AIRO 2026년 2분기 실적 발표회: 매출 76% 급증, 드론 수주 잔고 1억 6,300만 달러 달성

AIRO는 드론 인도량 증가에 힘입어 2026년 2분기 매출과 이익률이 개선되었다고 발표했습니다. 경영진은 연간 성장 전망을 재확인하면서도 인도 시점과 환율 변동이 하반기 실적에 영향을 미칠 것이라고 경고했습니다.

핵심 요약

• 2026년 2분기 매출은 드론 부문의 성장에 힘입어 전년 동기 대비 76% 가까이 증가한 4,320만 달러를 기록했으며, 항공전자 및 교육 부문의 부진으로 일부 상쇄되었습니다.
• 매출총이익률은 드론 중심의 제품 믹스 전환을 반영하며 전년 동기의 61%에서 64%로 상승했습니다.
• 영업이익은 2025년 2분기 1,970만 달러의 영업손실에서 170만 달러로 흑자 전환했습니다. 조정 EBITDA는 470만 달러에서 680만 달러로 증가했습니다.
• 드론 수주잔고는 전분기 대비 약 9% 증가한 약 1억 6,300만 달러를 기록했습니다. 이는 주로 RQ-35 모델에 대한 해외 주문으로 구성되어 있으며, 미국 수주잔고는 아직 포함되지 않았습니다.
• 경영진은 하반기에 수백만 달러 규모의 추가적인 환율 압박이 예상됨에도 불구하고, 2026년 전체 매출 성장률 가이던스를 15%~25%로 유지했습니다.
• RQ-35는 Blue UAS 인증을 획득했으며, RQ-70의 생산은 2027년 1월에 시작될 예정입니다. JC250 및 JX250은 2026년 하반기 첫 비행을 목표로 일정대로 진행되고 있습니다.

주요 재무 데이터

사업 및 경영 성과

드론 시스템

2분기에는 드론 인도량이 매출 성장을 이끈 주된 요인이었습니다. 약 1억 6,300만 달러의 수주잔고는 전량 해외 주문으로, 주로 RQ-35 관련 물량이며 RQ-70의 비중은 소수에 불과합니다. 경영진은 수주잔고의 대부분이 12개월 이내에 매출로 전환될 것으로 예상하고 있습니다.

RQ-35는 Blue UAS 인증을 획득하여 미국 국방권한법(NDAA) 요건에 따른 미국 정부 및 국방 조달 입찰 자격을 갖추었습니다. 경영진은 회사가 미국의 여러 견적 요청(RFQ)에 응답했으나, 아직 미국 관련 사업 기회가 수주잔고에 반영되지는 않았다고 설명했습니다.

AIRO는 장거리 ISR(정보·감시·정찰) 플랫폼인 RQ-70도 선보였습니다. 이 시스템은 GPS 수신이 불가능한 환경에서도 작동이 가능하며 최대 8시간의 비행 시간과 100km의 비행 거리를 제공하도록 설계되었습니다. 경영진은 2027년 1월에 생산이 시작될 예정임을 재확인했으며, 초기 방산 고객들의 관심이 매우 높다고 전했습니다.

JC250 및 JX250 개발 현황

화물용 드론 JC250과 ISR 변형 모델인 JX250은 2026년 하반기 첫 비행을 목표로 일정대로 개발이 진행 중입니다. 두 플랫폼의 공통 기반 활용, 공급업체 협상, 플랫폼 시너지 및 R&D 수행 덕분에 회사 자체 개발 비용은 내부 예상치보다 10%대 초반 수준으로 낮게 유지되고 있습니다.

경영진은 이러한 무인 화물 및 ISR 변형 모델의 개발 비용이 이전에 검토했던 여객용 플랫폼에 비해 상당 부분 적게 든다고 밝혔습니다.

항공전자 및 교육 부문

항공전자 부문 매출은 안정적인 제품 수요에 힘입어 전분기와 비슷한 수준을 유지했습니다. AIRO는 항공전자 및 확장 중인 미국 드론 사업 부문을 피닉스로 통합했으며, 향후 몇 분기 내에 운영 및 공급망 시너지가 나타날 것으로 기대하고 있습니다.

교육 부문 실적은 기대치에 미치지 못했습니다. 경영진은 현재 미국 정부의 과제 발주와 AIRO의 역량 간 부합도가 낮다는 점과 해당 사업부의 자본 집약적 구조를 원인으로 꼽았습니다. 회사는 전략적 대안을 검토 중이며 올해 말까지 이 부문의 방향성을 결정할 예정입니다.

경영진 가이던스

• AIRO는 2026년 전체 매출 성장률 전망치를 전년 대비 15%~25%로 유지했습니다.
• 상당한 규모의 드론 인도 건이 3분기에서 2분기로 앞당겨짐에 따라 상반기 매출은 경영진의 현재 연간 매출 예상치의 약 50%를 차지했습니다.
• 경영진은 하반기 매출이 상반기와 비슷한 수준이거나 소폭 상회할 것으로 예상하고 있습니다.
• 3분기 매출은 2분기 대비 감소할 것으로 보이나, 4분기에는 실적이 반등할 전망입니다. 경영진은 4분기 매출이 2분기를 소폭 상회할 것으로 기대하고 있습니다.
• 추가적인 환율 악재로 인해 하반기 매출이 기존 추정치보다 수백만 달러 감소할 것으로 예상됩니다. 이 같은 영향은 유지된 가이던스에 이미 반영되어 있습니다.
• 연간 매출총이익률은 2025년 대비 소폭 하락하겠지만, 2026년 상반기 수준을 대체로 유지할 것으로 예상됩니다.
• 연간 조정 EBITDA는 약 1,500만~1,900만 달러 규모의 적자를 기록할 것으로 여전히 예상되며, 분기별 실적은 대체로 매출 흐름을 따라갈 것으로 보입니다.
• 경영진은 2027년 이후부터 잉여현금흐름(FCF)이 흑자로 전환될 것으로 전망하고 있습니다.

위험 요인 및 주요 관전 포인트

AIRO의 분기 실적은 대형 드론 인도 시점에 민감하게 반응합니다. 대규모 물량의 인도가 2분기로 조기 반영됨에 따라 3분기 매출은 전분기 대비 감소할 요인으로 작용할 것으로 예상됩니다.

회사 매출의 높은 해외 비중으로 인해 환율 변동성 역시 단기적인 제약 요인입니다. 경영진은 하반기 매출에 미치는 환율 영향이 당초 예상보다 클 것으로 보고 있습니다.

교육 부문은 자본 집약적인 특성이 이어지고 있으며 실적도 기대에 미치지 못해 전략적 재검토에 착수했습니다. 경영진은 노르(Nord) 및 불릿(Bullitt) 합작법인 추진에 영향을 미친 우크라이나 정부의 인허가 이슈를 언급하면서도, 회사의 성장이 특정 단일 파트너십에 의존하지 않는다는 점을 강조했습니다.

AIRO는 생산 능력 확충과 신제품 개발에 지속적으로 투자하고 있습니다. JC250 및 JX250 개발 지출이 계획보다 적은 수준이지만, 경영진은 연간 조정 EBITDA가 상당한 규모의 적자를 유지할 것으로 예상하고 있습니다.

애널리스트 Q&A 주요 내용

애널리스트들은 수주잔고 구성, 미국 내 수주 기회, RQ-70 수요, 개발 지출 및 잉여현금흐름에 관심을 집중했습니다. 경영진은 현재 1억 6,300만 달러의 수주잔고에 미국 주문은 제외되어 있음을 분명히 밝혔습니다. Blue UAS 인증은 미국 시장에서의 수주 기회가 확정 주문 및 수주잔고로 이어지는 핵심 단계로 평가받고 있습니다.

유동성과 관련해 경영진은 7월 31일에 비해 6월 30일의 현금 잔액이 낮았던 이유가 주로 분기 말 인도건 및 매출채권 회수 시점 때문이라고 설명했습니다. 이후 채권 회수가 완료되면서 추정 현금 잔액은 약 5,600만 달러 수준으로 증가했습니다.

경영진은 교육 사업부에 대한 전략적 대안을 계속 검토 중이며, 드론과 항공전자를 최우선 자본 배분 대상 핵심 분야로 지정했다고 밝혔습니다. AIRO는 또한 분기별 매출 변동성을 줄이는 동시에 드론, 항공전자, 전자 장비 포트폴리오를 확장할 수 있는 파트너십 및 인수합병(M&A) 기회를 다각도로 검토하고 있습니다.

실적 발표 컨퍼런스 콜 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

Thank you for standing by. My name is Jonathan, and I will be your conference moderator today. At this time, I would like to welcome everyone to the Aero Q2 2026 earnings call. [Operator Instructions]

I would now like to turn the call over to Jack Senft, Investor Relations at Aero. Please go ahead.

Unknown Executive

Thank you, Operator, and good morning, everyone. Welcome to the Aero Group Holdings, Incorporated second quarter 2026 earnings call. We appreciate you joining us today and look forward to sharing an update on our progress and performance. With me on the call are Dr. Chiranjeev Kathuria, our Executive Chairman, Captain Joseph Burns, our Chief Executive Officer, and Dr. Mariya Pylypiv, our Chief Financial Officer. Today's call will include forward-looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to statements relating to Aero's 2026 outlook.

Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. Forward-looking statements represent management's beliefs and assumptions only as of the date made. Information on factors that could affect the company's financial results is included in the company's most recent annual report on Form 10-K and other filings with the SEC from time to time. In addition to our prepared remarks, our earnings press release, SEC filings, and a replay of today's call can be found on our Investor Relations website at investor.theaerogroup.com. We have also posted our earnings presentation on the Investor Relations section of our website.

In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures are in addition to, and not a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. Reconciliations between GAAP and non-GAAP financial measures and the discussion of the limitations of using non-GAAP measures versus their closest GAAP equivalents is available in our earnings release. Additionally, we plan to discuss drone segment backlog, a definition of which can be found in our earnings release. We will also discuss our cash balance as of July 31, 2026, which is a preliminary estimate based on information available to us as of the date of this presentation. Additional information on this metric can be found in the earnings presentation on our Investor Relations website.

With that, I will turn it over to our Executive Chairman, Dr. Chiranjeev Kathuria.

Chirinjeev Kathuria

Thanks, Jack, and thank you all for joining us today. Aero delivered a strong second quarter that was marked by revenue outperformance against expectations driven by solid execution within our drone segment. Gross margins improved to 64%, leading to a small operating profit for the quarter, a big improvement from the loss we saw in the same period last year. Looking ahead, and as Mariya will discuss in her section, we are reiterating full-year revenue growth guidance of 15% to 25%. She will detail some additional thoughts to think through the rest of the year. On top of this, total drone backlog grew roughly 9% from last quarter to approximately $163 million.

On the strategic front, it was also a busy quarter. The RQ-35 drone achieved Blue UAS certification, which opens up meaningful new opportunities in U.S. defense procurement. We also unveiled our new RQ-70 long-range ISR platform. Development continues on the JC250 and the JX250 cargo and ISR drone variants, and costs there are coming in below expectations, with the first flight still on track for later this year. We remain squarely focused on the unmanned drone market. Second quarter was a solid quarter of execution, and we expect that momentum to continue as we scale manufacturing, diversify our revenue base, and stay disciplined on cost, all while continuing to invest in Aero's next phase of growth.

With that, let me turn it over to Joe to discuss our strategy and the operational highlights.

Joseph Burns

Thank you, Chiranjeev, and thank you all for joining us on today's earnings call. I am happy to report second quarter results that exceeded expectations, finishing out a strong first half of the year. Our second quarter results were marked by on-time drone deliveries plus multiple announcements. These recent developments highlight our execution on strategy, but we are not done here. While second quarter top-line results mark sequential growth versus our 1Q performance, this demonstrates the variable nature of our business. Still, second quarter results topped expectations. We are reiterating our full-year guidance ranges we previously provided. Mariya will walk through the financial details later in the call.

Now let me provide some updates on our portfolio and strategic positioning at Aero. We have a solid, growing portfolio of products and services. We remain focused on the overall drone market, whether it be through new product developments or through partnerships and inorganic opportunities. We are actively working to reduce quarterly variability by expanding our international and domestic revenue base. One such milestone on our product side, and one that I'm especially pleased to highlight, is that our RQ-35 drone is now officially Blue UAS certified. With this approval, the RQ-35 is recognized by the Department of Defense as a secure, compliant unmanned aircraft system, eligible for government and defense procurement under NDAA requirements.

As most of you know, Blue UAS streamlines access to the DoD and federal procurement channels, accelerating our ability to compete for and secure U.S. defense contracts, which we expect will support Aero's long-term revenue growth across domestic and international markets. We believe the Blue UAS milestone is a testament to the RQ-35, from its embedded technology, use cases, and performance on the battlefield. The RQ-35 and now our recently unveiled RQ-70 continue to set our technology apart from the rest of the pack. The RQ-35 is battle-tested, having been deployed in the Ukraine conflict, and the platform is extremely quiet, hand-launched, and purpose-built for ISR missions. It has demonstrated real resilience, even against electronic warfare and in GPS and GNSS-denied environments.

With up to 50 kilometers of range and 150 minutes of flight time, it delivers extended time on target, quick frontline serviceability with a smart battery for reliable performance. The RQ-35 platform also offers onboard AI with edge computing, which enables real-time identification and classification of enemy assets and threats, while strengthening navigation, situational awareness, and mission execution. This drives faster, more informed decisions in the field. As a note, edge computing brings our flying servers closer to the battle, allowing us to significantly speed up and improve target recognition and decision speed, which reduces the already jammed bandwidth required by other competitor systems. Our goal is to embed AI across all of our product and service offerings at Aero.

The RQ-70 is our newest platform, built on years of RQ-35 battle data and leveraging our existing manufacturing and NDAA supply chain. We are already engaged with multiple defense customers on future deployment. It offers configuration flexibility between standard, long-range, and VTOL configurations and includes a modular design that lets it serve as a standalone ISR drone for NATO and allied customers. Our RQ-70 is built for up to 8 hours of endurance, 100 kilometers of range, and resilience in GPS-denied environments. We are reaffirming expected production start in January 2027. Capabilities such as these further set Aero apart with strong customer validation to date. We are building on that momentum with new initiatives and will continue to provide updates in the quarters ahead.

On the product side, we're making great progress developing our cargo and ISR drone variants, the JC250 and JX250. We have been strategically evaluating and selecting suppliers for the vehicle, and we are reaffirming our expectation for the first flight later this year. I am also happy to report that Aero-specific costs for development are running below our internal expectations by a low double-digit percent. There are a few driving factors. First, because the cargo and ISR variants share a common foundation, we are developing them at a fraction of the cost of their passenger counterpart. Second, we have made real progress in supply chain negotiations, which is lowering our input costs. Third, we are realizing synergies across the platform faster than we had modeled. And finally, our R&D team has been executing efficiently, which is keeping development costs disciplined. Taken together, these factors are giving us confidence in the cost trajectory of this program.

While still in the early innings, all the developments that I mentioned represent our efforts in diversifying our product portfolio and stabilizing revenue variability over time. On the avionics and electronics side of our portfolio, Aero delivered largely flat revenue quarter-over-quarter as demand for our avionics products remained stable and consistent with the prior quarter. Despite the static growth year-to-date, we are actively advancing next-generation sensor and navigation solutions, which were on display at the EAA AirVenture Oshkosh in late July. We received solid feedback at the trade show with customers highlighting our product reliability and functionality. Avionics continues to play a critical and strategic role within our broader company profile. With our avionics and ramping U.S. drone operations now consolidated under one roof in Phoenix, we expect synergies here to begin bearing fruit in the coming quarters.

These dynamics are part of what reinforces Aero's long-term competitive advantage. Over time, we expect to bring more avionics systems in-house across our unmanned platforms, streamlining operations, reducing supply chain complexity, and ultimately strengthening our gross margin profile. Lastly, on the services side, we are continuing to evaluate strategic alternatives for training, and we expect to have an update on that direction by the end of the year. We believe the training segment remains a valuable asset with a significant long-term opportunity, although the segment is capital-intensive and often requires meaningful ongoing investment. Recall, while underlying demand persists within this segment, performance here has been below expectations. This is driven by the fact that the task orders coming out of the U.S. government are not within the strengths of Aero.

We believe this narrative will shift over time, and we are positioning, investing, and strengthening our training asset to pursue upcoming long-term close air support training opportunities. That said, we are exploring all possible avenues for the business, but our focus remains on unmanned systems. Overall, we are encouraged by the momentum generated across our portfolio during the second quarter. From achieving Blue UAS certification for the RQ-35 and advancing customer engagement around our new RQ-70 platform to progressing development of our cargo and ISR drone variants and positioning our avionics business for future synergies, we continue to execute on our strategy of expanding capabilities, diversifying revenue streams, and embedding AI across our offerings. While there is still work ahead, we believe these milestones reinforce the strength of our technology and market position, and we look forward to building on this momentum in the quarters to come.

We remain disciplined on our capital initiatives. We continue to evaluate inorganic opportunities carefully, focusing on acquisitions that would be accretive in the near term and that strategically enhance our product portfolio, namely for drones, avionics, and electronics. We also see M&A as having the potential to play an important role in reducing Aero's quarterly revenue variability over time. As I have discussed in the past, our balance sheet gives us real flexibility to act when the right opportunity comes along, and selective M&A will continue to play a vital role in how we endeavor to maximize long-term shareholder value. With the multiple drone deliveries in 2Q, and given the timing of these drone deliveries at quarter end, our cash balance as of July 31, 2026, was approximately $56 million, significantly strengthening Aero's balance sheet.

In closing, the initiatives, discipline, and efforts we have employed to date bolster our strategy of delivering mission-ready ISR systems that can be produced, upgraded, and supported at scale. I'm also grateful for the colleagues beside me today and for every employee who makes this company what it is. Our leadership team brings extensive industry experience to the table, and as we continue to add key personnel, we are further strengthening our competitive position in the market. With that, I will turn it over to Mariya, who will walk you through the financial results in more detail. Mariya?

Mariya Pylypiv

Thank you, Joe, and good morning, everyone. For the second quarter of 2026, revenue was $43.2 million, compared to $24.6 million in the second quarter of 2025. This represents growth of nearly 76% year-over-year. Revenue for the quarter was ahead of expectations, driven by outperformance against expectations in our drone segment, partially offset by underperformance in avionics and training. Gross profit for the quarter was $27.7 million, representing a gross margin of 64%, compared to a gross profit of $15 million and gross margin of 61% versus the same period last year. The improvement in gross margins, both sequentially and year-over-year, was also driven by a product mix shift back towards drone products, consistent with expectations. Recall, our first quarter margins were impacted by upgrade revenue, negatively impacting margins.

Operating income for the quarter was $1.7 million versus negative $19.7 million in the second quarter of 2025. This year-over-year improvement is a result of higher revenue, improved gross margins, and IPO-related costs incurred in the prior year period. We remain disciplined on costs while continuing to invest selectively in the infrastructure needed to support our growth. Our second quarter net loss was $2 million versus a net income of $5.9 million in the second quarter 2025. Second quarter 2026 EBITDA was $5.1 million compared to $18.9 million in the prior year period. On an adjusted basis, EBITDA was $6.8 million, up from $4.7 million in the second quarter 2025.

As Joe mentioned, on the cost side for our JC250 and JX250 platform, I am happy to report that development costs are tracking below our internal expectations. The shared foundation between our cargo and ISR variants means we are developing them at a fraction of the cost of the passenger version, and we are realizing savings beyond our original projections by roughly a low double-digit percentage. We retain flexibility to adjust our spending pace up or down as conditions warrant. Right now, though, we believe the right path forward is deliberate, efficient investment to put the required infrastructure in place to support our next phase of growth.

Turning to cash flow and liquidity, as of June 30, 2026, we had $25.9 million in cash on the balance sheet, with $6.8 million in debt. Accounts receivables were higher than usual at quarter end, driven by the multiple drone deliveries late in the quarter. As of July 31, we had approximately $56 million of cash, primarily reflecting the subsequent collection of international drone receivables outstanding at quarter end. This strengthened our liquidity position and provides us with continued flexibility to execute against our strategic priorities. As of June 30, 2026, we had roughly $163 million in drone backlog. We expect the majority of this backlog to convert to revenue within the next 12 months. We will be updating our backlog to include U.S. opportunities and ongoing pursuits in the coming quarters. We expect this will meaningfully increase the total backlog as those orders are incorporated.

We define backlog as orders we reasonably expect to convert to revenue over the next 12 months. As this metric provides visibility into near-term demand, our broader pipeline continues to expand, underscoring the long-term demand trends we have discussed throughout today's call. Based on our current visibility, we are reiterating our full-year revenue growth guidance of 15% to 25% year-over-year. Let me provide some additional context on the expected cadence for the remainder of the year. First, 1 material drone delivery originally expected in the third quarter was completed in the second quarter. As a result, first half revenue represented approximately 50% of our current full-year expectations. Second, reflecting that pull forward, we currently expect second half revenue to be in line with, or modestly above, first half revenue. Within the second half, we expect third quarter revenue to decline sequentially from the second quarter, followed by a stronger fourth quarter. We currently expect fourth quarter revenue to be modestly above the second quarter.

Third, given the international nature of our business, foreign exchange remains a factor in our outlook. We now anticipate greater FX headwinds in the second half, with an incremental revenue impact of a few million dollars compared with our prior expectations. We have incorporated that impact into our outlook and remain confident in our full-year guidance range. We continue to expect modest gross margin compression versus 2025, with full-year gross margin broadly in line with first half levels.

Turning to profitability, we continue to expect full-year 2026 adjusted EBITDA in the negative mid to high teens millions, with the quarterly cadence expected to broadly follow revenue. In closing, our strategy remains focused on 3 priorities: diversifying our revenue base, scaling manufacturing, and accelerating new product introductions. As those products ramp up and make up a larger share of revenue, we expect that to reduce quarterly volatility and strengthen backlog growth over time. Specifically, with the introduction of the RQ-70, the first delivery of the Zentra camera suite, and the JC250 and JX250 coming online late next year, we expect to begin seeing the benefits of that revenue stability next year, with continued improvements in the quarters and years to follow.

That progress is exactly why fiscal year '26 is a year of accelerated investment for us. As I have said before, we are still early in our growth phase and we intend to invest accordingly, while staying disciplined on costs and preserving flexibility to adjust our cost structure as needed. That balance supports our confidence in Aero's long-term growth trajectory. With that, Operator, we're ready for questions.

Operator

[Operator Instructions] Our first question is from the line of Colin Canfield from Cantor Fitzgerald. Your line is now open. Please go ahead.

질의응답

Colin Canfield

Maybe if we could start on drone order trends to parse out the mix of U.S. and international drone orders for the RQ-35, discuss the milestones that you need to see to essentially increase the backlog. The comment you made on materially increasing backlog, basically, what milestones does it take to recognize that backlog increase? And then if you could also talk about early customer interest for the RQ-70.

Mariya Pylypiv

Hi Colin, thank you for your question. So I'll start. Our $163 million backlog represents international drone backlog and does not currently include any U.S. backlog. We expect that the majority of that backlog will convert to revenue over the next 12 months. So naturally, the portion of it extends into 2027. In terms of the U.S., we have responded to a number of RFQs and continue to see a growing pipeline of opportunities. And as those opportunities convert into orders, and we expect them to be able to convert into backlog, it will provide additional visibility for U.S. backlog, which will incrementally add to the $163 million backlog we are currently reporting today. As far as additional products being included, it's mostly composed out of the RQ-35. There's a very small percentage of the RQ-70 being added to this number right now.

Joseph Burns

And if I, this is Joe, good morning, Colin, if I could follow on with that. Some of the milestones, obviously key milestones for us were the Blue UAS certification, which will allow us into the U.S. market. So that was a big one. The RQ-70 announcement and launch of that product are also a big milestone to enhance our expansion of our margin profile. You also mentioned or asked a question about early customer interest in the RQ-70. It's been very strong because it does fill a gap in sort of that high-end ISR market, that long duration flight, ease of operations, and low costs. So we feel very, very strong about the RQ-70 filling in the interest category as well.

Colin Canfield

Maybe if we could talk about free cash flow. The foundational building blocks and kind of the level of investment related to the defense transport platform. Just kind of walk through how you think about the investment on that program and flexing down, and perhaps maybe kind of how you think about that relative to the company's ability to generate free cash flow. Thank you.

Mariya Pylypiv

Thank you, Colin. So I'll start and then I'll let Joe add anything I missed. So in terms of free cash flow, we are very comfortable right now with our liquidity position, and it's closely tracking our internal expectations. The biggest factor for the quarter was timing as we were building inventory to support deliveries. So those deliveries occurred at the end of the quarter, a significant portion of receivables converted into cash. And as I mentioned earlier, as of July 31, our cash and cash equivalents were approximately $56 million.

In terms of investments for the air mobility, our costs have been reduced, which Aero is very comfortable with. Right now they're running in the low double digits below initial expectations. And while we have not provided the size of the investments, we are still tracking on time. And overall, because we shifted our focus on ISR and cargo drones, it significantly reduced our expected development costs compared to the passenger platform, which obviously provides significant upside for our liquidity. And if we think about moving forward, free cash flow, we anticipate there should be a shift into positive cash flow in 2027 and beyond.

Joseph Burns

That's great. Thank you. And to expand on the JX250 and the JC250, our ISR and cargo variants of that large cargo transport, you know, we've talked about in the past about eVTOL. This is an eVTOL aircraft, but it's different than what we had previously discussed in the passenger realm. We don't carry passengers on this. It's basically a large cargo drone. Very long duration, hybrid drive can use conventional fuels. So we think there is a new and growing market for this type of transport if you think about sort of combat operations, the ability to resupply, get critical medical information to and from, etc. So for us, it's a real opportunity to jump into somewhat of a new market. You're starting to see that, obviously, in this industry as well.

Operator

Thank you. Your next question comes from the line of Andre Madrid from U.S. Bancorp BTIG. Your line is now open. Please go ahead.

Andre Madrid

I was wondering if you could provide us an update on where you're at with Nord and Bullitt, those JVs.

Joseph Burns

Sure. This is Joe. Good question, Andre. So as you probably know at this point, there are some significant order issues or significant issues with the Ukrainian government's permitting process. You know, in their current [indiscernible] government, there is [indiscernible] of aircraft coming into [indiscernible] transfers. We are still [indiscernible] and we're working [indiscernible] council over there and [indiscernible] these permits. But that said, the partnerships and JVs like these are really a compelling route for us. I want to make it clear that we're not dependent on any one of them for growth.

The partnership and JVs will expand our access to multiple markets and help accelerate our growth plans. We're currently evaluating additional partnerships as well in this particular market, and those specifically for drone dominance. So we're excited about other opportunities. It's really opened our eyes as to what's available, what the markets look like for us. And with the ability for our certification routes, we're excited about [indiscernible] in these things moving forward.

Andre Madrid

That's really helpful. And then maybe pivoting to training for a bit. I know you guys had mentioned last quarter your decision to pursue strategic alternatives or consider strategic alternatives there. Is there any update that you can provide as to maybe how that's tracking and when the decision might be made?

Joseph Burns

Sure, we're planning to have decisions by year-end. We're making a lot of discussions around it. As we mentioned before, we're actively evaluating a range of strategic options. And our intent in disclosing this is to be transparent with the market. Well, really our core focus right now is on drone and avionics operations. And we see limited synergies between the training segment and our core business, which is important while we're evaluating the long-term strategic fit. Training is expensive. We have made a significant investment so far, but we're still excited about the opportunities in this particular business. But as always, drones are our main focus, and that's where we want to look at focusing most of our capital.

Andre Madrid

Yes, that's really helpful, Joe. I appreciate it. I'll leave it there. Thanks.

Operator

Thank you. There are no further questions. We have reached the end of the Q&A session. This concludes today's call. Thank you for attending. You may now disconnect.