Counter-drone systems are emerging as an important incremental opportunity for Unusual Machines UMAC as demand for domestically sourced drone components continues to expand.
On the last earnings call, management noted that the Department of War remains the primary demand driver, supported by the Drone Dominance Gauntlet program, higher autonomous-systems spending and an accelerating counter-UAS market. Management highlighted that the Gauntlet Program is on track, with Phase 2 in its final selection process, and that more than 60,000 drones were expected to be ordered in the second half of 2026, primarily in the fourth quarter.
Management highlighted several large industry awards, including counter-UAS and FPV drone programs, and believes these programs should generate incremental component demand. UMAC expects demand stemming from these programs to begin flowing through the supply chain in the late third quarter, fourth quarter and into 2027.
Unusual Machines, Inc. Revenue (Quarterly)
Unusual Machines, Inc. revenue-quarterly | Unusual Machines, Inc. Quote
The company added that it is already working with more than one customer in the counter-drone space, with some existing FPV customers purchasing similar components for counter-UAS applications. Management highlighted Powerus as an early customer and said additional contract activity across the industry should provide better visibility into demand as customers finalize their supply chains.
In September, the company collaborated with Altana to reinforce the supply-chain infrastructure supporting its expanding domestic manufacturing.
This demand backdrop could support UMAC’s broader growth strategy, but execution remains critical. The company is already operating in a supply-constrained environment and is investing heavily in manufacturing expansion and qualifying new suppliers. On the last earnings call, management said the business needs to complete much of its infrastructure transformation by the end of the third quarter to prepare for the expected demand wave in late 2026 and 2027.
Mapping the Competitive Terrain
Ondas Inc. ONDS is also expanding aggressively in the counter-UAS space. Sentrycs’ Cyber-over-RF business posted roughly 298% year-over-year pro forma revenue growth in the second quarter of 2026, while management expects the platform to remain a key growth driver as customers adopt layered counter-drone infrastructure.
Ondas is also broadening its Counter-UAS portfolio through DZYNE. The company is combining DZYNE's Sawtooth technology with Sentrycs' Cyber-over-RF capabilities for counter-UAS applications. The solution is expected to offer a more complete detect, identify and defeat capabilities by integrating sensing, electronic effects and command-and-control functions together on one platform. Meanwhile, IonStrike (through DZYNE) is expected to begin receiving commercial-volume orders and initial deliveries during the second half of 2026.
AeroVironment AVAV is also seeing strong counter-UAS momentum. Its layered offering spans Titan RF jammers, LOCUST directed-energy systems and the Freedom Eagle-1 kinetic interceptor.
The company has secured a nearly $465 million contract for its LOCUST directed-energy systems under the U.S. Army's Enduring High-Energy Laser program in late August and received the first international order for LOCUST systems through a direct commercial sale. AeroVironment views LOCUST as a potential future franchise and believes the product line could become a more than $500 million annual business. The company is expanding its Albuquerque facility to support rising LOCUST production and anticipated global demand.
UMAC’s Price Performance, Valuation and Estimates
UMAC’s shares have inched up 1.2% over the past month against the Wireless-National industry’s decline of 2%.
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Unusual Machines is trading at a 12-month forward price/sales ratio of 12.9X, considerably higher than the industry’s multiple of 4.81X.
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The Zacks Consensus Estimate for UMAC’s earnings for the current year has been revised upward over the past 60 days.
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UMAC currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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