Shares of Archer Aviation (ACHR) are surging in after-hours trading after the electric vertical takeoff and landing aircraft maker shared its Q1 earnings results. Indeed, Archer reported an adjusted EBITDA loss of $109 million and a net loss of $93.4 million. It is worth noting that the firm is still in the pre-revenue phase.
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As a result, Archer will likely continue to rely on equity financing to fund its operations, which will dilute the value of the current outstanding shares. In fact, ACHR raised an additional $301.8 million in equity financing during the quarter from institutional investors, which included funds and accounts managed by BlackRock (BLK). Therefore, the company finished the quarter with $1.03 billion of cash and cash equivalents.
Business Highlights
Moving beyond the financial results, Archer Aviation is preparing to deliver its first Midnight aircraft to the United Arab Emirates in the coming months, with plans to launch service later this year. To support this rollout, the company recently secured design approval for the first hybrid heliport in Abu Dhabi. This will help set the foundation for electric air taxi operations in the region.
As part of its “Launch Edition” program, Archer announced two new customers this quarter: Abu Dhabi Aviation and Ethiopian Airlines. The program is designed to create a reliable process for bringing the Midnight aircraft to market in early adopter locations and is a key step in Archer’s commercialization strategy.
Archer also announced a new partnership with Palantir (PLTR) to integrate artificial intelligence into its next-gen aviation systems. Additionally, the company joined United Airlines (UAL) in New York City to announce plans for an air taxi network that will connect Manhattan with nearby airports. The goal is to replace long car rides with 5–15 minute flights in order to help travelers avoid traffic and save time.
Is ACHR a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on ACHR stock based on six Buys, one Hold, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average ACHR price target of $12.83 per share implies 40.5% upside potential.
