DroneShield Ltd (ASX: DRO) shares are racing higher on Wednesday.
At the time of writing, the counter drone technology company's shares are up almost 7% to $3.16.
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Why are DroneShield shares racing higher?
Investors have been bidding the company's shares higher this morning following the release of its second quarter results.
According to the release, DroneShield delivered a whopping 480% increase in revenue to $38.8 million for the three months ended 30 June.
This represents its highest revenue quarter on record, outperforming its previous best of $33.5 million in the first quarter.
But if you thought its revenue was stopping there, think again. Management notes that a total of $176.3 million of revenue has already been received or is under committed purchase orders (POs) for 2025 delivery, with much of the year still to go.
This means that DroneShield has already secured 3x its entire record annual FY 2024 revenue of $57.5 million (which itself was a record). And any new POs announced from now, will be in addition to this.
Also growing strongly were DroneShield's cash receipts, which lifted 208% year on year to $43.9 million during the second quarter. This is the second highest quarter of cash receipts in its history. As a result, as of 24 July, DroneShield's cash balance stood at a sizeable $192 million.
The company believes that this allows for the ongoing investment in the business to enable growth in a rapidly changing CUxS sector, attracting employees, potential acquisitions, and long-term planning.
Outlook
Management spoke positively about its outlook and its readiness to respond to strong demand for counter drone technology.
It highlights that it has a sales pipeline valued at $2.3 billion and is well placed to deliver on short notice. In fact, DroneShield has $81 million of inventory by book value, including completed and in-progress units. The sale value of these items is substantially higher.
It also has a total of 285 engineers driving technology development and working on quarterly AI software updates and two to three yearly hardware development cycles.
Speaking of software, although software as a service (SaaS) revenue is only a small portion of its overall revenue, management believes this could change in the future. It highlights that SaaS revenue is "expected to surge in 2026 when the next generation products are introduced."
DroneShield shares are up 320% since the start of the year.
