Army Bets $464,800,000 On Drone-Killing Lasers That Cost Under $10 A Shot

RTX's Raytheon received a $729M contract for C-UAS systems. Boeing tested MQ-25 software, enabling autonomous coordination. The Navy awarded MQ-25A production contracts and tested automatic landing gear retraction. AeroVironment's VideoRay demonstrated autonomous mine countermeasures. Lockheed Martin delivered a C-130J for TACAMO conversion, with Northrop Grumman integrating systems. ThinKom provided SATCOM antennas for the E-130J Phoenix II. XTEND, Orqa, and Swarm received DoD drone awards.

AeroVironment's LOCUST X3, a 30-kilowatt laser weapon, won a $464.8M U.S. Army contract under the Enduring-High Energy Laser (E-HEL) program. The system is designed for modularity, allowing it to be mounted on various vehicles, and is intended to counter drone threats cost-effectively. The Army chose 30 kilowatts over 50 kilowatts to improve reliability and reduce power demands, according to officials.

Adm. Daryl Caudle, the Navy's top officer, advocates for directed energy weapons to counter cheap drones, citing cost imbalances. The Navy is investing in laser systems, with Lockheed Martin's HELIOS and other projects in development. The Pentagon awarded $86M to nLIGHT Defense and Lockheed Martin for laser weapon systems, aiming for 150-500 kilowatts of power. The Army has also used laser systems to neutralize drones, marking real-world applications.

The Pentagon selected four directed-energy systems, including AeroVironment's (AVAV) and Boeing's (BA) lasers, for testing at five U.S. military bases starting in 2026. The systems will be evaluated for a year to assess their effectiveness against drone threats. The Pentagon has allocated billions for counter-drone defenses, with directed-energy weapons costing significantly less per engagement than traditional interceptors.

The U.S. Army aims to deploy its first high-energy laser counter-drone weapon by early 2028, with testing and training ongoing. AeroVironment received a $464.8M contract for the LOCUST X3 system, expected to be delivered by Q4 2027. The Army demonstrated successful kills using a prototype in October, highlighting the system's modularity and potential for field-level maintenance.

Ondas (ONDS) shares fell 5% to $6.86, despite $270M in new defense orders and recent acquisitions. AeroVironment (AVAV) dropped 1%, while Kratos (KTOS) rose 0.4%. The Defiance Drone ETF (JEDI) declined 3%. Ondas' growth relies on acquisitions and order conversions, raising concerns about execution and production scaling.