Space Force Cancels AeroVironment Contract for Satellite Antennas
The U.S. Space Force has officially canceled its contract with AeroVironment, valued at approximately $1.7 billion. This decision comes after unsuccessful attempts to renegotiate the terms associated with the Satellite Communications Augmentation Resource program, known as SCAR. AeroVironment’s executives announced the news during a recent earnings call.
Details Behind the Contract Cancellation
The SCAR program was geared toward developing advanced mobile phased-array antennas to enhance the military’s Satellite Control Network. This network primarily utilizes fixed ground stations with traditional parabolic dishes for satellite communication in geosynchronous orbit.
In 2022, the Space Force’s Rapid Capabilities Office selected BlueHalo to construct about 12 ground terminals named BADGER, which stands for Broad Area Deployable Ground Terminal Enabling Resilient communications. BlueHalo was acquired by AeroVironment in 2025.
Shift in Acquisition Strategy
Space Force officials indicated a change in their procurement strategy. They are moving away from a single-vendor model to a more competitive approach focused on commercially available systems. AeroVironment’s Chief Executive, Wahid Nawabi, noted the inability to reach an agreement that would allow work to continue under the existing contract.
- The government will reimburse AeroVironment for allowable incurred costs along with a profit fee.
- AeroVironment intends to compete for future opportunities within the redefined procurement landscape.
Financial Implications
This contract termination has led AeroVironment to adjust its revenue forecast for fiscal 2026 to about $1.9 billion, down from expectations of $1.975 billion. The company is facing an unfunded backlog of around $3 billion, including $1.5 billion linked to the SCAR program.
Despite the setback, AeroVironment’s leadership emphasized the high demand for other products, particularly in the Space and Directed Energy sectors. Nawabi pointed out that their Laser Optical Counter-UAS System for Tactical Use has generated significant interest.
Future Prospects for BADGER
AeroVironment aims to transform the BADGER technology into a commercial product available to multiple clients. Nawabi stated that the Space Force has indicated increased investment in this area, recognizing its importance for national security.
The development of a commercial BADGER product is expected to take some time, with revenue generation not anticipated until fiscal year 2028. Key challenges include finalizing customer requirements and transitioning the existing designs into production-ready systems. Nawabi noted that approximately 80% of the current BADGER architecture would remain relevant in a commercial version, focusing on cost reduction and simplifying manufacturing processes.
In summary, while the contract cancellation poses immediate financial challenges for AeroVironment, officials view this as a strategic opportunity to adapt and grow in the evolving defense technology landscape.
