Aerovironment Inc (AVAV) SEC Filing 10-Q Quarterly Report for the period ending Saturday, October 29, 2022

Exhibit 99.1

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AeroVironment Announces Fiscal 2023 Second Quarter Results

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ARLINGTON, VA, December 6, 2022

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Second Quarter Highlights

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“Our second quarter results came in line or slightly better than expectations and, given recent awards and accelerating demand across our portfolio, we are increasing our revenue guidance for fiscal year 2023,” said Wahid Nawabi, AeroVironment chairman, president and chief executive officer. “In November, we were awarded a Puma Small UAS systems contract with a ceiling value of $176 million and initial funding of $86 million. This award is the largest FMS order in the company’s history, and we expect shipments to start next quarter and continue over the next 6-12 months. This award, combined with our record backlog, gives us confidence to raise revenue guidance even as we continue managing ongoing supply chain constraints and inflationary cost pressures.

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“In addition, we are also slightly reducing our profitability outlook for fiscal year 2023 due to increased R&D investments targeted at additional growth opportunities and accelerated Medium UAS asset depreciation related to a shift in US DOD funding priorities. We expect margins will recover and backlog will increase throughout the second half of fiscal year 2023 setting the stage for profitable organic double-digit growth in fiscal year 2024 and beyond.”

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FISCAL 2023 SECOND QUARTER RESULTS

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Revenue for the second quarter of fiscal 2023 was $111.6 million, a decrease of 9% from the second quarter of fiscal 2022 revenue of $122.0 million. The decrease in revenue reflects a decline in product sales of $8.7 million and service revenue of $1.8 million. The overall decrease in revenue was primarily due to a decrease in revenue in the Small UAS segment of $28.0 million, partially offset by an increase in revenue from the Tactical Missile Systems (“TMS”) segment of $12.7 million and an increase in customer-funded research and development revenue of $4.2 million.

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Gross margin for the second quarter of fiscal 2023 was $25.9 million, a decrease of 39% from the second quarter of fiscal 2022 gross margin of $42.5 million. The decrease in gross margin reflects lower product margin of $9.2 million and lower service margin of $7.4 million. As a percentage of revenue, gross margin decreased to 23% from 35%. The decrease in gross margin percentage was primarily related to unfavorable product mix and accelerated depreciation charges related to the anticipated completion of certain MUAS COCO site locations of $4.5 million. Gross margin was negatively impacted by $4.0 million of intangible

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