AeroVironment says ‘could not come to acceptable agreement’ on SCAR

The company states: “We remain an active discussions with the US Space Force regarding the Badger Phased Array antenna system to support the Scar or satellite communication augmentation Resource Program. We appreciate that the contract was temporarily paused while we work together on a firm fixed price contract that provides a commercialized product solution. As of this morning, we could not come to a mutually acceptable agreement with our customer to modify the existing contract and resume work. Therefore, the US Space Force has concluded to terminate our existing contract for convenience, pay us for our allowable incurred cost with a fee. Fee and enable AV to recompete for the program.” Comments taken from Q3 earnings conference call. Separately in an 8-K filing, the company stated: “On March 10, 2026, during the course of negotiations between the Company and the U.S. Government regarding the Company’s Other Transaction Agreement (the “Agreement”) for the delivery of BADGER phased array antenna systems to support the Satellite Communication Augmentation Resource (“SCAR”) program, the U.S. Government informed the Company that it now intends to proceed with a termination for convenience of the Agreement, while providing the Company with the opportunity to compete for work under the SCAR program in the future. The Company intends to continue to invest in the BADGER product line by developing a commercial product to address the phased array antennae market.” Shares are extending afterhours decline, down over 10% below $199.