Archer Aviation shares soared on Monday after announcing a partnership with privately held defense technology start-up Anduril.
Shares of the electric vertical takeoff and landing, or eVTOL, aircraft maker rose 20.5% in midday trading to $5.36, while the S&P 500 was up 0.3%.
The move came after the company announced plans to develop an autonomous vertical takeoff and landing platform for defense and commercial applications.
The strength of the move might also be affected by short sellers. About 20% of the stock available for trading has been borrowed and sold short by investors betting on declines. Good news can send short sellers rushing to cover the bearish bets.
Anduril showed off the defense variant, Thunder, at the Farnborough Airshow on Monday. It is a "group five" attack rotorcraft. Group five drones are larger, more capable systems. Group one drones could be carried by a soldier and might be a guided bomb.
A hybrid-electric powertrain enables better range without compromising power.
"From raw performance to producibility, harnessing the best technologies from the commercial eVTOL market for defense is central to how Thunder will deliver operational value to our customers," said Shane Arnott, SVP of Maneuver Dominance at Anduril, in a news release. "The clean-sheet, dual-use platform that we've built with Archer truly represents a step change in capability."
Archer will announce commercial partners later this week.
The gains leave it down 55% over the past 12 months. It's been tough for eVTOL start-ups lately. Joby Aviation shares were down about 56% over the past 12 months, through midday trading.
Investors, it seems, know eVTOLs work and now want to see revenue generation. Archer plans to start commercial service in the Middle East this year. Significant sales aren't expected until 2028, and sales expectations have been sliding.
In October, Wall Street projected $1 billion in 2028 sales. That estimate is down to about $500 million. A slower sales ramp also means more cash will be needed to finance early operations.
That cycle of delayed profits requiring more external financing -- and how that affects investor sentiment -- is a risk any start-up faces.
Write to Al Root at allen.root@dowjones.com
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July 20, 2026 14:33 ET (18:33 GMT)
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