Red Cat Holdings has had a wild run this year, and Wednesday was no exception. The stock climbed around 12% intraday, touching the $18.10–$18.13 range, as traders positioned ahead of a Q4 earnings report set to drop after the bell.
The anticipation is backed by numbers. Back in January, Red Cat gave preliminary Q4 revenue guidance of $24M to $26.5M. Wall Street’s consensus heading into the print was around $23.95M, meaning the company’s own forecast already set the bar above analyst expectations.
For context, Q4 2024 revenue was just $1.3M. The implied growth rate of 1,842% is not a typo.
Full-year 2025 revenue is expected to land between $38M and $41M — up from $15.6M in 2024, and above the guidance range the company issued back in November.
The main engine behind the growth has been the U.S. Army’s Short Range Reconnaissance (SRR) Tranche 2 contract. Originally awarded as a Limited Rate Production deal in July 2025, it has since grown to approximately $35M. The contract centers on Red Cat’s Teal drone platform.
Q3 was already a signal of the momentum to come. Revenue hit $9.6M in that quarter — up 646% year-over-year and 200% sequentially — beating expectations at the time. Management then raised Q4 guidance, with CEO Jeff Thompson saying Q4 would be “more revenue in one quarter than we have ever done in a 12 month period.”
Thompson also highlighted the Black Widow drone system as the primary revenue contributor right now. The system was recently approved for the NATO NSPA catalog, which opens up procurement access to NATO member countries and partner nations.
The company has also been expanding its footprint beyond land-based drones. It launched Blue Ops, a new maritime division, which Thompson described as “perhaps the most exciting strategic expansion.”
Ladenburg Thalmann raised its price target on RCAT from $15 to $20 following a March 3 report, issuing a “Buy” rating. Needham maintained its “Buy” with a $16 target on March 2. Northland Securities has a $22 target set since January, while Weiss Ratings holds a “Sell” stance.
The consensus sits at “Hold” with an average target of $19.33.
On the institutional side, several funds added or expanded positions in Q4 2024. Invesco increased its stake by 36.3%, Janus Henderson by 29.5%, and Caitong International Asset Management grew its position by over 1,800%. Institutional ownership now stands at approximately 38%.
The stock’s 50-day moving average is $13.55 and its 200-day average is $11.00. The 12% Wednesday move pushes RCAT near its 52-week high of $18.78.
CFO Chris Ericson noted that the company’s financial position reflects improved operational leverage as production scales to meet rising demand.
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