Archer Q1 Loss Surges to USD$113 Million, Certification Progress Steady

Archer Aviation, the manufacturer of the Midnight eVTOL, reported its road to certification remains intact despite posting a net loss of USD$113.1 million for the first quarter of 2023. 

The net loss marked a significant increase from the same period in 2022, which stood at USD$59.2 million. It was also higher than the net loss for the fourth quarter last year at USD$95.4 million. 

Archer attributed the higher net loss to the $46.7 million increase in operating expenses.

The San Jose-based firm saw its total operating expenses skyrocket, going from USD$65.3 million in Q1 2022 to USD$112 million in the first three months of 2023. Continued investment in the design, development, tests, and certification of the Midnight aircraft contributed to the rise in operating costs. 

Despite Archer’s net loss and operating expenses trending upward, the company remains on track to obtain certification from the Federal Aviation Administration (FAA), with 15 out of 18 Subject Specific Certification Plans (SSCPs) having been submitted. The company also plans to begin the non-conforming and conforming versions of its Midnight eVTOL in the summer of 2023 and early 2024 respectively. 

Adam Goldstein, Archer’s CEO, said the company has achieved significant accomplishments in the first quarter of 2023 and insisted that the goal is to launch commercially in two years. 

“I am thrilled with the milestones our team has achieved in the first quarter of 2023. We have continued to make significant progress towards our goal of revolutionizing urban mobility, and our accomplishments are a testament to the dedication and hard work of our world-class team,” he said. “We remain steadfast in our commitment to delivering safe, sustainable, and low noise urban air mobility beginning in 2025.”

From a liquidity standpoint, Archer had USD$449.9 million in cash, cash equivalents, and short-term investments, coupled with the USD$150 million the company received in funding from Stellantis. Archer’s overall liquidity was USD$254.3 million lower than in Q1 2022 and USD$81.3 million less than in Q4 2022. 

The decrease in liquidity was spurred by the operating expenses incurred and USD$7.2 million of restricted cash being used to support numerous letters of credit for commercial leases, as well as the construction of a 350,000 square feet high volume manufacturing facility in Covington, Georgia, which is scheduled to be completed in the first half of 2024. 

Upon launching commercially, Archer plans to establish air taxi routes in New York and Chicago, while exploring additional routes in other cities across the U.S.

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