AeroVironment Laser Contract Makes History With $465M Army Award

The U.S. Army’s $464.8 million AeroVironment laser contract for the Enduring High Energy Laser program (E-HEL) is, by the Army’s own description, the first production contract for a directed energy system in U.S. military history. For AeroVironment (AVAV), it is the clearest signal yet that directed energy has moved from a science project to a program of record, and that the company’s LOCUST platform sits at the center of that transition.

What the AeroVironment Laser Contract Actually Covers

Awarded under an Other Transaction Agreement by the Army Portfolio Acquisition Executive for Fires (PAE Fires) program office, the contract funds production of dozens of 30 kW LOCUST laser weapons designed to defeat Groups 1 through 3 unmanned aerial systems, a range spanning miniature drones up to the size of the Army’s RQ-7B Shadow. The U.S. Army confirmed the award Wednesday, with AeroVironment headquartered in Albuquerque, New Mexico listed as the recipient.

Unlike missile-based air defense systems, the LOCUST reloads through its own power supply rather than a physical magazine, which removes per-shot cost from the engagement math. The LOCUST X3 variant is platform-agnostic and can be mounted on the Army’s Joint Light Tactical Vehicle (JLTV), a flexibility that expands the addressable deployment base well beyond a single vehicle program.

Brent Ingraham, Assistant Secretary of the Army for Acquisition, Logistics and Technology, pointed to the acquisition structure as part of the program’s appeal: “The E-HEL program is an example of how the Army has successfully utilized MOSA, a key element of acquisition reform, as part of our efforts to field technology quickly with an interface to upgrade in the future,” he said in the Army’s announcement. The Modular Open Systems Approach matters here because it keeps AV in the upgrade cycle. A platform built to swap components is a platform that generates follow-on contract value.

Why DE M-SHORAD’s Stumble Makes This Win Bigger

The E-HEL award lands against a backdrop of soldier dissatisfaction with the Army’s earlier directed energy effort, the Directed Energy Maneuver Short-Range Air Defense (DE M-SHORAD) system. Those prototypes, built for the Stryker vehicle, drew disappointing operational feedback from troops deployed in the Middle East. The LOCUST program addressed two of the structural criticisms directly: it is not locked to a single vehicle platform, and it builds on the Army Multi-Purpose High Energy Laser (AMP-HEL) prototypes already in use by U.S. soldiers rather than starting from a clean sheet.

Validation came before the production award. Testing at White Sands Missile Range, led by Joint Interagency Task Force 401 and PAE Fires, demonstrated effective counter-drone operations in U.S. airspace and generated a Department of Defense-FAA safety agreement for domestic use. The system was also demonstrated aboard the USS George H.W. Bush (CVN-77) in October 2025, with the Navy announcement coming April 21, 2026, adding a cross-service proof point that complicates any argument that LOCUST is purely an Army play.

AeroVironment CEO Wahid Nawabi framed the moment as a structural shift: “The transition of directed energy from experimentation to an enduring, fielded capability reflects years of collaboration, innovation, and operational success alongside the U.S. Army.”

The HII Angle and the Ecosystem Forming Around E-HEL

AeroVironment is not the only defense name with skin in the E-HEL program. Huntington Ingalls Industries (HII) announced on September 30, 2025 a capital investment in a new integration, production, and test facility tied to Phase 2 of the E-HEL program, following an earlier Army contract for HII to develop and test a high-energy laser prototype covering the same Groups 1-3 UAS threat set. The implication is a program structure where multiple suppliers contribute, which reduces single-source risk for the Army but also means the revenue concentration in this contract runs through AV, not HII.

AVAV’s Stock Reaction and What Comes Next

Markets moved quickly on the news. AVAV shares gained nearly 1% in Wednesday’s regular session and added another 0.25% after the close, according to Yahoo Finance. Thursday premarket extended that to nearly 4%, a reaction that reflects both the contract size and the precedent-setting nature of the award.

Breaking Defense confirmed the $464.8 million figure directly with AV’s vice president of directed-energy systems, John Garrity, who briefed reporters ahead of the official announcement.

The bull case rests on the MOSA architecture and the cross-service demonstrations: a platform built to upgrade, already proven at sea, is a platform that earns follow-on orders. The bear case is execution risk on a production ramp for hardware that, until now, has only existed in prototype and test quantities. Vice Chief of Staff General Christopher LaNeve called the program the means to “defeat unmanned systems and dominate from the outset,” but the Army has said similar things about directed energy before. Delivery on schedule is what converts a historic contract into durable revenue.