AeroVironment surpassed analysts' revenue expectations for the second quarter of 2026.
Management downwardly revised fiscal 2026 guidance.
The current sell-off provides a potential buying opportunity for investors willing to endure some volatility.
Shares of drone manufacturer AeroVironment (NASDAQ: AVAV) are encountering turbulence late this afternoon. The company reported disappointing financial results for the second quarter of 2026, and management's downward revision of guidance for fiscal 2026 is also contributing to the stock losing altitude this afternoon.
As of 4:50 p.m. ET, shares of AeroVironment are down 4.7% from their closing price of $281.42 at 4:00 p.m.
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Despite a strong performance at the top of the income statement, investors are placing more weight on the company's inability to meet analysts' profitability expectations. While analysts anticipated the company would report adjusted diluted earnings per share (EPS) of $0.79, AeroVironment posted adjusted EPS of $0.44, a 6.4% year-over-year decrease.
In addition to examining the company's recent performance, management's increasingly bearish outlook on the remainder of fiscal 2026 is prompting investors to consider move the drone stock from their portfolios. AeroVironment now expects to report adjusted diluted EPS of $3.40 to $3.55 -- lower than the adjusted diluted EPS of $3.60 to $3.70 that it projected in September, when it reported Q1 2026 financial results.
Reporting Q2 2026 revenue of $472.5 million, AeroVironment achieved a 151% year-over-year increase on the top line, surpassing analysts' estimates of $465.6 million.
While investors are sending AeroVironment stock lower in after-hours trading, those with the resilience to withstand some near-term turbulence would be wise to consider shares of this leading drone stock. The company projects strong revenue growth in fiscal 2026, and while it expects to report lower adjusted diluted EPS than it did several months ago, this is hardly enough to justify a steep sell-off.
Scott Levine has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AeroVironment. The Motley Fool has a disclosure policy.