Archer Aviation (ACHR 4.12%) has big plans. The company is working diligently to establish a solid foundation for its long-term success. However, there are still some very important hurdles to overcome before this company has any hope of becoming a sustainably profitable business. The stock's over 33% drop since October 2025 is a sign that uncertainty around its future remains high.
What does Archer Aviation do?
Currently, Archer Aviation spends money. And a lot of it. In fact, the income statement reported in the company's third-quarter 2025 10-Q filing began with expenses. That's because there was no income to report. The spending was material, too, with nearly $121 million going toward research and development and $54 million spent on general and administrative costs.
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Archer lost $0.20 per share in the third quarter of 2025. That was actually an improvement over the same quarter of 2024, when it lost $0.29 per share. However, that comparison is highly misleading. On an absolute basis, Archer Aviation lost nearly $130 million in the third quarter of 2025 and a smaller $115 million in the prior year. The per-share loss declined because the number of shares outstanding was 66% higher in the third quarter of 2025.
It isn't remotely surprising that Archer Aviation is bleeding red ink. It is a start-up business attempting to break into an industry that is inherently capital-intensive. That industry is also highly regulated, given the inherent risks associated with flying. Given the ongoing need for capital investment, it is highly likely that Archer Aviation will continue to lose money for the foreseeable future, even after it starts generating regular revenue.
This is a high-risk investment that only the most aggressive investors should consider. Even then, material caution should be taken.
The ups and downs will likely continue
The risk for investors is highlighted by the stock's recent drawdown. It lost a third of its value in a matter of months. That's a problem in its own right, but this was the third such drawdown in a year. This is an extremely volatile stock. Given the lack of revenue, the driving force behind the stock is largely related to news flow and investor sentiment.
NYSE: ACHR
Key Data Points
There has been a steady flow of good news. For example, Archer continues to progress through the regulatory approval process for its vertical lift aircraft, Midnight. It has a first customer lined up in Abu Dhabi, with a goal of carrying its first commercial customers in 2026. There are other companies lined up to start air taxi services in additional regions if Abu Dhabi's service is well-received. And Archer is laying the groundwork for its own air taxi services in the United States. In fact, it is ready to hit the road running in key markets like California and New York once the Midnight aircraft is approved by regulators.
The problem for investors is trying to predict both the success and timing of the next big steps for the business. The volatility of the stock clearly shows that Wall Street isn't entirely sure about the final outcome here. It probably makes sense for most investors to wait until additional milestones have been achieved before investing in Archer Aviation's stock.
There is a cost to waiting
If you believe strongly in the future of air taxis and think Archer Aviation will end up an industry leader, it could make sense to get in early. Without question, if you hold off investing in Archer Aviation until after it carries its first commercial customers in Abu Dhabi or until it receives FAA approval for domestic flights, you will probably be giving up some potential gains.
That said, air taxis, if they "take off" as expected, won't be a one-time phenomenon. It will be an entirely new category of transportation that could have years, if not decades, of growth ahead of it. In that scenario, waiting to make sure you are backing the right company could be well worth the risk of missing some early gains. Indeed, Archer Aviation is making material progress with its business, but it has competition, and there's still no clear winner.
