AeroVironment shares fell after the company confirmed that the U.S. Space Force terminated its Satellite Communication Augmentation Resource (SCAR) contract, worth up to $1.7 billion. The contract was a key component of AeroVironment’s $4.1 billion acquisition of BlueHalo, which closed in May 2025.
The agreement called for AeroVironment to build BADGER, a new generation of mobile, phased-array ground antennas designed to control military satellites. Company executives said AeroVironment and the Space Force could not reach a mutually agreeable solution to modify the existing contract. The government will terminate the contract for convenience and reimburse AeroVironment for costs incurred.
Following the cancellation, AeroVironment lowered its fiscal 2026 revenue forecast. The company said it remains committed to developing BADGER for the commercial market and plans to recompete for SCAR under revised requirements.