Redwire CEO Blames Drone Delivery Timing, Not Demand, For Soft Quarter
Management reaffirmed a $450 million to $500 million revenue range after a quarter of $109 million.
Redwire Chairman and CEO Peter Cannito said on the company's Thursday earnings call that uneven drone shipments, not weak demand, held back third-quarter revenue of $109 million, up 5.4% from a year earlier. Redwire shares fell 19.82% to $6.19 in Thursday trading, against a prior close of $7.72.
Export licenses and late parts
Redwire, a space and defense technology company that builds spacecraft, solar arrays, drones and sensors, is moving its Stalker drone from Block 30 to Block 40 and developing the Penguin Mark 3. Cannito told analysts that an export-control approval that does not arrive, or a supplier that delivers late, can push a big order across quarters.
He pointed to "big, chunky orders" like the National Guard's Stalker order as the upside and the risk. Defense tech revenue was $47.8 million, down year over year on shipment timing, while space revenue was $61.3 million, up more than 30% organically.
Total revenue also slipped from the second quarter, which CFO Chris Edmunds called a small sequential decrease.
Inventory as a proxy for revenue
Edmunds said defense tech work in process and finished goods inventory rose $10.6 million from the prior quarter to $46.8 million, with customer orders nearing completion in the coming weeks. A Jefferies analyst asked whether that build is a rough proxy for revenue pushed into the fourth quarter. Edmunds replied "you're right on."
He added that the defense tech segment books revenue when products ship, unlike the space business, which recognizes it over time. The drones must be finalized and any licenses obtained first.
Defense tech bookings were $68.8 million, a book-to-bill ratio of 1.44, meaning orders ran ahead of revenue in the segment.
A wide gap to the full-year range
Management reaffirmed 2026 revenue guidance of $450 million to $500 million. Edmunds cited $323.1 million recorded in the first nine months and record backlog of $619.7 million, up 14.3% from the prior quarter.
Margins improved: gross margin reached 32.3%, from 16.3% a year earlier. The net loss narrowed to $23.2 million, and adjusted EBITDA was negative $5.3 million as research spending rose to $14.4 million from $7.7 million. Total liquidity stood at $538.9 million.
Whether the finished drones clear licensing and ship in the fourth quarter decides if nine-month revenue of $323.1 million reaches the reaffirmed range.
Sources
- Redwire Q3 2026 Earnings Call Transcript — benzinga.com
- RDW Stock Drops Overnight Despite Record Margins And Backlog – Here’s Why Retail Bulls Are Betting On 2027 — Yahoo Finance
- Redwire Stock Hits Turbulence After Mixed Quarter: EPS Beats, Revenue Misses Estimates — benzinga.com
- Redwire Non-GAAP EPS of -$0.06 beats by $0.03, revenue of $109.04M misses by $17.52M (RDW:NYSE) | Seeking Alpha — seekingalpha.com
- Redwire Exec at AUSA: Some Defense Solutions Worth More Than the Price Tag — Yahoo Finance
