AeroVironment Inc (NASDAQ: AVAV) shares rose 2.36% to $193.90 on Friday, driven by President Donald Trump’s announcement of new import tariffs aimed at boosting U.S. drone manufacturing. The policy shift has sparked a premarket rally across U.S. drone manufacturers as the administration moves to reduce reliance on unmanned aircraft built overseas.

Trump’s Drone Tariffs Lift the Sector

President Trump signed a proclamation Thursday imposing steep tariffs on imported unmanned aircraft systems and their components. The order sets a 100% tariff on drones weighing more than 25 kilograms or built with capabilities deemed particularly sensitive for national security, including thermal imaging and docking stations.

Imports from allied countries face lighter rates. The European Union, Japan, Liechtenstein, South Korea, Switzerland, and Taiwan face a 15% tariff. Imports from the United Kingdom carry a 10% rate, provided nearly all hardware, software, and underlying technology originates from the U.K. or the U.S.

AVAV’s Chart Shows an Improving but Incomplete Recovery

The stock’s price action reflects an intermediate bounce within a longer-term downtrend. Shares trade 14.8% above their 20-day moving average of $165.56, 16.5% above their 50-day average of $163.16, and 9.2% above their 100-day average of $174.15. However, AeroVironment remains 16% below its 200-day moving average of $226.32. The 50-day average stays below the 200-day average following a death cross that formed in March.

Shares are down 23.88% over the past 12 months, indicating that while the recent rally has improved the chart, it has not fully reversed the broader downtrend. The MACD line sits above its signal line with a positive histogram, pointing to fading selling pressure.

Traders are watching $200.50 as resistance, a round-number level where rebounds have tended to stall, and $175 as support, tied to a recent pivot zone near the 100-day moving average. Whether the stock can hold higher lows if it pulls back from resistance may determine whether the recovery continues or fades back toward the mid-$170s.

The US Army has awarded AeroVironment a $400 million contract for the supply of anti-drone laser systems, signaling a major commitment to integrating directed-energy technologies into its defense infrastructure. The agreement, reported by Bloomberg News on August 7, 2026, highlights the growing urgency for advanced counter-measures against unmanned aerial threats in modern combat scenarios.

Contract Details

The deal represents a substantial financial outlay for specialized defense technology. AeroVironment, known for its expertise in small unmanned aerial systems and related technologies, will provide the laser-based systems designed to neutralize drone threats.

Strategic Implications

This procurement reflects a broader trend within the US military to adopt high-tech, precision defense mechanisms. Directed-energy weapons offer distinct advantages over traditional kinetic interceptors, including lower cost per shot and rapid response times. The $400 million investment suggests that the US Army views these systems as critical components of its future force structure.

What the Numbers Show

The scale of the $400 million contract indicates that the US Army is moving beyond pilot programs and testing phases into significant operational deployment. For AeroVironment, this order serves as a strong validation of its technology platform and likely secures a long-term revenue stream in the defense sector. The focus on anti-drone capabilities specifically points to the increasing prevalence of unmanned systems in contemporary warfare, necessitating robust defensive measures.