Archer Aviation Inc. (ACHR) Q3 2026 earnings review
Archer nears its Boeing deal, but its cash losses grow
Archer Aviation, the developer of electric air taxis and military drones, moved closer to city flights and a major Boeing deal while its cash drain grew. Third-quarter operating loss excluding one-offs was $179 million, inside the company's plan, as research spending rose and cash fell to $1.35 billion. Chief executive Adam Goldstein said the purchase of Boeing's Wisk, Insitu and SkyGrid units has only one approval left, and Archer delivered its first Midnight aircraft to Los Angeles after winning a new flight certificate.
| Revenue | $5.1M $5.0M last quarter |
|---|---|
| Ebitda loss, excluding one-offs | $178.5M planned $170–200M loss |
| Cash and short-term investments | $1,354M down $207M from last quarter |
| Q4 Ebitda loss outlook | $185–205M middle of the range: $195M loss |
⚖️ Verdict: ⚪ Neutral
The story is unchanged because progress on regulators and acquisitions matched a step-up in planned spending. Winning the Los Angeles flight certificate and shipping initial drone engines to defence partner Anduril help the commercial and military plans, and the Boeing deal will soon add over $200 million in yearly drone sales. One caution: the fourth-quarter outlook pushes the operating loss range higher before those three Boeing units even join the books, leaving about six and a half quarters of cash at this quarter's pace by our math.
The question now is whether buying Boeing's three units lowers Archer's cash drain or increases it. Either Insitu's drone profits cover the cost of developing Midnight, or Wisk's autonomous aircraft research adds a heavy new expense on top of an already rising budget. The first quarterly report after the Boeing purchase closes will settle it.
🐂 Bull Case
FAA Certificate Clears Los Angeles Test Flights
Archer makes Midnight, an electric aircraft designed to carry passengers on short city trips. To prepare for the 2028 Los Angeles Olympics and a federal pilot programme called eIPP, the company needs permission from the Federal Aviation Administration (FAA), the US aviation regulator, to fly over busy cities. Chief executive Adam Goldstein said the new Market Survey certificate "allows us to mature to passenger trials and revenue operations under the eIPP and as a part of LA28".
The company earned that certificate after flying Midnight more than 300 miles across seven Northern California cities, including flights out of Oakland International Airport. Archer also delivered its first Midnight aircraft to its hub at Hawthorne Airport in Los Angeles and began building eleven new hangars there. Operating in crowded airspace builds the test record the regulator requires before approving commercial service.
What to watch: the start of piloted flights out of Hawthorne Airport in the coming weeks. Flying regularly in Los Angeles airspace will show that Midnight can operate around major commercial airports ahead of passenger trials.
Boeing Deal Nears Close With One Approval Left
Archer is shifting from a single-product air taxi developer into a broader aviation and defence business through acquisitions. In August, the company agreed to buy three Boeing subsidiaries: autonomous aircraft maker Wisk, airspace software provider SkyGrid, and military drone maker Insitu. Management previously planned to close the purchase by the end of 2026.
Goldstein said closing "will be much sooner than that, with only one of the nearly 20 governmental and third-party approvals outstanding". Insitu brings more than $200 million in yearly sales across 35 countries and has built over 4,000 unmanned aircraft. Goldstein wants to grow Insitu's sales in 2027 so its profits can "meaningfully offset our continued spend to bring Midnight to market".
What to watch: the fourth-quarter outlook update after the Boeing deal closes. That disclosure will show how much immediate revenue Insitu adds and whether Wisk's research spending increases Archer's total cash drain.
Anduril Engine Deliveries Start Defense Revenue
Developing a military aircraft or selling parts to defence partners offers a faster path to sales than waiting for civilian passenger certification. Archer works with defence technology company Anduril on two programmes: supplying electric powertrain parts for Anduril's Omen drone in the United Arab Emirates, and jointly building a larger hybrid-electric autonomous aircraft called Halo for commercial use and Thunder for military missions.
This quarter, Goldstein said Archer "delivered the initial battery packs and electric engines to Anduril for Omen", helping generate $5.1 million in third-quarter revenue alongside Hawthorne airport sales. Engineers also started testing the turboshaft engine, a fuel-burning turbine that generates electricity in flight, for the Halo and Thunder platform. Delivering hardware proves the defence partnership is generating early cash while full-scale flight testing stays on schedule for late 2027.
What to watch: fourth-quarter revenue against the $5 million to $6 million outlook. Hitting or beating that range before the Boeing deal closes will show whether Anduril component shipments are becoming a steady revenue stream.
🐻 Bear Case
Cash Burn Rises Again in the Fourth Quarter
Archer funds its aircraft development and airport construction from its cash balance while managing several major programmes at once. Last quarter, management framed its current spending level as a baseline that would stay relatively steady. Instead, the fourth-quarter outlook points to a wider operating loss even before absorbing the three Boeing businesses.
- Third-quarter Ebitda loss, excluding one-offs: $178.5 million, up 53.7% from a year ago
- Fourth-quarter Ebitda loss outlook, excluding one-offs: $185 million to $205 million ($195 million at the middle of the range)
- Research and development spending: $198.3 million, up $12.3 million from last quarter
- Cash and short-term investments: $1,353.6 million, down $207.0 million in three months
Spending is climbing because Archer is paying for Midnight certification, Hawthorne hangar construction, and hybrid engine testing all at once. By our math, losing $207 million of cash a quarter leaves about 6.5 quarters of cash runway on a standalone basis. Because the company is burning more cash before Wisk even joins the books, the risk of another share sale remains high.
What to watch: first-quarter 2027 cash drain after the Boeing deal closes. A wider quarterly cash loss would show that Wisk's research costs outweigh Insitu's profits.
Key Flight and Launch Targets Remain Open
To carry paying passengers, Midnight must complete piloted transition, where the aircraft takes off straight up like a helicopter, tilts its propellers forward to cruise like an aeroplane, and lands vertically with a pilot on board. Management previously targeted completing piloted transition, starting Texas eIPP flights, and delivering more aircraft to the United Arab Emirates before the end of 2026.
With less than two months left in the year, none of those three goals is finished. On piloted transition, Goldstein said engineers "are closing in on completing that milestone by the end of the year". For Texas, he said teams "continue to plan with the FAA to bring the “No Roads” tour to Texas, Florida, and New York", while the shareholder letter did not mention United Arab Emirates aircraft deliveries at all. Delaying these steps pushes back commercial air taxi revenue.
What to watch: a press release or fourth-quarter update confirming a piloted full transition flight by December 31. Missing that year-end deadline would mark another delay in the Midnight test schedule.
Stock Compensation and Deals Drive Share Dilution
Archer excludes stock-based compensation—shares given to employees, founders, and suppliers instead of cash—from its headline operating loss metric. While that practice saves cash today, it steadily increases the number of shares outstanding and reduces each existing shareholder's slice of the business.
In the third quarter, stock-based compensation reached $86.5 million, up 63.8% from $52.8 million a year ago, plus $8.6 million in warrant expenses for manufacturing partner Stellantis. Weighted-average diluted shares rose 20.0% from a year ago to 793.4 million, and closing the Boeing deal will issue another large block of stock to make Boeing the company's biggest shareholder. High stock pay means the real cost of running Archer is nearly half again as large as its headline operating loss suggests.
What to watch: total share count in the fourth-quarter report after the Boeing transaction closes. That figure will establish the new ownership baseline before any future cash raises.
Risks this quarter didn't answer
Several standing financial and operational concerns received no new numbers in the third-quarter shareholder letter or earnings release.
- Wisk and SkyGrid cash burn and Insitu cash flow: still undisclosed; post-closing financial filings will show the combined cash drain.
- Midnight production rate and fleet size: no count of built aircraft was given; the quarterly filing or fourth-quarter report is the next check.
- Phase 4 certification progress: no percentage of completed FAA compliance checks was disclosed; future regulatory updates will test the pace.
- Competitor lawsuits and related-party spending: updates on the Joby and Vertical lawsuits and Neon Aero payments await the quarterly 10-Q filing.
👓 Other Themes
Formula 1 and European Airline Partnerships
Archer signed two commercial agreements to build future demand for its Midnight air taxi. The company partnered with Formula 1 "to explore the future integration of eVTOL air taxi services at Grand Prix events", after displaying an aircraft in Austin and ahead of a showcase in Las Vegas. Separately, Italian flag carrier ITA Airways, part of the Lufthansa Group, joined Archer's network to plan air taxi routes in Italian cities.
💲 Other KPIs
Spending on property and equipment eased from $37.1 million in the second quarter and $32.6 million in the first quarter. Across the first nine months of 2026, capital spending reached $101.4 million, more than double the $49.2 million spent in the same period last year as Archer upgrades Hawthorne Airport and builds out manufacturing.
Overhead and administrative costs fell 3.1% from $93.9 million last quarter, driven by a $5.7 million drop in one-time legal settlement accruals. Compared with a year ago, general and administrative spending is still up 68.2% from $54.1 million, reflecting a larger corporate workforce and $3.5 million in cash advisory costs for the Boeing acquisition.
Combined short-term and long-term debt rose by $12.2 million from $80.1 million in the second quarter, after holding near $80 million for the prior three quarters. Cash flow statements show Archer borrowed $11.8 million during the third quarter while repaying $0.3 million, adding modest leverage alongside its $88.4 million in lease obligations.
🔮 Guidance
New. Archer issued its first quarterly revenue outlook, calling for $5.5 million at the middle of the range, up about 8% from the third quarter's $5.1 million. The forecast reflects ongoing operations at the Hawthorne Airport fixed-base operator and initial hardware deliveries to Anduril, and appears to exclude any post-closing contribution from Boeing's Insitu business.
New. The plan calls for an operating loss of $195 million at the middle of the range, widening by $16.5 million from the third quarter's $178.5 million loss. That steps above the $170 million to $200 million range management set for both the second and third quarters. Archer has landed inside its quarterly loss range for seven straight quarters.
❓ Key Questions
What is the combined cash drain of Wisk and Insitu?
Insitu generates over $200 million in yearly revenue and is profitable, but Wisk is developing an autonomous air taxi that requires heavy research spending. Investors need each unit's cash flow to see if the Boeing deal lowers or raises Archer's total cash drain.
How many Midnight aircraft is Archer currently building?
Management previously targeted building two aircraft a month by the end of 2025, then stopped mentioning that figure. Disclosing how many FAA-conforming test aircraft are in the fleet today would clarify whether manufacturing is keeping pace with the Los Angeles launch plan.
What is the current schedule for United Arab Emirates flights?
The United Arab Emirates Launch Edition programme used to be Archer's top near-term commercial goal, but it did not appear in the third-quarter shareholder letter. Investors need to know if customer payments have paused or if the commercial focus has shifted to Los Angeles.
How will Archer measure Phase 4 certification progress?
Midnight is in the fourth and final stage of FAA type certification, where engineers test every aircraft system against agreed rules. Without a clear percentage of completed compliance checks, outsiders cannot tell if full commercial approval is on track for the 2028 Olympics.