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The electric vertical takeoff and landing (eVTOL) revolution is certainly gaining momentum, with JPMorgan analysts projecting a massive $1 trillion market opportunity by 2040. Leading the charge in this high-stakes race, Archer Aviation (ACHR) is positioning itself as a key player in the future of urban air mobility. With powerful manufacturing partnerships with automotive giants and strategic defense collaborations, Archer is building the foundation to scale production and capitalize on both commercial and military markets.
While its flagship eVTOL, Midnight, inches closer to Federal Aviation Administration (FAA) certification, the company is not willing to wait around for the certification to earn revenue and is preparing to launch its air taxi services as early as late 2025 in certain international markets. Through its “Launch Edition” initiative, the company recently secured a groundbreaking deal to introduce its air taxi services in Abu Dhabi later this year, a milestone that could prove the viability of its entire business model.
But with regulatory hurdles, capital-intensive scaling, and fierce competition still ahead, is Archer Aviation stock a buy, sell, or hold this year?
About Archer Aviation Stock
California-based Archer Aviation (ACHR) is charting the future of urban air mobility with its advanced eVTOL aircraft.
Valued at around $3.35 billion by market cap, shares of this flying taxi stock are gaining attention as investor excitement builds around the future of urban air mobility. Over the past year, shares of Archer Aviation have skyrocketed by an impressive 86%, vastly outpacing the broader S&P 500 Index’s ($SPX) 13.8% return. And the rally has only intensified in the last six months, with shares skyrocketing 149%.
Digging Into Archer Aviation’s Q4 Performance
The pre-revenue company dropped its fourth-quarter earnings release on Feb. 27, highlighting deepening losses. Net loss for the final quarter of fiscal 2024 surged to $198.1 million, a sharp increase from $109.1 million incurred in the same period last year. The company’s adjusted EBITDA loss also deepened in the fourth quarter, reaching $94.8 million, widening from the $85.2 million loss recorded a year ago.
While the company’s bottom line remains in the red and might be concerning, it’s also important to acknowledge that this is hardly a surprise, especially for a startup operating in such a capital-intensive industry. On the brighter side, Archer Aviation closed out the fourth quarter with a record-high cash position, boasting $834.5 million in cash and cash equivalents, along with an additional $6.8 million in restricted cash.
This marks the highest quarter-end cash balance in the company’s history, reinforcing its strong financial footing. Adding to this momentum, the company successfully secured a $301.8 million registered direct offering in early 2025, pushing total liquidity to an impressive $1.1 billion. With this war chest, Archer is well-positioned to accelerate its vision for the future of urban air mobility. Looking forward to Q1, management anticipates its adjusted EBITDA loss to range between $95 million and $110 million.
Archer Aviation Soars on New Commercial Customer
While Archer Aviation’s financial results didn’t spark much excitement among investors, another game-changing announcement stole the show. On the same day as its fourth-quarter earnings release, the company introduced its “Launch Edition” commercialization program for the Midnight aircraft. The news sent Archer’s stock soaring more than 12% on Feb. 28, signaling strong investor enthusiasm for its growth ambitions.
The Launch Edition program is designed to create a scalable and repeatable framework for deploying Midnight eVTOLs in early adopter markets, with Abu Dhabi Aviation (ADA) stepping in as the first customer. Archer is gearing up for a transformative year, with plans to deliver its first Midnight aircraft to ADA next summer. Together, the two companies will introduce electric air taxi services in Abu Dhabi, focusing on pilot training, flight operations, and community engagement.
As part of the deal, Archer will also provide back-end software infrastructure and a front-end booking platform. Looking ahead, Archer plans to begin generating revenue from Midnight eVTOL sales in 2025. With a vision to replace lengthy 60- to 90-minute car commutes with efficient 10- to 20-minute air taxi flights, the company is accelerating toward the future of urban transportation.
What Do Analysts Expect for Archer Aviation Stock?
Despite limited coverage, Wall Street appears optimistic about ACHR stock, with a consensus “Moderate Buy” rating. Of the nine analysts offering recommendations, five back it with “Strong Buy,” two give a “Moderate Buy,” and the remaining two maintain “Hold.” The average analyst price target of $11.33 indicates 40% potential upside from current price levels, while the Street-high price target of $13 suggests that ACHR could rally as much as 60% from here, offering investors a compelling growth opportunity in the rapidly evolving eVTOL industry.
