AIRO

Evidence of pricing strength appears when full systems dominate mix: Q4 2025 gross margin was about 61 percent and Q2 2026 reached 64 percent, while Q1 2026’s 26.6 percent shows vulnerability when upgrades and lower-margin work skew mix.

Blue UAS status and mission-proven performance support premium positioning, but the presence of well-capitalized rivals caps latent pricing power. We see room for margins to improve as U.S. procurement ramps and avionics and camera subsystems (Zentra) increase proprietary content per system.

Overall pricing power looks moderate with upside if mix and scale normalize.