What changed in this filing

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Item 1. Business

2026-06-29 compared with 2025-06-25 · 123 added, 114 removed, 265 unchanged (47% of the section changed)

Acquisition of BlueHalo Financing Topco, LLC (“BlueHalo”)

On May 1, 2025, we closed our acquisition of BlueHalo, a Delaware limited liability company, pursuant to the Agreement and Plan of Merger, dated as of November 18, 2024 (the “Merger Agreement” by and among us, Archangel Merger Sub LLC, a Delaware limited liability company (the “Merger Sub”), BlueHalo, and BlueHalo Holdings Parent, LLC, a Delaware limited liability company and sole member of BlueHalo (“Seller”).

Other than financial data, the disclosures and references in this Item 1 to this Annual Report, including the description of our business operations in this Item 1, and risk factors related to our operations included in Item 1A include the BlueHalo acquisition, unless otherwise specifically noted.

References to financial data, unless otherwise indicated, do not include the BlueHalo acquisition.

The assets, liabilities and results of operations of BlueHalo have not been consolidated into our results as of and for the period ended April 30, 2025 or any of the historical periods presented.

We are a defense technology provider delivering integrated capabilities across air, land, sea, space, and cyber.

We develop and deploy autonomous systems, precision strike systems, counter-UAS technologies, space-based platforms, directed energy systems, and cyber and electronic warfare capabilities.

We operate a national manufacturing footprint to deliver proven systems and capabilities whose markets offer the potential for significant long-term growth.

We operate an international manufacturing footprint, delivering proven systems and capabilities in markets that we believe offer the potential for significant long-term growth.

In addition, we believe that some of the innovative potential products, services and technologies in our R&D pipeline will emerge as new growth platforms in the future, creating additional market opportunities.

Effective May 1, 2025, we operate our business in two reportable segments:

(1) Autonomous Systems and (2) Space, Cyber and Directed Energy.

Effective May 1, 2025 in connection with our acquisition of BlueHalo Financing Topco, LLC (“BlueHalo”), we operate our business in two reportable segments:

(1) Autonomous Systems (“AxS”) and (2) Space, Cyber and Directed Energy (“SCDE”).

Autonomous Systems

Uncrewed Aircraft Systems (“UAS").

Our family of uncrewed systems includes Group 1-3 UAS which are deployed globally and provide multi-mission capability, autonomy, versatility, reliability and ease of use, providing the warfighter with critical situational awareness.

Our family of uncrewed systems includes Group 1-3 UAS which are deployed globally and offer multi-mission capability, autonomy, versatility, reliability and ease of use, providing the warfighter with critical situational awareness.

● Small UAS (“SUAS”):

Small UAS in Groups 1 and 2 are designed for reliable operation at low altitudes, offering real-time observation and communication capabilities with easy transport, assembly, and quiet electric propulsion.

Products include Puma LE, Puma 3 AE, Puma VTOL, P550, Raven B, and VAPOR 55 MX.

Products include Puma LE, Puma 3 AE, Puma VTOL, P550, Raven B, and VAPOR 55 CLE.

Systems within the SUAS portfolio utilize our common and interoperable handheld ground control systems and an array of spare parts and accessories.

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All are field-deployable and deliver extended endurance and increased payload capacity to unlock a broader set of uncrewed missions.

● Kinesis Command and Control Software:

Our Kinesis software is an advanced command and control platform designed to enhance the operation of our diverse uncrewed systems, including UAS, ground vehicles, and maritime vessels.

Kinesis integrates seamlessly with our product suite, offering a scalable and intuitive interface that centralizes the control of multiple assets and provides real-time situational awareness.

The software’s interoperability and automated mission planning capabilities reduce operator workload, improve decision-making, and increase mission success rates.

Counter-UAS (“C-UAS”) and Precision Strike.

Precision Strike includes our family of loitering munitions solutions (“LMS”) that deliver actionable intelligence and precision firepower modern warfighters need to achieve mission success across multiple domains.

C-UAS includes our family of radio frequency and kinetic C-UAS products which, when combined with our Directed Energy C-UAS solution, provide a comprehensive suite of counter-drone solutions with rapid deployment and advanced threat detection and defeat, as well as our Electronic Warfare (“EW”) solutions which provide critical tactical communication, geolocation and cyber effects capabilities utilizing modular architectures and open standards.

● AV_Halo Command and Control Software:

AV _ Halo, including Kinesis Command and Control Software, is a modular, hardware-agnostic software ecosystem built to orchestrate operations across air, land, sea, space, and cyber domains.

The software stack is a mission-ready suite of artificial intelligence (“AI”) powered software tools providing AI driven intelligence fusion and the ability to unify command and control, surveillance, targeting, and training under one integrated framework.

Precision Strike and Defensive Systems (“PSDS”).

This operating group includes our family of loitering munitions solutions (“LMS”) that deliver actionable intelligence and precision firepower modern warfighters need to achieve mission success across multiple domains and our One-Way Attack Platform, Red Dragon, a fully autonomous-capable UAS designed for precision one-way attack missions in high-threat, GPS-denied, and communications-degraded environments.

Integrated Air and Missile Defense (“IAMD”), counter-UAS (“C-UAS”) capabilities in this group include our family of radio frequency detect and defeat counter drones as well as our kinetic C-UAS intercept products.

Additionally, this group includes our Electronic Warfare (“EW”) solutions which provide critical tactical communication, geolocation and cyber effects capabilities utilizing modular architectures and open standards.

● Precision Strike:

Our Switchblade family includes the Switchblade 300 and Switchblade 600, which are loitering munitions solutions and provide portable, low-signature, precision strike capabilities against static or mobile targets and Blackwing, which provides intelligence, surveillance and reconnaissance (“ISR”) capabilities.

In addition to these loitering munitions products, we recently launched a One Way Attack offering called Red Dragon.

Our Switchblade family includes the Switchblade 300, Switchblade 400 and Switchblade 600, which are LMS that provide portable, low-signature, precision strike capabilities against static or mobile targets and Blackwing, which provides intelligence, surveillance and reconnaissance (“ISR”) capabilities.

Included in Precision Strike is our one-way attack offering, Red Dragon.

The Red Dragon family of products offers an autonomous capable, GPS-denied, precision-strike, one-way attack UAS engineered for scalable production and deployment.

Designed to operate in disrupted, disconnected, intermittent, and low-bandwidth conditions, it delivers unmatched resilience against advanced electronic warfare threats.

● Radio Frequency (“RF”) and Kinetic C-UAS:

Our Titan family of solutions provides comprehensive C-UAS RF capabilities deployed across two core products.

Titan C-UAS offers advanced threat detection and rapid response, deploying within five minutes to identify and intercept hostile drones.

This autonomous system, powered by artificial intelligence (“AI”) and machine learning (“ML”), defeats Group 1 and 2 drones, providing non-specialist operators with comprehensive situational awareness and defensive capabilities against UAS threats.

Titan SV delivers comprehensive 360° surveillance, efficiently localizing malicious SUAS.

We recently unveiled our latest Titan offering, the Titan IV, offering a smaller, lighter and more powerful RF-based solution to detect and defeat Group 1 and 2 drone threats.

Designed to operate in disrupted, disconnected, intermittent, and low-bandwidth conditions, it delivers resilience against advanced electronic warfare threats.

In addition to these products, we recently launched Mayhem 10.

Mayhem 10 is an autonomous, multi-role launched effect that can deploy from air, ground, and maritime platforms.

It supports a wide range of mission effects, including ISR, EW, decoy, communications relay, and precision strike.

● Integrated Air and Missile Defense (“IAMD”):

IAMD includes Radio Frequency (“ RF”) and Kinetic C-UAS .

Our Titan family of solutions provides comprehensive C-UAS RF capabilities comprising multiple detection modalities and highly effective RF defeat.

The new Titan 4 system offers a smaller, lighter and more powerful RF-based solution improving in many critical ways on previous capabilities.

Titan 4 offers advanced threat detection and rapid response, deploying within five minutes to identify and intercept hostile drones.

This autonomous system, powered by AI and machine learning (“ML”), defeats Group 1 and 2 drones, providing non-specialist operators with comprehensive situational awareness and defensive capabilities against UAS threats.

Titan SV MPV3 delivers comprehensive 360° surveillance, efficiently detecting malicious SUAS via cutting edge demodulation and decryption capabilities.

Titan-MS (multi-sensor) is a multi-mission, multi-threat system pairing Titan 4 with radar and Electro-Optical/Infrared capabilities thereby providing multimodal detection and defeat suitable for fixed-site installations in air, sea, and land domains.

Also included is our newest C-UAS kinetic interceptor, Freedom Eagle (“FE-1”).

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● Electronic Warfare Systems :

Our EW Systems are designed utilizing sensor open system architecture (“SOSA”) and modular open systems architecture (“MOSA”) standards as well as AI/ML technologies for RF signature analysis and automated detection and identification of out-of-band signals, enhancing system interoperability,

modularity, and resilience to enable operational advantage across contested domains.

This approach ensures seamless integration with existing defense infrastructures and allied systems, enabling cohesive and collaborative operations.

This approach ensures seamless integration with existing defense infrastructures and allied systems, enabling cohesive and

collaborative operations.

Key products include the SharkCage Tactical Chassis, which is an expeditionary command, control, communications, computers, cyber, intelligence, surveillance and reconnaissance (“C5ISR”)/EW chassis environmentally sealed to withstand the elements associated with land, air, and sea operations as well as the extreme temperature changes associated with airborne missions, and BlueFin Angler SDR which supports multiple signals of interest and third-party waveforms.

Included in “Other” is MacCready Works, our innovation engine where autonomy, AI, and advanced platform technologies converge to deliver next-generation capabilities;

Unmanned Maritime;

Uncrewed Ground Systems (“UGV”);

and High-Altitude Pseudo-Satellites (“HAPS”).

● Autonomy, AI and Advanced Platform Technologies:

In our MacCready Works organization, we develop solutions, such as ACE, SPOTR-Edge, and ARK, to enable robotic systems to perform complex missions in complex environments requiring advanced AI/ML and autonomy.

Our most recent One Way Attack offering, Red Dragon, was designed and developed in MacCready Works.

Unmanned Maritime (“UUV”);

and Uncrewed Ground Systems (“UGV”).

● MacCready Works:

MacCready Works serves as our advanced concepts and innovation organization, focused on the rapid development, prototyping and maturation of unmanned systems and related technologies, underpinned by our perception and autonomy products of AVACORE and SPOTR-EDGE.

MacCready Works supports our long term growth by developing new capabilities, enabling expansion into additional mission sets and markets, and helping sustain our competitive position in unmanned systems and related defense and commercial applications.

For example, our recent one way attack system, Red Dragon, was conceptualized, developed and scaled within MacCready Works, as well as the WildCat Group 3 vertical take-off and landing (“VTOL”) UAS developed for the Defense Advanced Research Projects Agency (“DARPA”).

● Unmanned Maritime:

Unmanned Maritime provide effective surveillance, reconnaissance, and mine detection in contested waters.

The Defender is a robust Remotely Operated Vehicle (“ROV”) designed for precise control of the vehicle position and orientation, heavier payloads, and demanding intervention, such as rendering unexploded ordnance safe or to search and retrieve evidence.

Unmanned Maritime provides effective surveillance, reconnaissance, and mine detection in contested waters.

The Mission Specialist Defender platform is a robust Remotely Operated Vehicle (“ROV”) designed for precise control of the vehicle position and orientation, heavier payloads, and demanding intervention, such as rendering unexploded ordnance safe or to search and retrieve evidence.

The Mission Specialist Wraith is the next-generation platform with increased autonomy, scalability, and extended operational reach.

The Pro 5 and Ally are modular underwater systems for diverse operational needs, combining speed, power, efficiency and agility.

Our UGV systems support complex explosive ordinance disposal (“EOD”) operations through multi-axis manipulation and integrated tool exchange capabilities.

● Uncrewed Ground Systems:

Our UGV systems support complex explosive ordnance disposal (“EOD”) operations through multi-axis manipulation and integrated tool exchange capabilities.

Our UGVs have proven themselves in a variety of dangerous applications including EOD and improvised explosive devices (“IED”), hazardous materials handling (“HAZMAT”), chemical, biological, radiological, nuclear and explosive (“CBRNE”) threat assessments and special weapons and tactics (“SWAT”) team operations.

Products include tEODor EVO and Telemax EVO.

HAPS are long-endurance UAS maintaining geosynchronous orbits, providing low-latency communications, and operating over large areas of interest.

HAPS can carry a variety of communications and sensing payloads that are easily installed, upgraded, and swapped based on mission needs.

Products include tEODor EVO, Telemax EVO and our newly launched TOM 50 RE, a new, compact, backpackable UGV.

Space, Cyber and Directed Energy

Space and Directed Energy.

As space becomes a more contested domain, investments in satellite operations and communications, missile warning systems, and space-based ISR ensure dominance and resilience in potential conflicts.

Space technology supports satellite operations and communications, missile warning systems, and space-based ISR.

Directed energy C-UAS systems use high energy laser systems paired with AI/ML enabled sensing technology to track, identify, and defeat targets.

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High-bandwidth, secure data transmission systems for modern space operations enable Low Probability of Intercept and Low Probability of Detect communications.

Our payloads provide up to 100 times more bandwidth than RF for stable, resilient space communications.

● Space-Qualified Hardware:

Our trusted hardware delivered for mission critical capabilities includes line of sight stabilization and control electronics in Low Earth Orbit (“LEO”), Medium Earth Orbit (“MEO”), Geostationary Earth Orbit (“GEO”), and cislunar orbits.

We have over 260 systems currently on orbit, including angular rate sensors, fast steering mirrors, power system controllers, command and data handling, and spacecraft attitude determination and control units.

Earth Orbit (“GEO”), and cislunar orbits.

We have over 260 systems currently in orbit, including angular rate sensors, fast steering mirrors, power system controllers, command and data handling, and spacecraft attitude determination and control units.

● Phased Array Antenna Technology:

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● Directed Energy:

The Locust Laser Weapon System (“LWS”) and Locust TATS uses advanced AI and engineering for an effective directed energy kill chain, tracking, identifying, and defeating targets with a high energy laser system.

Designed for roll-on/roll-off modularity and quick deployment, it is easily transported and integrated onto various platforms.

Cyber and Mission Systems.

Our Cyber and Mission Systems provide specialized operational support, services, and technologies to execute critical missions within the national security community.

The family of LOCUST Laser Weapon System (“LWS”) and LOCUST TATS both use advanced AI and engineering for an effective directed energy kill chain, tracking, identifying, and defeating targets with a high energy laser system.

Designed for vehicle integration and roll-on/roll-off modularity and quick deployment, it is easily transported and integrated onto various platforms.

The LOCUST X2 product has a 20 to 25-kilowatt range.

The LOCUST X3 is a third-generation 20–35+ kilowatt directed energy laser weapon system designed to defeat current and emerging aerial threats, including Group 1–3 unmanned aircraft systems.

Cyber and Mission Solutions.

Our Cyber and Mission Solutions Group provides advanced cyber, intel, defense operations, and basic/applied R&D solutions that deliver mission-critical expertise and prototype development for U.S.

defense, intelligence community, and national security customers.

Our expertise spans offensive and defensive cyber capabilities, Geospatial Intelligence (“GEOINT”), Signals Intelligence (“SIGINT”), Measurement and Signature Intelligence (“MASINT”) as well as Open Source Intelligence (“OSINT”) analytics.

Our cyber solutions are engineered to empower national security and defense operations with advanced tools and capabilities in both offensive and defensive cyber operations enabling full-spectrum warfare.

● Mission Systems:

Our HaloCortex OSINT Platform is an AI-powered OSINT Analysis product that leverages the largest data store in the world, to provide unique insights and solve Department of Defense (“DoD”) and commercial challenges.

● Mission Solutions:

We provide our customers including the Department of Defense (“DoD”) high-end engineering, scientific, and operational expertise and technology to enable multi-domain solutions to support all phases of system lifecycles.

Additionally, our R&D capabilities are in alignment with the DoD’s six Critical Technology Areas of Applied Artificial Intelligence, Scaled Directed Energy, Scaled Hypersonics, Advanced Materials and Biomanufacturing, Battlefield Information Dominance, and Contested Logistics Technologies.

As a leading defense technology provider, our strategy is to grow our business by delivering innovative, mission-critical, safe and reliable multi-domain solutions tailored to our customers’ most pressing challenges.

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Expand the market penetration of existing products and services.

Our UAS, C-UAS and Precision Strike, Space and Directed Energy, Cyber and Mission Systems and other businesses have gained reputations as performance leaders and technology innovators in their respective markets.

Our UAS, PSDS, Space and Directed Energy, Cyber and Mission Solutions and other businesses have gained reputations as performance leaders and technology innovators in their respective markets.

We intend to increase the penetration of our products and services within the U.S.

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In some cases, such innovations result in upgrades to existing offerings while expanding their value among existing customers and markets.

In other cases, such innovations become entirely new solutions that enable us to address new markets, customers and business opportunities.

cases, such innovations become entirely new solutions that enable us to address new markets, customers and business opportunities.

We believe our strategy, which is focused on R&D investments, will allow us to deliver innovative new products and services that address market needs both within and beyond our current target markets, enabling the creation of new growth opportunities.

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We also have a government relations team comprised of individuals with prior military, government and policy making experience who regularly meet with key decision makers within the Pentagon, Congress and other key organizations within the U.S.

Our global business development organization seeks to understand customer needs, responds to information requests, submits proposals, solicits feedback on the performance of our products, furnishes spares, and provides training and customer support.

Our global business development organization seeks to understand customer needs, responds to information requests, submits proposals, solicits feedback on the performance of our products and services, furnishes spares, and provides training and customer support.

Finally, our project and program managers work intimately with customers to oversee the design, development, testing, manufacturing and delivery of solutions the customers want and need.

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the intelligence community agencies;

public safety agencies;

federal and public safety agencies;

allied governments and coalition partners through direct commercial sales or foreign military sales;

and to commercial customers, supporting critical infrastructure protection, open-source intelligence operations, and advanced research initiatives.

During our fiscal year ended April 30, 2025, prior to the acquisition of BlueHalo, we generated approximately 20% of our revenue from the U.S.

and commercial customers, supporting critical infrastructure protection, open-source intelligence operations, and advanced research initiatives.

During our fiscal year ended April 30, 2026, we generated approximately 25% of our revenue from the U.S.

Army pursuant to orders placed under contract by the U.S.

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government agencies and government subcontractors accounted for 47% of our sales revenue.

However, no individual contract accounted for greater than 10% of funded backlog as of April 30, 2026.

Sales revenue to foreign customers, inclusive of foreign military sales made through the U.S.

DoD, commercial and consumer customers accounted for the remaining 53% of sales revenue during our fiscal year ended April 30, 2025, of which Ukraine accounted for 18% of our total sales revenue.

With the acquisition of BlueHalo, we expect the proportion of total revenue attributable to sales to the U.S.

DoD and other U.S.

government agencies to increase in fiscal year 2026.

DoD, commercial and consumer customers accounted for 28% of sales revenue during our fiscal year ended April 30, 2026.

No individual foreign country accounted for greater than 10% of total sales revenue during our fiscal year ended April 30, 2026.

Technology, Research and Development

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Strongly linking our technology and business development activities to customer needs in attractive growth markets constitutes an important element of this process.

We constantly revisit our customer requirement assumptions to evaluate continued investment and to seek to ensure that our products and services deliver high value and, conversely, high returns.

As of April 30, 2025, prior to the BlueHalo acquisition, we had issued and retained 353 U.S.

patents, as well as 103 pending U.S.

We constantly revisit our customer requirement assumptions to evaluate continued investment and to seek to ensure that our products and services deliver high value as well as high returns.

As of April 30, 2026 we had received and retained 407 U.S.

patents, had 64 pending U.S.

patent applications;

and numerous foreign patents and pending applications.

and had numerous foreign patents and pending applications.

In many cases, when appropriate and to preserve confidentiality, we opt to protect our intellectual property through trade secrets as opposed to filing for patent protection.

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Further, we have many U.S.

registered trademarks including those for AeroVironment, AV, Switchblade, Raven, VAPOR, Arcturus UAV, JUMP, Tomahawk Robotics, and Kinesis, and have several pending applications for trademark registration.

Upon the closing of the BlueHalo acquisition on May 1, 2025, we obtained an additional 150 issued U.S.

patents with 60 patents pending, and numerous foreign issued patents and pending patent applications.

BlueHalo has many registered trademarks as well as many pending trademark applications, including but not limited to U.S.

trademarks for its major products like TITAN C-UAS, LOCUST, UAS-MAX, Badger, WASP, NXTHEALTH, NXTTRUST, NXTAERO, NXTRF, NIQUIST, SCRAAWL, Protection from the Swarm, and several more.

registered trademarks including those for AeroVironment, AV, Switchblade, Raven, VAPOR, Arcturus UAV, JUMP, Tomahawk Robotics, and Kinesis, P550 QUANTIX, WASP, SNIPE, CRYSALIS, and have several pending applications for trademark registration.

government licenses some of our intellectual property that was specifically developed in performance of government contracts and may use or authorize others to use this intellectual property.

In some cases, we fund the development of certain intellectual property to maximize its value and limit its use by potential competitors.

While the development and protection of our intellectual property are integral to the continued success of our business, the loss or limitation of rights to any particular piece of intellectual property is not expected to have a material adverse effect on our overall business.

While the development and protection of our intellectual property are integral to the continued success of our business, the loss or limitation of rights to any particular piece of intellectual property would not be expected to have a material adverse effect on our overall business.

Research, Development and Commercialization of Projects

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Technological Capabilities

Our core technological capabilities, developed over more than 50 years of innovation, include robotics and robotics systems autonomy;

Our core technological capabilities, developed by more than 50 years of innovation, include robotics and robotics systems autonomy;

modular open systems architecture;

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design and qualification for robotics in extreme terrestrial and space environments;

low SWaP (Size, Weight and Power) system

design and integration;

low SWaP (Size, Weight and Power) system design and integration;

collaborative multi-robotic crewed and uncrewed mission operation;

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fluid dynamics;

human-machine interface development;

human-machine interface

modular dismounted, networked multi-domain robotic control interfaces and analytic processing architecture;

and integrated mission solutions for austere environments.

The BlueHalo acquisition significantly enhanced our core technological capabilities, which now include advanced RF system design and development, software defined digital phased array antennas and radars, space qualified electronics, laser communication technologies, software defined radios, electronic warfare technology, target acquisition and tracking, directed energy-based weapons systems for counter uncrewed systems, RF-based systems for counter uncrewed, next generation counter uncrewed system missile technology, XR/VR system for training, modeling and simulation, hardware in the loop simulations, C2 sensing and tracking, uncrewed maritime platforms, uncrewed aerial platforms, full spectrum cyber operations, tactical mission networks, multi-int data analytics and threat intelligence, tools and analytics for GEOINT, SIGNINT, MASINT and OSINT, aerospace power and propulsion, material and processes, directed energy, photonics and electronics, biological and nanoscale technology, and health and human performance.

The BlueHalo acquisition significantly enhanced our core technological capabilities, which now include advanced RF system design and development, software defined digital phased array antennas and radars, space qualified electronics, laser communication technologies, software defined radios, electronic warfare technology, target acquisition and tracking, directed energy-based weapons systems for counter uncrewed systems, RF-based systems for counter uncrewed, next generation counter uncrewed system missile technology, extended reality and virtual reality systems for training, modeling and simulation, hardware in the loop simulations, C2 sensing and tracking, uncrewed maritime platforms, uncrewed aerial platforms, full spectrum cyber operations, tactical mission networks, multi-int data analytics and threat intelligence, tools and analytics for GEOINT, SIGNINT, MASINT and OSINT, aerospace power and propulsion, material and processes, directed energy, photonics and electronics, biological and nanoscale technology, and health and human performance.

We believe the principal competitive factors in the markets for our products and services include product performance;

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and brand reputation.

Several companies across the globe, primarily in the U.S., attempt to compete in our markets to some degree, although we believe none matches the breadth and depth of our product line nor our expertise in core capabilities.

Several companies across the globe, primarily in the U.S., attempt to compete in our markets to some degree, although we believe none match the breadth and depth of our product lines nor our expertise in core capabilities.

The defense market for UAS continues to evolve in response to changing technologies, shifting customer needs and expectations and the potential introduction of new products.

Our current principal competitors include Elbit Systems Ltd., Quantum-Systems, Inc., Edge Autonomy, Teledyne Technologies, Inc., Sierra Nevada Corporation, Lockheed Martin Corporation, The Boeing Company, Textron, Inc., Shield AI, Inc., Northrop Grumman Corporation, Griffon Aerospace, Inc., L3Harris Technologies, Inc.

and Israeli Aircraft Industries.

The defense and technology markets for the C-UAS and Precision Strike products and solutions are highly competitive, evolving with rapid technological advancements and shifting customer needs.

Competitors in the LMS market include Textron Inc., RTX Corporation, Lockheed Martin Corporation, Anduril Industries, Inc., Aevex Holdings, LLC and UVision Air Ltd.

Competitors in the C-UAS and Electronic Warfare markets include Anduril Industries, Inc., The Boeing Company, Lockheed Martin Corporation, RTX Corporation and other emerging technology firms and international players.

The space technology and directed energy market includes competitors such as The Boeing Company, Lockheed Martin Corporation, L3Harris Technologies, Inc., BAE Systems, Inc., and RTX Corporation.

Our current principal competitors include Elbit Systems Ltd., Quantum-Systems, Inc., Redwire Corporation, Teledyne Technologies, Inc., Sierra Nevada Corporation, Lockheed Martin Corporation, The Boeing Company, Textron, Inc., Shield AI, Inc., Northrop Grumman Corporation, Griffon Aerospace, Inc., L3Harris Technologies, Inc., Anduril Industries, Inc., Airbus SE and Israeli Aircraft Industries.

The defense and technology markets for Precision Strike and Defensive products and solutions are highly competitive, evolving with rapid technological advancements and shifting customer needs.

Competitors in the LMS market include Textron Inc., RTX Corporation, Lockheed Martin Corporation, Anduril Industries, Inc., Aevex Corp., SpektreWorks, Inc., Dragoon Technology LLC, Cummings Aerospace, Inc., Elbit Systems Ltd., and UVision Air Ltd.

Competitors in the C-UAS and Electronic Warfare markets include Anduril Industries, Inc., The Boeing Company, Lockheed Martin Corporation, RTX Corporation, DroneShield Limited, SRC Inc., Polaris, Inc., CACI International Inc., Northrop Grumman Corporation, L3Harris Technologies, Inc., and other emerging technology firms and international players.

The space technology and directed energy market includes competitors such as The Boeing Company, Lockheed Martin Corporation, L3Harris Technologies, Inc., BAE Systems, Inc., nLIGHT, Inc., Epirus, Inc., EO Solutions Corporation, Huntington Ingalls Industries, Inc., and RTX Corporation.

These companies have extensive experience and resources, offering satellite systems and spacecraft engineering solutions that compete with our offerings.

The cyber and mission systems areas are highly competitive, with principal competitors including L3Harris Technologies, Inc., Thales Group, Anduril Industries, Inc, and Sierra Nevada Corporation.

The cyber and mission solutions areas are highly competitive, with principal competitors including L3Harris Technologies, Inc., Thales Group, Anduril Industries, Inc., Sierra Nevada Corporation, Lockheed Martin Corporation, Booz Allen Hamilton Inc., and Leidos Holdings, Inc.

We also face competition from specialized cybersecurity firms.

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By drawing upon experienced personnel across various manufacturing industries including aerospace, automotive and volume commodities, we have instituted lean production systems and leverage our International Organization for Standardization (“ISO”) certification for Quality Management Systems, integrated supply chain strategy, document control systems and process control methodologies for production.

Our ISO 9001:2015 + AS9100D certified manufacturing facilities, which focus on continuous improvement in order to increase acceptance rates, reduce lead times, improve efficiency and lower cost.

Our ISO 9001:2015 + AS9100D certified manufacturing facilities focus on continuous improvement in order to increase acceptance rates, reduce lead times, improve efficiency and lower cost.

We also provide customer service, support and training to ensure the safe and effective operation of our solutions in the field.

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No material portion of our business is considered to be seasonal.

Historically, revenue in the second half of our fiscal years has exceeded revenue in the first half.

This trend is expected to continue in fiscal year 2026 following the acquisition of BlueHalo.

Historically, revenue in the second half of our fiscal years has exceeded revenue in the first half and such trend is expected to continue in fiscal year 2027.

The factors that affect our revenue recognition between accounting periods include the timing of new contract awards, the availability of U.S.

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Workforce Demographics

As of April 30, 2025, we had 1,456 full time employees and 19 part time employees, of whom 528 were in R&D and engineering, 75 were in sales and marketing, 533 were in operations and 339 were general and administrative personnel.

Upon closing of our acquisition of BlueHalo on May 1, 2025, our workforce increased to 3,594 full time employees and 137 part time employees including over 200 employees with a PhD.

As of April 30, 2026, we had 3,991 full time employees and 100 part time employees, of whom 2,366 were in R&D and engineering, 181 were in sales and marketing, 637 were in operations and 907 were general and administrative personnel including over 208 employees with a PhD.

Talent Acquisition, Retention and Development

Our ability to attract, cultivate, and retain highly skilled individuals, particularly those with technical and engineering expertise and high-level security clearances, is paramount for the successful execution of our strategic objectives and the expansion of our enterprise.

We maintain vigilant oversight of recruitment, employee retention, and management practices.

We maintain vigilant oversight of recruitment, employee retention, and

management practices.

A pivotal component of our People and Culture strategy involves the recruitment of early-career professionals through collegiate programs and internships, with a specific focus on technical disciplines.

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We prioritize the development of our workforce through educational initiatives, training programs, and support for further education and professional certifications.

Moreover, we conduct meticulous succession planning for leadership roles to ensure the sustained cultivation of a talented management cadre essential for the realization of our strategic vision.

Moreover, we conduct succession planning for leadership roles to ensure the sustained cultivation of a talented management cadre essential for the realization of our strategic vision.

Employee Safety and Health

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Furthermore, we extend health and wellness benefits to our employees for their well-being.

Consistent with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), we define backlog as remaining unsatisfied performance obligations under firm orders for which work has not been performed.

As of April 30, 2025 and 2024, our backlog was approximately $726.6 million and $400.2 million, respectively.

Consistent with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), we define funded backlog as remaining performance obligations under firm orders for which funding is currently appropriated to us under a customer contract.

As of April 30, 2026 and 2025, our funded backlog was approximately $1,183.0 million and $726.6 million, respectively.

We expect that approximately 85% of our backlog will be recognized as revenue during our fiscal year ending April 30, 2027.

In addition to funded backlog, we also had unfunded backlog of $1,457.7 million and $774.6 million as of April 30, 2026 and 2025, respectively.

The increase in unfunded backlog is primarily due to the acquisition of BlueHalo.

Unfunded backlog does not meet the definition of a performance obligation under ASC 606.

We define unfunded backlog as the total remaining potential order amounts under cost reimbursable and fixed price contracts with (i) multiple one-year options and indefinite delivery, indefinite quantity (“IDIQ”) contracts, or (ii) incremental funding.

We define unfunded backlog as the total remaining value of awarded contracts with incremental funding yet to be received.

We do not include unfunded ceiling amounts for sole-source or multi-awardee Indefinite Delivery, Indefinite Quantity (“IDIQ”) contracts in unfunded backlog.

Unfunded backlog does not obligate the customer to purchase goods or services.

There can be no assurance that unfunded backlog will result in any orders in any particular period, if at all.

Management believes that unfunded backlog does not provide a reliable measure of future estimated revenue under our contracts.

There can be no assurance that unfunded backlog will result in any orders in any particular period, or at all.

Because of possible future changes in delivery schedules and/or cancellations of orders, backlog at any particular date is not necessarily representative of actual sales to be expected for any succeeding period, and actual sales for the year may not meet or exceed the backlog represented.

Our backlog is typically subject to large variations from quarter to quarter as existing contracts expire, are renewed or new contracts awarded.

A majority of our contracts, specifically IDIQ ones, do not currently obligate the U.S.

government to purchase any goods or services.

Our backlog is typically subject to large variations from quarter to quarter as existing contracts expire or are renewed or new contracts are awarded.

Additionally, all U.S.

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The federal government audits and reviews our performance on contracts, pricing practices, cost structure, and compliance with applicable laws, regulations and standards.

Like most government

contractors, our contracts are audited and reviewed on a continual basis by federal agencies, including the Defense Contract Management Agency (“DCMA”) and the Defense Contract Audit Agency (“DCAA”).

Like most government contractors, our contracts are audited and reviewed on a continual basis by federal agencies, including the Defense Contract Management Agency (“DCMA”) and the Defense Contract Audit Agency (“DCAA”).

In addition, we are subject to industry specific regulations due to the nature of the products and services we provide.

For example, certain aspects of our business are subject to further regulation by additional U.S.

government authorities, including (i) the Federal Aviation Administration (“FAA”), which regulates airspace for all air vehicles in the U.S.

authorities, including (i) the Federal Aviation Administration (“FAA”), which regulates airspace for all air vehicles in the U.S.

National Airspace System, (ii) the National Telecommunications and Information Administration and the Federal Communications Commission, which regulate the wireless communications upon which our UAS depend in the United States, (iii) the Defense Trade Controls of the U.S.

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There are three primary types of government contracts in our industry.

These basic types of contracts are typically referred to as fixed price contracts, cost reimbursable contracts, including cost plus fixed fee, cost plus award fee, and cost plus incentive fee, and time and materials contracts.

These basic types of contracts are typically referred to as firm fixed price (“FFP”), cost-plus-fixed fee, cost-plus-award fee, and cost-plus-incentive fee (“Cost Plus”) and time and materials (“T&M”) contracts.

These contracts are not subject to adjustment by reason of costs incurred in the performance of the contract.

With this type of contract, we assume the risk that we will not be able to perform at a cost below the fixed price, except for costs incurred because of contract changes ordered by the customer.

Cost Reimbursable.

These contracts reimburse allowable costs and include types such as cost-plus-fixed fee, cost-plus-award fee, and cost-plus-incentive fee.

Under each type of contract, we assume the risk that we may not be able to recover costs if they are not allowable under the contract terms or applicable regulations, or if the costs exceed the contract funding.

Under each type of contract, we assume the risk that we may not be able to

recover costs if they are not allowable under the contract terms or applicable regulations, or if the costs exceed the contract funding.

They typically present lower profit margins and risk.

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Under these contracts, our compensation is based on a fixed hourly rate established for specified labor or skill categories.

We risk reduced profitability if our actual costs exceed the costs incorporated into the fixed hourly labor rate.

One variation of a standard time and materials contract is a time and materials, award fee contract.

We risk reduce profitability if our actual costs exceed the costs incorporated into the fixed hourly labor rate.

One variation of a standard T&M contract is a T&M, award fee contract.

Under this type of contract, a positive or negative incentive can be earned based on achievement against specific performance metrics.

Additional key contract frameworks include the following:

Commercial Service Offerings (“CSO”) .

These contracts are for services that we typically sell or are prepared to sell to the general public or to non-governmental entities for purposes other than governmental purposes, and we offer to the U.S.

Government price, terms and conditions similar to those offered to its commercial customers.

IDIQ and IDIQ Type Contract Form.

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Competitive bid contracts are awarded after a formal bid and proposal competition among providers.

International competitive bidding processes are highly competitive and sometimes we face disadvantages in the bidding and evaluation process in comparison to local, domestic bidders that may receive priority or more favorable evaluations than non-domestic suppliers due to stated requirements in the local

regulations that promote domestic procurements.

Sole source awards are direct engagements with the procuring agency.

Generally, sole source awards are utilized by our existing customers to sustain or augment their use of our products, commonly through multi-year support agreements.

These agreements allow for customer logistics organizations to tailor procurement and support efforts to the needs of the end users.

These agreements allow for customer logistics organizations to tailor

procurement and support efforts to the needs of the end users.

International funding processes vary, are generally allocated during the applicable country’s fiscal year, are often confidential, and may be broadly allocated or targeted for specific purposes, making it difficult to forecast demand.

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norms, potentially complicating enforcement and receivable collection.

We minimize risks by assessing each contract individually and requiring banking guarantees or advance payments.

To minimize risks, we assess each contract individually and may require banking guarantees or advance payments.

International sales may be Foreign Military Sales (“FMS”) or Direct Commercial Sales (“DCS”).

FMS contracts are agreements between the Company and the U.S.

Government, managed by the Defense Security Cooperation Agency (“DSCA”), to supply defense equipment, services, or training to foreign governments or international organizations.

Under these agreements, the U.S.

Government acts as the primary purchaser and intermediary, holding the contractual responsibility for delivery, while the contractor works directly with the foreign customer to define technical specifications and logistics.

DCS contracts are agreements between the Company and a foreign government, international organization, or authorized foreign commercial entity, without the U.S.

Government acting as the intermediary contracting party.

Under DCS arrangements, the Company is contractually responsible to the foreign customer for delivery, performance, and compliance with applicable U.S.

export control laws and regulations, including required licenses and approvals.

Some of our international contracts are subject to industrial participation or offset requirements established by the procuring government.

These programs may require us to invest in local industry, source components or services from in-country suppliers, or otherwise provide economic benefits in the customer’s jurisdiction as a condition of securing or performing the contract.

Failure to satisfy applicable offset obligations could result in penalties or fees.

Environmental Regulation

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Our website address is http://www.avinc.com .

We make our website content available for information purposes only.

We make our website content

available for information purposes only.

It should not be relied upon for investment purposes, nor is it incorporated by reference into this Annual Report.

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We may announce material business and financial information to our investors using our investor relations website at https://investor.avinc.com/investor-relations.

We therefore encourage investors and others interested in the company to review the information that we make available on our website, in addition to following our filings with the

SEC, webcasts, press releases and conference calls.

We therefore encourage investors and others interested in the company to review the information that we make available on our website, in addition to following our filings with the SEC, webcasts, press releases and conference calls.

Information contained on our website is not part of this Annual Report on Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business