo VTOL aircraft is designed around both a low thermal and acoustic signature purpose built for next generation cargo and defense use cases. Our goal is to bring together our ability to rapidly develop advanced VTOL aircraft using our existing commercial parts and supply chains and Anduril’s deep expertise in AI, missionization, and systems integration, to enable more efficient and effective deployment of critical advanced aviation capabilities than traditional alternatives. To support this effort, we are investing in the development of our hybrid-propulsion platform, as well as in critical capabilities like the manufacturing of composites. In 2025, we aimed to accelerate our development of this aircraft by acquiring key intellectual property, such as Overair Inc.’s patent portfolio and a license to Karem Aircraft’s tiltrotor and rotor technology.
Manufacturing Operations & Supply Chain
We continue to be focused in the near term on ramping our production capabilities across our manufacturing and test facilities in California and Georgia. The Midnight aircraft we build during this new product introduction phase will be used in certification and early commercial deployments. As part of our production certificate efforts, the FAA continues to conduct reviews and inspections of our manufacturing operations.
During this new product introduction phase, we are utilizing a “golden manufacturing line” approach at one of our Silicon Valley facilities for final assembly of our early Midnight builds and then applying lessons learned to inform the design and ramp of our high-volume manufacturing in Georgia.
A key aspect of our strategy has been to focus our internal component development efforts on the key enabling technologies like our electric and hybrid propulsion systems, flight control software and composites. For those areas that are not differentiating technologies we aim to leverage the existing aerospace supply base to supply us with components many of which are already being used in certified aircraft today. We depend on U.S. and non-U.S. suppliers and service providers to meet quality, performance, cost and delivery requirements as we work towards developing and manufacturing, and ultimately commercialization of, our aircraft. Key raw materials used for our aircraft include aluminum and composites.
Competition
The commercial aerospace and defense industries include many strong U.S. and international competitors. Key competitive factors include long development cycles, rapid technological change, and intense competition. In the defense industry specifically, it is typical to work on development programs in partnership with companies who may also be your competitors and involve a competitive bid process to be awarded a contract.
In our planned commercial air taxi service, we also compete with ground based alternatives, such as personal automobiles and ride-sharing services, as well as existing aircraft and helicopter charter services. The market for these services is intensely competitive, with key differentiating factors including safety, trip duration, technology, overall user experience, and cost.
We seek to differentiate ourselves by delivering aircraft, advanced aviation technologies and services that deliver superior design and performance, safety, reliability and quality. For additional information about competition, see “Risk Factors” in Item 1A of this Annual Report.
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Government Regulation and Compliance
Globally, our commercial aircraft will be required to comply with regulations governing aircraft design, production and airworthiness. In the United States, the regulations are put forth by the FAA and Department of Transportation (“DOT”). Outside the United States, similar requirements are generally administered by the national civil aviation and transportation authorities of each country. We continue to focus our efforts on obtaining certification from the FAA of our aircraft in the United States, the GCAA of the UAE and engaging with key decision makers in the initial cities in the United States and UAE which we plan to operate our aircraft. We also work with similar government authorities in the other international markets where we are targeting commercialization.
The following describes the key certifications necessary for us to design, manufacture, sell and operate our aircraft in the United States:
•Designing our aircraft: Type certification in the United States is formalized by the FAA’s approval process for new aircraft designs and covers the design of the aircraft and all required components and systems. The FAA outlines the process for type certification in Order 8110.4C, which defines the 4 phases that lead to type certification. Our initial aircraft type certification is required to meet the criteria set forth by the FAA through a “special class” definition under 14 CFR Part 21.17(b). In May 2024, the FAA published the Final Rule with the final airworthiness criteria for our Midnight aircraft and in June 2024, we then finalized our G-1 Issue Paper containing the certification basis with the FAA, which formally closed the FAA’s work in the second phase of our certification program. In the third phase of our certification program, we collaborated with the FAA for full agreement on the Means of Compliance, which is the full set of details defining the methodology, design, analysis and testing standards that will be used to demonstrate that the aircraft is safe and complies with the Airworthiness Criteria. We initially submitted a comprehensive proposal for Midnight’s Means of Compliance to the FAA back in December 2021 and in January 2026, Midnight’s Means of Compliance was fully FAA accepted. As part of the third phase of our certification program, we are also working with the FAA to review and provide final acceptance of our subject specific certification plans (“SSCPs”). SSCPs provide precise detail on each of the specific tests and analyses that must be completed during the fourth and final phase of our Type Certification program, known as the implementation phase, in which we actually demonstrate to the FAA that Midnight meets all relevant FAA requirements necessary to receive a Type Certificate. In June 2025, we began the piloted test flight phase of our Midnight program and are preparing for formal type inspection authorization testing as part of the implementation phase. We believe that we are now substantially complete with the third phase of our certification program and are largely focused on the fourth phase of the certification program, and we estimate that we have received approximately 15% of the compliance verification documents in that phase.
•Producing our aircraft: Production certification is the FAA’s approval for us to be able to manufacture our Midnight aircraft as approved by the FAA per the Type Certified design. To obtain a Production Certificate from the FAA, we must demonstrate that our organization and our personnel, facilities, and quality system can produce our aircraft such that they conform to its approved type design. We are working to develop the systems and processes we will need to obtain a FAA Production Certificate with the goal of obtaining such certification shortly following receipt of Midnight’s Type Certification.
•Selling our aircraft: Airworthiness certification from the FAA signifies that an aircraft meets its approved design and is in a condition for safe operation in the U.S. National Airspace System. Each of the aircraft manufactured by us will need to be issued an airworthiness certificate. We expect that the airworthiness certificates issued to each of our aircraft will be a Standard Airworthiness certificate in the Normal Category, as defined by the FAA.
•Operating our UAM service: The FAA and the DOT have primary regulatory authority over air transportation operations in the United States. To operate our UAM service, among other requirements, we are required to hold a Part 135 Air Carrier and Operator Certificate and. In 2024, we obtained our Part 135 Air Carrier and Operator Certificate from the FAA, which allows us to begin operating aircraft commercially under Part 135 of the Federal Aviation Regulations to refine our systems and procedures in advance of launching Midnight into commercial service. In February 2024, we received our Part 145 Repair Station Certificate, which lays the foundation for us to operate repair stations that perform maintenance, repair and overhaul services on our aircraft, and we received our Part 141 Certificate which enables us to train and qualify pilots in our training academy. We expect that as we build out our UAM operations there will be additional federal, state and local laws, regulations and other requirements that will cover our operations. For example, take-off and landing locations (e.g., airports and heliports) typically require state and local approval for zoning and land use and their ongoing use is subject to regulations by local authorities in addition to the FAA requirements. Therefore, we have already begun, and will continue to grow, our engagement and collaboration with the cities in which we intend to operate our UAM service in an effort to ensure that it operates in a safe manner.
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We have been working closely with the GCAA over the past year to determine the most appropriate regulatory pathway to support our planned early commercial operations there. The GCAA has transitioned our Midnight aircraft into a Restricted Type Certification program, advancing the regulatory path for the aircraft's entry into service in the region. Our work with the GCAA is designed to operate in parallel with our certification efforts in the U.S. and other jurisdictions around the world. The Restricted Type Certification approach is meant to offer a streamlined approach toward early-stage commercial operations specific to Midnight in the UAE.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related accompanying notes included elsewhere in this Quarterly Report and the audited consolidated financial statements as of and for the year ended December 31, 2025 set forth in our Annual Report. The following discussion includes forward-looking statements, which are based on our current expectations and beliefs concerning future developments and the potential effects of such developments on us. There can be no assurance that future developments affecting us will be those that we have anticipated. See the section titled “Special Note Regarding Forward-Looking Statements” in this Quarterly Report. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those set forth in Part I, Item 1A, “Risk Factors” in our Annual Report.
Overview
Headquartered in Silicon Valley, California, Archer is developing the technologies and aircraft to power the future of aerospace and defense. We are building a platform to deliver advanced aircraft, technologies and services to customers worldwide across the commercial aerospace and defense sectors.
Midnight is our eVTOL aircraft purpose-built for air taxi operations in major cities. 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 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 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, 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 the development of our hybrid-electric, autonomous vertical take-off and landing (“VTOL”) aircraft platform intended for dual use by both civil and defense customers. As part of this development effort, we are working closely with our strategic partner, Anduril Industries Inc. (“Anduril”), to ensure this platform meets the next generation vertical lift aircraft needs of the U.S. and its Allies. For commercial customers, that aircraft is expected to be used primarily for cargo and rescue operations.
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.
Our Planned Lines of Business
By maintaining an innovative and disciplined approach to new product and service development, manufacturing, and commercialization we believe that we can deliver advanced technologies and solutions to the aerospace and defense sectors that can service a broad range of industries and use cases. We intend to primarily operate in the following areas:
•Commercial: This is planned to primarily 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 major cities.
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•Defense: This is planned to primarily consist of the sale of next-generation aircraft and related technologies through our Anduril partnership 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 UAM operations, and work to commercialize both the commercial and defense sectors of our business.
Components of Results of Operations
Revenue
We continue to design, develop, certify, and bring up manufacturing of our aircraft and do not expect to begin generating significant revenues until we complete the design, development, certification, and manufacturing ramp-up of our aircraft, as 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.
Operating Expenses
Cost of Revenue
Cost of revenue primarily consists of master ground lease payments to the City of Hawthorne, utilities, depreciation, 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 the cost of revenue to increase over time as operations expand.
Research and Development
Research and development activities represent a significant part of our business. Our efforts focus on the design and development of our aircraft and certain systems within it. As part of those activities, we continue to work closely with U.S. and international regulators towards our goal of 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 commercialization and manufacturing.
We cannot determine with certainty the timing, duration or the costs necessary to complete the design, development, certification, and manufacturing bring up 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
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 amortization 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 Income (Expense), Net
Other income (expense), net consists of miscellaneous income and expense items, including the change in fair value of our warrant liabilities.
Interest Income, Net
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 debt.
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Results of Operations
The following table sets forth our condensed consolidated statements of operations for the periods indicated:
| Three Months Ended March 31, | ||||||||||||||||||||||
| 2026 | 2025 | Change $ | Change % | |||||||||||||||||||
| (In millions except percentages) | ||||||||||||||||||||||
Revenue | $ | 1.6 | $ | — | $ | 1.6 | 100.0 | % | ||||||||||||||
| Operating expenses: | ||||||||||||||||||||||
Cost of revenue | 1.3 | — | 1.3 | 100.0 | % | |||||||||||||||||
Research and development (1) | 171.7 | 103.7 | 68.0 | 65.6 | % | |||||||||||||||||
General and administrative (1) | 83.2 | 40.3 | 42.9 | 106.5 | % | |||||||||||||||||
| Total operating expenses | 256.2 | 144.0 | 112.2 | 77.9 | % | |||||||||||||||||
| Loss from operations | (254.6) | (144.0) | (110.6) | 76.8 | % | |||||||||||||||||
| Other income (expense), net | 20.6 | 42.0 | (21.4) | (51.0) | % | |||||||||||||||||
| Interest income, net | 16.4 | 8.7 | 7.7 | 88.5 | % | |||||||||||||||||
| Loss before income taxes | (217.6) | (93.3) | (124.3) | 133.2 | % | |||||||||||||||||
| Income tax expense | (0.1) | (0.1) | — | — | % | |||||||||||||||||
| Net loss | $ | (217.7) | $ | (93.4) | $ | (124.3) | 133.1 | % | ||||||||||||||
(1) Includes stock-based compensation expense as follows:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (In millions) | |||||||||||
| Research and development | $ | 32.1 | $ | 11.1 | |||||||
| General and administrative | 38.3 | 19.0 | |||||||||
| Total stock-based compensation expense | $ | 70.4 | $ | 30.1 | |||||||
Comparison of the Three Months Ended March 31, 2026 and 2025
Revenue
Revenue increased by $1.6 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025 as we primarily generated $1.0 million revenue from the lease of hangar space at Hawthorne Airport.
Cost of Revenue
Cost of revenue increased by $1.3 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This increase primarily consisted of 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.
Research and Development
Research and development expenses increased by $68.0 million, or 65.6%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to increased investment in people and materials to advance technology development. The increase consisted of $22.7 million in personnel-related expenses driven by workforce expansion, $21.0 million in stock-based compensation expense, $17.2 million in engineering services and tools and materials to support our increased research and development activities, and $7.1 million in facilities, travel, and other operating costs.
General and Administrative
General and administrative expenses increased by $42.9 million, or 106.5%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was primarily due to an increase of $19.4 million in stock-based compensation expense, an increase of $6.4 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 million in facilities, travel, and other operating costs.
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Other Income (Expense), Net
Other income (expense), net decreased by $21.4 million, or 51.0%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The decrease was primarily due to 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.
Interest Income, Net
Interest income, net increased by $7.7 million, or 88.5%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to higher interest income from higher average cash, cash equivalents and short-term investments.
Liquidity and Capital Resources
As of March 31, 2026, our principal sources of liquidity were cash, cash equivalents, and short-term investments of $1,775.9 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.
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 collateralized by specified cash and financial assets and are guaranteed by certain of our domestic subsidiaries. As of March 31, 2026, 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 collateralized by a leasehold deed of trust on the properties.
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 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.
Vendor Share Issuances
During the three months ended March 31, 2026 and 2025, we issued 6,547,560, and 1,906,161 shares of Class A common stock, respectively, to certain vendors to satisfy $42.1 million and $13.6 million of our current and future vendor obligations.
In the long term, our ability to support our working capital and capital expenditure requirements will depend on many factors, including:
•the level of research and development expenses we incur as we continue to develop our aircraft, technologies and services to be provided in our planned business lines;
•capital expenditures needed to bring up our aircraft manufacturing capabilities, including for both the build out of our manufacturing facilities, component purchases necessary to build our aircraft and support the development of our airline operations, vertiport infrastructure, UAM networks, and development of Hawthorne Airport;
•general and administrative expenses as we scale our operations; and
•sales, marketing and distribution expenses as we build, brand and market our business lines, products and services.
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Until such time as we can generate significant revenue from our business operations, we expect to finance our cash requirements primarily through existing cash and cash equivalents, pre-delivery payments, equity issuances, and debt financings.
The following includes our short-term and long-term material cash requirements from known contractual obligations as of March 31, 2026:
Leases
We lease office, lab, hangar, manufacturing and storage facilities in the normal course of business. Under our operating leases as noted in Note 9 - Commitments and Contingencies in the accompanying notes to our condensed consolidated financial statements, we have current obligations of $11.4 million and long-term obligations of $100.3 million.
Cash Flows
The following table summarizes our cash flows for the periods indicated:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (In millions) | |||||||||||
Net cash provided by (used in): | |||||||||||
Operating activities | $ | (149.1) | $ | (94.6) | |||||||
Investing activities | 78.7 | (10.0) | |||||||||
Financing activities | — | 300.2 | |||||||||
Cash Flows From Operating Activities
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 functions 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 three months ended March 31, 2026 was $149.1 million, resulting from a net loss of $217.7 million, reflecting our continued investment in our research and development activities. The net loss adjustment for non-cash items consists primarily of $70.4 million in stock-based compensation expense, a gain of $22.8 million due to a change in fair value of our warrant liabilities, and $7.8 million in depreciation and amortization. The net cash used in changes in our net operating assets and liabilities was $8.5 million.
Net cash used in operating activities during the three months ended March 31, 2025 was $94.6 million, resulting from a net loss of $93.4 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 million in stock-based compensation. The net cash provided by changes in our net operating assets and liabilities was $4.7 million.
Cash Flows From Investing Activities
Net cash provided by investing activities during the three months ended March 31, 2026 was $78.7 million, driven by proceeds from maturities of short-term investments of $115.0 million, partially offset by purchases of property and equipment of $32.6 million and business acquisition of $3.7 million.
Net cash used in investing activities during the three months ended March 31, 2025 was $10.0 million, driven by purchases of property and equipment within the period.
Cash Flows From Financing Activities
Net cash provided by financing activities during the three months ended March 31, 2026 was immaterial, reflecting $0.1 million of principal repayments on debt, offset by $0.1 million of proceeds from employee stock option exercises.
Net cash provided by financing activities during the three months ended March 31, 2025 was $300.2 million, driven by gross proceeds from the registered direct offering of $301.8 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 million.
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Critical Accounting Policies and Estimates
Our condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, and expenses, and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates. To the extent that there are material differences between these estimates and our actual results, our future financial statements will be affected.
For a discussion of our critical accounting policies and estimates, see “Critical Accounting Policies and Estimates” included under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report. There have been no material changes in our policies from those previously discussed in our Annual Report.
Recent Accounting Pronouncements
Refer to Note 1 - Description of Business and Basis of Presentation in the accompanying notes to our condensed consolidated financial statements for a discussion about accounting pronouncements recently adopted and recently issued and not yet adopted.
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-06-11 | Lentell Eric | Chief Legal & Strategy Officer | Sell | -3,754 | $5.00 | -$18,764 |
| 2026-05-18 | Rungta Harsh | Chief Accounting Officer | Sell | -12,414 | $5.95 | -$73,897 |
| 2026-05-18 | Muniz Thomas Paul | CHIEF TECHNOLOGY OFFICER | Sell | -91,839 | $5.95 | -$546,690 |
| 2026-05-15 | Muniz Thomas Paul | CHIEF TECHNOLOGY OFFICER | Sell | -44,740 | $6.06 | -$271,174 |
| 2026-05-18 | Lentell Eric | Chief Legal & Strategy Officer | Sell | -48,169 | $5.95 | -$286,736 |
| 2026-05-15 | Lentell Eric | Chief Legal & Strategy Officer | Sell | -39,967 | $6.06 | -$242,244 |
| 2026-05-18 | Gupta Priya | Interim CFO | Sell | -9,860 | $5.95 | -$58,694 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-11-05 10-Q expected by 2026-11-09 (in 87 days)
- ~2027-03-03 10-K expected by 2027-03-14 (in 205 days)
- ~2027-05-10 10-Q expected by 2027-05-14 (in 273 days)
- ~2027-08-10 10-Q expected by 2027-08-14 (in 365 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-10 8-K Material Agreement Entered; Unregistered Equity Sale; Regulation FD Disclosure; Financial Statements and Exhibits
- 2026-05-14 8-K Other Events; Financial Statements and Exhibits
- 2026-05-14 424B7 424B7
- 2026-05-14 424B5 Prospectus Supplement
- 2026-05-11 8-K Earnings Release; Financial Statements and Exhibits
- 2026-05-11 10-Q Quarterly Report
- 2026-04-17 PRE 14A Preliminary Proxy Statement
- 2026-03-19 8-K Officer/Director Change
- 2026-03-05 8-K Other Events; Financial Statements and Exhibits
- 2026-03-02 10-K Annual Report
- 2026-03-02 8-K Earnings Release; Financial Statements and Exhibits
- 2026-01-26 8-K Other Events
- 2026-01-22 8-K Other Events; Financial Statements and Exhibits
- 2025-12-10 8-K Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-12-02 8-K Other Events; Financial Statements and Exhibits