This article is published in Aerospace Daily & Defense Report part of Aviation Week Intelligence Network (AWIN), and is complimentary through Mar 19, 2026. For information on becoming an AWIN Member to access more content like this, click here.
AeroVironment’s Badger phased array antenna system.
AeroVironment is cutting its sales and earnings outlook after the Pentagon terminated the Satellite Commercial Communications Augmentation Resource (SCAR) program.
The company on March 10 disclosed that the U.S. Space Command terminated the program for convenience after talks failed to solve issues that triggered the service in January to issue a stop-work order for the company’s Badger system.
“We could not come to a mutually acceptable agreement with our customer to modify the existing contract and resume work,” CEO Wahid Nawabi said on an earnings call. The Space Force will now pay the company fees owed under a termination for convenience, and Nawabi said AeroVironment will be able to recompete for a revised program requirement.
The stock fell almost 10% in March 11 pre-market trading.
The Space Force in 2022 awarded then-BlueHalo a $1.4 billion contract for 12 Badger phased array antenna systems, with a subsequent September 2025 option for the effort about 10 months after AeroVironment acquired the company.
AeroVironment trimmed full-year top-line growth and earnings expectations as it reported its third financial quarter figures. Sales for the year should now come in at $1.85 billion to $1.95 billion from $1.95 billion to $2 billion. Adjusted operating earnings should be $265 million to $285 million, or $35 million below the previously anticipated figure.
Company backlog also will need to be pared back, CFO Kevin McDonnell said on the call. AeroVironment ended the quarter with $1.1 billion in funded and $3 billion of unfunded backlog. About half the unfunded figure is SCAR related, he noted. The SCAR termination also triggers a $151 million non-cash goodwill impairment associated with the BlueHalo acquisition.
Nawabi said he is not giving up on the Badger program, though. “The need for this capability gap has become more important and more urgent than before,” he said, calling the company’s offering “compelling.”
The Badger program involves a multi-band software-defined antenna to improve performance of satellites in geostationary orbit. Nawabi said the company would continue to develop the technology and offer it as a commercially available product to the Space Force, arguing the company is years ahead of rivals.
“We do not expect the SCAR program to have a significant impact on our growth profile beyond this year,” he said.
Related Content
