DroneShield Ltd. (DRO:ASX; DRSHF:OTC) received a set of three standalone follow-on contracts for AU$61.6 million ($61.6M), or US$40M, worth of counterdrone system (C-UAS) products, the largest order in the company's history, more than all of its 2024 revenue of AU$57.5M, according to a news release.
"Following this contract announcement, DroneShield has US$161M in contracted revenue to be delivered in 2025, exceeding our current full-year estimate of US$140M," wrote Bell Potter Analyst Daniel Laing in a June 25 research report.
The Australia-based firm provides C-UAS solutions to customers globally, with a focus on radiofrequency sensing, artificial intelligence and machine learning, sensor fusion, electronic warfare, rapid prototyping and MIL-SPEC manufacturing.
The new contracts, for handheld detection and counterdrone systems and related accessories, are with a privately owned, in-country European reseller that is contractually required to distribute the products to a European military customer.
"Our expanded team in Europe, combined with growing manufacturing output in Australia, ensures DroneShield is well positioned to meet the rising demand from both existing and new defense partners," the company's chief executive officer Oleg Vornik said in the release.
Throughout Q3/25 the company intends to deliver all equipment contracted for, and will be able to do so due to its recent production expansion. Shaw and Partners Analyst Abraham Akra pointed out in a June 25 research report that the antidrone company's expanded Sydney plant and two manufacturing partners can handle up to US$500M of annual output.
"DRO's ability to rapidly fulfill a contract of this size is a key competitive advantage in the defense sector and a reflection of the company's significant inventory investment over the last 18 months," Laing wrote.
DroneShield expects to receive cash payments per the three contracts in Q3/25 and Q4/25.
European Pipeline Keeps Growing
This major set of contracts aligns with DroneShield's broader expansion throughout Europe, one of its largest geographical segments, the release indicated. The European pipeline, now 46% of all active projects, is US$1,100M, up from US$382M in late February, Akra reported. Last year, the company exported 91% of its Australian production.
DroneShield is significantly investing to expand its operations in the region, supporting domestic defense programs such as the €800B (AU$1.4 trillion) ReArm Europe Plan, now called Readiness 2030.
"DRO's ability to rapidly fulfill a contract of this size is a key competitive advantage in the defense sector and a reflection of the company's significant inventory investment over the last 18 months," Laing wrote.
This program is to boost European Union (EU) defense spending through fiscal flexibility and loans, reinforce industrial and procurement autonomy throughout the EU, and mobilize private investment and support for Ukraine.
DroneShield continues to support Ukrainian frontline operations with rapid upgrades to counter evolving drone threats, a process enhanced through its Sydney-based development and collaboration hub.
As such, DroneShield is establishing a European Center of Excellence focused on manufacturing and assembly; research and development (R&D); drone testing; and training. This will be the company's first European manufacturing and in-house assembly facility outside of Australia, a second production line for the company's main hardware with at least 65% European industry content for specific regional sales.
"Establishing a robust European supply chain to support equipment sold in the region will strengthen sovereign capability," Vornik wrote. "Meanwhile, our experienced Australian software development team continues to deliver critical updates addressing emerging threats, both in Ukraine and globally."
The new manufacturing capabilities are expected to qualify the company for further procurement programs, increasing both scale and frequency of Europe-based orders.
NATO OKs More Defense Spending
In other related news, at the North Atlantic Treaty Organization's (NATO's) annual conference earlier this week, the group's members agreed to increase defense spending to 5% from 2% of their country's economic output by 2035, after months of pressure from U.S. President Donald Trump, reported The Washington Post on June 25.
"We see DroneShield reaching an inflection point in sales and profitability with the NATO agreement supplementing the U.S. Department of Defense recommendation and solidifying DRO as a market leader in jamming C-UAS," Akra wrote.
Other countries already had planned to boost their defense spending before the recent agreement among NATO leaders. In the U.S., the Trump Administration's proposed fiscal year 2026 (FY26) budget included a 13.4% increase in defense spending to US$1.01 trillion, reported the International Institute for Strategic Studies in May.
Australia's defense spending is forecasted to double to AU$100B by fiscal year 2034, under the Future Made in Australia initiative to develop a more capable and self-reliant defense force, the release noted. DroneShield intends to continue delivering cutting-edge sovereign defense capabilities to support the interests of Australia and its allies.
Solely Focused on C-UAS Sector
DroneShield offers artificial intelligence-powered hardware and software solutions designed to detect, track and defeat unmanned threats from drones used by terrorists, state actors, criminals and other nefarious groups, according to its website.
The company has nine hardware products in its portfolio, two of which it introduced in Q1/25, notes DroneShield's June 2025 Investor Presentation. Its technology is safe and not destructive, posing no harm to drones or humans.
DroneShield is the only publicly listed company exclusively focused on the fast-growing C-UAS sector. As it continues growing, DroneShield is ideally positioned to drive innovation and deliver lasting value. It boasts 217 engineers on its team and an annual R&D spend of AU$50M-plus.
Shaw and Partners' Akra also raised his target price on DroneShield, by 67%, and it now suggests a potential return for investors of 16%. The analyst rates the company Buy.
Because the number of applications for DroneShield's C-UAS technology is on the rise, there is significant opportunity to expand into multiple end markets. These include government facilities, energy production and critical Infrastructure, airports, military, correctional facilities, law enforcement and other (stadiums, events, oil refineries, shipping and ports, etc.).
DroneShield has an extensive and growing pipeline on which it continues to execute. It consists of 256 projects and as of May, is worth AU$2.35B, reflecting a 351% year-over-year (YOY) increase.
The company's financial performance is strong. Q1/25, the most recent period reported, was its highest revenue quarter, at AU$33.5M, up 102% YOY. Its revenue from software-as-a-service (SaaS) was AU$1.7M, a 198% increase over Q1/24. Year-to-date secured revenue is AU$100.4M. DroneShield had CA$213.4M in cash as of May 20, affording the company financial flexibility and allowing for its ongoing investment.
The New Way to Battle
The use of drones continues to transform warfare globally and thus is bolstering the need and demand for counterdrone technology and solutions. From the Ukraine-Russia War to the recent Israel-Iran War, drones have been employed by both sides in several recent conflicts. In the latter, Iran deployed 1,000 drones towards Israel during the 12 days, some of which France intercepted, by ground-to-air systems or its Rafale fighter jets, before they could reach their destination, Reuters reported on June 25.
Israel, in a move reminiscent of Ukraine's recent drone strategy in Operation Spiderweb against Russia, deployed a network of small drones against Iran from deep within Iranian territory, reported Miriam McNabb in a June 23 Dronelife article. In early June 2025, Ukraine attacked Russian airfields with 117 drones that had been smuggled into Russia over an 18-month period. Israel also employed advanced counterdrone technologies to defend against Iranian drone attacks, with a reported 95% interception rate, reported The Jerusalem Post on June 25.
"As drone capabilities continue to evolve, we can expect further innovations in both offensive tactics and defensive countermeasures, with significant implications for global security and military doctrine," McNabb wrote.
Counterdrone technology increasingly is a primary focus of military budgets. For instance, in the U.S., a proposal introduced by Republicans in the House of Representatives would earmark US$1.3B for counterdrone technology as part of the defense spending increase, reported C-UASHub in April.
Sector CAGR 26.5% to 2030
The global anti-drone market will reach US$14.51B by 2030 from US$4.48B in 2025, reflecting a compound annual growth rate of 26.5%, according to Market and Markets' latest report, noted Security World Market in a June 25 article.
The primary market growth driver is escalating security concerns about "unauthorized and potentially malicious use of drones" in military, critical infrastructure and public spaces, the article noted. Advances in detection and mitigation technologies, such as AI-powered systems, multisensor integration and directed energy weapons, in large part fuel the market by improving the effectiveness and reliability of C-UAS solutions.
Counterdrones' ground-based segment is projected to hold the biggest share of the antidrone market in 2030 due to the equipment's versatility, ease of deployment and ability to cover vast areas with integrated sensor arrays.
The Catalysts
In its Investor Presentation, DroneShield listed its strategic priorities for 2025 and 2026, any of which could catalyze its share price.
One is to launch next generation hardware for all of its product families.
Another is to grow SaaS revenue through both new products and additional Saas options on existing products.
A third is to expand wallet share by embedding more solutions for customers. The last is to start selling its products to civilians.
Analysts Bullish on DRO
In his recent research report, Bell Potter's Laing reiterated his Buy recommendation but increased his target price on DroneShield by 76%. The new target implies a 50% return from DRO's current share price.
"We remain positive on the outlook for DRO and are comfortable with the current valuation based on 1) forecast earnings growth, 2) increasing scale/frequency of contracts, 3) industry tailwinds, and 4) strong reratings across the defense sector," the analyst wrote.
Along with valuation, Laing's investment thesis for DroneShield contains three more parts. One is strong market demand, which the company is poised to meet, having scaled up its operations and invested heavily in building its inventory. Structural growth in the market is a second element. Geopolitical conflicts are causing countries to increase their defense budgets significantly. Drone and anti-drone defense is one of the fastest-growing subsets of the growing military market, DroneShield's area of expertise. The third component is the opportunity for expansion into adjacent markets.
Shaw and Partners' Akra also raised his target price on DroneShield, by 67%, and it now suggests a potential return for investors of 16%. The analyst rates the company Buy.
Streetwise Ownership Overview*
DroneShield Ltd. (DRO:ASX; DRSHF:OTC)
In his report, Akra highlighted DroneShield's accelerating momentum, citing the 60% increase in secured 2025 to US$161M, already more than double that in 2024. He reported that the opportunity pipeline rose to US$2.41B with 268 active projects, "pointing to broader, repeat demand." Akra increased his forecasted 2025-2027 revenue for DroneShield by 60% and his projected EBITDA by 64–130%, he noted.
Ownership and Share Structure
Recent filings reveal that Vanguard Group has become a substantial shareholder in DroneShield, holding a 5.47% stake. Regal Funds Management holds approximately 9.5%, while JP Morgan Chase owns 6.34%.
These holdings add to the company's strategic investors, which currently control over 11% of DroneShield's stock. Management and insiders hold 5.68%, according to the most recent company presentation.
DroneShield has 872.12 million outstanding shares and 782.40 million free float traded shares. Its market cap is approximately AU$2 billion, and its sales pipeline has grown to AU$2.3 billion. The company’s 52-week share price range is AU$0.5850 to 2.72.
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- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of DroneShield Ltd.
- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
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