Archer Aviation Inc. (ACHR) Q3 2025 Earnings Summary

Executive Summary

• Archer reinforced liquidity with a $650M registered direct equity offering (81.25M shares at $8.00), taking total liquidity to “over $2B”; $171M of proceeds earmarked for the Hawthorne Airport acquisition/redevelopment, with the balance for general corporate purposes .
• Q3 2025 financials: GAAP operating expenses $174.8M, GAAP net loss $129.9M, GAAP diluted EPS −$0.20, Adjusted EBITDA −$116.1M; quarter-end cash, cash equivalents and short-term investments $1.641B .
• Against S&P Global consensus, EPS was a beat on “Primary EPS” (consensus −$0.200 vs actual −$0.116*), while revenue missed (consensus $0.4M* vs reported $0) as Archer remains pre‑revenue; note GAAP diluted EPS was −$0.20, indicating definitional differences versus S&P’s Primary EPS *.
• Strategic catalysts: signed definitive agreements to acquire control of Hawthorne Airport for $126M cash to anchor LA air taxi hub and AI testbed; record Midnight flight test milestones; closed Lilium patent portfolio acquisition (€18M/~$21M) to expand IP leadership; UAE Launch Edition initial payments began; APAC demand strengthened (Korean Air exclusive partnership; Osaka/Tokyo selections) .

What Went Well and What Went Wrong

What Went Well

• Liquidity and capital access: “over $2B” liquidity following a well‑oversubscribed $650M raise; management cites balance sheet strength as a strategic advantage to win opportunities (e.g., Lilium IP, defense programs) .
• Strategic asset control: definitive agreements to acquire Hawthorne Airport (80 acres, ~5,000 ft runway) as LA hub and AI operations testbed; proximity to LAX and major venues positions Archer for LA28 .
• Flight test progress: Midnight achieved 55‑mile range, 10,000‑ft altitude, >150 mph speeds, 31‑minute flight; showcased quiet operations at California International Airshow .

Quote: “The era of advanced aviation has arrived—not as a distant vision, but as a tangible reality… we are not waiting for the future; we are building it” — Adam Goldstein .

What Went Wrong

• Revenue still pre‑commercial: reported Q3 revenue $0, while S&P consensus expected ~$0.4M*, leading to a revenue miss; Archer reiterated revenue recognition in UAE begins as program milestones evolve (expect beginning in 2026) *.
• Certification friction: FAA progress partially constrained by government shutdown; remaining policy items must be resolved before final flight‑performance TIA blocks can proceed .
• Continued heavy burn: GAAP operating expenses $174.8M; Adjusted EBITDA loss −$116.1M, reflecting ongoing investment in engineering, certification, manufacturing ramp, and go‑to‑market .

Financial Results

Notes:

• Q3 2025 non-GAAP excludes ~$52.8M stock‑based comp and ~$0.8M Stellantis warrant expense .
• CFO commentary rounded GAAP opex to ~$175M vs $174.8M in the shareholder letter .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Establishing Hawthorne… gives us a structural advantage… build the first purpose‑built eVTOL hub at the center of a world‑class aviation corridor” — Adam Goldstein .
• “We closed Q3 2025 with $1.64B… and today announced an additional equity raise of $650M… our goal is always to be opportunistic” — Priya Gupta .
• “The revenue has the opportunity to be in the tens of millions, and it is EBITDA positive… we look at it mostly from a strategic standpoint” — Adam Goldstein on Hawthorne .
• “We are nearing completion of Midnight’s piloted CTOL test campaign… next phase will be piloted VTOL including full transition flights” — Tom Muniz .
• United CFO Michael Leskinen: Archer’s AI vision “leveraging cutting‑edge technology to better enable moving people safely and efficiently in our most congested airspaces” .

Q&A Highlights

• Hawthorne rationale: rare chance to control a city‑center airport, enabling LA hub, depot/MRO, and real‑world AI deployments in Class D airspace; strategic over pure EBITDA .
• Capital raise: largely reverse‑inquiry driven; adds cushion to pursue civil/defense opportunities; liquidity viewed favorably by partners and customers .
• UAE commercialization: Launch Edition is multi‑year tens‑of‑millions program; initial seven‑figure payments tied to milestones; UAE regulator reaffirmed target certification as early as Q3 2026 .
• Certification timeline: multi‑block TIA could start as soon as year‑end; final flight‑performance TIA awaits resolution of remaining FAA policy items; shutdown has slowed some resources, others continued .
• Manufacturing capacity: demand exceeds near‑term production; phased ramp from single‑digits to ~50 aircraft to balance test, EIPP, UAE, and LA28 needs .

Estimates Context

Notes:

• S&P Global Primary EPS actual differs from Archer’s GAAP diluted EPS (−$0.20) due to methodology/definition; Archer reported GAAP net loss per share −$0.20 .
• Values retrieved from S&P Global.*

Key Takeaways for Investors

• Balance sheet strength is a competitive weapon; “over $2B” liquidity plus strategic airport control materially enhances Archer’s LA28 execution and partner confidence .
• EPS beat on S&P Primary EPS contrasts with GAAP diluted EPS, underscoring definitional nuance; focus on Adjusted EBITDA trajectory as commercialization approaches *.
• Pre‑revenue status persisted in Q3; UAE Launch Edition payments began, but management guides revenue recognition cadence starting in 2026 — calibrate near‑term revenue expectations accordingly .
• Certification path is advancing despite shutdown; watch for TIA initiation and EIPP city announcements (expected Q1) as milestones that can re‑rate risk .
• Flight test KPIs strengthen product confidence (55 mi, 10k ft, >150 mph); manufacturing ramp toward ~50 aircraft/yr supports LA28 and early deployments .
• APAC strategic depth (Korean Air exclusive; Osaka/Tokyo selections) diversifies commercialization vectors beyond U.S./UAE, improving medium‑term optionality .
• Monitor Hawthorne integration and redevelopment spend pacing; management emphasizes strategic use vs immediate profit maximization, with optional FBO stake and hangar redevelopment upside .

Additional Data and Sources

• Q3 2025 press release and shareholder letter: $174.8M GAAP opex; $121.2M non‑GAAP opex; $129.9M net loss; −$116.1M Adjusted EBITDA; $1.641B liquidity .
• Registered direct offering: 81.25M shares @ $8 for $650M gross; proceeds allocation including $171M Hawthorne spend .
• Lilium patent portfolio acquisition (€18M/$21M): expands portfolio to >1,000 assets .
• Korean Air exclusive partnership and Osaka/Tokyo selections: strategic APAC footprint .