Shares of Ondas (ONDS) surged 11% after the Palantir-partnered autonomous drone company reported first-quarter revenue grew 1,065% year-over-year to $50.1 million, beating analyst estimates.
"We delivered record results in the first quarter of 2026, with revenue of $50.1 million representing a ten-fold increase year-over-year, as our Core + Strategic Growth Program continues to drive strong execution and accelerating momentum across the business," Eric Brock, Chairman and CEO of Ondas, said.
The West Palm Beach, Florida-based company's results showed soaring demand for its autonomous systems, particularly for counter-drone platforms. Ondas beat expectations on both the top and bottom lines while significantly increasing its order book.
The stock rose to $9.83 following the release. Ondas raised its full-year revenue guidance to at least $390 million from a previous target of $375 million, citing a pro forma backlog that surged 569% to $457 million from $68.3 million at the end of 2025.
Institutional Support and Strategic Growth
The strong results come as regulatory filings show growing institutional interest. BlackRock recently disclosed owning over 9.3 million shares, valued at about $84 million, while J.P. Morgan established a new stake of nearly 7 million shares.
Ondas' growth has been heavily fueled by its "Ondas Autonomous Systems" (OAS) division and a series of acquisitions. The company's backlog was materially boosted by the additions of Mistral, a U.S. Department of War prime contractor, and World View, a stratospheric balloon platform. These moves expand Ondas' capabilities in loitering munitions and advanced intelligence, surveillance, and reconnaissance (ISR). A strategic partnership with Palantir Technologies (PLTR) is also helping the company integrate its systems and scale its AI-driven platforms.
Path to Profitability in Focus
Despite the massive revenue growth, profitability remains a key concern for investors. The company's adjusted EBITDA loss widened to $10.9 million from $7.5 million a year ago as operating expenses surged due to acquisition costs and investments in growth. Ondas expects adjusted EBITDA losses to peak in the second quarter of 2026.
Critics point to substantial execution risks associated with integrating multiple acquisitions in a short period. The company's path to company-wide profitability, which it targets for the first quarter of 2028, depends on flawlessly converting its large backlog into revenue. The company's high valuation and reliance on financing, which can dilute shareholder value, also remain significant risks.
The strong guidance and surging backlog signal management's confidence in capturing demand for autonomous defense systems. Investors will watch for further details on the integration of recent acquisitions and progress toward managing cash burn.
This article is for informational purposes only and does not constitute investment advice.
