AIRO Group Holdings sales dip as company eyes backlog to drive recovery
AIRO Group Holdings (NASDAQ:AIRO) reported a decline in first-quarter revenue and a widening net loss Thursday, as the aerospace and defense newcomer works through a transition in product mix and timing of shipments.
Despite the slow start to the year, management reaffirmed its full-year growth targets, pointing to a robust defense backlog and the recent unveiling of next-generation autonomous aircraft as catalysts for a stronger second half.
AIRO reported first-quarter revenue of $8.9 million, down 24.6% from the $11.8 million recorded in the prior-year period.
The top-line contraction was accompanied by a significant compression in gross margin, which fell to 26.6% from 58.8% a year ago.
The company attributed the margin decline to a shift in project timing and heavy investments in scaling its manufacturing infrastructure.
The bottom line reflected these increased costs, with an operating loss of $17.2 million compared to a loss of $3.1 million in the first quarter of 2025.
Net loss widened to $15.5 million, and adjusted EBITDA fell to a loss of $12.8 million.
Management characterized the quarter as the "low point" for the 2026 fiscal year, noting that the results were consistent with internal roadmaps prioritizing long-term platform integration over immediate profitability.
The company remains optimistic about its 2026 outlook, reiterating its full-year revenue growth guidance of 15% to 25%.
This confidence is bolstered by several operational milestones achieved in early May, including the public unveiling of its full-scale autonomous VTOL (vertical takeoff and landing) aircraft at the XPONENTIAL 2026 conference and the introduction of the RQ-70 Dainn, a long-range unmanned aircraft system designed for battlefield ISR (intelligence, surveillance, and reconnaissance).
The company currently holds more than $200 million in bookings, which it expects to begin converting into recognized revenue more aggressively starting in the third quarter.