Can Drone-Maker AeroVironment Compete In A Civilian Environment?
But the question, according to Zacks, was whether the positive news would last. This was especially relevant given considering AeroVironment -- a company that has been so heavily involved with the U.S. military and military action worldwide -- has been winding down.
Still, the company’s fiscal fourth-quarter results, announced Tuesday, beat analyst estimates handily.
Number One For Small Drones
AeroVironment posted income of $0.36 per share, compared with analyst estimates of only $0.22 a share.
The $8.1 million in fiscal Q4 profit realized was tied to an increase in sales. Last year, during the same period, the company reported a net loss of $795,000 or $0.01 per share.
Despite overseas military action winding down and U.S. involvement in worldwide conflict decreasing, AeroVironment CEO Timothy Conver said drone sales have remained strong.
in the earnings conference call,Conver said the company hoped to diversify its customer base, including sales of civilian unmanned aircraft, based on Federal Aviation Administration plans to enact regulations to allow small drones in U.S. airspace by 2015.
This past June AeroVironment’s Puma drone became the first UAS -- or "unmanned aerial system" -- to fly over land in commercial use with permission from the FAA.
In the conference call Conver said, “The time, rigor and resources we have invested to develop, test and qualify military small UAS are allowing us to satisfy FAA requirements for reliability and safety certification and facilitating approval of our systems for commercial operation.”
A Rapidly-Growing Market
AeroVironment’s ability to show growth because of its entry into the civilian drone space would depend, not only on meeting requirements of the FAA, but also on its ability to compete with other companies joining that segment.
According to International Business Times that list includs heavyweights like Boeing (NYSE: BA), Lockheed Martin (NYSE: LMT) and Northrup Grumman (NYSE: NOC) -- making it clear the road ahead would be filled with challenges.
At the time of this writing, Jim Probasco had no position in any mentioned securities.
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