Red Cat Holdings Inc (RCAT)
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Since November 2024 Red Cat has what every small defense company wants: a U.S. Army Program of Record. Revenue jumped to $40.7 million in fiscal 2025. Only $1.3 million of it survived as gross profit — 3.1 percent — against operating expenses of $67.9 million and a net loss of $72.1 million. Three quarters of revenue came from a single customer, management rates its own controls "not effective", and in May 2026 the company raised roughly $245 million of fresh equity. Not investment advice — just the arithmetic behind the order.
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AI Rating
Sells AIDie KI-Software steckt im verkauften Produkt: Der Geschäftsbericht 2025 beschreibt die umsatztragende Drohne Black Widow ausdrücklich mit zuschaltbaren integrierten KI-Software-Fähigkeiten, das Unternehmen bestätigt den Einsatz von KI-Technologien in seinen Produkten, und im März 2026 kaufte es für 19,8 Mio. US-Dollar den Schwarm-Autonomie-Entwickler Apium hinzu.
View the full file — quotes, sources, reviewed filings
„Teal products include the Black Widow™, which enables swift adaptation to mission requirements, including SRR with selectable integrated AI software capabilities."
Zu den Teal-Produkten gehört die Black Widow™, die eine schnelle Anpassung an die Einsatzanforderungen ermöglicht — einschließlich SRR mit zuschaltbaren integrierten KI-Software-Fähigkeiten.
„We currently incorporate AI Technologies into certain of our products, solutions and business functions, and may seek to expand or alter the use of AI Technologies in the future."
Wir setzen KI-Technologien derzeit in bestimmten unserer Produkte, Lösungen und Geschäftsfunktionen ein und werden ihre Nutzung künftig möglicherweise ausweiten oder verändern.
„On March 27, 2026, the Company purchased the assets of Apium, Inc. and Apium Swarming Robotics, Inc. and created a new subsidiary called Apium Swarming Technologies, Inc. (“Apium”) to deepen the Company's ability to deliver intelligent, adaptive unmanned systems that enable coordinated operations in contested and communication-degraded environments."
Am 27. März 2026 erwarb das Unternehmen die Vermögenswerte von Apium, Inc. und Apium Swarming Robotics, Inc. und gründete eine neue Tochtergesellschaft namens Apium Swarming Technologies, Inc. („Apium“), um die Fähigkeit des Unternehmens zu vertiefen, intelligente, anpassungsfähige unbemannte Systeme zu liefern, die koordinierte Einsätze in umkämpften und kommunikationsgestörten Umgebungen ermöglichen.
Filings Reviewed: 10-Q 2026-05-07 · 10-K 2026-03-19 · 10-Q 2025-11-13 · 10-Q 2025-08-14 · 10-Q 2025-05-14 · 10-K 2024-08-08
Rated on July 27, 2026 · How the Rating Is Built
Highlighted are things our editorial team noticed: green = stands out as strong, red = deserves a closer look. No single metric is a verdict on its own — always read it in context.
Quarterly Figures
| Quarter | EPS (Earnings Per Share) | EPS YoY (%) | Sales ($M) | Sales YoY (%) | Net Margin (%) | OCF ($M) | FCF ($M) |
|---|---|---|---|---|---|---|---|
| 2025: Q1 | -0.27 | – | 2 | -72.10 | -1,418.60 | -16 | -16 |
| 2025: Q2 | -0.27 | – | 2 | -74.20 | -1,418.60 | -16 | -16 |
| 2025: Q3 | -0.15 | – | 3 | 141.10 | -412.50 | -13 | -13 |
| 2025: Q4 | -0.16 | – | 10 | 528.40 | -166.00 | -24 | -25 |
| 2026: Q1 | -0.16 | – | 26 | 1,509.50 | -74.90 | -37 | -42 |
| 2026: Q2 | -0.22 | – | 16 | 849.10 | -171.60 | -32 | -39 |
- EPS (Earnings Per Share):
- Quarterly profit divided by the total share count — how much of the profit works out to a single share.
- YoY (Year over Year):
- Change versus the same quarter a year ago — this is how you compare without seasonal distortion (e.g. the holiday shopping season).
- Sales:
- All revenue for the quarter, before any costs are deducted — the top line of the income statement.
- Net Margin:
- What percentage of sales is left over as profit in the end. Negative means the company is posting a loss.
- OCF (Operating Cash Flow):
- The cash that actually flows into the till from the core business during the quarter — harder to dress up than book profit.
- FCF (Free Cash Flow):
- Operating cash flow minus capital expenditures — the money that's genuinely free to use, say for paying down debt, buybacks, or dividends.
Assessment: Opportunities & Risks
The selection of Teal Drones for the U.S. Army's Short Range Reconnaissance program in November 2024 is a permanently anchored procurement line, not a one-off order. Revenue rose from $4.850 million in the eight-month transition period to December 31, 2024 to $40.729 million in fiscal 2025 and to $15.471 million in the first quarter of 2026 alone (prior-year quarter: $1.630 million). A $9.5 million reorder followed on May 8, 2026.
Of $40.729 million of 2025 revenue, only $1.274 million remained as gross profit — 3.1 percent. Against that stood $67.871 million of operating expenses, including $36.875 million for administration alone. The net loss came to $72.075 million. In the first quarter of 2026 the gross margin rose to 12.7 percent, yet $16.718 million of administrative cost still exceeded $15.471 million of revenue.
In fiscal 2025, 73 percent of total revenue came from a single customer, and as of December 31, 2025 that customer also held 88 percent of outstanding receivables. About 73 percent of revenue came from U.S. Government contracts. The first quarter of 2026 eased that slightly (Customer A 56 percent, Customer B 19 percent) but leaves a dependence on one procurement program.
As of March 31, 2026 the books showed $131.919 million of cash, $238.739 million of equity and virtually no financial debt ($0.350 million short-term). In May 2026 net proceeds of about $245.4 million from an offering were added. Measured against the first-quarter 2026 operating cash outflow of $31.945 million, that is arithmetically about twelve quarters, just under three years — provided the burn rate does not rise.
Disclosure controls were rated not effective as of December 31, 2025 and again as of March 31, 2026; the material weakness in staffing, supervision and segregation of duties persists. Add a class action and two derivative suits over production capacity and contract value, a compensation proposal defeated on June 18, 2026 (15,194,017 to 21,304,013), four of five directors with more withheld than affirmative votes, and the for-cause termination of the Chief Revenue Officer on July 17, 2026 together with his July 21 lawsuit.
85.5 million weighted shares in the first quarter of 2025 became 152,192,265 after May 19, 2026; as of March 31, 2026 a further 23 million shares stood behind options, warrants and plan reserves. At $8.51 (weighted average of the CEO sales, Form 4 of July 16, 2026) that corresponds to about $1.3 billion of market value and roughly 32 times fiscal 2025 revenue. The company itself puts net tangible book value after the offering at $2.80 per share.
Red Cat has the contract small defense companies work toward for years: a U.S. Army Program of Record that lifted fiscal 2025 revenue to $40.729 million. So far, though, that success is paid for by the capital market rather than by the customer: $1.274 million of gross profit stood against $67.871 million of operating expenses, the net loss came to $72.075 million, and three quarters of revenue came from a single buyer. The gross margin firms up to 12.7 percent in the first quarter of 2026 and the cash box is well filled after the May 2026 offering — but the company's own controls are rated ineffective, four proceedings are running, and shareholders rejected the pay proposal in June 2026. Not investment advice.
- Red Cat reached the research list through the Reddit hype scanner, which measures which names are written about unusually often in the stock forums; that data was pulled on July 25, 2026. The cross-check against our own screens on July 27, 2026 showed: across the lists of our in-house stock scanner, Red Cat appears that day on exactly one, "EPS acceleration" (29 names). These lists are recalculated daily.
- Recency status: the basis is the annual report (10-K) for 2025 filed March 19, 2026 and the quarterly report (10-Q) as of March 31, 2026 filed May 7, 2026. Every document filed afterwards was reviewed — the offering (424B5/8-K, May 2026), the closing of the Quaze acquisition (8-K, May 20, 2026), the annual meeting (8-K, June 25, 2026), the insider filings (Form 4) of June 15 and July 16, 2026, the notice of proposed sale (Form 144) of July 15, 2026 and the 8-K of July 22, 2026 on the termination of the Chief Revenue Officer.
- Careful with time series: Red Cat moved its fiscal year end from April 30 to December 31. Between the year to April 30, 2024 and calendar 2025 sits a transition period of eight months. Percentage changes across those periods compare spans of unequal length. Market value here is not a feed number but is calculated from 152.2 million shares and $8.51 per share — the weighted average price of the CEO's sales per the Form 4 of July 16, 2026. The share count on the cover of the notice of proposed sale (Form 144) of July 15, 2026 still reads 122,742,361; that is plainly the unchanged May 5, 2026 figure from before the offering, and is therefore not used here.
About the Company
Red Cat Holdings, Inc. bietet zusammen mit seinen Tochtergesellschaften Drohnen- und Robotiklösungen für Verteidigung, nationale Sicherheit und kommerzielle Anwendungen in den USA an.
| Employees | 244 |
|---|---|
| Headquarters | South Salt Lake, UT |
| Website | redcat.red |
| IPO Date | 22. Sep 2017 |
| Next Earnings | 13. Aug 2026 |
Management
| Name | Title | Birth Year |
|---|---|---|
| Jeffrey M. Thompson | Founder, President, CEO & Chairman | 1964 |
| Christian Koji Ericson | Chief Operating Officer | 1977 |
| Geoffrey Hitchcock | Chief Revenue Officer | 1963 |
| Christian Morrison | CFO, Treasurer & Secretary | 1983 |
| Sam Pelletier | Vice President of Finance & Accounting | – |
| Stan Nowak | Vice President of Marketing | – |
| B. Barrett Hinckley | President of BLUE OPS | – |
| Brian Huinker | Senior VP of Business Development & Global Defense Solutions | – |
| Rachel Erb | Senior Vice President of Business Operations | – |
| Mitch McDonald | President of Teal Drones | – |
Executives per the latest required filings; titles kept in their original language. Source: fundamental data.
Chart
Interactive price chart (TradingView).
Data as of: July 24, 2026 · Source: fundamental data & SEC filings (annual and quarterly reports, 10-K/10-Q)
Note: pure fact-based analysis, not investment advice and not a solicitation to buy or sell. All figures without guarantee.