Archer’s (ACHR) eVTOL business still has tremendous potential, and its recent deal with Boeing (BA) gives it valuable intellectual property and a profitable unit that can help defray some expenses.
Additionally, Archer’s partnership with Anduril, one of the world’s most successful defense-tech businesses with a compelling long-term outlook, is encouraging.
On the other hand, Archer still has not clarified the status of its manufacturing operations, and the company may struggle to get the Pentagon to spend heavily on its upcoming military aircraft.
In light of these points, I do not believe Archer’s shares are worth buying right now. Instead, ACHR will remain a “wait-and-see” story until it shows that it can effectively and efficiently manufacture significant numbers of eVTOLs and/or generate meaningful demand for its military aircraft.
Big Potential With Boeing and Anduril Deals
As I’ve asserted in past columns, I believe eVTOLs can become very popular because they let travelers in major cities avoid traffic jams at reasonable prices. Moreover, the Trump administration is supporting eVTOLs, significantly increasing the chances of them succeeding.
Turning to Archer’s deal with Boeing, ACHR through the transaction acquired Insitu, a profitable drone maker that can help Archer reduce its huge losses. Further, Archer also obtained Wisk Aero, which develops software that enables autonomous vehicles. Archer can potentially use Wisk’s technology to make its own eVTOLs and drones autonomous.
Encouraging for the outlook of ACHR stock, Boeing’s compensation will consist of “a nearly 20% stake in Archer“ and the right to choose one member of the startup’s board. The deal shows some confidence by Boeing, which will retain access to Wisk’s technology, in ACHR stock.
Additionally, Archer has built an “autonomous attack rotorcraft” called Thunder in partnership with Anduril. Using the same platform, the pair have also unveiled a hybrid-electric vertical takeoff and landing aircraft for several companies. Anduril, whose revenue reportedly doubled to $2.2 billion in 2025 and is expected to nearly double again this year, has developed AI-powered software that enables drones to operate autonomously.
Moreover, Anduril has contracts with most branches of the Pentagon, and was named as the most disruptive company overall by CNBC in 2025. So Archer’s alliance with Anduril could prove to be very positive for ACHR stock. And given Anduril’s involvement, the aircraft developed by the two companies likely employs state-of-the-art, technology and there’s a good chance that the Pentagon will be interested in buying a number of them.
Manufacturing Issues and Uncertain Demand for Anduril Aircraft
As I noted in past columns, Archer had planned in 2024 to manufacture 15 to 25 eVTOLs in 2025. But it has not yet stated that it has met this goal, and in general it has been quite tight-lipped on the subject. The company did not appear to address the issue in its Q2 shareholder letter or during its Q2 earnings conference call. In light of these points, I remain quite concerned about the company’s ability to manufacture its eVTOLs.
Further, it’s difficult to determine the extent of the demand for the aircraft that Archer developed in partnership with Anduril. Thunder has multiple advantages, including quietness and a combination of the speed of aircraft and the vertical-landing capabilities of helicopters. Also importantly, Anduril’s involvement, as mentioned earlier, is certainly advantageous. But with the Pentagon seemingly focused on drones and autonomous ships, it may not wind up spending a great deal of money on Thunder.
Similarly, it’s difficult to gauge how much interest there will be in the companies’ civilian aircraft, Halo.
Outlook for ACHR Stock
Archer has a market capitalization of $4.8 billion, but its revenue next year, even with Insitu’s contribution, probably won’t come in much above $400 million in the best-case scenario. Moreover, Archer may be experiencing problems with its manufacturing operations and/or its supply chain, while it may have trouble selling a large number of its new aircraft. As a result of these issues, I recommend that investors avoid ACHR stock.
*This article is intended to be informational only; it is not financial advice.
