If Archer Aviation (NASDAQ:ACHR) achieves its vision, electric vertical takeoff and landing (eVTOL) vehicles could soon become a reality, reshaping how people move through cities. The company’s ambitions have already drawn support from major players in the aviation industry, including Boeing and United Airlines.
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While it is quite an undertaking, the company is making progress on its journey to commercialization. It is in the midst of manufacturing six of its Midnight aircraft, and just recently completed its longest test flight (going 55 miles in 31 minutes) under the watchful gaze of United Airlines’ CFO.
A supportive U.S. administration is also pushing things along. In June, President Donald Trump created the eVTOL Integration Pilot Program, and ACHR is currently conducting discussions with the Department of Transportation and the Federal Aviation Administration for potential deployments of the Midnight aircraft in 2026.
Even with industry and political tailwinds, however, Archer still faces considerable hurdles. The company remains pre-revenue, and its annual cash burn of $447.5 million is giving some investors pause. Among them is Brett Schafer, who foresees plenty of turbulence on the horizon.
“Archer Aviation is going to have a hard time getting to profitability,” explains the investor.
The company seems to be in a strong financial position, acknowledges Schafer, and its $1.7 billion in cash at the end of Q2 2025 gives it at least a few years to figure out the manufacturing puzzle. However, the investor also worries that the financing won’t be such a simple equation to solve.
For instance, Schafer estimates that Archer will need to generate some $1.5 billion in revenue to cover its annual expenses. With Midnight aircraft expected to cost $5 million each, the investor points out that the company will need to “eke out” a 30% gross margin per vehicle while ramping up to 300 deliveries a year.
“It could take Archer Aviation five to 10 years to reach this level of revenue. Remember, it generates zero revenue today,” adds Schafer.
Shareholder dilution is another concern, as the company executed a $850 million stock offering earlier this summer. Schafer notes that this could serve as another headwind for investors going forward.
“Archer Aviation stock is not a buy for investors, even with the stock dipping below $10,” concludes Schafer. (To watch Brett Schafer’s track record, click here)
Wall Street, however, is feeling much more bullish. With 6 Buys and 1 Hold, ACHR enjoys a Strong Buy consensus rating. Its 12-month average price target of $13.14 suggests gains approaching 50% in the year ahead. (See ACHR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.