DroneShield Ltd (ASX: DRO) shares had one of the wildest rides you will ever experience on the Australian share market in 2025.
The counter drone technology company's shares had plenty of ups and downs, but ultimately delivered the goods (and more) for investors.
What happened with DroneShield shares in 2025?
After ending the previous year at 77 cents, the DroneShield share price was as high as $6.71 at one stage last year.
However, some heavy insider selling and the accidental release and subsequent retraction of a contract win announcement weighed heavily on sentiment.
This meant that DroneShield shares ultimately ended the period at $3.08, which represents an annual return of 300%.
The catalyst for this was the announcement of an endless stream of major contract wins, which underpinned explosive sales and profit growth.
For example, in October, DroneShield released its third quarter results and revealed revenue of $92.9 million and cash receipts of $77.4 million. This was a 1,091% and 751% increase, respectively, over the prior corresponding period.
Since then, it has continued to win significant contracts. This includes an $8.2 million contract from an in-country reseller for delivery to a western military end-customer and a $49.6 million contract with an in-region European reseller that is contractually required to distribute the products to a European military end-customer.
In addition, DroneShield addressed investor concerns by announcing plans to establish a mandatory minimum shareholding policy (MSP) for all directors and members of senior management.
What's next?
The good news is that there could be further market-beating returns for investors in 2026 according to analysts at Bell Potter.
Late last year, the broker put a buy rating and $4.40 price target on DroneShield's shares. Based on its current share price of $3.31, this implies potential upside of 33% for investors over the next 12 months.
Bell Potter highlights that the company has an approximate $2.5 billion sales pipeline to attempt to convert in the first half of the year. The broker said:
We believe DRO has a market leading RF detect/defeat C-UAS offering and a strengthening competitive advantage owing to its years of battlefield experience and large and focused R&D team. We expect 2026 will be an inflection point for the global counter-drone industry with countries poised to unleash a wave of spending on RF detect and defeat solutions. Consequently, we believe DRO should see material contracts flowing from its $2.5b potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26e.
