Prediction: Archer Aviation Carries Its First Paying U.S. Passenger Before 2028

With shares down 61% from its 52-week high, Archer Aviation (ACHR) stock presents an interesting angle: its second-quarter revenue was $5 million, all of which came from fueling, ground handling, and leasing space at Hawthorne Airport in Los Angeles. A year earlier, revenue was zero. The company’s electric vertical takeoff and landing (eVTOL) aircraft, Midnight, is in its final phase of FAA certification, having completed Phase 3 in May.

Phase 4 involves formal testing to achieve a type certificate. In July, a piloted Midnight flew a round-trip between Salinas Municipal Airport and Monterey Regional Airport, marking the first intercity flights in California. Archer was selected as an air taxi partner in three winning applications under the White House’s eVTOL Integration Pilot Program (eIPP), covering eight states.

CEO Adam Goldstein announced plans to begin operations in the Los Angeles area based out of Hawthorne Airport, with subsequent flights under the eIPP expected later this year in Texas. Archer is the Official Air Taxi Provider for the LA28 Olympic Games in 2028, a role that would require passenger service to commence by then. Despite a $263.2 million net loss in Q2, Archer ended June with $1.6 billion in cash and short-term investments, covering about seven more quarters.

The company also agreed to buy three Boeing subsidiaries in August, paying with stock and warrants, with closing expected by year-end. The UAE’s aviation regulator has already granted a Restricted Type Certificate for Midnight, allowing limited commercial operations in Abu Dhabi. While Archer’s prediction is that the first paying passenger will board a Midnight in the U.S. before 2028, the UAE could potentially lead with a paying passenger first.

The U.S. path hinges on FAA certification, but the UAE’s streamlined process offers an alternative timeline. The prediction hinges on Archer’s ability to demonstrate airworthiness, secure pilot programs, and manage operational costs without additional funding.

Source: The Motley Fool