Palladyne AI Corp (PDYN) AI Stock Analysis

• Market Cap: $351.04M
• Dividend Yield: N/A
• Average Volume (3M): 6.13M
• Price to Earnings (P/E): 16.5
• Beta (1Y): 3.59
• Revenue Growth: -44.07%
• EPS Growth: 25.75%
• Country: US
• Employees: 71
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): -0.16
• Shares Outstanding: 46,494,865
• 10 Day Avg. Volume: 6,149,887
• 30 Day Avg. Volume: 6,125,941
• PEG Ratio: -0.15
• Price to Book (P/B): 2.22
• Price to Sales (P/S): 31.54
• P/FCF Ratio: -5.84
• Enterprise Value/Market Cap: 0.88
• Enterprise Value/Revenue: 59.08
• Enterprise Value/Gross Profit: 121.26
• Enterprise Value/Ebitda: -11.49
• 1Y Price Target: $11.00
• Price Target Upside: 45.70% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): -0.41
• Revenue Forecast (FY): $24.92M

• Rating: 56 Neutral
• Price Target: $8.00 ▲(5.96% Upside)
• Action: Reiterated Date: 03/06/26
• Date: Action: Reiterated 03/06/26

The score is held back primarily by weak financial performance—deep operating losses and ongoing negative free cash flow—despite improving revenue and margins. Technicals are a key offset with strong upside momentum, though signals look extended. The earnings call adds moderate support via reiterated high-growth guidance and rising backlog, but continued cash usage and execution/integration risks keep the overall score in the mid-range.

Positive Factors

Backlog and Revenue Guidance

Reiterated $24M–$27M 2026 guidance and backlog growth to ~$18M indicate a meaningful structural revenue runway from converted contracts and acquisitions. This underpins durable top-line scalability over 12–24 months if backlog converts and execution remains consistent.

Vertical integration and strategic acquisitions

Acquisitions add avionics design, certified U.S. manufacturing and precision components, creating a vertically integrated platform. This reduces supplier dependency, accelerates productization, and supports higher-margin systems sales across defense and industrial markets over multiple years.

Improving unit economics (revenue and gross margin)

Sustained revenue growth and a ~57.6% gross margin point to improving unit economics in core autonomy products. Durable margin improvement suggests the business can leverage software and integrated hardware to drive higher incremental margins as revenue scales, benefiting long-term profitability.

Negative Factors

High cash burn and negative free cash flow

Persistent negative operating and free cash flow implies reliance on external financing to fund growth and acquisitions. Over 2–6 months this raises runway and dilution risk if revenue conversion slows or cash burn remains near management's $8M–$9M quarterly guidance for 2026.

Deep operating losses and weak profitability

Extremely negative operating margins signal the cost base far exceeds current revenue, meaning scaling is required before core profitability. Until structural cost discipline or significant revenue uplift occurs, returns on capital and earnings durability remain fragile.

Integration, certification and long defense sales cycles

Ongoing integration and certification tasks, plus multi-step defense procurement, create execution timing risk. Even with backlog, delays in certification or long contract cycles can postpone revenue recognition and increase incremental costs, challenging near-term delivery of the roadmap.

Palladyne AI Corp Business Overview & Revenue Model

Company Description

Palladyne AI Corp., a software company, focuses on delivering software that enhances the utility and functionality of third-party stationary and mobile robotic systems in the United States. Its Artificial Intelligence (AI)/ Machine Learning (ML) Foundational Technology enables robots to observe, learn, reason, and act in structured and unstructured environments. In addition, the company's technologies enable robotic systems to perceive their environment and quickly adapt to changing circumstances by generalizing from their experience using dynamic real-time operations without extensive programming, training, or the latency associated with processing in the cloud. Further, it offers Palladyne IQ used with industrial robots and cobots, enabling them to learn multiple tasks and handle disruptions or obstacles; and develops Palladyne Pilot for use with unmanned platform, such as Class 1 UAVs to enable persistent detection, identification, tracking, and classification of objects of interest by sharing situational awareness information across multiple drones that is derived by fusing multi-modal sensor data. It serves industrial manufacturing, defense, infrastructure maintenance, repair and surveillance, energy, and aerospace and aviation industries. The company was formerly known as Sarcos Technology and Robotics Corporation and changed its name to Palladyne AI Corp. in March 2024. Palladyne AI Corp. is headquartered in Salt Lake City, Utah.

How the Company Makes Money

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Palladyne AI Corp Financial Statement Overview

Summary

Revenue growth and improved gross margin are positives, and leverage appears manageable, but the financial profile is still dominated by extremely weak operating profitability and persistent cash burn (negative operating cash flow and free cash flow), implying continued reliance on external funding.

Income Statement

TTM (Trailing-Twelve-Months) revenue grew strongly (+20.7%) and gross margin improved to ~57.6% versus prior years, showing better unit economics. However, profitability remains very weak: EBIT and EBITDA margins are deeply negative (about -581% and -561% in TTM), indicating the cost structure is still far above the current revenue base. Net income swung positive in TTM, but the margin is still shown as highly negative, suggesting earnings quality is not yet supported by core operations.

Balance Sheet

Leverage looks manageable in TTM with debt-to-equity around 0.20 and total debt of ~$10.8M against ~$74.7M of equity, providing balance-sheet flexibility. That said, equity has been volatile (negative in 2024), and returns on equity are negative in TTM, reflecting ongoing value dilution from losses at the operating level. Overall, the balance sheet is not heavily levered, but consistency and profitability remain key risks.

Cash Flow

Cash generation is a major weakness: TTM operating cash flow is about -$27.6M and free cash flow about -$28.4M, continuing a multi-year pattern of sizable cash burn. Free cash flow improved versus the prior period (positive growth), but it is still materially negative, implying ongoing reliance on financing to fund operations. With negative operating cash flow, the company’s ability to self-fund growth remains limited.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.25M	7.79M	6.15M	14.57M	5.08M
Gross Profit	2.56M	4.30M	1.10M	2.96M	1.21M
EBITDA	-31.31M	-26.29M	-78.64M	-103.21M	-80.46M
Net Income	10.04M	-72.62M	-115.59M	-157.13M	-81.51M
Balance Sheet
Total Assets	95.71M	56.25M	60.43M	167.63M	235.82M
Cash, Cash Equivalents and Short-Term Investments	47.05M	40.07M	39.09M	114.50M	217.11M
Total Debt	10.78M	11.04M	12.40M	13.28M	7.00K
Total Liabilities	21.04M	65.79M	19.52M	23.18M	21.86M
Stockholders Equity	74.67M	-9.53M	40.91M	144.45M	213.96M
Cash Flow
Free Cash Flow	-28.35M	-22.89M	-77.40M	-66.89M	-46.79M
Operating Cash Flow	-27.64M	-22.63M	-76.62M	-65.39M	-42.10M
Investing Cash Flow	-24.58M	6.88M	64.68M	-109.05M	-4.69M
Financing Cash Flow	39.25M	23.80M	-82.00K	-7.52M	230.24M

Palladyne AI Corp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.55
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PDYN, the sentiment is Positive. The current price of 7.55 is above the 20-day moving average (MA) of 7.23, above the 50-day MA of 6.67, and above the 200-day MA of 7.48, indicating a bullish trend. The MACD of 0.41 indicates Negative momentum. The RSI at 52.00 is Neutral, neither overbought nor oversold. The STOCH value of 38.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PDYN.

Palladyne AI Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
PDYN	56 Neutral	$351.04M	16.48	19.25%	―	-44.07%	25.75%
ZENA	52 Neutral	$111.10M	-4.91	-93.10%	―	312.20%	―
BBAI	49 Neutral	$1.94B	-83.08	-69.72%	―	-6.95%	-53.69%
VERI	48 Neutral	$288.27M	-2.44	-367.59%	―	-17.50%	-51.25%
GRRR	48 Neutral	$257.29M	-21.55	―	―	―	―
AI	47 Neutral	$1.26B	-2.86	-55.55%	―	1.84%	-27.74%

Palladyne AI Corp Corporate Events

Palladyne AI Reports Transformational 2025 Results, Strong Backlog

Palladyne AI Corp. reported its fourth quarter and full-year 2025 results on March 5, 2026, highlighting a year of structural transformation driven by November 2025 acquisitions of GuideTech, Warnke Precision Machining and MKR Fabricators, and the launch of Palladyne Defense. The company shifted from a pure autonomy software player to an integrated defense and industrial technology platform spanning advanced avionics, proprietary UAV and missile systems, engineering services and certified manufacturing, while also strengthening its intellectual property and expanding into space-related work with the Air Force Research Laboratory and Portal Space Systems.

In the fourth quarter of 2025, revenue rose 118% year over year to $1.7 million, though the company posted a larger operating loss of $9.3 million, and for the full year revenue fell 33% to $5.2 million amid a $32.4 million operating loss despite GAAP net income driven by non-operational items. Operationally, Palladyne AI commercially released Palladyne IQ 2.0, signed its first customer, demonstrated collaborative autonomous swarming between its Gremlin-X UAV and Red Cat platforms, secured a missile propulsion subsystem contract with a new defense prime and grew backlog to $13.5 million by year-end 2025 and nearly $18 million by mid-February 2026, underpinning reiterated 2026 revenue guidance of $24 million to $27 million and signaling increased visibility and momentum across air and space defense programs.

The company also hired a new President of Commercial and Industrial, advanced development of its Gremlin-X mini-bomber and new BRAIN variants, and obtained a new patent plus multiple applications supporting swarming and decentralized autonomy architectures. These moves collectively position Palladyne AI to pursue significant revenue growth, deepen defense engagements and translate its embodied AI and autonomy technologies into broader commercial and space-domain opportunities despite ongoing losses, making backlog conversion and program execution key for stakeholders watching its 2026 trajectory.

The most recent analyst rating on (PDYN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Palladyne AI Corp stock, see the PDYN Stock Forecast page.

Palladyne AI Elevates Matt Muta to Lead Commercial Push

On February 18, 2026, Palladyne AI Corp. announced that long-time board member Matt Muta will become President, Commercial and Industrial, effective March 2, 2026, and that he has resigned from the board in connection with this transition. The company said his departure from the board, formalized in a February 17 resignation letter, was not driven by any disagreement over operations, policies or practices.

The appointment underscores Palladyne AI’s push to accelerate commercial deployment of its Palladyne IQ embodied AI platform for poly-functional industrial robots following the launch of Palladyne IQ 2.0. By putting an executive with deep experience in enterprise software adoption and complex technology commercialization in charge of sales, partnerships and go-to-market strategy, the company aims to strengthen execution, drive enterprise adoption and build a scalable revenue engine for its commercial and industrial business.

The most recent analyst rating on (PDYN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Palladyne AI Corp stock, see the PDYN Stock Forecast page.

Palladyne AI Unveils Embodied AI Strategy Investor Deck

On January 14, 2026, Palladyne AI Corp. published a new investor presentation on its website outlining its strategy as an “embodied AI” provider and cross-domain defense and industrial technology player, emphasizing its closed-loop autonomy software portfolio, vertically integrated capabilities from AI to manufacturing, and dual focus on defense and commercial markets. The company signaled that this deck will guide upcoming investor outreach and reiterated that it will continue to disseminate potentially material information through SEC filings, its websites and social media channels, underscoring a push to sharpen its market positioning and investor communications as it seeks to capitalize on demand for autonomous systems and mid-tier defense primes.

The most recent analyst rating on (PDYN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Palladyne AI Corp stock, see the PDYN Stock Forecast page.

Palladyne AI Corp Issues Strong 2026 Revenue Outlook

On January 13, 2025, Palladyne AI Corp announced preliminary, unaudited 2025 financial figures and sharply higher revenue guidance for 2026, signaling a major step-up in scale following late-2025 acquisitions. For the year ended December 31, 2025, the company expects revenue of $5.0 million to $5.5 million, along with approximately $47 million in cash, cash equivalents and marketable securities and more than $13 million in backlog as of year-end, most of which it anticipates converting to revenue over the following 12 months. For 2026, Palladyne is guiding to revenue of $24 million to $27 million—representing a 336% to 440% increase over 2025 driven largely by the integration of GuideTech, Warnke Precision Machining and MKR Fabricators, as well as expanding contracted demand—highlighting management’s view that the business is at an operating inflection point with greater revenue visibility and a stronger liquidity position to support execution and integration efforts.

The most recent analyst rating on (PDYN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Palladyne AI Corp stock, see the PDYN Stock Forecast page.