Unusual Machines (NASDAQ:UMAC) is emerging as a key U.S. supplier in the reshoring drive for drone components, with defense demand and government-backed investment in unmanned aerial systems expected to fuel a sharp revenue ramp over the next two years.
The company is positioned to benefit from a historic surge in small, low-cost drones as Washington prioritizes domestic production and accelerates spending on next-generation military platforms.
Needham analyst Austin Bohlig initiated coverage on Unusual Machines with a Buy rating and $15 price forecast, citing its strong positioning as a U.S.-based supplier of NDAA-compliant drone components.
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He projected revenue to climb from $10 million in 2025 to $25 million in 2026, as defense contracts ramp and reshoring efforts accelerate demand for small, low-cost unmanned systems.
The analyst called the drone component maker one of the best-positioned domestic suppliers to benefit from the U.S. shift away from Chinese parts.
He argued that the U.S. is entering a historic supercycle for small, low-cost unmanned aerial systems (UAS), fueled by geopolitical conflicts that showcased the strategic importance of First Person View (FPV) ISR and one-way attack drones.
With the reshoring of critical drone components now a national priority, Bohlig sees UMAC poised to capture a meaningful share in the roughly $620 million U.S. component market by 2026.
Bohlig highlighted that recent conflicts in Ukraine and the Middle East demonstrated how inexpensive, attributable drones can reshape modern warfare.
In contrast, the U.S. procured only a fraction of the volume deployed abroad, leaving a clear capability gap. The Trump administration has placed unmanned systems at the center of defense strategy, with the fiscal 2026 defense budget and “One Big Beautiful Bill” allocating more than $15 billion to unmanned platforms, including an estimated $2 billion for small UAS.
Bohlig sees the Purpose-Built Attritable Systems (PBAS) program, valued at over $500 million, as the most significant near-term catalyst. With 12 firms bidding and more than half using UMAC’s components, he argued the company is uniquely positioned to benefit.
Financially, Bohlig projects 2025 revenue to grow 79% year-over-year to $10 million, driven by early defense demand and increasing consumer adoption of NDAA-compliant drone components.
He expects a sharper ramp beginning in 2026 as contracts materialize, forecasting 149% growth to $25 million, with enterprise sales rising 255% to $11 million.
He models gross margins improving from ~32% in 2025 to 38% in 2026, with long-term potential in the mid-40% to 50% range as scale and vertical integration expand.
Bohlig forecasts adjusted EBITDA losses of $5.7 million in 2025 and $2.8 million in 2026, with profitability likely in 2027 at a $44 million revenue run rate.
Price Action: UMAC shares are trading lower by 2.84% to $9.765 at last check Tuesday.
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