In 2024, aircraft stock Archer Aviation (ACHR 0.40%) was dominating the market. Shares of the fledgling electric vertical takeoff and landing (eVTOL) aircraft manufacturer rose 58.8% for the year, and that was on top of a 228.3% gain in 2023. Investors and aircraft enthusiasts had high hopes for the company coming into 2025.
Those hopes seem to have been dashed. Archer's stock is down more than 20% year to date, despite a soaring market and outperformance by rival Joby Aviation (JOBY 0.11%).
NYSE: ACHR
Key Data Points
Is Archer yesterday's news? Or could the company stage a massive comeback in 2026? Here's what investors need to know.
Awaiting approval
For both Archer and Joby, it's a waiting game. Specifically, both companies are waiting for regulatory approval to begin offering air taxi service in major cities using their eVTOL aircraft.
The grand prize here, of course, is approval from the U.S. Federal Aviation Administration (FAA), which has notoriously strict standards, particularly for new classes of aircraft like eVTOLs. Archer would need to obtain three separate FAA certifications to officially launch its air taxi service: Type, Production, and Operational. As of now, the company has received its Operational certification, and is in the process of obtaining its Type and Production certifications.
In the meantime, the company is moving forward with certification requests in other countries, including a partnership with Saudi Arabia's The Helicopter Company and Red Sea Global to bring eVTOLs to Saudi Arabia, and a partnership with Japan Airlines to bring eVTOLs to Tokyo.
Archer is also eyeing an alternate pathway to certification by partnering with several U.S. cities to submit applications to launch air taxi operations under the White House's eVTOL Integration Pilot Program (eIPP), which has a goal of creating operational air taxi services in 2026.
So, while Archer's forward progress may be currently stalled, it seems likely to restart soon.
Image source: Getty Images.
Worth the wait?
Although Archer seems likely to make further progress toward launching its air taxi service in 2026, it may not be worth the wait for investors.
Even after the stock's 2025 share price slide, the company still has a valuation of $5 billion, which might be cheap for a company that was already dominating the eVTOL air taxi space, but Archer isn't there yet (and looks unlikely to get there anytime soon).
Meanwhile, existing investors have seen the value of their shares diluted by the company's recent additional stock offerings. In June, Archer raised needed capital by issuing $850 million in new stock shares, and it announced another upcoming $650 million stock offering to help pay for its recent purchase of Hawthorne Airport in Los Angeles. Investors who buy in now should expect future share price dilution once the company starts receiving regulatory approvals and begins the expensive process of ramping up production.
In short, Archer Aviation certainly isn't yesterday's news, and it may be next year's news. However, given the near-term hurdles the company is facing, investors may want to wait a bit before buying in.
