Palladyne AI stock falls after announcing defense division formation
Investing.com -- Palladyne AI Corp (NASDAQ:PDYN) stock fell 5.6% Monday after the company announced the formation of Palladyne Defense through multiple acquisitions, transforming the AI software developer into a vertically integrated defense technology company.
The Salt Lake City-based company acquired GuideTech LLC and two Crucis companies (Warnke Precision Machining and MKR Fabricators) for approximately $31 million, consisting of $20 million in stock, $5 million in cash, and the assumption of about $6 million in debt.
Palladyne AI, which reported 2024 revenue of $7.8 million, expects these acquisitions to more than triple its revenue by 2026. The acquired businesses are projected to be adjusted EBITDA positive in 2026, though the company plans to invest approximately $5 million over the next 12-18 months to advance GuideTech’s proprietary loitering munitions systems.
The newly formed Palladyne Defense will unite the company’s patented embodied AI with UAV and loitering munitions components, advanced engineering, and U.S.-based manufacturing capabilities. The division aims to deliver revenue-generating programs and scalable U.S. production capacity while supporting Department of War modernization priorities.
"This marks a defining inflection point for Palladyne AI. Through the creation of Palladyne Defense, we are transforming from an AI software innovator into a vertically integrated defense technology company," said Ben Wolff, President and CEO of Palladyne AI.
The combined companies bring an 18-month backlog exceeding $10 million. Palladyne Defense will focus on supplying avionics, components, and software along with design and engineering services, while also developing proprietary products to address capability gaps not currently served by traditional defense contractors.
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