What Are Archer Aviation Stock Bears Missing

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Archer Aviation (ACHR) is buying the drone maker Insitu from Boeing. This deal may be what the company's bulls are betting on. Bears see an air taxi startup that burns cash with almost nothing to sell. Meanwhile, the stock fell 64.6% over the past year, while the S&P 500 gained 17.1%. Shares closed at $3.98 on October 20, 2026, giving the company a market value of about $3.1 billion. The pending acquisition and the falling stock price point in opposite directions. So how big is the drone business Archer is buying?

Insitu Would Bring Sales Archer's Air Taxis Lack

Insitu sells about 29 times as much as Archer. Management said on the fiscal Q2 2026 call that the drone maker is currently profitable, producing over $200 million in annual revenue across 35 countries. Archer itself reported $6.9 million in revenue over the four quarters ended June 2026.

Management provided these figures. Because the deal has not closed, Insitu's sales do not yet appear in Archer's accounts. Management also said it expects Insitu to contribute positive free cash flow after closing. If that holds, the drone business would fund itself rather than draw on Archer's cash.

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Can Archer Keep Its Cash Burn Steady?

Not so far. Archer's free cash flow was negative $681 million over the four quarters ended June 2026. That metric worsened from negative $477 million a year earlier, showing the cash burn has grown. Management said on the same call that the company can grow sales while keeping cash burn relatively flat from where it stands today, through the closing and the integration.

The company has time to try. Archer held $1,561 million in cash and short-term investments at the end of June, compared with $126 million of debt. Its adjusted EBITDA loss for fiscal Q2 2026 was $177 million, landing near the low end of management's $170 million to $200 million range.

The share count presents a fair objection. Archer's diluted share count rose 211.4% in the three years to fiscal Q2 2026. Boeing is taking a stake in Archer as payment for Insitu and two other Boeing businesses, Wisk Aero and SkyGrid. That payment is all stock with a lockup. If Insitu funds itself as management expects, that helps Archer's cash, but not the number of shares.

What Would Show The Boeing Deal Falling Short?

A delayed or failed closing would offer the first sign. Management is targeting a close by the end of the year. On September 24, 2026, Archer announced that the Hart-Scott-Rodino waiting period for the deal had expired.

The $200 million metric represents revenue. Management called Insitu profitable but provided no profit figure for it. Without the deal, Archer is left with the air taxi business the bears already see. Management said the pace of that market is hard to predict.

Insitu's sales reach Archer only when the deal closes, and Archer's own cash burn grew over the past year. Management expects the adjusted EBITDA loss for fiscal Q3 2026 to stay within $170 million to $200 million. Watch whether Archer's fiscal Q3 2026 adjusted EBITDA loss lands in that range in the report expected on or around November 5, 2026.

Is Too Much Of Your Wealth Riding On One Stock?

A stock like Archer Aviation can look very different depending on which part of the business you watch. When one position grows into a large part of your wealth, a sharp fall can hurt your whole plan, and selling to spread the money out can bring a large tax bill. Our partner advisory firm offers a free strategy review of ways to protect a concentrated position and unwind it with less tax.

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